Having built out their data centers to support infrastructure services, cloud service providers are starting to...
By submitting your personal information, you agree that TechTarget and its partners may contact you regarding relevant content, products and special offers.
look up the cloud stack for their next play. Platform as a Service (PaaS) cloud computing services have caught their eye as an opportunity to boost revenue, add value to existing services and gain broader adoption of cloud services with business customers.
PaaS, the layer sandwiched between Infrastructure as a Service (IaaS) and Software as a Service (SaaS) in the cloud stack, is an enabling engine for SaaS applications. PaaS cloud computing services provide the building blocks -- in the form of templates, application programming interfaces (APIs) and programming tools -- that make it easier to develop, integrate and deliver SaaS applications.
Cloud providers that have established themselves in the IaaS market may be reluctant to enter territory already claimed by software providers, such as Salesforce.com with its Force.com platform and Google with its Apps Engine. But there are a host of reasons, both strategic and tactical, for infrastructure providers to enter the PaaS market.
PaaS cloud market both strategic and tactical for providers
From a strategic perspective, most leading cloud providers -- including Verizon, IBM and AT&T -- are betting that cloud computing will radically transform how IT services are consumed. This vision includes not just enterprise IT, but how cloud providers use and manage their own resources as well.
To prepare for the Anything as a Service (XaaS) world, cloud providers are developing homegrown, flexible cloud platforms to support a variety of functions for their own internal cloud environment and processes. This includes platforms to develop, integrate and deliver applications and services. At the same time, cloud providers can monetize these platforms by opening them up to customers, partners and developers to be consumed as a PaaS cloud computing service.
All PaaS providers offer application development as a core capability, differentiating themselves by which additional functions they roll into the platform. These other capabilities often play to the cloud provider's heritage and strengths.
Telecom operators, for example, offer strong billing and operations capabilities in their cloud platforms because their heritage as telcos means they already have strong metered billing mechanisms in place. By contrast, IBM has played up the integration and management capabilities of its SmartCloud PaaS cloud computing service.
But most cloud providers have their eye on more tactical goals -- namely, growing the customer base and boosting revenue. Some are looking to deploy PaaS cloud computing services as a way to layer value onto their IaaS products, as Amazon has done with its Beanstalk PaaS product and IBM with its SmartCloud portfolio. Even neophytes that are still developing their cloud strategies -- including cable operators, managed service providers (MSPs) and second-tier data center and communications service providers -- are considering PaaS to provide greater value to customers.
Three PaaS cloud computing models emerge
Several PaaS models have emerged, and cloud providers may choose to deploy one or more of them. For example, cloud providers may open parts of their internal platforms to external developers through APIs. Providers may then augment their own capabilities -- and enhance their service offerings to customers -- by aggregating and integrating commercial and custom software into the platforms.
Here are three possible PaaS business models that cloud providers should evaluate:
- SaaS development/delivery platforms: A full-service PaaS cloud may include components for enterprise customers to build development, billing, customer and vendor management, and self-service portal functions into a SaaS application. Specialized platforms may focus only on one area, such as development or delivery. Cloud providers may also market their PaaS cloud computing service -- in the form of software and hardware, or hosted services -- to third-party developers that build and sell their own SaaS applications. Additionally, PaaS providers may target other providers in the cloud ecosystem, such as cloud aggregators, which use the development capabilities to add their own services.
- SaaS aggregation platform: In this model, the cloud provider assumes more of an intermediary, value-add role versus solely being a platform provider. As an aggregator, the provider uses a cloud platform -- its own or one developed by others -- to build additional features or functions into a set of third-party, so-called "best of breed" SaaS applications. Aggregators usually offer a select number of pre-screened, commercial SaaS applications that will appeal to a specific target market -- such as business customers, small businesses or a particular industry. The aggregator uses its platform to bundle these applications with custom, complementary services, such as managed security, backup and disaster recovery and unified communications. This type of PaaS model may also include cloud-based customer self-service tools for identity and access management, billing reports and usage reports for the aggregated applications.
- SaaS marketplace platform: In the marketplace model, multiple developers arrange for their SaaS applications to be presented to end users via a single portal, with common ordering processes. A SaaS marketplace is like an online flea market or mobile app store, where the participants pay the provider to participate, either through a direct fee or a portion of sales. Unlike aggregation platforms, most SaaS marketplaces accept anyone, with little or no screening to determine "best of breed" in a particular category. Furthermore, marketplaces generally do not facilitate integration of apps or wraparound services. This may restrict their usefulness to cloud service providers, which should ideally add value to commercial SaaS services by offering their own value-added services.
As SaaS usage grows, PaaS cloud computing services may become an even more important part of the delivery ecosystem for business applications, especially at the lower end of the market.
In the 2011 Frost & Sullivan Cloud User Survey of business IT decision makers, 73% of midsize businesses said they would be interested in a SaaS bundle that integrates multiple applications at a per-user fee, with centralized administration and access management. These respondents also indicated that they are willing to pay for the convenience and control that PaaS cloud computing services can offer. Cloud providers are in a unique position to meet their needs with a PaaS solution -- and in return, they can expect to maximize revenue and strengthen customer retention.
As the cloud market evolves, cloud providers are coming to the conclusion that providing access to data center resources -- especially in an on-demand, 'rent by the hour' IaaS model -- is not a strong enough play to support a long-term cloud strategy. PaaS may provide the answer.
Lynda Stadtmueller is program director of cloud computing research and analysis at Stratecast, a division of Frost & Sullivan.