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Posted by James Staten on May 19, 2014
There’s no shortage of companies these days calling themselves cloud service providers (CSPs) but are they really? And if not, what value do they bring to your portfolio and the cloud landscape?
Following up on our recent cloud services market forecast, our latest report helps CIOs understand the CSP market landscape. It breaks down the CSP market into its three tiers (see Figure 1 below) and its various business model approaches so you can evaluate your existing and potential partners and understand what value they will bring. The market is composed of three tiers of providers, based on size, investment and R&D capabilities and geographic reach. The market was historically dominated by traditional managed service providers (before cloud came into vogue) but the market is heavily under disruption today by the pure-play cloud providers. In addition to SaaS providers, “SaaS” providers, cloud platforms and “cloud platforms” there are a slew of CSPs who may not deliver cloud services themselves but can make it easier for you to consume true clouds.
The bulk of this market are companies who used to be managed service providers or hosting companies. But these traditional markets, which still hold significant value to enterprises today, have been under threat by cloud services and many would argue, would lose business if they didn’t market themselves as cloud or add cloud services (either directly or through resale) to their marketing. While I have made it my job to help Forrester clients see through the cloud marketing to determine which providers really do deliver cloud value, this aim is an on-going challenge and one that gets more complicated all the time as service providers evolve their portfolios. Therefore, also in this report you will find a CSP maturity model that enterprise technology managers can use to determine if a given provider is committed to offering and expanding its cloud services, or is simply giving lip service to this value proposition.
Enterprises can also use this report to assess themselves, as many enterprises really aren’t all that ready to make cloud a significant part of their portfolios. Partnering with a CSP who helps you manage this transition, offering a curated set of cloud services along with a heavy emphasis on managed hosting, application outsourcing and value add consulting, may be a more appropriate fit for you - at this time.
And if you are ready to go all-in on cloud, that still won’t mean all your apps. A lot of your applications aren’t ready for the cloud. That’s why we recently updated our Strategic Rightsourcing tool that can be used to objectively assess your application portfolio and right source them across in-house, traditional hosting, outsourcing and cloud deployment options.
How far into the cloud are you prepared to go? Let us know by leaving your comments here or within the Forrester client forums.
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