Discussion topics on engaging enterprise companies are often a daily task for me these days. As the economy climate start to settle, many ISV’s face great opportunities and requests from larger organisations, and consuming cloud applications is on many CIO’s and CTO’s strategy plans the next couple of years.
Previously I have discussed a opinion of mine, that Identity is the tipping point for the cloud. I would like to connect this back to the CIOs, CTSs and IT business decision makers in modern companies. Selecting a vendor, provider or hosted that cannot help you establish single sign-on and enterprise identity life-cycle management (EILM) will not bring success to any cloud enablement. Also for ISV’s – if you do not offer, and I repeat, do not offer and identity solution to bridge internal identities with your application, your application will never be consumed in an enterprise state.
Microsoft is facilitating the TechEd 2010 in New Orleans, and among many new and broad insight, I seems like Microsoft finally started to push back on their strategy for hosters. For a long time, hosting partners and Microsoft has collided as Microsoft launched BPOS and later Azure. Whether or not the parts see themselves as competitors or not, many hosting partners are facing a hard time on cost-pressure commodity services, and failing to recap their business strategy to go up the stack. Seeing Azure and BPOS as a competitive solution are fare from the truth, and I would like to use Bob Muglia’s statements from TechEd 2010:
“Microsoft sees hosting partners becoming more important as the cloud becomes more predominant. The partner piece of this is incredibly important.”
Muglia said – CRN http://www.crn.com/software/225402105
“If a business wants to go outside the firewall in a cloud environment, Muglia notes, the main difference between using Microsoft and one of its hosting partners is that a partner’s cloud can be customized better to your environment.”
Also Bob Muglia touched upon the statement of building Windows Azure together with hosting offerings, maybe bundling BPOS for other services. This has been the voice of Microsoft for many months, but I yet still see a lot of hosters, neglecting to recap their business strategy and start building dynamic data centers to support higher margin services and outsourcing opportunities.
- SMB customers WISH to outsource their IT these day.
- SMB customers WISH to rent commodities at a very low price
- SMB customers NEED fanatically good support
- SMB customers SEE service providers as their future IT support
Even Enterprise customers wish to asses their opportunities: http://advice.cio.com/vanessa_alvarez/10108/look_beyond_cloud_labels_prepare_for_hybrid_journey
Face your fears and change your business model. Turn into a service provider to facilitate services and sell more premium support packages on top of BPOS. It does not sell itself, and the term, just of using a credit card does not compete with a hosters telesales organization!!! Turn into a hoster to transform business from internal IT management to outsource IT management with a combination of dynamic data centers and commodity services. As Bob Muglia shows, Windows AppFabric may be the piece to tie it all together, so partner up with SI’s or software vendors to make the solutions stick. Microsoft ForeFront 2010 offers extensive identity integration capabilities, giving an established hoster or service provider, many many new channels of revenue.
It a known paradigm for many Independent Software Vendors (ISVs) and cloud computing businesses: get a capital investor to bridge your existing business model with the future of software distribution – or, try to build a new business model, whilst preserving the old revenue streams – becoming a FUSE-CO (future-service-company). It is doable. It is risky. If you pull it off – and you have the right solution, your private beach is already reserved.
If you need the muscle and in loss of time: get that capital investor, your still get a private beach (just a small one).
Microsoft recently held a conference for Microsoft BizSpark participant’s dating their ISV partners with the venture market. A great way to build an eco-system of add-value for being a Microsoft Partner; and a great quick entry for an V.C., to spot groups of ISVs in a little time – with a high investment opportunity. I had the opportunity to speak with some of the participant in BizSpark recently, and it became apparent to me that tomorrows business service companies face a set of challenges that we, as an industry, adopted upon them. Continue reading