10 Things Every VAR Should Know About Cloud Computing

The Cloud Is Here

Ingram Micro's Cloud Services Summit 2011 was an eye-opener to solution providers looking to break into the cloud services game. Ingram executives and cloud computing luminaries from a host of companies shared their thoughts and vision on the cloud with nearly 300 solution providers. Solution providers learned that now is the time to move to the cloud.

Here are 10 key takeaways from Ingram Micro's Cloud Services Summit and, really, 10 things that every VAR should know about cloud computing.

Resellers Become More Important

VARs worried about being disintermediated because of the cloud couldn't be more wrong, Ingram Micro's vice president of managed services and cloud computing Renee Bergeron said. In fact, cloud services make solution providers more important as they help customers navigate the often complex cloud waters and assume the role of a trusted advisor.

"The reseller's role is more important," Bergeron said, adding that customers are challenged to find the right services that fit their environments and will rely heavily on the channel to build and integrate seamless cloud solutions. That, too, is an area where resellers continue to play a necessary role.

"The reseller's traditional role as a trusted advisor will become more important," she said, later adding, "I don't think there will be disintermediation, if anything, I think the role of distributors and resellers will be reinforced by cloud services integration."

First-Movers Will Win Big

Want to succeed in the cloud services game? Better get into the market soon. According to Ingram Micro executives, it's the first movers that will see the biggest benefit as they'll get cloud services into market sooner than the competition and create stickiness with clients.

"If you're a reseller that gets into cloud services early, it gives you the first-mover advantage," Bergeron said.

Keith Bradley (shown), senior executive vice president and president of Ingram Micro added: "Whatever resellers move to the cloud first … you're going to be ahead of your peers and your competition."

Services Are The Biggest Opportunity

When it comes to cloud computing, it's cloud services where solution providers will truly shine. And according to Gartner analyst Tiffani Bova, cloud service brokerage will represent the single largest revenue growth opportunity in cloud computing by 2015.

"Many vendors are not going to touch services, they're going to leave that to their partners," she said, adding, "Don't get trapped in the fact that you don't sell the app or the licensing … If you don't sell the license, if you don't sell the server, it doesn’t mean there's nothing for you to do."

Video Will Explode

It's no secret that video has crept its way into more and more enterprise applications. And solution providers that capitalize on the video revolution will be big winners.

According to Guido Jouret, vice president and general manager of the enterprise video group at Cisco, video will represent 90 percent of Internet traffic by 2014. "Video is happening, and it's happening now," he said, adding "This is not a science experiment, it's happening now."

Jouret added that the video boom will also drive the need for more bandwidth because "you can't suck a golf ball through a straw."

Cloud Is More Secure Than You Think

Concerns around cloud security have made some solution providers and their customers apprehensive about making the move to the cloud. But according to Ingram Micro CIO Mario Leone, security in the cloud is just as solid as on-premise and security isn't a good reason to avoid cloud computing.

"You cannot go head and look at security as a reason to not go ahead and embark upon this journey," Leone said.

He added that the cloud is more security than most people think, but just in case, here are four questions solution providers should ask their cloud vendors, and be prepared to answer themselves: How much of the cloud infrastructure is redundant; how is the data encrypted in the cloud infrastructure; what types of user access controls are in place and how granular are they; and how are the Web applications protected from attacks?

Cloud Outages Will Happen

Cloud outages, like those that impacted Amazon and Microsoft BPOS in recent months, will happen; but the potential for a cloud outage is no reason to avoid the cloud altogether.

According to Ingram Micro CIO Mario Leone, there will be failures, but "they shouldn't hold you back from experimenting," he said. "Don't let the news take you off of the path of talking these solutions through with customers."

Financial, Sales Structures Need To Change

While the goal of cloud computing is agility, scale and ease, solution providers must retool their financial and sales structures to accommodate the new business model introduced by cloud services.

According to Bradley (second from left), on the financial side, solution providers have to plan and prepare, build an annuity business, stabilize their revenue forecast. And on the sales side, they must change their selling practice, retrain their sales forces, build new customer relationships and alter sales incentives for sales teams.

Community Cloud Is Coming

We've all heard of public, private and hybrid cloud infrastructures, but Bergeron hinted at a new type of cloud that is on the horizon: The community cloud. With the community cloud, it's a private cloud infrastructure becomes multitenant because it is shared between agencies with similar use cases. For example, a government agency deploys a private cloud infrastructure that other, similar agencies can leverage as well.

Companies Are Buying The Cloud

Solution providers concerned that cloud computing is all hype should guess again; customers are really using the cloud.

According to Microsoft General Manager Matt Thompson (shown), Windows Azure, Microsoft's cloud offering, has 10,000 customers.

And Daniel Powers, Amazon Web Services vice president, said Amazon's cloud had 2.9 billion stored objects in 2006 and as of this year that number skyrocketed to 339 billion stored objects. "We have hundreds of thousands of customers in 190 countries," he said.

Customers Won't Go It Alone

Further reinforcing the need for resellers and solution providers in the cloud, Salesforce.com Vice President Peter Coffee cited recent research from cloud solution provider Appirio that shows that only one in six companies interested in cloud computing will move to the cloud without help for a solution provider or partner.