The cloud is almost an inevitable destination for the enterprise in some way, shape, or form. A recent 2015 IDC Storage Services survey showed that 55.1% of U.S. enterprises plan to engage in a "datacenter to cloud transformation" project with a storage vendor within the next 12 months, highlighting that the shift towards the cloud continues with reasonable fervor. In a business shift, enterprise IT has also moved from cost-driven decision making to making more strategic and performance oriented decisions. A recent European IDC Storage Manager survey highlighted that only 26 percent of respondents cited reducing capex as a top driver for investing in public cloud-based storage services. Clearly, the desire to embrace new service opportunities from the cloud is the new reality.
As the cloud market continues to mature, we’re seeing some shifts in the ways that Service Providers (SPs) are trying to address hosted cloud offerings for your enterprise customers. Over the last several years, SPs have seen their margins continue to shrink as pricing pressures have bumped up against an ever increasing set of feature requirements demanded by tenants that are becoming smarter with their purchasing decisions in a cut-throat market. Also, with the first generation of cloud offerings, many SPs ended up taking on all of the risk of making everything work. And in some cases, the lack of tight integration between the various components of the cloud may have even led to system downtime damaging market reputation. This ended up costing significantly more than originally intended, and in many cases caused lengthy timelines for bringing services to market.