For a long time now vendors, not just public cloud vendors, have misread the pulse of the channel, and when I say channel I mean the managed service providers (MSPs). These misreadings started many years ago but they continue even through today. I’ll give you an example that just happened.
Microsoft’s Small Business Server has been shut down. For many MSPs (and their customers) Small Business Server was a most valuable piece of technology. For MSPs, it represented a valuable conduit through which they could deliver a wide variety of managed services offerings. For customers, SBS was a cost effective software platform, which allowed businesses to experience enterprise like services in a fully managed environment (when delivered by a MSP).
It is no secret that Microsoft, in a desperate attempt to push customers and channel MSPs alike onto its Office 365 cloud platform, is trying to limit the choices available. You would think Microsoft would remember their lesson from the Internet Explorer browser battles of the late 1990s. However, in my opinion, Microsoft has greatly misread the landscape of what is coming and has put itself in an undesirable position regarding the next 3-5 year trend. I’m talking about private cloud.
Even now, at the time of this writing, governments and organizations around the globe are thinking of reasons why they shouldn’t use public cloud platforms like Office 365 and Google Apps. If you’re not familiar with why this is happening, read up on PRISM. Furthermore, evidence is mounting that the US public cloud sector could lose upwards of $35 billion over the next 3 years.
The point is, private cloud is likely to be the best alternative to public cloud, but also the biggest think in IT services for the next decade. If you’re with me so far, Microsoft hasn’t done itself any favors by removing products like SBS. Sure, Microsoft still has Hyper-V, SQL , and System Center, but these products are almost exclusively being targeted to data centers and larger service providers.
Microsoft is minimizing its position within the mid-market and SMB segments of the channel. Doing so, will make it more challenging for Microsoft when it realizes exactly how valuable these channel MSPs really are in terms of getting private cloud infrastructure and services out to the masses. Having Office 365 as the only product for these segments is ill advised and underestimates the role these smaller providers will have in the next decade.
You can’t really blame the vendors since it must be difficult for them to see this far down range. I mean, this is precisely why customers choose to work with channel companies, because it is a more intimate experience. However, Microsoft (and the other public cloud vendors) had best learn from these lessons and start crafting a strategy that takes into account the role private cloud will be playing in the not too distant future.