Gartner published its annual update of the Magic Quadrant for infrastructural cloud services. At a first glance not much has changed ‘in’ diagram since last year’s version. Especially the Leaders’ positions haven’t changed much. However, Gartner decided to extend the ‘scope’ of the Magic Quadrant. For the first year, it includes not just Cloud ‘Infrastructure’, but also ‘Platform’ Services. This change has important implications for buyers of the cloud services.
Not just a matter of semantics
This extension is not about just changing a definition or a title. Rather, this change reflects the evolution in supply and demand in this market. This has been happening for some years already. Because moving your architecture ‘up’ from infrastructure components to include more platform solutions is necessary if you want to maximize the benefits from cloud technologies. As a result, the Magic Quadrant’s change of scope became inevitable.
This ability to ‘move ‘up’ even changes the rationale for a transition to the cloud. It is not only – or rather, no longer – about ‘renting’ reliable compute or storage resources at an affordable level. Rather, these platform solutions offer important opportunities to innovate, differentiate your business services and make IT a true part of your business strategy.
Two implications for suppliers
This evolution has two implications for the supplier side. First, it raises the barrier to entry for this market. Initially, datacenter capability and capital expenditure would buy suppliers a ticket into this space. Yet, as the game continued, players dropped out. For example, whereas the 2017 Quadrant still had 14 vendors, in 2018 only 6 were still on the pitch. Fast forward to today: the essential ability is innovation – both broad and deep, and encompassing an innovative platform offering. Also, these innovations must include the vendor’s capability to cultivate a comprehensive ecosystem which can deal with such fast pace of innovation. As a result, competing in this market has become much more complicated than just having the ability to burn immense amounts of cash on buying hardware and erecting datacenter facilities.
Second, and as a logical consequence, the inclusion of platform services has accentuated the differences between providers. For example, comparing 2020 with 2019, AWS has distanced itself from Microsoft. This increased gap must come as a surprise to those (analysts and buyers) who focussed on ‘revenue growth percentages’ as the leading proxy for capability and quality. Rather, this widened gap reflects the differences between the two market leaders. AWS has taken an early lead with its platform offerings. Also, its platform services are adopted more successfully by its partners and its customers when compared to Microsoft.
Just someone else's computer?
So what does this mean for buyers? ‘Cloud is just someone else’s computer’ – those days are over. This is true, not just when comparing the ‘private’ with ‘public’ cloud offerings and vendors, but also when taking a closer look at the latter category.
First, it underlines that the use of the adjective ‘public’ in public cloud should not be misunderstood. This cloud category does not consist of interchangeable commodities or just basic utility services. As a result, buyers should investigate their choice of cloud vendors carefully. Too often they are being led by their familiarity with the vendor in the pre-cloud IT era. They then make the wrong assumption this equates to an easier transition with similar benefits. Other buyers are considering to distribute their spend across multiple vendors e.g., to hedge risks of dependency. However straightforward their choices may appear – there are only three Leaders – they too should take a closer, careful look.
Second, when comparing vendors, the buyers must not interpret their positions in the ‘Leaders’-quadrant as a mere reflection of the differences of their market entry. It is not ‘just’ because AWS was first, that this company is still ahead of the others. Or said differently: it is not just a matter of time for Microsoft and Google to catch up – despite what these vendors project via their considerable marketing budgets.