“The cloud provision market is particularly buoyant right now as it expands right around the world. Cloud providers are rapidly deploying the correct infrastructure to meet the needs of enterprises as they move their workloads into the cloud,” said Gary Keogh, sales director with Digital Realty.
“More and more companies are moving into the cloud — that’s what our experience, as well as the statistics and market research, says. That’s why we’re currently investing heavily in providing the infrastructure in our data centres around the world so that enterprises can locate there and have us provide them with direct connections onwards to the cloud providers they work with.”
Digital Realty points out that with pay-as-you-go model, it is important for enterprises to fully assess the market before going with a provider to make sure they are not paying more than they need to.
Connectivity view
From a connectivity point of view, the company recently launched a product called Service Exchange in its data centres which allows customers to take one pipe with which they can then connect to an upstream cloud provider, whether that is Amazon Web Services or Azure or others.
“Because we’ve come in to this market quite late compared to other providers, we’ve been able to take advantage of the latest technology and therefore we can now do bandwidth on-demand and be very flexible,” said Keogh.
According to Digital Realty, many enterprise class companies are building out hybrid infrastructure as they refresh old technology and redesign the way they deploy their assets. A major feature of this is a move towards maintaining less hardware and using more external cloud provision.
“I think that we’re going to see a lot more demand for managed services to help enterprises migrate in a seamless way into the cloud and to meet the hybrid requirements they have. Companies are going to need to keep certain things in-house, whether that’s from a data security or application security perspective whilst at the same time utilising the benefits that come with cloud.”
Pricing model
Amazon Web Services is well known for a pricing model in which it regularly lowers prices and according to Ian Massingham, chief evangelist for the EMEA region for the company, it has had a policy of doing this since launching in 2006.
“Since that time, we’ve reduced costs for AWS services 59 times and those cost reductions have been proactive so when we reduce costs, customers immediately benefit. If you’re a long term AWS user your bill will naturally go down and there’s no need to come to us to ask for a price reduction,” he said.
“When we announce a cost reduction, customers immediately benefit from that effective date and on a few occasions we have actually backdated those reductions.”
AWS said it can do this because it is continually engaged in a process of driving efficiencies out of its business model. As more customers sign up to use its services, the total overall cost of providing those services drops, and the company passes those savings on.
“We can tackle supply chain optimisation in a way that most customers cannot because they don’t have the same kind of scale that we have. We can also optimise our technology because we understand very well what our usage profile is, how our data centres are built and how they’re configured and operated,” said Massingham.
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