The Marketplace of Cloudy Ideas
CIO magazine looks to the day when cloud services will be traded like any other commodity. Now it’s Nick Carr’s turn to feel vindicated, since this suggests that price competition is the only differentiator left to a Managed Service Provider (MSP). For many businesses this may be true. An e-commerce site probably can expect the performance, scalability and security of all those vying for their hosting custom to be more or less equivalent. But for those of us with more complicated businesses, and especially those in regulated industries, there are still a few things we need to keep in mind before we line up to bid on MIPS.
- Jurisdiction: Does it matter to you if your data isn’t stored in the same country that you do business?
- Compliance: The health care industry has special privacy regulations, for instance. Will a thin-margin storage service offer that level of security?
- Security: When you have a business need to scrutinize the user authentication, firewalls, encryption, audits and DR sites can you rely on a commodity service? Is a server farm on the San Andreas Fault worth as much to you as one in Iowa?
- Data Loss: what’s the SLA around outages and data corruption? Can you expect pretty much any company to recover from a catastrophic data loss as fast as your business would need it to?
- Customer Service: do you expect to need to deal with the company regularly? Does it matter to you if they pick up the phone or only respond to email?
If any reasonably capable company would probably supply you with satisfactory answers to these questions, then a rosy future awaits you in which you can depend on market forces to keep the price low and service acceptable.
But before cloud services appear on the Chicago Mercantile Exchange along with bauxite and pork bellies there are a few details to be worked out. Firstly, what are the units of the service? Practically, how do we define what we’re bidding on? The amount of actual business value that is delivered by a certain quantity of MIPS, for instance, depends on programming language and architecture. As a commodity industry there will have to be standard contract terms and metrics that all MSPs use to describe their products.
Secondly, how will the service be delivered and how easy is it to swap in and out? If I buy a million bucks worth of cranberry futures, someone somewhere will eventually back a truck up to a loading dock and dump fruit into a processing plant. To drive that truck for an MSP today takes expert professionals, many hours and a lot of skull sweat (and no small amount of trust) from both sides to configure, test and go live. A service-oriented architecture makes this easier, but only if the same standards are in use at your MSP. It’s not a commodity if it takes a month and a professional services contract to disconnect the old one and hook up the new.
Someday perhaps we’ll be able to buy the cheapest service off the shelf and swap it in as easily as changing a light bulb. But that day may not arrive before we’ve all stopped using tungsten light bulbs.
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