The growth of cloud computing is undeniable. Back in the early days the first wave of customers that were attracted to the cloud were generally motivated by the cost savings that this new model promised. But now, as we enter the next growth phase, customers are demanding more from cloud vendors and their trusted IT advisers.
Many channel companies sat out the initial growth phase of cloud computing, waiting for what they saw as the latest fad to pass. Now that they realise cloud is here to stay, they need to redefine the value they provide their customers and assess the impact on their long-term viability.
Businesses need to stay ahead of their competitors and retain customer loyalty. They also need to collaborate more efficiently – offering their employees the technology that engages them in a meaningful way with a wider community, both internally and with customers and suppliers. A recent study by the Future Foundation – a UK-based independent research agency – found an 81 per cent correlation between collaboration and innovation.
The rise of social media technology has mirrored the rise of cloud computing. It allows employees to share useful business information easily with a wide group of colleagues. Micro-blogging sites such as Twitter may help businesses empower ad hoc teams to rapidly develop new ideas.
Finally, new devices such as smartphones and tablets are proliferating in the workforce, making staff more effective anywhere, any time.
These themes are inter-related and are driving productivity, collaboration and competitive advantage for companies that understand and embrace them.
That is why it is not surprising that cloud computing has taken off with such velocity. Gartner believes that 43 per cent of CIOs want to move to a cloud-dominated infrastructure and that by 2015 half of all Global 1000 enterprises will use cloud computing for their top revenue-generating processes. At Google, for instance, we now have about three million businesses, governments and universities using Google Apps each day.
We added about 120 new features to Google Apps in 2010 and we are committed to moving businesses to the web, encouraging them to deliver business applications over the internet via a web browser. Applications and data can be stored centrally and served with highly scalable, secure and reliable multi-tenant infrastructure.
The licence revenue that the channel derives from a 100-per-cent all-web model is critical for partner profitability. But that ignores some 90 per cent of the potential profits here.
Many IT resellers treat cloud computing as just another IT project. Some VARs who grew up making fat margins implementing legacy information systems, such as Microsoft Exchange and Lotus Notes, do not look beyond the services revenue from migrating companies to new cloud solutions. This is a shame.
When companies first adopted computers, they did not use the new technology to simply replicate old ways of working – they used it to re-engineer business processes, speed up innovation, improve collaboration and strip out inefficiencies. This is a similar opportunity to fundamentally transform customer businesses, with the channel becoming embedded as valued and trusted advisers with long-term revenue opportunities.
Partners should view cloud computing services as a platform, which opens up a universe of opportunity. A skilled partner can help customers adjust and fully benefit from the unprecedented speed of innovation, as well as introducing businesses to further services and options, using the new platform, in a scalable and cost-effective way.
Because their applications are accessed over the web, they can enable workforces to become truly mobile and work more productively on any device – Mac, PC, Unix or Android smartphone. And smartphones will become increasingly prevalent.
Many channel companies are now ready for this 100-per-cent web world. There are plenty more examples of resellers starting to profit from the world of cloud. For instance, Specsavers recently deployed Google Apps to 2,500 staff.
You can be incredibly successful if you fully buy into this new model and first-mover advantages are there for the taking. Your success is limited only by your imagination and willingness to commit to a new way of working.
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