A recent post by EDL Consulting comments on what kind of an edge the first movers in the web-based hosted software solutions will have in regards to the cloud computing market. Will they have an edge or will they be swept up by larger companies with large existing client bases like Microsoft?
With the advantages of virtualization becoming more and more widely known, companies are jumping on the cloud bandwagon quickly. Reuters has suggested that even those cloud companies that got on the bus early will still face fierce competition from larger companies that will come in later with huge databases of trusting customers.
While the post is focused on the Software as a Service aspect of cloud computing, I think that the discussion rings true among cloud computing hosting providers as well. BlueLock has been doing infrastructure-as-a-service for two years now, before the big cloud boom hit. Suffice it to say, we definitely feel that we were one of the first movers and shakers when it comes to managed cloud hosting, especially considering the fact that when we first started talking about the value of virtualization our prospects looked at us like we were crazy. Crazy or not, BlueLock was built around the value of virtualizing IT infrastructure to shift capital expenses to a monthly operating expense that's a fraction of the cost (plus we could throw in virtual disaster recovery for almost a 3rd of what it would cost in a traditional model). So maybe we were crazy, but the idea has caught on.
In terms of advantages and disadvantages of being a beginning mover and shaker in the cloud computing arena, we'd have to say that BlueLock has definitely found some advantages. We've seen our competition try to add on cloud services to their traditional hosting services, and in many cases its a difficult transition. How do you know what to tell your salespeople? Sell cloud or sell traditional colocation? The companies had worked for years building a business on traditional hosting services and then virtualization comes along and shakes everything up - its less expensive, there's more space and compute to work with at a fraction of the cost, etc etc. Your margins and MRC start to decrease, but you need to keep up with the cloud competition. Not only that, but you don't really specialize in virtualization, the traditional way was your thing.
Well at BlueLock, we started with virtualization and that's what our engineers specialize in so its a no brainer for us what we should sell and its a no brainer for us on how to provide the biggest bang for our prospect's buck. As for the bigger companies cramping our style - the Rackspaces and GoGrid's of the world aren't really our direct competition anyway.
We surely feel we've got an edge.