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11/18/2015
12:05 PM
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Forrester: In The Cloud, The Big Get Bigger

Forrester says cloud challengers will have a hard time competing with incumbents in 2016. AWS, IBM, and Microsoft are "innovating like startups."

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A consolidation in cloud computing has been underway for a while, and that trend will not only continue, but accelerate in 2016. Clouds will become recognized as more secure than some enterprise environments through their automated security measures. They will also be big adopters of containers for efficiency in operations.

Forrester Research made those forecasts as the cornerstone of a new report, Predictions 2016: The Cloud Accelerates. Cloud computing reached mainstream acceptance with more widespread enterprise participation in 2015. That process will shift up another gear in 2016, the report says.

As cloud computing moved into the mainstream, some smaller cloud providers and wanna-be suppliers were acquired. In May, EMC bought Virtustream; ActiveState sold its PaaS system, Stackato, to HP in July; HP also bought Amazon API look-alike Eucalyptus Systems in September 2014. OpenStack vendor Piston Cloud Computing was acquired by Cisco in January; GoGrid was purchased by Datapipe the same month. The consolidation continues apace, with the table stakes growing each month for what it takes to become a global cloud provider.

"The consolidation and shakeout will accelerate in 2016, which will force many current providers to refocus on a narrower field, retreat from cloud or exit," Forrester said.

[AWS is emerging as a dominant cloud supplier. Learn how in AWS Emerges As Goliath As Cloud Competition Fades.]

Even with what Forrester describes as innovative new players, such as DigitalOcean and Aliyun, the cloud unit of Chinese online giant Alibaba, "the number of options for general, infrastructure-as-a-service cloud services will be much smaller at the end of 2016 than the beginning."

In part, that's because Amazon Web Services, Microsoft Azure, and IBM SoftLayer are all showing a remarkable ability to innovate as well, and they already have scale. Forrester named those three incumbents as the ones most likely to gain strength in 2016, but it noticeably left out one party normally named to such a list, Google.

"Despite excellent technology and scale, Google will only begin to develop momentum in large enterprise business in 2016," the report said. It ventured no explanation for why Google has thus far fallen short in making significant inroads into the enterprise, but Microsoft, IBM, and Amazon already had a significant number of enterprise customers before their cloud offerings matured, and they appear to know better how to talk to them.

(Image: Anatolii Babii
/iStockphoto)

(Image: Anatolii Babii /iStockphoto)

At one time, cloud computing seemed to be a green field for startups and early pioneers. With the incumbents growing faster than younger contenders, small vendors and "specialists will be sold or go cold in 2016," the authors warned, advising "be wary of small players because they carry much more risk." They also advise keeping pressure on the incumbents to innovate and "abandon those that do not."

The report was written by Forrester analysts John Rymer, Dave Bartoletti, Lauren Nelson, Andras Cser, Andre Kindness, and William Martorelli.

When it comes to cloud security, the analysts said, potential users' biggest fears concern the security of their workloads -- but major providers are upping the security assurance game through automated systems. Frequent use of encryption, user directory integration with cloud operations, access control, improved data governance, and network security monitoring to prevent intrusion are now often imposed by cloud systems.

Heuristic systems that can apply sophisticated rules of analysis to suspicious code can detect previously unidentified viruses. They are provided by vendors like Elastica and Netskope. Constant monitoring for suspicious user behavior can halt some intrusions before they've accessed their first sensitive file.

The analysts' advice: "Stop using security as an anti-cloud excuse and tap automated governance."

Implementing the use of containers will become a way to both build new applications in the cloud and create hybrid cloud operations with workloads shared between on-premises and remote public cloud data centers. "Use of containers grew meteorically in 2015. Hyperconverged infrastructure is not far behind."

Hyperconverged infrastructure is compute, storage, and networking bundled together in hardware units governed by software controllers treating the unit as a small, preconfigured cluster or data center module. Container services can be built into hyperconverged infrastructure, just as virtual machine management already is. Also, multiple hyperconverged modules can be scaled out to enlarge a data center. "AWS, CoreOS, Docker, Google, Mesophere, Red Hat, VMware, and the various OpenStack players will lead the way," Forrester predicts.

That may be the case, but it may take 2016 and beyond to rationalize the emerging hybrid infrastructure. Containers are great for moving code around between development teams, across the data center, or between data centers, but Docker, VMware, Kubernetes, and Rackspace Carina are each doing it in their own way, with no standard hyperconverged infrastructure appearing yet. On the contrary, most IT shops are focused on wringing as much use out of containers as possible as a way to decrease the distance between developers and operations, without IT having to worry about hybrid cloud operations yet.

Intel, VMware, and even Google's approach in its own Google Cloud Platform still see a container-virtual machine combination running in multitenant architectures, albeit with a microvisor -- a virtual machine hypervisor that has been shrunk to a fraction of its former self. Exactly what hyperconverged infrastructure will look like at the end of 2016 is hard for Forrester (or anyone else) to say at this point.

But the report is right to point out the rapid rise of containers and assume that cloud operations will depend on them, as well as on an increasing share of on-premises operations. New security and governance measures may enable multiple containers to run together on one host, even though they have different owners. The gains in efficiency would be great.

But the whole prospect will become more credible when hyperconverged infrastructure emerges that manages both VMs and containers and that works both in the enterprise data center and in the public cloud. Red Hat, VMware, IBM, and various practitioners of OpenStack hope to be the ones to do that in 2016.

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Charles Babcock is an editor-at-large for InformationWeek and author of Management Strategies for the Cloud Revolution, a McGraw-Hill book. He is the former editor-in-chief of Digital News, former software editor of Computerworld and former technology editor of Interactive ... View Full Bio

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Gary_EL
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Gary_EL,
User Rank: Ninja
11/25/2015 | 7:01:59 PM
Re: As Expected
Well, the per job cost of anything standardized goes down as you do more, so why not cloud services as well? Not long ago, right here on InformationWeek, I remeber reading about some kind of exchange or auction where cloud sevices were being bought and sold. That's indicative of a great deal of standardization.
Charlie Babcock
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Charlie Babcock,
User Rank: Author
11/25/2015 | 5:26:47 PM
Google attracts startups
"Scalability may be a major reason why companies would want to target startups." tuzbair, I would tend to say it another way, if I understand you correctly: "Scalability may be a major reason why startups would want to target a cloud." They can use a few servers as they get underway. With successful products in the market, they can scale up to whatever level matches the growing business. Google's Compute Platform attracts many Silicon Valley startups because Google is such a strong example of startup success.

 
tzubair
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tzubair,
User Rank: Ninja
11/25/2015 | 5:17:30 PM
Re: As Expected
"If you are larger, you buy infrastructure to suit the needs of many customers, which will be far less choppy than the needs of fewer. And, wasn't that one of the earliest reason to be for the cloud in the first place?"

@Gary: I think the needs do not change much from customer to customer if you're having a large number of them on your platform. What they're looking for is pretty standard stuff - computing, storage etc. Even the SLAs do not vary much from company to company. I don't see how having a large number of customers as opposed to a few will change much on the technology side. The administration side might be a whole different game.
tzubair
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tzubair,
User Rank: Ninja
11/25/2015 | 5:13:08 PM
Re: Two reasons for cloud economies of scale
"The cloud also imposes a uniform environment across those 100 customers rather than customizing to each one, which leads to huge operational savings. The economies of the cloud will ultimately win out."

@Charlie: In that light, it may makes sense to have lots of startups onboard to share a cloud platform, as opposed to having one dedicated platform for a large organization. Scalability may be a major reason why companies would want to target startups.
ChrisDunnGator
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ChrisDunnGator,
User Rank: Apprentice
11/20/2015 | 1:23:00 PM
There's still room for smaller MSPs in this market
 

Full disclosure I work at ScienceLogic, a hybrid cloud monitoring software provide for MSPs and Enterprises.

Great article - it certainly looks like the big players are winning in the enterprise.  While consolidation among smaller providers and cloud MSPs will continue, the smart smaller MSPs who offer hybrid capability and value-added managed cloud services will still thrive.  

If anyone is interested we have several toolkits and templates available for free for MSPs to use when developing their own managed service offerings through our MSPJumpstart program. Feel free to access these resources here:

https://www.sciencelogic.com/service-providers

 

Charlie Babcock
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Charlie Babcock,
User Rank: Author
11/19/2015 | 12:25:36 PM
Two reasons for cloud economies of scale
Gary_El, "it probably doesn't cost 100 times as much to protect 100 customers than it does to protect one customer." That's right. The cloud also imposes a uniform environment across those 100 customers rather than customizing to each one, which leads to huge operational savings. The economies of the cloud will ultimately win out.
Gary_EL
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Gary_EL,
User Rank: Ninja
11/19/2015 | 1:26:20 AM
As Expected
It makes sense that the big get bigger in the world of the cloud.  The big can leverage their investment in security technology over more customers – it probably doesn't cost 100 times as much to protect 100 customers than it does to protect one customer. If you are larger, you buy infrastructure to suit the needs of many customers, which will be far less choppy than the needs of fewer. And, wasn't that one of the earliest reason to be for the cloud in the first place?
Charlie Babcock
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Charlie Babcock,
User Rank: Author
11/18/2015 | 5:28:30 PM
Will Google Cloud connect with enterprises?
Forrester analysts write as if it's a foregone conclusion Google will start connecting enterprises to the Google Cloud Platform in 2016. Not sure it is. It's always been attractive to startups. But if IBM, Microsoft and Amazon attract most of the enterprise business, it will prove more lucrative.
Multicloud Infrastructure & Application Management
Multicloud Infrastructure & Application Management
Enterprise cloud adoption has evolved to the point where hybrid public/private cloud designs and use of multiple providers is common. Who among us has mastered provisioning resources in different clouds; allocating the right resources to each application; assigning applications to the "best" cloud provider based on performance or reliability requirements.
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