The Cloud service lifecycle race

This is a post by Stefan Daniovsky. As a member of the Solutions Marketing team, Stefan's main focus is cloud as well as solutions message alignment with HP's global campaigns team. Prior to that role he was responsible for product and solutions marketing in Europe covering all of HP Software's offerings.

 

Stefan D.jpg

 

. . . . .

 

Combining off- and on-premise resources to deliver a hybrid service also means dealing with different resource lifecycles (be it infrastructure or application) owned by different parties each with their own investment and upgrade strategies. Is this another hard part of cloud contractual relationship that needs reconciliation?

 

Occasionally I go to Nick Carr’s popular blog, (Rough Type). I recently found a short post there about his longtime experience with Apple’s iDisk service. The point he raised is that consumer clouds are evolving at pace. This consequently puts pressure on users to migrate to newer services with all the pain such migration can cause. He also gave a warning about what such tempo of cloud service evolution would mean to businesses, or to organizations in general.

 

As the enterprise segment is still cautious about public cloud adoption we are probably not yet in such a situation. But the business innovation cycle is still accelerating, and so what if one day even the most agile early-adopter companies find the innovation tempo of their providers just too fast?

 

Succumbing to dictatorship

With traditional, on-premise IT we’ve seen support contracts in place to ease the move from a previous hardware/software platform to the next. In an off-premise world we could potentially re-apply the support clauses in support contracts too but the issue is, who dictates the tempo? In the traditional world it’s been IT who decides when to migrate so organizations could match their investment cycle and depreciation period with the application (or platform) lifecycle. In the cloud world it will be external providers dictating the moment of upgrade.

 

One might say that with an SaaS model it’s a non-issue because new releases occur smoothly with no migration headache (quick user training needed at worst). But in a hybrid delivery world, we assume a service will run on a combination of on-premise and off-premise resources and so we can expect a clash between different upgrade cycles and service strategies owned by different constituents sitting in different organizations. It sounds like an area where provider’s interests may not always match customer’s needs.

 

It’s kind of a governance issue but not only…

Surely this issue must have already been solved with outsourcing? Well, maybe. But the cloud model assumes multi-tenancy running on a single software version so unlike the outsourcing providers who can afford to respect a customer’s spending cycle, a cloud provider won’t have the same luxury. The cloud provider’s migration tempo will depend on its own ROI as well as market pressures like maintaining its competitive advantage or catching-up with competition.

 

So the potential service support contract will have to be very clear about mutual responsibility whenever a new release is to be introduced. And it still may not prevent a conflicting situation when provider’s ROI is already ripe for new release but customer’s ROI is still not at break-even.

 

Cloud brokers can help but still…

Cloud brokers will certainly play a strong role here as they will handle not only the sourcing but also migration and “de-sourcing” questions. However the primary issue of not owning the complete lifecycle of a hybrid (or composite) service won’t go away. It’ll still be a business case vs business case discussion frequently leading to a broken (or compromised) “total cost of ownership” result for one or another party. This is because we’re entering a services economy where finance and accounting drivers rule more strongly than ever before.

 

What to do about it?

Far from understanding all peculiarities of the cloud I can’t see a lot of solutions around. Enterprises can try to dictate the upgrade tempo but what will be the transaction costs of such effort. And how long they can sustain and resist the provider’s dictate?

The one and only solution coming to mind is to achieve a shorter lifecycle than the cloud provider’s one. In other words, be ready to migrate whenever your provider wants to move up the release. Be ahead and get your service ROI positive faster than your provider. You’ll have to win that lifecycle race!

Tags: cloud| PaaS
Leave a Comment

We encourage you to share your comments on this post. Comments are moderated and will be reviewed
and posted as promptly as possible during regular business hours

To ensure your comment is published, be sure to follow the Community Guidelines.

Be sure to enter a unique name. You can't reuse a name that's already in use.
Be sure to enter a unique email address. You can't reuse an email address that's already in use.
Type the characters you see in the picture above.Type the words you hear.
Search
Showing results for 
Search instead for 
Do you mean 
About the Author
Mike has been with HP for 30 years. Half of that time was in R&D, mainly as an architect. The other 15 years has been spent in product manag...
Featured


Follow Us
The opinions expressed above are the personal opinions of the authors, not of HP. By using this site, you accept the Terms of Use and Rules of Participation.