In the second session of the sales and marketing track at HostingCon 2012 on Wednesday, Flexiant founder and SVP of product Tony Lucas discusses how service providers can find their niche in the cloud.
Now a cloud orchestration solution for service providers, Flexiant started out as a hosting provider in 1997, Xcaibre Communications. Lucas says it was actually a pig farm that got him thinking about the cloud.
To elaborate on this, he says one customer had produced a documentary about a pig farm and for four hours after the documentary aired on TV, its website traffic went through the roof. Lucas says that the only way to deal with burstable traffic like this was to embrace the cloud.
Lucas says after spending years developing its IP, and building its own public platform, Flexiant realized that it would be better equipped to sell its software to service providers rather than direct customers.
Past the sales pitch, Lucas says cloud is a paradigm shift in the way things are provisioned and managed. There are big players dominating in the cloud space in ways service providers didn’t expect, he says.
The good news for service providers is it is not too late to offer cloud services. Lucas says cloud will continue to be a fragmented market, and is a really great market to be in right now.
“We believe this is the decade of the service provider,” Lucas says.
Trying to compete with Amazon is a losing game, because traditional hosting providers can’t drop their prices continuously as Amazon does.
Lucas says a lot of service providers already have a niche. For example, geography or industry. Interestingly, Lucas says cloud doesn’t mean you have to reinvent your business models.
Enterprise IT requirements are moving out to the service provider like never before, he says.
Service providers will also have some of the services they offer in other data centers. Lucas says this enables service providers to focus on what they do best.
The time, resources and experience required to build a cloud is more than most hosting providers can afford in terms of cost and time, Lucas says.
“For those of you that don’t have a cloud strategy already, you need one,” he says.
If a host doesn’t have a cloud strategy, customers are looking at what else is out there, he says.
“It is about differentiation now,” he says. “It’s about finding your particular area.”
He says service providers need to ask themselves what it is that makes them special.
“You need to investigate what it is that brings customers to you, and keeps customers with you,” Lucas says.
Service levels and offerings are two examples of how a provider can differentiate.
“You haven’t got two years to work out how you will do this. You have to do this now,” Lucas says.
In January, Flexiant raised an investment round of $1.5 million and named John Pocoock as chairman and George Knox as CEO.
Talk back: What do you think will differentiate your cloud offering? Let us know in a comment.
About Nicole Henderson
Nicole Henderson writes full-time for the Web Host Industry Review where she covers daily news and features online, as well as in print. She has a bachelor of journalism from Ryerson University in Toronto, and has been writing for the WHIR since September 2010. You can find her on Twitter @NicoleHenderson.