BETA
This is a BETA experience. You may opt-out by clicking here

More From Forbes

Edit Story

How Cloud Heavyweights Microsoft, Amazon And IBM Will Transform Cloud Computing In 2018

This article is more than 6 years old.

Amazon.com

(Note: After an award-winning career in the media business covering the tech industry, Bob Evans was VP of Strategic Communications at SAP in 2011, and Chief Communications Officer at Oracle from 2012 to 2016. He now runs his own firm, Evans Strategic Communications LLC.)

CLOUD WARS -- While each of the three biggest and most-influential cloud-computing vendors—Microsoft, Amazon and IBM—will pursue markedly different strategies in 2018, their individual influences will coalesce around several key initiatives that will radically reshape the cloud marketplace for years to come.

Those initiatives reflect the rapid—and welcome—evolution of the cloud business away from the tech-obsessed and jargon-jammed discussions that dominate the early days of emerging marketplaces, and toward the development of more customer-centric products, services, positioning and messaging.

This is a fantastic step forward for the cloud business because after several years of such frothy behavior, it's time for cloud computing to grow up.

It's time for the cloud industry to leave its teenage self-absorption and narrow worldview behind, and to join the ranks of adults who understand that the business imperatives of customers trump the shiny-object obsessions of the perpetual-adolescent insiders who mistakenly believe that CEOs care even a little bit about their incredible code.

Fortunately, the three biggest vendors in the enterprise cloud—Microsoft, Amazon and IBM, each with 2017 cloud revenue of more than $16 billion and annualized run rates approaching $20 billion—have already mastered the customer-first culture so vital in times of massive disruption like what we're seeing in the business world today.

Here are the areas where those three cloud powerhouses in 2018 will reshape the cloud business for years to come:

  1. Customer lock-in gives way to open approaches triggered by new technologies such as containers and Machine Learning.
  2. End-to-end management of entire "digital estates" (Microsoft's term) within the cloud becomes possible.
  3. Multi-cloud environments are recognized as the norm, and appropriately powerful and easy-to-use solutions surge into the market.
  4. A range of cloud-based tools are made available to meet the widely diverse needs of businesses. For example, not every data set requires a high-end, world-class database—and customers are demanding (and will receive) more choice.
  5. CEOs might love the business value that, for example, Kubernetes can generate, but that doesn't mean a CEO ever—EVER—wants to hear about Kubernetes in a presentation. The moral of the story: cloud vendors need to speak in the language of their customers, and leave the shiny-object wonder-talk back in the lab.
  6. When industry insiders think of what "cloud" is and means, they imagine sharply delineated product and tech categories with a nearly unlimited number of segments, subsegments, branch categories, roots, shoots and ladders. When business customers think of "cloud," they imagine lower IT costs with more funds for innovation, less integration and more innovation, better customer insights, fewer data centers, shorter product cycles, more-successful recruitment and nurturing of world-class talent, and other business priorities. The cloud industry must organize itself around what customers want and need, rather than around insular, arcane and simply irrelevant terminology.

And here's why I think Microsoft, Amazon and IBM are uniquely qualified to lead this profound transformation within the Cloud Wars:

MICROSOFT: CEO Satya Nadella articulates the business value of cloud computing more artfully and persuasively than any other cloud-vendor CEO because he always builds his remarks around the challenges and opportunities that business leaders face in today's rapidly evolving world. He doesn't attempt to dazzle audiences with his own technological expertise—although that is there in deep abundance—but rather make his empathy for their situations abundantly clear: they're attempting to digitally transform, they're attempting to engage with customers in entirely new ways, they're attempting to reshape their businesses from top to bottom to align with the fast-changing digital lifestyles of consumers, and they're facing extraordinary pressures to achieve all this while also dramatically improving their cybersecurity.

Unlike some cloud-industry leaders, Nadella does not take the operating model of the cloud and attempt to convince business leaders that they must adapt their operating models to that cloud model; rather, he shows how a customer-centric cloud vendor with end-to-end cloud services can help that business create a new digital operating model around the needs of that company's customers and prospects.

Every cloud vendor—whether a big-time player or a niche specialist—will need to follow that lead in 2018.

AMAZON: Combining the cloud-technology chops of his Amazon Web Services unit with the customer-first innovations of his parent company, AWS CEO Andy Jassy has pushed his company into emerging segments of the cloud beyond its first-mover leadership in IaaS with a single goal in mind: give customers something that's better than what they have, that's less expensive than what they have, and that's easier to use than what they have.

Lacking Microsoft's or IBM's enormous breadth and depth in enterprise-software expertise, Amazon is not attempting to become—at least it's not doing so yet—a full-fledged IaaS + PaaS + SaaS player, but it is leveraging its incredible combination of broad and deep customer engagements with its own internal cloud-technology expertise to become a sharp-elbowed disruptor of the Enterprise IT status quo.

Rather than trying to simply extend its big lead in IaaS, Amazon is becoming the Innovator's Enabler: what's your ugliest problem? Why do it the old-fashioned way? Have you thought about throwing out that old approach and trying this?

By pairing its unmatched infrastructure expertise with its customer-first culture, Amazon will force all cloud vendors to drop the easy and "obvious" approaches and instead hammer away on things new and previously unexpected.

IBM: Microsoft's about 45 years old, Amazon's about 20 years old, and then there's old-timer IBM, ready to turn 107 years old here in 2018. The extraordinary achievement of IBM CEO Ginni Rometty has been to repackage huge swaths of that century-old expertise in modern and relevant ways: from the Watson Data Platform to cloud-plus-cognitive to mainframes reconfigured to encrypt staggering volumes of information-in-motion to meet the needs of a business world under relentless cyberattack.

I call this the "power of incumbency"—taking your unique expertise in technology and customer relationships and vertical industries and leveraging it into the cloud. All the major cloud players are doing this—SAP with applications, Salesforce with CRM, Oracle with databases, Microsoft with platforms and Office—but IBM might be outdoing all the others by crafting an $8-billion-plus business in which it helps its biggest customers convert their legacy systems and apps into private-cloud or cloud-compatible environments.

@bobevansIT

In doing so, IBM has regained its prestige as a world-class and modern enterprise-IT partner that offers a "cloud plus" set of business value to customers: cloud plus AI, cloud plus Watson, cloud plus cognitive.

In 2018, every major cloud player must be able to exploit more effectively than ever before its power of incumbency as the cloud expands from being a bit player in the enterprise to being the primary model for business technology.

Conclusion: Teenagers are endlessly lovable, but they can also be endlessly maddening—and it's probably good for all of us that the teenage years don't last that long. And in the cloud in 2018, business customers are looking for adults, not tech-obsessed teens.

In that context, Microsoft and Amazon and IBM offer the entire industry an enticing plan for not just growing, but for growing up.

So lace 'em up tight—looks like another world-changing year ahead in the cloud!

Follow me on Twitter or LinkedInCheck out my website