2nd Watch's New CFO: Enterprises Want Managed Cloud Services

On the heels of Amazon's Q1 revelations about the strength of its league-leading cloud business, AWS Premier Partner 2nd Watch has brought in a channel veteran as its new chief financial officer.

Scott Parrish has started managing 2nd Watch's financial operations at a time when the Seattle-based solution provider is undergoing spectacular growth that eclipses even that of its cloud partner.

Amazon impressed analysts last week when it revealed Amazon Web Services as a rapidly growing $6 billion business. But "for the most part," Parrish told CRN, "the numbers weren't too much of a surprise."

[Related: Amazon Q1 Earnings: AWS Is A Cash Cow]

While the business' margins and profits have been ballyhooed, Parrish said, "from a partner perspective, I think the key thing is just the growth."

With AWS expanding almost 50 percent year-over-year, "you get a sense of the impact of the partners," Parrish said. "We all have to be ready. We're investing in all facets of the business. The appointment of myself is one example of that."

The new CFO started work Monday at 2nd Watch. Before that, he held the same position at Azaleos Corp., a Microsoft partner. He previously worked as director of accounting at F5 Networks.

2nd Watch continues looking to the future, he said, investing in R&D driven by requests from clients, and from Amazon, to deliver new features and functionality.

The company is also expanding its professional services and managed services capabilities, Parrish told CRN.

Those investments are driven by market trends, which 2nd Watch helped shine light on this week with the release of its latest quarterly AWS Scorecard.

The research shows that enterprise customers, including those from highly regulated industries, are ramping up the migration of mission-critical workloads to the cloud. They're also quickly adding big data and analytics capabilities, accounting for an almost 50 percent increase in medium EC2 instances 2nd Watch launched in Q1.

Windows-based instances are also rising fast as chief information officers move production apps onto Amazon's cloud -- they grew by 76 percent in Q1, ramping up from the 34 percent growth of the fourth quarter. At the same time, Linux instances grew by only 24 percent, a sharp decline from the 66 percent growth in Q4, according to the AWS Scorecard.

With highly regulated industries migrating to the cloud, the best-selling products from third-party vendors revolve around security. The four top sellers were Alert Logic Log Manager for AWS, Alert Logic Threat Manager for AWS, AlienVault Unified Security Management for AWS and Barracuda Web Application Firewall, according to 2nd Watch.

The solution provider is witnessing more companies going all in on the cloud rather than doing piecemeal migrations. And once enterprises have deployed their mission-critical apps on AWS virtual machines, their concern shifts to the managed service components they will need, Parrish told CRN.

"These large enterprise customers, even highly regulated companies, are figuring out they can operate effectively with a cloud partner like AWS. And that's just going to accelerate the transition more and more. If anything, the adoption rate is just going to increase faster," Parrish said.

Partners like 2nd Watch will thrive by identifying how to add value to those core services, he said.

"It's about filling a gap that might exist from a technology standpoint that we can fulfill from our end," Parrish told CRN.