What small businesses really want from the cloud

Smaller firms are already using cloud services – now it's time for the businesses that have supported their IT in the past to catch up.
Written by Simon Bisson, Contributor

Small and medium businesses all around the world are moving to the cloud, so it's time for their IT partners and ISPs to support this move.

That was the message at this year's Parallels Summit, where the enterprise side of virtualisation vendor Parellels focuses on the software it provides to ISPs of all sizes, and where it looks at how its tools help deliver and manage cloud services.

Discussing his optimism for the future of SMB-focused ISPs, Parallels CEO Birger Steen made the point that, "On the old [enterprise] side of the IT world we have consolidation, as most big companies look similar. Once you get into SMB space, it is very diverse, as is the channel. Structurally this will move to the cloud world. So how do you provide a custom cloud for SMB?"

His question was at the heart of much of this year's ISP-focused event. Forget running Windows on Mac, Parallels' much larger business is focused on supporting ISPs all around the world with the tools and technologies they need to become cloud providers in their own right. That means a mix of virtualisation tools, management software, and an open standard that lets vendors package up cloud apps for use by smaller ISPs.

The cloud makes a lot of sense for small businesses. There's no need to run servers on premises, no need to have a managed service provider on call to fix failed hardware or handle backups. All of that's handled by a cloud provider, whether it's Office 365's cloud productivity servers, or Salesforce's CRM.

That makes it attractive to the ISPs that support those SMBs, as they can use their existing relationships - and above all, their existing data centres and networking infrastructure — to deliver cloud services.

For a small business, cloud services allow you to do more than just get rid of costly infrastructure, switching capex into opex. They also let you punch above your weight. You might not normally have considered CRM without looking at Salesforce subscription plans, or using Lync to take calls from Skype users without Office 365. It's the scale of cloud that lets you handle these more complex scenarios, without needing extra hardware or tools.

Even so, there's still an issue for many smaller businesses: the cloud is impersonal. Local ISPs and managed service providers are trusted points of contact, and they give you one person to talk to when there's a problem, not a web form or an email address for a contact centre. That's why Parallels has reworked its Plesk control panel to support a range of different use cases. With SMB ISPs using its tools to syndicate and provision apps, end users and their partners also need to tools to help quickly manage their accounts.

Self-service is an important part of cloud services, but not everyone wants to drill into the deep technical details of the service being used. A customer might want to add new users or change billing details on an account, while their web designer will want to manage domains and web apps on their site, while their IT partner will want to configure specific tools and services, while monitoring performance. There's no point in cluttering up one user's control panel with information another needs.

Different control panels accessing different elements of the same services start to make sense when you consider that while a SMB today uses four or five separate cloud services — and in a couple years that amount is likely to double.

Remembering where to manage just which aspect can be a problem especially when those cloud services are composite services themselves. A control panel like Plesk brings you closer to what really matters: the workflow you're building around your information and your tools. That five services number is a global average — in practice an SMB in a developed market like the UK and the US is using many more.

There's certainly a market for SMB clouds: in his Parallels Summit keynote GoDaddy CEO Blake Irving talked about the simplified sign-up portal for Office 365 his company has developed, noting that it's been live for five weeks, with over 10,000 sign-ups a week.

That's a significant run rate just for a reseller (albeit a high profile one). Microsoft has also partnered with Parallels around its Azure Pack high density web server offering, making it easier for ISPs to bundle as part of their existing offerings, using Parallels APS packaging tools to quickly deploy Azure Pack websites as part of a user's package of services.

According to Parallels, the UK market for cloud services is growing at 20 percent a year, and is currently a $4.2bn dollar market, the second largest just in Europe behind Germany. Customers are focusing on productivity solutions and outsourcing infrastructure, with communication and collaboration services showing the highest, with cloud-hosted PBX services not far behind.

Even so ISPs need to consider how they sell cloud to their SMB customers, as they have lots of ways to consume services — with bundling a key opportunity, allowing ISPs to build a relationship with customers and add services as they need them.

There are a lot of opportunities out there for SMB-focused ISPs — and for the consultants and ISVs who support them. The challenge is in understanding that the old on-site servers and services that SMBs used to use are gone, and they are already well into a transition to cloud services.

Instead of leading that transition, it's up to ISPs and MSPs to follow and adapt their businesses to support those changes. It's not as big a change as it seems, but it is one that will take some work.

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