A new report on the DevOps industry should be a concern for the top three cloud providers, showing that organizations are increasingly looking for alternate providers.
AWS, Microsoft Azure, and Google Cloud dominate the industry, accounting for a 71% share of the market. Similarly, the three companies account for 65% of all cloud spending. Nonetheless, it appears some organizations are looking to support smaller, independent rivals.
A new report, commissioned by Linode and conducted by Techstrong Research, shows that despite 93% of respondents using one of the Big Three, two-thirds would consider an alternative.
The largest three hyperscalers (Amazon Web Services, Microsoft Azure, Google Cloud Compute) are used by 93% of respondents. Yet many DevOps buyers are re-thinking a reflex default to these hyperscalers. Two-thirds of companies surveyed would consider bringing in an “alternative” CSP; almost 22% have already done so. In fact, the combined market share for the top alternative vendors is fourth in the category, just behind Microsoft and Google.
Even more troubling for the Big Three is the growing interest in alternative providers, as well as the reasons that interest is growing.
Interest and adoption is highest in small and medium organizations (fewer than 10,000 employees). Main reasons for bringing in a new vendor include reducing reliance on a single provider, improving price performance and ease of use, and better data protection.
Another growing concern is competition from a company’s cloud service provider (CSP). Each of the Big Three are part of larger companies that offer a wide array of products and services, many of which can compete with the products and services of their cloud customers.
More than 50% of DevOps professionals and leaders surveyed say their CSP is already a competitor to their B2B or B2C business or is expected to become one. Fear of IP loss and rapid market displacement is also evidenced in respondent’s strong stated desire to work with a trustworthy, capable provider who shares their company values.
Needless to say, the Big Three hold a commanding position in the market, and it will be a long time before they face a serious challenge. Nonetheless, the report should be a cause for concern and highlights areas where they must improve in order to keep their customers happy.
Rackspace may sell off some of its business as the company looks to ‘sharpen its focus’ on its cloud business.
Rackspace has been pivoting its business, rolling out services aimed at helping customers migrate to the cloud and take advantage of multicloud offerings. The company now believes it may have some businesses it can offload, ones that don’t necessarily align with its overall goals, according to San Antonio Express News.
“We concluded that a sum of the parts of Rackspace Technology could be greater than our current enterprise value,” CEO Kevin Jones said in a statement. “Accordingly, we are evaluating strategic alternatives and options.”
“The market has evolved, and it’s evolved pretty rapidly in the last 18 to 24 months,” he continued. “We have a public cloud business that is significantly scaled from 18 months ago. We’ve been proactively evaluating all of our strategic options to take advantage of the public cloud market opportunity and sharpen our focus.”
The company has been posting solid growth, with its latest quarter being the tenth consecutive quarter of revenue growth. The company posted a loss of $38.5 million on $775.5 million in revenue. While a loss, it was significantly better than the $64 million the company lost on $725.9 million in revenue in the year-ago quarter.
Jones remained bullish on the company’s outlook:
“While there are near-term headwinds in the economy, such as supply chain disruption and the war in Ukraine, we do not see any recessionary pressure in this business,” he said, later adding: “Cloud is only accelerating, even in the economic environment we’ve seen so far this year.”
Boeing is increasing its investment in its cloud infrastructure, tapping the top three providers for a multicloud approach.
AWS, Microsoft, and Google Cloud are the top three players in the cloud market, and it appears Boeing wants to work with all of them, rather than going all-in on a single one. The company “announced a significant investment” today, expanding its existing relationships with each of the companies.
“These partnerships will strengthen our ability to test a system – or an aircraft – hundreds of times using digital twin technology before it is deployed,” said Susan Doniz, Boeing chief information officer and senior vice president of Information Technology & Data Analytics. “Our partners will help Boeing take advantage of the best the industry has to offer while enabling employees to tap into leading tools, training and experts to improve skills and learn new ones.”
While many companies choose to build their business around a single cloud provider, many experts believe multicloud deployments are the future of the industry, and offer the best combination of reliability and scalability.
Boeing seems to agree, citing their belief that a multicloud approach is critical to the company’s success and sustainability.
“No one company or industry can ensure a sustainable future alone,” said Boeing Chief Sustainability Officer Chris Raymond. “We’re grateful to partner with technology leaders like AWS, Google, and Microsoft, who share our commitment to reducing carbon emissions.”
According to CNBC, the outages are causing companies to look more closely at multicloud options. As evidence of that is HashiCorp’s public offering, just two days after the AWS outage. HashiCorp helps companies utilize multiple clouds. In just its second day of trading, the company surged to a market cap of more than $15 billion.
Critics have long warned that reliance on just a few cloud vendors could put entire industries at risk, and it appears companies are increasingly taking notice of those warnings, especially in the wake of AWS’ failures.
Despite a seeming endless litany of data breaches, a new report says only 17% of US companies are encrypting more than half of their cloud data.
Data breaches have become an everyday occurrence, with company after company notifying users that their data has been exposed. More often than not, the exposure is the result of a database being left unencrypted and easily accessible via the web.
Unfortunately, it seems that US companies are a little slow on the uptake, as the 2021 Thales Cloud Security Study shows that 83% are leaving over half of their sensitive cloud data unencrypted.
Even more concerning, industry sectors containing sensitive information are only marginally better.
Sectors such as financial services, transportation, and media and entertainment are only marginally better at 21% saying they encrypt more than half of their sensitive data.
The report also found a correlation between multicloud deployments and low encryption levels. Of the organizations using multicloud environments, only 15% have encrypted more than 50% of their cloud data.
The report emphasizes the need for companies to take action to better protect user data.
To the extent that protecting customer data is a priority, organizations should strongly consider reviewing their strategies and approaches to proactively protect data in cloud, especially sensitive data. This includes understanding the role of specific controls and technologies including authentication, encryption and key management, as well as the shared responsibilities between providers and their customers.
As data privacy and sovereignty regulations grow across the globe, it will be paramount for end-user organizations to have a clear understanding of how they remain responsible for data security and how they must make clear decisions about just who is in control of and who can access their sensitive data.
The 2021 Thales Cloud Security Study gives a disturbing glimpse into how cloud-based companies are (mis)handling data and is well-worth a read.
Rackspace is looking to help companies tackle multicloud security with its Rackspace Elastic Engineering for Security.
Multicloud deployments have become a popular option. In fact, a recent poll showed that, among banks and financial companies using cloud computing, 17% were using multicloud. Even more significantly, 88% were considering adopting a multicloud approach in the next 12 months.
As a leading multicloud solutions company, Rackspace is looking to help companies transform their security operations by offering experts that will work as an extension of a client’s own staff.
“Now more than ever it is critical for organizations to rapidly evolve and efficiently operationalize their cybersecurity capabilities,” said Gary Alterson, Rackspace Technology Vice President of Security Services. “Businesses working with multiple security providers and partners are facing a growing execution and operational management gap. With Rackspace Elastic Engineering for Security, our customers have access to a dedicated partner that has both a deep understanding of their environments and expertise in managing the end-to-end security lifecycle.”
Rackspace Elastic Engineering for Security can help customers with everything from cloud migration to securing and managing existing apps and services. As the move to multicloud solutions increases, Rackspace’s new service is sure to be a major help to many companies.
Some 66% of companies believe it would take them at least five days to recover from an unpaid ransomware attack, according to a new survey.
Ransomware has become one of the most popular and lucrative types of cyber attacks in recent years, with companies of all types and sizes falling victim. Government, non-profits and healthcare organizations have increasingly been in the crosshairs as well. In fact, the first confirmed ransomware death occurred when a hospital in Germany was hit in September.
One of the biggest challenges many organizations face is the whether to pay or try to recover on their own from an attack. According to data firm Veritas’ 2020 Ransomware Resiliency Report, 66% of companies estimate it would take at least five days to recover from an attack if they chose not to pay the ransom.
As ransomware attackers continue to deploy more effective and potentially devastating means of holding companies’ data and workloads ransom, the time for enterprises to act is now. They need to immediately assess their resiliency approach and make their backup and disaster recovery processes more robust, no matter where their data and applications are hosted, so they can more confidently pursue their hybrid multicloud strategy.
The full report is worth a read, and illustrates the need for companies to continue to improve their ransomware resiliency.
“VMWare allows the datacenter to act like a public cloud,” says VMWare COO Sanjay Poonen. “It is a multicloud world. While AWS will be first and preferred for us, we want every customer that has VMWare in the private cloud but AWS, Azure, Google, IBM, and Alibaba, those are the top five hyperscalers, and all of them have embraced VMWare.”
Sanjay Poonen, COO of VMWare, discusses the incredible growth of VMWare which is driven by their ability to connect companies to any and every cloud in an interview with Jim Cramer on CNBC:
Software Is Defining Everything
We had a great quarter. You have to put the bigger picture in perspective. We’re in the golden age of software where software is defining everything. Software companies, in general, are doing well. What we have done as a company is focus on making the datacenter software-driven and we think there is a bright future there. We showed some examples of that in hyperconverged (HCI) and in software-defined networking (SDN).
We also showed some incredible momentum with our partnerships in the hybrid-cloud. Amazon is obviously first and preferred there. We announced a partnership with Azure. There is also the digital workspace which is all of the devices. We think our future is bright and we just have to keep executing. Our view is always the long-run.
In This Software Future We Are Not Tethered To One Company
I think there is a little bit of a misperception that we should nip in the bud (regarding correlating Dell’s earnings with VMWare). First off, VMWare’s business with Dell in these areas like hyperconverged, we’ve now surpassed companies like Nutanix who are number one in hyper-converged infrastructure, and in the digital workspace where we are partnering with Dell Laptops, those are going very well. We want Dell and VMWare to do well together. In the datacenter we work with Dell, HPE, Cisco, Lenovo, etc. There is no one hardware player that is the majority of our business.
In cloud we work with AWS, Azure, Google, Alibaba, and IBM. You won’t find another company that has got as many hybrid-cloud partners. In the digital workspace, we work with Apple, Google, and Microsoft. In this software future, we are not tethered to one company. We are optimized to Dell, we are not tethered to them. You need a software-based solution for any of these areas, the datacenter, the cloud, or the digital workspace during tough times and in good times.
It Is a Multi-Cloud World
You should think about applications like mobile homes. They’re going to move from the datacenter to the cloud on this freeway called VMWare. The mobile home could go to one cloud and may come back. VMWare allows the datacenter to act like a public cloud. We make the hardware datacenter look like Amazon. Now if you are an Amazon customer, and they have 30-35 percent market share, number one in the market for cloud, they are our preferred cloud partner, we can help customers. We have many customers who are adopting VMWare cloud in AWS.
For those customers who said we are not an Amazon shop, for example, we quoted Walmart in our earnings announcement, they are using Azure. They have an option now because we announced a partnership with Azure. There are some customers that are going to have some other clouds. It is a multicloud world. While AWS will be first and preferred for us, we want every customer that has VMWare in the private cloud but AWS, Azure, Google, IBM, and Alibaba, those are the top five hyperscalers, and all of them have embraced VMWare.
IBM is a great partner of VMWare. We love their services business. IBM Cloud has 2,000+ customers. We are going to partner really well with Ginni Rometty and the team. We compete with a small part of Red Hat’s business in containers. Over 80 percent of Red Hat’s business is Linux, a good part of their business which is OpenShift and JBoss, is not doing so well. The future of containers is a small part of the business. We can walk and chew gum. We can partner with IBM and compete with that small part of Red Hat and that’s our focus. We want a big tent at VMWare. We want to partner with as many people as possible and compete with as few people as possible.
Make Your Story Sesame Street Simple
First off, if you want to serve your customers well start by serving your employees. One of my professors at the Harvard Business School, Len Schlesinger, wrote an article and book on service profit chain. What he talked about is if you want to create shareholder value focus not just on customer satisfaction but satisfied employees. Hug your start. Take care of the best and brightest who come in there.
The second one is something that all of us can do which is make your story Sesame Street simple. All too often, I see product managers and account executives blabbering on with PowerPoints. Let’s tell the story just like you are telling the story to your mother or to your kids. Ironically, when you make things simple you’re going back to the basic principals of Steven Covey, 7 Habits of Highly Effective People, or Dale Carnegie, How To Win Friends and Influence People. It’s not that complicated. Have customer empathy.
It Is a Multi-Cloud World, Says VMWare COO Sanjay Poonen
