IFR in the Clouds: True Heading & Cloud Computing

Why are there no market prices for IaaS or other basic services in the Cloud Computing space ?

In my opinion Cloud Computing

• Is not a technology, but a market trend
• Dominated by non-IT Companies
• Revenue Streams out of  IaaS are there, but more or less irrelevant. Just too small.
• Most IaaS offerings are just a starting point

This is just a foil out of my latest and greatest CC presentation. It is a simple sample for a logistic company.

Better:  For a logistic company with own IT Services.

Here is my recommendation -)

1. Start offering cheap IaaS services for dedicated customers.
2. Add Web content including design services
3. If your customer is lucky with your services, start offering additional services like:
4. A Catalog Management System for the products of your end-customer
5. Offer a Price list Management System. You will need this, as you will offer flexible catalog systems.
   This requires dedicated catalogs or shops for different customer groups: Different prices for end-customers and for
   Retailers.
6. Well, if you know the customers, you can offer services that will cover peaks. Offer campaign management, for seasonal or other peaks.
7. If you already manage the Campaign, enhance your offering: Ask for the complete campaign logistics. If your customer wants to
   sell 400.000 footballs in 2 months......it is a good idea, to outsource the logistics for this peak.
8. If you do your job good, you may offer to take over the complete logistics for your end-customer
9. This may include not only stock/warehouse, but call center and / or CRM Systems

This is just a logical order......There is no starting point Cloud Computing.

Remember: Cloud Computing brings the idea of book-shop-logistics to the IT Department.

• There is no such thing as a isolated IT Cloud Solution. It is all integrated in one big business scenario
• There is no market price for IaaS. It will be more and more combined, merged, mashed with additional offerings
• These additional offerings will be the true heading here. This is where the margins are....
• Remember: No or low margins with IaaS. This is  the land of  sharks and desperates......
• This is your big chance: This ties your customer to your company. There is no loyalty with IaaS only.
• If you can add/combine your business with IaaS or SaaS solutions: Cloud Computing is your technology.
  

Now, here is a sad story.

I walked into that at one of my last CC presentations.  The customer was already faced with some negative effects:

• Parts of their business migrated already from reals life to the web space.
• Parts of IT Services are alredy lost to Cloud Computing suppliers (SaaS) Remember: The pareto about the revenue streams !
  

At every customer workshop we do the same brainstorming when we talk about the pareto:

How can IT services be expanded, how can they be part of a more complex solution. How can we rise the contribution of the service ?

At this point we failed. They recognized, that they could not extend or enhance their offerings to their end customers.

They, on the other hand had almost no chance to extend their offerings in the pre-production area.

We all noticed just in that situation: The situation is more serious than expected.

So, now you know why I thing that Cloud Computing is not about IT Technology. It is more like SOA, but spreading from one company to the next.

From IT Technology to business process and more into business. It is 2009, Cloud Computing is just starting to change. And the extreme cost pressure from the economic crisis will drive this faster and faster.