Liam Eagle, analyst at 451 Research Group covering the Internet infrastructure business, joins Flexiant Founder and Product Champion, Tony Lucas in a presentation that explored the strengths and benefits of moving from VPS to an IaaS platform.

1. www.flexiant.com
© 2013 Flexiant Ltd
VPS and Beyond:
The Service Provider Path from VPS to IaaS

2. www.flexiant.com
© 2013 Flexiant Ltd
Liam Eagle
Analyst- Internet Infrastructure
451 Group
Joe Sherman
Digital Marketing Manager
Flexiant
Tony Lucas
SVP Product & Founder
Flexiant

3. www.flexiant.com
© 2013 Flexiant Ltd
Cloud Orchestration Software
European, Offices in London,
Edinburgh, Amsterdam,
New York
Started as a Hosting Company
Launch Europe’s first
cloud services company
100+ Customers

4. www.flexiant.com
© 2013 Flexiant Ltd

5. www.flexiant.com
© 2013 Flexiant Ltd
The only
cloud management software you need
to create, sell and manage
your cloud services

6. www.flexiant.com
© 2013 Flexiant Ltd
VPS and Beyond
Series
Ø VPS and Beyond Part 1:
Why Moving to an IaaS
Offering will Pay Dividends
Ø VPS and Beyond Part 2:
Why IaaS will Solve
Problems Beyond VPS

7. VPS
and
Beyond:
The
Service
Provider
Path
from
VPS
to
IaaS
Liam
Eagle

8. The
451
Group
Today
§ 230+
Staff
§ One
company
with
5
business
lines
§ Syndicated
research,
cerKficaKon,
accreditaKon,
and
advisory
services
§ Global
Events
§ 1,300+
client
organizaKons:
enterprises,
vendors,
service
providers,
and
investment
firms
§ Organic
and
growth
through
acquisiKon

9. Agenda
Hos$ng
and
Cloud
Market
Data
VPS
and
IaaS
Capabili$es,
Market
Drivers
VPS
and
IaaS
Opportuni$es,
Use
Cases
IaaS
Hos$ng
Market
Strategies
Service
Provider
Recommenda$ons

10. Cloud
As-­‐A-­‐Service
Taxonomy

11. Cloud
Market
EvoluKon

12. Global
HosKng
Market
vs
Cloud
Source:
451
Research
Market
Monitor
(Data
Cut
5/14/13)
$0
$5,000
$10,000
$15,000
$20,000
$25,000
$30,000
$35,000
$40,000
2010
2011
2012
2013
2014
Infrastructure
as
a
Service
$680
$1,495
$2,772
$4,001
$5,486
Dedicated
HosKng
$3,078
$3,257
$3,490
$3,787
$4,177
Managed
HosKng
$12,808
$15,524
$18,839
$22,908
$27,983
in
millions
of
US$

13. Key
CapabiliKes,
Demand
Drivers
for
VPS
and
IaaS
Virtual
Private
Server
Resource
and
performance
upgrade
versus
shared
hosKng
Infrastructure
as
a
Service
Pay
per
use
compute
and
storage
resources
Root
access,
pla^orm
control
Cost
conscious
alternaKve
to
dedicated
server
infrastructure
VerKcally
(automaKcally)
scale
instances
up
and
down
API
control
Availability,
fault
tolerance

14. VPS
and
IaaS
Customer
Use
Cases
Virtual
Private
Server
Web
server
Infrastructure
as
a
Service
Website
pla^orm
Mail/DNS/IRC/Game
etc.
server
File
share
/
seedbox
Remote
computer
/
desktop
Hobbyist
/
sandbox
use
Scalable
app
back-­‐end
Cloud
storage
Disaster
recovery
Batch
processing
Big
data
Test
/
dev

15. The
AppeKte
for
VPS
HosKng
is
Ongoing
• Worldwide
VPS
market
conKnues
to
grow,
due
to
a
variety
of
factors
• VPS
growth
in
2013
and
2014
to
outpace
mass
market
hosKng
growth,
with
Y/Y
growth
of
17%-­‐18%
• Global
monthly
Google
searches
for
“VPS”
are
1.5
million
• However:
price
pressure
and
commodiKzaKon
are
major
forces
in
the
VPS
space.

16. Service
Provider
Business
Case
for
IaaS
• Don’t
compete
with
AWS
for
market
share
• Winning
IaaS
business
of
exisKng
customers
• Workload-­‐appropriate
services,
hybrid
opportunity
(Best
ExecuKon
Venue)
• DifferenKator,
upgrade
path
versus
exisKng
compeKKon
• Increased
customer
spend
without
major
purchase
decision
• API
encourages
customers
to
put
whole
applicaKon
on
your
infrastructure
• Fixed
resources
at
monthly
rate,
with
potenKal
to
scale
• Enabler
of
other
services
–
applicaKon
marketplace
• Higher
margins
on
applicaKons/services
than
raw
infrastructure

17. The
QuesKon
of
Cloudwashing
• DecepKve
rebranding
of
exisKng
services
as
“cloud”
• TemptaKon
among
hosKng
providers
to
posiKon
virtualized
server
resources
as
“cloud
servers”
(VPS
+
SAN)
• Follows
markeKng
trends,
but
ignores
real-­‐world
customer
and
product
issues
• PosiKons
product
to
fail
by
aoracKng
customers
with
implicit
promise
of
specific
funcKonality
it
can’t
deliver
• Ignores
the
ongoing,
exisKng
market
for
VPS
as-­‐is
• Generally
short-­‐sighted;
bad
business

18. Opportunity:
the
ApplicaKon
Marketplace
• App
catalogs
and
marketplaces
meet
the
need
for
simplicity
in
delivery.
• One-­‐stop-­‐shop
for
purchasing
applicaKons
and
the
resources
to
power
them.
• One-­‐click
install
of
a
popular
applicaKon
is
a
driver
of
IaaS
consumpKon.
• This
model
is
being
adopted
across
the
board,
from
AWS
to
web
hosts,
MSPs,
Sis
and
SaaS
companies.

19. From
VPS
to
IaaS;
Bridging
the
Gap
• Customers
seeking
VPS
may
not
be
recepKve
to
IaaS
or
cloud
servers
• Focus
on
selling
them
the
disKnct
advantages
of
VPS
• Win
VPS
customers
onto
your
pla^orm,
and
manage
their
transiKon
to
cloud
services
• IaaS
products
can
be
packaged
to
meet
the
predictable-­‐cost
or
resource
requirements
of
VPS
customers.

20. RecommendaKons
for
Service
Providers
• It
is
early
innings
for
cloud,
but
the
opportunity
is
large
• Don’t
target
big
public
clouds
with
a
“me
too”
IaaS
product
• Target
exisKng
customers,
build
to
your
strengths
(support)
• Emphasize
workloads
and
Best
ExecuKon
Venue;
hybrid
service
model
• Add
value
via
services
• eg.
Backup,
DR,
security,
VDI
• ApplicaKon
marketplace
and
one-­‐click
install
• IaaS
is
not
necessarily
a
replacement
for
VPS
today
• Win
VPS
customers,
lead
them
to
IaaS
• SMB
customers
care
about
availability,
cost,
simplicity
and
security
• End
users
are
concerned
about
runaway
costs
–
provide
predictable
pricing
models
and
tools
for
managing
spending
and
costs

21. HosKng
Provider
IaaS
ConsideraKons
• Build,
buy,
partner,
syndicate?
• Pla^orm
choices
• Commercial
vs
open
source
• CompaKbility,
standardizaKon
• User
interface
(new
or
exisKng)
• IntegraKon
challenges
(pla^orm,
billing,
interface)
• Service
startup
costs
–
hardware/sorware/staffing
• Skills
gap
–
building
in-­‐house
experKse
• What’s
your
strategy
for
differenKaKon?
• How
do
you
make
IaaS
a
higher-­‐margin
service?

22. QuesKons?
Comments?
liam.eagle@451research.com
@liam.eagle

23. www.flexiant.com
© 2013 Flexiant Ltd
23
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