SPONSORED: Twin tracks on the cloud journey

clock • 3 min read

While some resellers are embracing the cloud with enthusiasm and moving their customers across to SaaS options as quickly as possible, a significant proportion continue to resist the lure of the subscription-based model

It would seem safe-enough to assume that the cloud is now an accepted element of most IT infrastructures. But while it is clearly recognised as an option and does play a part in many situations, by no means all resellers are pursuing a cloud agenda with their customers - especially in the SMB space.

Findings of recent CRN Special Report, backed by distributor Giacom, revealed that just under a quarter (24 per cent) of resellers have migrated more than 75 per cent or more of their customer base to cloud, while just over a third (36 per cent) have moved half to three-quarters.

But 40 per cent of resellers have moved fewer than half of their customers onto the cloud. The reason for the inertia seems to be partly due to smaller customers who still don't believe it is right for them, and partly because resellers that work with SMBs are not entirely confident it is the best way forward for them either.

This has been a noticeable trend for some time, according to Mike Wardell, CEO of Giacom. "UK SMEs are slower to adopt cloud computing than counterparts in the enterprise. However, we expect there will be a material increase in UK SMEs adopting cloud-based services in the second half of 2018 onwards."

One of the reasons for this is the progress that Microsoft has been making with its Cloud Solutions Provider (CSP) programme, which is, Wardell said, driving adoption of the SaaS model and fast becoming the "anchor tenant" for adoption of cloud services from other vendors.

Even so, it seems that resellers are one of two distinct tracks when it comes to cloud sales. While those with more progressive strategies are forging ahead, others are in danger of being left behind. Resellers set up in more recent times and starting from a cloud-first position, are taking full advantage of the benefits, Wardell notes, but most of those that have a more traditional background are less enthusiastic. These businesses "will need to dramatically change their business model and value proposition to take full advantage of the benefits offered by cloud, such as improved efficiencies, diversification and the SaaS subscription model", he said.

The survey we conducted for the CRN Special Report found that only half of all resellers have as yet engaged on the Microsoft CSP programme; the other half are, for now, maintaining the status quo for various reasons. These range from a lack of demand from customers (33 per cent cited this as one reason for not migrating customers), to customers still preferring on-premises options (25 per cent) and concerns over customer ownership (19 per cent).

There is some work for vendors and distributors to do then before all resellers join the cloud crusade. There may be a need for more pro-active and supportive programmes like CSP that will encourage more resellers to start the migration to the cloud, which is undoubtedly the way all software will be consumed and managed in the future. If that is indeed the case, there is also risk that resellers who take the slower route to the cloud, will find that they have lost customers to rivals who chose the fast track.

Download the full report here:

 

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