- Sales & CRM
- Business Intelligence
When delivered effectively, cloud is simplistic, secure and economical for end users and provides an easy way to access IT on-demand. However, In order to deliver these services, suppliers have to work in a different way, combining capabilities from different providers, often enabling new services, and masking the complexity of the ecosystem from the user.
In this context, brokerage, the matching and managing supply to meet demand from a variety of suppliers, has an enhanced role because it manages all the complexities to deliver a seamless experience. Brokers help to make it easier for companies to consume cloud services, particularly when they span multiple providers, which is the norm these days. I don’t actually like the term brokerage, as it somehow misses the dynamism of what is going on in the cloud ecosystem, but it is the word of the day. For convenience sake I'll use it but it my opinion, the role involves a more harmonic orchestration of the ecosystem and a better understanding of the businesses pulse than the term brokerage suggests.
Brokers help to make it easier for companies to consume cloud services, particularly when they span multiple providers
It’s a complex concept to get one's head around, so let me simplify how this works. Take the music market, if you think how music from an artist gets to the end-consumer, then these days it’s 101 ways through 101 channels and intermediaries, packaged and compiled in many ways, and more and more it’s 'as a service', often through catalogues, and in that system there are increasingly few hiding places for those who do not add value.
Cloud brokerage models are similar. You get a simultaneous swirl of disintermediation, intermediation and re-intermediation, often complex, so how is that complexity metabolised? Ultimately any intermediary has to make things simpler, cheaper, faster or better, or there is no role.
The language doesn't overly matter, there will be some fuzziness: one certainty is there will be differences in definition from customers and vendors alike. That said, there are a number of logical roles to be fulfilled in the cloud ecosystem and a new report by Forrester states that most companies in the cloud will become cloud brokers. Essentially, the brokerage should be making the cloud ecosystem work well for the client using it.
Many providers, both traditional and emerging, can participate in this ecosystem. Individual organisations can have more than one area of expertise, and end-clients or alliances of end-clients themselves can provide services based on their industry expertise. It’s not surprising that the role of broker has emerged to navigate and manage through all the options available.
CloudBroker is a start-up company located in Zurich, which provides easy access to high performance computing applications in the cloud. It’s a spin off company from ETH Zurich which helps researchers analyse disease-causing proteins in record time.
Sunderland City Council is delivering its services through the cloud but also acting as a broker to provide city-wide accessibility and services to a raft of businesses, agencies and public sector partners by hosting an ecosystem of companies and agencies to collaborate.
A prominent IT player in the cloud ecosystem, who can also potentially act as a broker, is the Managed Service Provider (MSP). MSPs are third party organisations that proactively manage IT resources for customers on a remote basis. An example of this is ArrowSphere. ArrowSphere is a cloud ecosystem newly launched by the IBM Business Partner Arrow ECS. The cloud ecosystem provides the reseller community with their services webstores, changing the way service providers are delivering cloud services. MSPs employ a one-to-many support model founded on the premise of low-labour content and low price points to maximise economies of scale for clients.
Of course another way of looking at the cloud brokerage model is through the shop window. The IBM PureSystems Centre is an exhibit of a simple cloud services brokerage using this. Just in the last few weeks the latest iteration of our UK Government CloudStore was announced, a great example of a shop window brokerage for interested B2B public sector shoppers buying through the G-Cloud catalogue.
Whoever plays in this cloud ecosystem - brokerages, cloud service brokers, aggregators, MSPs, it’s clear to see that cloud has allowed a new business model to emerge. Businesses large and small, public and private can play on an equal footing, benefiting from what the broker can provide and manage for them.
Cloud broker has made it into the NIST Cloud Computing Reference Architecture and I think that we’ll see a lot more about this role in 2013 and how it evolves as part of the overall cloud ecosystem. Perhaps a provocative next question must be how long will it endure as a premium value-added service?