Imagine a world with iPhones and iPads, but no App Store. That's the state of the cloud ecosystem today, according to CA Technologies, which recently launched its Cloud Commons Marketplace -- a cloud marketplace and communal hub where cloud buyers, sellers and developers can advertise, test and buy services.
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"People who are not in the community of developers don't realize this is a key thing that's missing," according to Stephen Hurford, director of cloud services at DNS Europe, a London-based cloud provider that sells its CA AppLogic-based Cloud Control Panel service, a cloud application delivery and management platform, in the cloud marketplace.
About 25 software vendors and cloud providers have joined Cloud Commons since launching in mid-November. Although most of the products currently sold are based on CA's AppLogic application delivery platform -- because most of the market's current products are sold by CA -- it is a platform-agnostic marketplace. Like other app store business models, cloud providers and ISVs pay CA a percentage of any sales made through the Cloud Commons Marketplace. That percentage varies according to the type of service and deployment model.
By selling their services through Cloud Commons, providers enable prospective customers to procure cloud services just the way they shop for consumer goods at an online retailer -- comparing user reviews, rating products, selecting a service, adding it to the shopping cart and proceeding to checkout to pay. But instead of buying books or airline tickets, customers rent an independent software vendor's (ISV's) application and select the service provider cloud environment where they want it to run.
"That's practically all of our marketing done for us -- and with a much bigger global [audience] than we could reach on our own," said Hurford, whose company primarily targets developers building Software as a Service (SaaS) and Platform as a Service (PaaS) products on AppLogic.
Cloud providers can also use CA's marketplace to do their own shopping and expand their portfolios by purchasing and pre-integrating cloud products from ISVs on Cloud Commons, as well as use cloud-based AppLogic appliances to convert traditional applications into cloud services, according to Andi Mann, vice president of strategic solutions at CA.
"[Cloud] providers have the ability to now be hosts for a range of software that is not [otherwise] available as a cloud offering," Mann said.
Aggregation model spells opportunity for cloud marketplaces
CA is hardly the only vendor to sponsor a cloud marketplace initiative. Equinix and Synnex launched cloud marketplaces earlier this fall, and Ingram Micro announced its cloud marketplace in June 2010. VMware announced its intentions earlier this year to develop something akin to cloud marketplace, vCloud Datacenter Global Connect service, which would rely on cloud providers to partner with each other. Even NASA recently announced plans to build a cloud marketplace for the science community.
Some of these projects, however, bear a closer resemblance to directories than marketplaces -- not actually selling anything, but instead prompting would-be buyers to submit a form with their contact information for the cloud provider's or ISV's sales representatives.
An open cloud marketplace that resembles a cloud aggregator model, such as Cloud Commons, will be a more rewarding opportunity for the cloud provider ecosystem, according to Steve Hilton, principal analyst at Boston-based Analysys Mason.
"It gives [cloud providers] an opportunity to sell a pre-integrated solution, which is something needed in the cloud world," Hilton said. "While cloud services are a large opportunity, the bundling of cloud services and other solutions like connectivity, security solutions and consulting [services] is an even better model."
Global cloud services revenue is expected to reach $40 billion by 2016, and about half of that (46%) will go to ISVs bypassing the channel to sell their own cloud services, Hilton said. Twenty-five percent of that revenue that will go to communications service providers, while 29% will go to partners, distributors and solution providers.
"The cloud marketplace gives sellers another channel-to-market for their cloud services that they wouldn't normally have," Hilton said.
Emphasizing that the Cloud Commons Marketplace is still in its infancy, DNS Europe's Hurford said he sees room for improvement in the cloud marketplace, adding that CA must shorten or streamline the certification process for cloud providers, and ISVs must rethink their pricing.
"A lot of vendors are setting their own prices for their products and -- perfectly honestly -- they're quite high, based on what we know the market is willing to pay," he said. "That's something [CA is] going to have to manage in the marketplace."
Developer's workbench adds to CA cloud marketplace
The cloud marketplace isn't the only expansion to Cloud Commons, which CA originally launched in 2010 as an online community for the cloud ecosystem. CA also opened the Developer Studio, which gives Cloud Commons members free access to project management tools and a cloud-based AppLogic test environment. Once tested and certified, the cloud service may then be loaded onto the cloud marketplace.
CA launched the Developer Studio to address the challenges that cloud providers and ISVs face when trying to rebuild applications and services for the cloud, Mann said.
"There's a lot of time and a lot of effort, and it shouldn't be that involved," he said. "We're a software vendor ourselves, and we see this every day with our own customers and our own solutions."
The ability to save, share and collaborate on programming templates will also be invaluable to smaller and midsize cloud providers, Hurford said. .
"Bringing a customer onto the cloud can be quite complex and can involve re-architecting or rebuilding a template from nothing," Hurford said. "Up until now, it was a case of rebuilding it [ourselves], as a service provider, or [getting] word of mouth contacts through CA salespeople or other partners in the community to see if anyone had done this before."
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