Rating and Certifying the Cloud Hosting and Web Application Providers. Part III

Rating and Certifying the Cloud Hosting and Web Application Providers. Part III

I have been slowly morphing my consulting practice. I usually offer myself as a product sector strategy asset. Product Managers and VP’s in the on-line applications business hire me to shoulder some of their burden when targeting specialist sectors – you know, industrial, technical, services, professional. These established clients usually have an idea of where their development efforts are heading. I came in to refine and prove the potential numbers. I developed approaches to paid subscriptions, industry specialty requirements, and I found innovative ways to exploit trade specific marketing. I was the product manager’s helper, and It was a good gig until about 2007, when the economy got soft. Analysts are the first to have their contracts cut.

Now I am delivering what I learned as an analyst, and applying this to evangelizing small and medium businesses. These folks are the end users I had quantified, targeted, and interviewed in my work for web applications providers. Small and medium bizfolks perceive the benefits of hosted services and cloud computing. They clearly perceive the benefits of fault tolerance, licensing advantages, and a simplified communications topology. These smaller accounts are certainly numerous. Can they abide having recurring computing fees forever? They certainly know that their internal server and workstation / mobile infrastructure (as traditionally delivered), costs them big time when things go bad.

The SMEĀ  / SMB, in other words, gets it. They get the benefits of Web based, cloud hosted stuff. They like getting out from under the local IT support guy, or the internal IT guy that they are held hostage to. They look forward to a time where individual routers with special configurations are replaced by safe, centralized fault tolerant networks, servers, and comm infrastructure that they can provision and pay for in a rational way. They just don’t know if they can trust you and if you will be around long enough to justify the cut over.

So, before I close this series, which might include one more post on the brokering of technical services between partners and competitors to backstop business continuity failures, I will talk briefly about ratings and certifications for any remote provider of compute and storage – out there in the cloud.

Established utility computing providers, like AWS, are probably uninsureable as far as client’s needs are concerned; they are too big, and any coverage they do have insures only their own facilities and operations, which does accrue somewhat to the client’s benefit in the very long run, but does nothing when the downtime occurs. In the case of the big dogs, your insurance is their size and need to maintain a reputation. Eventually we will get our way, and instances of client computing services will get risk based pricing, preceded by business viability ratings, and of course, certifications for good facilities, operating procedures, and back office accounting standards. I’m willing to bet the ISO is working up something in their wild and crazy working groups as we speak.

One more thing: Why is PAAS different?

Briefly: clients using unitary applications or suites have invested a certain amount of time moving fromĀ  thick client project management to a hosted solution (one example). They have probably identified ways of moving the data off the platform (I hope), and so on. They are using an application, and we have all changed applications. PAAS is like marrying your company to .Net or some other standard. There is an investment, a rather large one for the SME, actually. For the lone developer making web apps, it’s ok.

The PAAS landscape is made of some very innovative and funny systems. I think you know what I mean. Some remind me of 4GL, some will let you host a language and framework, but not the integral database, some have language environments that are made from whole cloth. As a group they are fascinating and right on the cutting edge, and they are, as a group, under capitalized and illiquid. There are exceptions, but I will bet you the best dinner in Boston that one would be hard pressed to find a PAAS provider that would allow an industry ratings organization to inspect their capital and operations profile.

If a SAAS application company is illiquid in its essence, then we find another, move the data. If a PAAS company is under capitalized, we have a larger set of problems. The way migration has been handled for PAAS failures has been shameful.

Someone once asked me if the 25M round for an on-line storage provider places them in a well capitalized position; my answer was, “it depends, but generally, no, it is not considered well capitalized for the intended target and use case – 25M in a VC round ain’t shit when rating a crucial service provider that has not attained sustained profitability and near perfect uptime.” Continue reading

Consultants: Mess Up Totally while being 100% Right!

Consultants: Mess Up Totally while being 100% Right!

Don’t go against the money; what say, you say? Consultants, don’t go against the opinion of the people funding a venture, or their management proxies – you will not get contracts, you will have your early termination clauses invoked, and you will be forced out the valley. Of course, you will also not be able to provide any services of value, but it seems that the valley is chock full of closed end product management hires that are basically yes-men and gals for the management. So why did they hire you?

First, some background about what a good product strategist does -people are confused until they really need a guy like me. I built my reputation by being honest and never pulling punches, all while providing action oriented, sane product / channel re-jiggering.

People who label as ‘Strategists’ take a lot of heat; where do you get the nerve? Well, first of all, there are two types of strategists: Corporate capital ‘S’ strategists, and product channel specialty small ‘s’ strategists. I am a small ‘s’ strategist specializing in technical, industrial, and vertical markets. Without this specialization, I should be rebuffed; with no MBA, no degree from any institution of higher learning, I need my tool belt of practical industry experience to underwrite my credibility, and to speak with authority regarding the markets that I swim in, on behalf of my clients.(visit)

When a client calls me, via a referral or via my blog articles, they have a bone to pick. Often this bone is an internal conflict over the direction of a product’s channelization, or a strategic (small ‘s’, product features and industry targeting strategy) issues that is causing division or insurrection in the ranks.

I can often be a balm to these conflagrations; it doesn’t always get to the point of emotional entanglement, either. I have had a good career acting as an honest broker for the best interests of the product and the user community. This obtains in cases when the particular user community is already in place, or needs to be freshly recruited.

There are so many great Web 2.0 tools and services that have steered down the path of fremium and ad-supported subscription models. Many of these great, small companies will never see the revenue sufficient to turn a profit, and therefore wait for the buyout that may or may not come.

All the while, there are any number of technical and skilled trades markets that are dying for specialized instances of messaging, social networking, and mobile applications that can help their constituencies work more effectively. However, these vertical markets are never going to be evangelized by non-specialists, and their revenue models require a fine-tuned balance between ads (and these industry specific ads can have hight CPC and CPM) and subscriber paid accounts.

That’s my job, to use my skills as an advocate on behalf of the Web application provider, to swim in the vertical and fine tune the delivery of these services, and to help make a payment model that works for the product sector, and the developers.

More on this topic, and in depth, soon.

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