Making cloud strategies more palatable to virtual data center holdouts

Providers shouldn't ignore enterprises choosing a virtual data center over a cloud strategy. Get tips on how to address this often-overlooked market.

Editor's note: Is enterprise data center virtualization the enemy of cloud providers? It can certainly seem that

way, but providers shouldn't turn their backs on enterprises that are choosing to build virtualized data centers rather than adopting cloud strategies. In the second part of this two-part tip, Frost & Sullivan's Lynda Stadtmueller explains how providers can tackle the issue. Don't miss part one, "How virtualized data centers are inhibiting cloud adoption."

Infrastructure as a Service (IaaS) adoption is losing to virtual data center deployments, but the good news for cloud service providers is that the market will change in a few years. It won't be long before virtualized data centers fill to capacity and aging infrastructure can no longer be coaxed to perform. In five years, over 90% of businesses expect to be using both virtualization and IaaS, according to a recent Frost & Sullivan survey.

Rather than ignoring or attempting to displace the on-premises infrastructure, cloud providers should focus their efforts on enabling hybrid environments.

This timeline gives cloud providers three choices:

  1. They can target non-virtualizers -- something that will be harder to do, however, as virtualization penetration reaches close to 100% in the next five years.
  2. They can revise their business plans downward to reflect a surge in demand to two to five years, when large percentages of enterprises seek to replace virtualized infrastructure.
  3. Or, they can start now to expand their purviews and portfolios to address current and future needs of enterprises with a full IT solution.

This third option reflects the successful approach taken by cloud providers with roots in IT, including IBM, HP and Fujitsu. It starts with an understanding that the private data center is and will continue to be an important part of enterprise data center strategies. Rather than ignoring or attempting to displace the on-premises infrastructure, cloud providers should focus their efforts on enabling comprehensive hybrid environments that comprise traditional and virtualized data centers as well as private, public and hybrid clouds.  

Cloud providers can also provide consulting services to enterprises that have recently virtualized their private data centers. According to the Frost & Sullivan survey, 72% of businesses expect to turn to an external source for assistance in developing and implementing a data center and cloud strategy. Enterprises do not have experienced cloud technicians on staff, nor do they have the time and resources to do necessary research. Instead, they are willing to pay for managed and professional services to help them with critical, strategic tasks: security and risk assessments, strategy development, migration and implementation, and ongoing management.

Cloud service providers have an opportunity to earn the trust of enterprises, even those that are not currently in the market for cloud services. Providers that ignore them now cede that future business to a competitor.

About the author
Lynda Stadtmueller is program director for Cloud Computing Services Research at Stratecast, a division of Frost & Sullivan. 

This was first published in December 2012

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