online back-up and storage, IT infrastructure, network solutions, collaboration, database

Though many organizations, large and small, have put non-critical applications such as email, HR and payroll on the cloud, there is still a lack of proper understanding about the cloud ( computing  ) and its benefits. According to industry estimates, SMBs will become the largest cloud ( computing  ) adopters in India since they operate on lower IT budgets and hence, the cloud ( computing  ) is the perfect option for them. Indeed, cloud ( computing   )adoption among SMBs grew 40 percent in 2010-11. Key opportunities for partners came from the manufacturing, retail, BFSI, education, real estate and tourism sectors for cloud ( computing ) security services, online back-up and storage, IT infrastructure, network solutions, collaboration, database and utility applications. Opportunities also exist for smaller brands and start-ups which offer customized applications or white-label services on the cloud. According to market research firm Zinnov, 60 percent of SMBs are willing to try solutions from new brands. “Tech-inclined partners are talking the language of storage on the cloud, SaaS, DR, business continuity and verticalized applications with reference to hardware, support and maintenance cost, and savings in real estate,” says Kalyan Banga, Manager, Product Development, Netscribes India. What does all this mean for the partner? We take a look at the existing opportunities and highlight some new ones which partners can explore to increase their share in this evolving segment.

Messaging

Industry leaders and analysts are unanimous that email and unified communications will be the services that move to the cloud ( computing   )the fastest. One of the reasons for this is that almost all users have been exposed to hosted email services, and are comfortable with the idea when large vendors are willing to back it up with security, reliability and quality of service. “In our SMB study we found that over 85 percent of SMB customers were willing to move their email to the cloud. Small business customers are already exposed to the hosting model, and are comfortable with the idea of cloud-based hosting,” says Neha Jalan Goenka, Senior Associate, AMI Partners. According to the latest research from AMI, SMBs (companies with less than 1,000 employees) in the Asia-Pacific region (excluding Japan) will invest $16.5 billion in cloud ( computing   )computing solutions in 2012. While hosted email was for very long the territory of shared hosting providers, the entry of Microsoft, Google, VMware, IBM and a host of cloud ( computing   )service providers reselling their cloud ( computing   )offerings has changed equations. “While shared email hosting remains the best option for a start-up or small business to have a business email, there are scalability issues. There’s also the perceived security threat,” says George Zachariah, GM, Host Cats, a Bengaluru-based hosting company. Most shared hosting providers run their email servers on a free email server application such as Sendmail, Postfix or Exim Mail, and host hundreds of customers and thousands of email accounts on a single server. They set several limitations on the attachment size, number of emails which can be sent and received within an hour, and so on. Typically, the pricing is included within the Website hosting charges, and are usually Rs 100-500 per user per year.

“We used to advise customers with over 100 users to set up their own mail server,” notes Zachariah. “Now with the cloud ( computing   )we can service customers of virtually any size.”  Google is offering a free Google App version for customers with less than 50 users. The only caveat is that the service is the same as the free Gmail service, and comes with Web ads but no strong SLA. At $50 per user per year, Google is offering not just mail, messaging and calendar, but a whole suite of office applications. Microsoft is offering hosted Exchange for as low as $2 per user per year. There is also a package at $8 per user per year with Exchange, Lync and Sharepoint integration. Compare this to the cost of an on-premise deployment of Exchange—roughly Rs 1,400 per user in terms of licensing alone. Apart from the licensing cost, there are server, storage, power system, administrator, redundant network and bandwidth costs. Often, the cost of hosted email is estimated to be around Rs 2,500 per user per year for a server catering to 500 users over a 3-year period. Messaging solutions off the cloud ( computing   )offer no real entry barrier in terms of technical knowledge for channel partners. Microsoft has even engaged regular distributors such as Redington to engage with channel partners for enablement. Migration services (from premises to a hosted model) and other integration opportunities can result in extra services revenue for systems integrators.

Office & small biz apps

Office applications off the cloud ( computing   )is a business opportunity that requires channels to make little or no investment. Puneet Thakkar, CEO, ShivaamiCorporation, Mumbai, who has been selling Google Apps to his existing customer base, says that he has not made any investments. “Since Tata Communications have taken over the distribution, we have been pushing Google Apps to customers. We make around 20 percent, and there is no technical challenge or financial issue.” Google, Microsoft and Zoho are the three main players in this space. Microsoft India has initiated one of the most aggressive pitches to woo channels to sell its Business Productivity Online Services (BPOS) offering, Office365, through the Microsoft Cloud ( computing   )Partner Program. Business Productivity Online Servicesconsists of cloud ( computing   )versions of Microsoft Office, Exchange, Sharepoint, Windows Intune and Microsoft CRM Dynamics, as well as Microsoft’s cloud ( computing   )computing platform Azure. The pricing cuts across several slabs with the highest slab presently priced at $24 per user per month. The company is offering standard commissions of 12 percent for the first year and 6 percent from the second year onward. “Over a period of time we will be introducing various channel rebate schemes that increase the profitability of the partners,” says Sanjay Manchanda, Director, Business Division, Microsoft India.Meanwhile, Zoho is offering, on monthly rates, a number of services including office applications, CRM, invoicing, project management, remote support and accounting.  Tata Communications, which offers Google Apps through a white-label service called InstaOffice, is also offering Zoho products. TCS is another vendor. It has floated a cloud-based model called iON, which offers, apart from messaging, office applications, CRM, business analytics and ERP.

“Over the past few months we have seen a lot of interest from customers for the Tata Consultancy Services cloud ( computing   )offering. The market is just starting to mature. Customers are keen to look at a pay-as-you-go model,” says Edward Jeevan, Director, Binary Systems, Bengaluru. Smaller vendors are also looking at delivering business applications over the cloud. One example is GreeneStep Technologies, a Bengaluru-based company which is offering a suite of business applications including CRM, ERP, ticketing, ecommerce and supply chain for as low as Amount Rs 2,500 per user per month. “We are actively scouting for partners who can provide level one and two support, and can hand-hold customers. Partners need not make any extra investments,” says Mr.SunilKumar, CEO, GreeneStep. While some partners sound excited, others point out that selling business applications or office software off the cloud ( computing   ) will not be easy. “While Microsoft and Google have simplified the entire process by evolving compelling cloud ( computing   ) models, a few users may be unwilling to shift from a desktop-based Office suite to a Web-based Office suite,” points out Vishal Bindra, CEO, ACPL. “Nevertheless, I see a huge market shift; give it a year and a half.” Adds Ajay Sawant, MD, Orient Technologies, “At present, the Internet here costs a bomb compared to what it does in the west. But bandwidth prices are going down, so adoption would begin in a couple of years as prices rationalize.” Vinod Menon, Director, Ashtech Mumbai, is more upbeat. “Without doubt, selling business applications through a cloud-based model is more exciting than other opportunities. This is because for a solution provider like us it is a space which is fairly new, and proposing a cloud-based model makes it easy for us.”

Storage-as-a-service 

One of the hottest trends in the cloud ( computing  ) landscape is storage-as-a-service. There are several models and services in storage depending on the specific needs of a customer. In fact, many industry leaders are concerned about the future of stand-alone storage; they say that channel partners must embrace cloud-based models and be prepared for hybrid storage. “Enterprise storage will move partially or fully to the cloud ( computing  ) over the next few years,” forecasts Girish Krishnamurthy, former MD, Kaseya India. “It will be interesting to see how channels react to this disruptive change in the way customers store data.”  Several partners have already launched their own services or the white-labeled services of other vendors. For instance, Delhi-based Ace Data Devices (ADD) has launched a cloud-based service for backup and recovery, and offers a pay-as-you-go model. “We have 10 live customers at present, and are running pilots with 45 more,” disclosed Neeraj Mediratta, CEO, ADD. “The conversion rate is at least two customers per week. We are focusing on the manufacturing and healthcare segments.” Tata Communications, IBM, HP and Netmagic are some of the other vendors which have started offering cloud-based storage. “We recently tied up with Netmagic to roll out disaster recovery services off the cloud. We are hoping to address the needs of mid-market resellers and their customers through the partner network of Netmagic,” said Ashish Guha, President, Global Sales, Sanovi Technologies. Object-based storage systems are another promising alternative to traditional NAS. Object-based storage forgoes traditional file systems which have capacity and management shortcomings. Instead, these systems assign a unique identifier, or digital fingerprint, to each file plus its metadata.

Netmagic and Tata Communications are both expected to announce their Object-based storage cloud ( computing   )offerings shortly. While customers are expected to prefer their own premises for primary storage, the cloud ( computing   )has already become a common option for secondary storage, backup and disaster recovery. Says Karan Kriplani, Product Manager, Netmagic, “Customers are showing a lot of interest in storage-as-a-service. While primary storage is still within the premises, backup and secondary storage is definitely moving to the cloud.” The consumerization of storage is a reality in mature markets, and channels expect it to happen in India too. There are several cloud-based backup and recovery services like Backblaze, Mozy (an EMC company), Dropbox, Apple iCloud, Box and Microsoft SkyDrive that target individual PC users. All services offer some basic storage (like 2 GB) free while extra storage is charged. The biggest advantage of storage-as-a-service for an enterprise is the freedom to take decisions based on pure SLA terms. As Harikrishna Prabhu, Director, Technobind, a VAD based in Bengaluru points out, “A customer need not worry about capacity planning, the choice of technologies or vendor software licensing, but pay based on the storage required.”

Security-as-a-service

Security vendors have also started taking the cloud ( computing   )route to offer an alternative to premise-based investments. In India Tata Communications has been one of the first cloud ( computing   )service providers to jump on to the bandwagon. “Cloud-based security services, deployed within our IP backbone, complement your premise-based security components to deliver a comprehensive solution. We offer purpose-built architecture and scalable capacity to combat the full range of security threats you face,” says Prateek Pashine, President, SME, Tata Communications. Some of the services bundled by cloud-based providers include Internet clean pipes with DDOS mitigation, virtual proxies, managed authentication, antivirus software management and email security. Fortinet has been working with telcos and ISPs to offer security-as-a-service to enterprises and consumers. “We have a partnership with Sify Technologies for enterprise network and data center services based in India to enable them to offer an on-demand security solution and their Clean Connect service to their cloud ( computing   )computing customers,” says Vishak Raman, Regional Director, Fortinet India & Middle East. Raman says that the biggest opportunity lies with telcos which have the bandwidth to work with IT resellers to offer value added services. “We see in the future security delivered as a monthly subscription fee. L1 support can be handled by partners while the telco’s call center takes care of continuous support.” Hosted email security is another business that’s fast receiving acceptance. Symantec, which acquired Messagelabs, offers antispam and antivirus filtering for email servers on a hosted model.

Even channel partners have come up with their own offers. Chennai - based Futurenet Technologies has a hosted email spam filtering solution which is hosted from multiple servers across the globe. It has been offering the service on a pay-as-you-go model for the past two years. Explains L Ashok, CEO, Futurenet, “We have built the solution on top of an open source stack. The hosted model works better for customers because they do not have to worry about infrastructure costs.”  The demand is coming even from the smallest players—the SOHO and the home segment. And contrary to popular belief that the enterprise segment would adopt a wait-and-watch attitude before taking the plunge, it is this segment that is adopting the cloud ( computing  ) because of the savings they could infer after doing a cost analysis.

Infrastructure-as-a-service

As a concept, infrastructure-as-a-service has fast gained maturity because of the attractive pricing models that vendors in the space have launched. According to S Sriram, CEO, iValue Systems, “Selling infrastructure-as-a-service in terms of simple compute instances has become an accepted norm in the industry today.” Amazon, which pioneered this idea, has actively started scouting for opportunities in India. Said Shane Owenby, MD, APAC, AWS, “The usage patterns and adoption rates for India are similar to those around the world. Indian companies use AWS as a cost-effective underlying infrastructure to build their business, and as an important part of their GTM strategy to expand across different regions around the world.” A public cloud ( computing   )is essentially a scalable virtual machine that’s made available to a customer on a pay-as-you-go model. “Since most on-premise infrastructure is not properly utilized, the cloud ( computing   )model makes a lot of sense for enterprises of all sizes,” reasons Ganesan Arumugam of VMware India. Service providers are also offering infrastructure for partners to set up their cloud ( computing   )services as well as white-label their services. “Our Instacompute platform can be white-labeled by a channel partner and he can offer value added services to his customers,” informs Pashine. VMware has signed on around 40 partners for the VMware Cloud ( computing   )Service Provider program, and is offering a pay-as-you-go model for them to offer cloud ( computing   )services to their customers at a monthly subscription as low as $360.

Another opportunity for systems integrators is the private and public cloud. “Private clouds and hybrid clouds represent a huge opportunity. Customers who have reasonable in-house infrastructure could set up private clouds and then move applications to the public cloud ( computing   )to set up hybrid clouds,” says Apalak Ghosh, Manager, Emerging Technologies Research, CMR. Intel has also joined the race. Leveraging on its OEM partnership with Microsoft, Intel has bundled nearly 74 applications and is offering the same on a pay-as-you-use basis. The hybrid cloud ( computing   )server is leased out to customers for 1-3 year contracts. “We quote an indicative upper-limit figure, of which a customer has to pay a standard fee for the hardware irrespective of whether he uses it or not. The cost of the software licenses are calculated on the cloud ( computing   )payment model,” explains MuraliKrishnan, MD of the Bengaluru-based NJ Data Print. Another obvious advantage is the faster availability of infrastructure. “Customers need not wait and can very quickly use infrastructure. This makes it easier for them to go to the market faster,” says Vamsi Velluri, GM, Cloud, IBM India/SA.

Conclusion

While for many years the cloud ( computing  ) remained a much-hyped technology, there is no doubt now that the opportunities are real, hence cloud ( computing   )service providers are developing channel programs which make it easier for partners to sell cloud-based solutions.

Source: CRN News Network

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