As the Clouds Approach, Hardware Vendors Must Change Their Tunes

August 16, 2010 Off By Hoofer
Grazed from GigaOM.  Author: Derrick Harris.

I read a thought-provoking CNET blog post this week that argued storage vendors are better off focusing their sales and marketing efforts on internal clouds rather than public clouds. Essentially, the argument goes, in the name of large-volume sales, vendors are feeding a growing monster, the cloud, that ultimately hopes to steal their sales. As I write in my weekly column at GigaOM Pro, I’d argue this concern applies equally to server vendors, and that as the cloudscale market gets more crowded, the long-term solution is investing in a hybrid strategy or getting into the software racket.

Assuming that internal infrastructure will always remain (IDC certainly thinks this is the case), hybrid clouds offer a variety of benefits to users, but they’re arguably more important for vendors. Whether they’re selling servers, storage or both, hybrid cloud computing allows vendors to feed customers’ cloud itches while maintaining those internal sales. Depending on the hybrid model, vendors might actually be able to boost their overall sales by incentivizing both types of buyers to purchase their platforms.

As I wrote several months ago, another surefire method to ensure revenues continue in the cloud computing era is to sell software optimized for the cloud. Even if hardware sales slow, someone has to bring enterprise-grade capabilities to cloud platforms. EMC’s Greenplum acquisition, for example, gives it an opportunity to help customers build analytic databases on cloud resources. Likewise, standalone deduplication products or management software could prove lucrative atop bare cloud resources.

Cloud computing will affect storage and server vendors businesses, but it needn’t be devastating. With a little ingenuity and foresight, vendors can embrace both public and internal clouds and keep on reaping the rewards of our collective appetite for more capacity.