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Users Benefit Most When Cloud Brands Compete

Cloud Brokerages Help Businesses Take Advantage Of The Commoditized Cloud Market

If you’re a follower of the cloud space, you’ll be well aware that the industry leaders are engaged in a vicious price war, with regular price cutting. There are several reasons that cloud vendors have embarked on the price slashing path. Some large companies have a “winner takes all” attitude guided by the expectation that the vendor that achieves market dominance in will retain that position over time — but an effort to increase product penetration isn’t the only motivation for price cuts.

A second major component is the difficulty cloud vendors have in differentiating their product. Compute and storage are becoming commoditized. The commoditization of the cloud market is a significant problem for some cloud vendors because without product differentiation, price is the only grounds on which to compete. Price competition erodes profit margins. In recent weeks, we’ve seen Rackspace, a major cloud vendor, withdraw from the commodity IaaS market, instead offering a combination of managed cloud services.

For cloud users, however, the price war that commoditization engenders is highly beneficial. Prices are tumbling.But fully leveraging the benefits of a volatile markets requires the ability to pick and choose between vendors in response to changing prices, deploying workloads on those platforms that offer the most beneficial pricing structure.

Most companies lack the in-house technical expertise and resources to coordinate the efficient multi-cloud strategy necessary to leverage price differences between competing vendors. Cultivating expertise is expensive and frequently impractical. But without that expertise, companies might as well be in the old world of vendor lock-in. There’s no point having a choice if the expense of exercising it exceeds any potential benefit. In an ideal scenario, companies would be able to deploy their workloads on infrastructure that best suits their individual needs, both financial and technological.

ComputeNext provides the integration layer that facilitates cloud choice. By aggregating many cloud vendors and providing a flexible, comprehensive, and easily comprehensible interface for deploying workloads and data onto diverse cloud platforms, ComputeNext returns to companies the choice that the complexity of the cloud marketplace would otherwise deny them.

With brokerages like ComputeNext, businesses are able to select the optimal combination of vendors. Consider a simple storage example. Company X routinely produces one terabyte of data per month which is held in a cloud storage solution prior to analysis. Cloud storage prices are relatively volatile: price differences arise between vendors — sometimes fairly significant differences. ComputeNext allows Company X to easily compare storage costs and deploy or move their data to the solution offering the best prices. This is a very simple example, but the same process applies to much more complex storage scenarios and compute workloads.

ComputeNext’s cloud brokerage empowers companies to take advantage of a fluctuating market to get the best bang for their buck.

Image: Flikr/Robert Donovan


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