Fans of ‘Battlestar Galactica’ would probably recognise the saying “It’s happened before; it’ll happen again”. Without giving too much away, in the sci-fi series it relates to a war between man and man-made machines – and how this war eventually repeats itself over thousands of years.
Which is a bit like our IT Industry – 15 years ago there were Corporate IT Resellers and Value Add Resellers who made profit from re-selling server, storage, networking and datacentre products.
The market changed several years back with the advent of Enterprise Cloud where these resellers re-modelled into IaaS or Managed Service Providers (MSP’s).
Now the UK market has 100’s, if not 1000’s of Enterprise Cloud Providers selling Infrastructure-As-A-Service.
Analysts are now predicting a 20 percent reduction in 2014 from the top 100 IT Service Providers as a result of tough market conditions. And that’s just the in the top 100! The mid-market will see similar, if not higher consolidation ratios.
I’m an IaaS Provider, so what?
For the IaaS Provider this can be scary news. Their strategy will be to build as much of an annuity business as possible to ensure long term business stability or increase their buy-out value. They will either, survive, go out of business, or their business will change radically from a new parent.
I’m a customer of an IaaS Provider, so what?
More importantly, it’s the customers who are at risk the most. Customers who use their core systems in an IaaS model along with their DR.
Your chosen IaaS Provider may have the latest Flash drives, fastest network, best performing or resilient IaaS going, however if they’re not going to be in business this time next year, what will your exit strategy be?
– How will your IaaS provider selling up impact the promises they made to you?
– If they go bankrupt, how will you get your systems out and up maintain your service?
– If they get acquired, will your infrastructure be moved to another platform? One you weren’t sold on?
– If you use your IaaS because of their flexibility and agility, will this be the same once you’re a ‘little fish in a big pond’ with the new, acquiring company?
“It’s happened before; it’ll happen again” – last year we saw the demise of 2e2; an Infrastructure Services leader with over 3,000 employees and 400m+ turnover. 2e2, due to debt derived from an aggressive acquisition trail, failed to secure funding to continue to operate.
Its public knowledge that they ran an IaaS for several large Local Authorities who depended on 2e2’s Cloud services for not only production systems, but for their DR solutions too. These Authorities were now at the mercy of the 2e2 Administrators, and had to pay significant fees to keep 2e2’s Datacentres on long enough so they can migrate their systems out. We’re talking bills of up to six figures.
These kinds of stories are not uncommon, and most get unreported as they’re not as high profile. However we’ll see more and more of these examples throughout 2014 and 2015 as the market consolidate.
I’m a customer – what can I do?
Disaster Recovery Strategy
Firstly, after the above debacle happened, a lot of independent advisors and Tech Architects advised NOT to host your DR functions with the same IaaS provider as your Production systems.
When you move to the Cloud, your DR strategy needs to expand to incorporate commercial supplier risk, as well as technical and environmental risks.
Having a secondary IaaS doesn’t mean you have to double up costs. dsp can specify low cost Public or cut-down Hybrid solutions – so you can take the Cloud advantage of ‘Scaling up’ in the event of a disaster, then scale down for BAU.
High (Data) Availability
Secondly, you need to make sure you have a simple, robust data replication method.
Take your SQL Databases, for example. Using SQL 2012 Always-On Technology means your applications do not care where your SQL servers are, and fail-over is automated and seamless.
Replicating on a database level means you do not have to rely on the infrastructure layer. Your Data Platform becomes almost infrastructure agnostic.
Can dsp’s Cloud Services really help?
Yes we can. We can impartially map your Data Platform and determine exactly what infrastructure platform you need. This greatly reduces the costs of paying for IaaS or Microsoft Licensing you don’t need. (Just last week, we saw a £3k dsp consultancy investment save a firm moving to the Cloud £18k in MS SQL licensing!)
Secondly, we can reduce the risk around not only technical and environmental incidents, but commercial. If your Cloud provider goes bust, working with dsp means you can migrate to your secondary supplier in hours, not months.
Our most popular Cloud service is analysing Data Platforms consulting on the ‘TO-BE’ in any given Cloud environment. We have saved clients significant time and direct costs – when you consider a copy of MS SQL Server Enterprise costs in the region of £15,000 for 2 cores, you’d want to be sure you need it. Just license savings alone can stretch into the six figures!