When Amazon, Google and Microsoft rocked up on UK shores a couple of years ago to build their first set of public cloud datacentres in the region, many were prophesising the end of local hosting providers.
The public cloud giants, backed by their channel partners, touted their enormous R&D capabilities which cannot be matched by regional players. The local guys, meanwhile, warned that the US-based firms could not be trusted to keep the US government's grubby mitts off our data - no matter where it is stored.
But tensions may have softened. Earlier this year £40m-turnover hosting provider UKCloud announced a partnership with Microsoft - to bring the Azure Stack on-premise solution to its datacentres - and more recently UKFast launched a dedicated public cloud operation.
This business, named Clear Cloud, is not just focused on providing current UKFast customers with access to the public cloud, but also on bringing in public cloud-only customers.
The moves from both companies mark a shift in focus, with execs from the pair having been openly critical of the public cloud in the past.
Speaking to CRN, UKFast's CEO Lawrence Jones stressed that "this is not a defensive move", but accepted that the hyperscalers have become an important part of the infrastructure ecosystem.
"Amazon has some very clever capability, Azure has its plus points, and our eCloud has its plus points," he said.
"Nowadays people have a huge array of technology and they need it hosted in different ways.
"It would be naïve to think that we could beat everybody on every front, but at the same time there are many things that AWS and Azure can't do compared with UKFast."
Where Jones hasn't wavered is in his view that AWS and Microsoft cannot possibly deliver the level of customer service that UKFast can afford its clients.
But instead of attacking the pair for what he has previously highlighted as an Achilles' heel, Jones said that AWS and Microsoft want and need to partner with local firms to give the attention to smaller customers that they cannot.
"There is no mass hosting provider on the planet that could provide that level of detail [that we offer] and that is the whole idea; they don't intend to," he explained.
"They are relying on companies such as ourselves to step in and manage those workloads."
UKFast's growth has shown no signs of slowing down since the big three entered the UK, with the firm claiming to have seen organic revenue growth of 18 per cent in its last financial year. It is this customer demand that served as the catalyst for the move into AWS and Azure consultancy.
Clear Cloud is a Microsoft, AWS and Google consultancy, and bills itself as a "multi-cloud expert". Jones said that the rationale for setting up the business was largely driven by customers asking UKFast if it would carry out the same services that it already provided on its own infrastructure.
"A lot of our larger customers were saying it would be great if we'd manage their AWS. We fought it for a while because it isn't our core business, but when you think about it, support is our core business. It doesn't really matter what we're supporting," he said.
"There is no point fighting this; it is important to embrace it, take advantage of it, and help customers decide which environments they want in each area.
"We have already won clients that we have never had dealings with before, and we've won [back] clients that have moved away from UKFast and had extraordinary pain because they've been used to our type of handholding."
Keeping with the times
While Jones insisted that this is not a defensive move for UKFast, there will be some in the channel who believe that the hosting provider is adapting in order to maintain a foothold in a world that is fast adopting public cloud.
Chris Bunch, head of Europe at AWS and Microsoft partner Cloudreach, said that while this is a shrewd move for UKFast, it is a move borne out of necessity.
"They're attempting to stay relevant," he told CRN. "They know that there is increasingly limited future growth potential in their target customer base.
"I've been relatively scathing about those guys. Not because they're nasty people, but because I think the business model has a very limited lifespan. They've made a lot of money and had a lot of opportunities when organisations didn't have a choice.
"Organisations had to operate locally in some places for legal regions - such as the UK public sector - and these organisations did well; you see people like UKCloud at the top of the G-Cloud spending list.
"But if you compare their offering from a technology perspective they are just not even in the same league or the league below, they are several leagues below. The world evolved and they are not in a position to match the spending."
Bunch praised the move by UKFast, claiming that building out a Microsoft and AWS capability is a potentially effective way for local hosting providers to retain their relevance - because in some cases they already have a strong customer base.
"It is what I would be doing if I was them," he said. "If you want to think about the future, and the present, you have to move into public cloud if you are in that space. Hopefully they can transfer some of their skills across to the more market-leading public cloud platforms.
"One thing that slows organisations down is that it is very difficult to pivot to make money in 24 months when you can still make money immediately. It's not easy, but I would suggest that it is the right kind of move. If you're in infrastructure then you need to be in public cloud."
Bunch added that some datacentre owners may attract interest from the larger cloud players that want to expand their datacentre reach, but are struggling to find locations and pre-existing facilities.
"They have a decision to make about their business and at what point that growth stops completely. Ideally you want to time it so that the growth is about to decrease and then you can do something else with that datacentre business," he said.
"If it is big enough, any one of them could be looking at selling that space to somebody else because, for the most part, that is one of the challenges right now.
"If I'm Amazon, Microsoft or Google, finding where to put these datacentres is one of the challenges anywhere in the world."
Public cloud partnering
Others in the local hosting space are adopting a different approach, such as UKCloud, which partnered with Microsoft, as mentioned above.
In other regions Microsoft has been known to launch a dedicated public sector datacentre region, but in the UK it opted to partner with a local provider.
UKCloud's CTO Leighton James said the firm appreciates that many organisations will want to utilise the public cloud, but said it opts to partner with the channel to deliver these solutions, rather than implement them itself.
"We founded our business on the principle of competition breeding innovation. Competition is a good thing and the biggest concern we have with customers opting for the public cloud is that it can become quite monopolistic," he said.
"Our dependency on those public clouds could become immense if we are not careful, but we recognise that there is some innovation on the public cloud that customers should absolutely be tapping into, so we help our customers work out how they can use elements of the public cloud and have their data securely hosted on our platform.
"If they need ongoing support or services, then that is where we bring in our partners - most of which are proudly agnostic. They offer UKCloud services but they also offer other services and can give impartial advice.
"This is a very channel-friendly approach."
Joe Macri says the vendor saw 20 per cent of its UK growth come from its Cloud Solution Provider programme last year
Pure set for further acquisitions, with a focus on the south-east
Reports claim BlackBerry is in talks over a $1.5bn deal