The Ecosystem of the Cloud: The Roles and Requirements of the Next Generation Solution Provider

August 24, 2010 at 9:56 pm Leave a comment

A Candid Conversation with Robert Fuller from Rackspace Hosting

Beth Vanni, Director, Market Intelligence


I recently sat down with Robert Fuller, vice president of worldwide channel sales at Rackspace Hosting, Inc., a global provider of infrastructure and hosting services. We discussed his views of the evolving cloud and services market. Some of the topics we covered included the business models cloud solution providers are adopting and the bigger challenges that solution providers are facing as they build cloud practices. We also discussed how Rackspace supports partners (2,000 worldwide) as they build practices around this new technology.

Here are some highlights, with Fuller’s thoughts on:

Infrastructure challenges for cloud services providers:

“VARs and MSPs are suddenly realizing that they offered to host one of their customer’s services in their own data center versus them putting it under their desk on premise. Business has grown and suddenly they’re finding that they’ve run out of their own data center space. Today, it’s very difficult to manage and support, and a lot of investment is required to deliver that level of service.”

Partner business challenges:

“It’s important that [solution providers] maintain their trusted advisor status with their customer. To do that they need to be understanding of the market changes that are taking place and they need to be able to provide advice and guidance to the customers…. There’s an education element involved there and really understanding what the options they can provide to the customers.”

“With the VAR or solution provider, they’re probably more used to a more complex or broad solution. So we see them moving into more of data center services, server consolidation, virtualization, and audit within their customer base and their customer’s IT area. They may get involved in infrastructure consulting, you know, what do I do with my SharePoint and my Exchange.  We see some of them going into business process outsourcing like help desk. And even a number of VARs are moving into leasing and recycling. So there are a number of areas that they’re morphing or transitioning into based on the way that the market is changing.”

Hybrid hosted environments:

“…The hybrid [environment] … is a combination of managed hosting where you have the dedicated environment but leverages the cloud as a resource. Someone who is dealing with e-commerce, for example, may have a couple of dedicated servers for PCI compliance, but uses the cloud to hold the catalog, video files, that sort of thing. Then it’s a resource that’s only being used depending on the amount of traffic coming to that particular site.”

Vendor Support Requirements:

“We’ve found that with our partners, we really go into most situations with the customer together and collaborate.  Therefore, the power of us knowing the service side of the business, the solution partner understanding the solution service that they may wrap around or add to what Rackspace is providing can be a very powerful vehicle as far as providing guidance there.”

“Basically it comes down to flexibility and mapping to the way that the partner wants to do business and how they conduct business to current and future customers.  So therefore you can either refer business to Rackspace, in other words, we work together with an end customer, the service contract is between Rackspace and the end customer, and we provide a commission to the partner. Or else, a partner may want to resell our services, in other words, take a discounted service (we provide a discount to the partner) and then they would then add their own uplift to that invoice as well as to other services that they would be providing to the end customer.  They then just provide one invoice through to the end customer. And what we’ve found is that a number of our partners actually have both types of relationships with Rackspace.”

Fuller offered some ideas on a clear, crisp, and offensive strategy as it relates to engaging channel partners around cloud solutions. To read more or to download a transcript of the entire conversation, please click here.

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Building Cloud Services – The Great Channel Divide The Ecosystem of the Cloud: The Roles and Requirements of the Next Generation Solution Provider

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