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Blog3 Things You Need to Know About the Rise of the Alternative Cloud

3 Things You Need to Know About the Rise of the Alternative Cloud

3 Things You Need to Know About the Rise of the Alternative Cloud

In the early days of cloud computing, a handful of big players dominated the market and shaped expectations around availability, performance, and the cost of cloud services. As the industry matured, the key players became more complex, more expensive, and less business-friendly to their customers and partners.

While these companies still dominate the top end of the cloud computing market, a new tier of hyperscale providers has emerged. This new tier has gained traction by giving developers, small businesses, and even multinational enterprises an alternative to the old guard’s complexity, cost, and sometimes competitive business practices.

Liam Eagle, Research Director at 451 Research, was among the first to give a name to this new category of providers: The Alternative Cloud™. Over the past several years, alternative cloud providers such as Linode, Digital Ocean, Vultr, and OVHcloud have become credible alternatives to hyperscale clouds and now command one-third of all spending on cloud services.

In 451 Research’s latest report, “Examining the Value and Opportunity in Alternative Clouds,” Eagle examines what’s driving market growth, discusses the most prominent players in the space, and analyzes related technologies such as open source tools that enable better cloud workflows.

This new report covers three key themes.

  1. Cloud Complexity and Costs are Increasing 

As cloud providers innovate, capabilities continue to grow. 451 Research’s Cloud Price Index (CPI) identifies more than 2 million distinct cloud services across 176 data center locations worldwide. But as the large cloud providers keep expanding their portfolio of individual features, they are also pushing cloud customers to spend more money on these additional services. The natural consequence of more offerings is more complexity, and that complexity “becomes more difficult to solve over time, and likely leads to resource use and cost-spiraling,” writes Eagle. 

The overall ease of use of alternative cloud platforms is one of its most attractive traits to users, according to Eagle. But simplicity extends beyond just the user interface to more straightforward billing and pricing structures, streamlined feature sets, and open source operability. “A benefit of this approach is a significant flattening (relative to more complex cloud platforms) of the learning curve,” explains Eagle, “or a reduction in the time from starting out with the platform to being able to accomplish key objectives.” 

  1. Alternative Cloud Providers are a Core Component of Multicloud 

Alternative cloud providers have often been thought of as a route users take “instead of” the larger cloud companies. However, alternative cloud platforms are now playing a more significant role as complementary choices within a broader multicloud ecosystem. While alternative cloud providers have been more popular among SMBs and independent developers thanks to their affordability, there’s also a growing number of large enterprises pairing alternative cloud services alongside other public clouds to find significant benefits.

According to the report, multicloud has emerged as the most common approach to cloud consumption—with unique features of specific platforms cited as the chief reason for going the multicloud route. “If the simplicity, reduced cost, and ease-of-use offered by the alternative clouds is considered a distinct feature of those platforms, it could outline the case for their inclusion in a larger portfolio of cloud services being consumed by an enterprise,” says Eagle. 

  1. Cloud Users Crave Better Support Services 

Eagle writes that alternative cloud providers include a far higher level of support and managed services delivered along with cloud infrastructure. 

With more hands-on support, organizations don’t need to rely on a 100% self-service utility approach, which means less cloud-savvy organizations can adopt more cloud services effectively despite a growing cloud skills gap. Eagle notes this is important to SMBs and independent developers who need the cloud but don’t necessarily have the engineering expertise or resources to optimize their cloud deployments fully. 

Cloud workloads continue to grow and evolve. So, too, does the industry. And, as the 451 Research report shows, alternative cloud providers are providing much-needed choice for developers and companies searching for a better fit or complement to their multicloud efforts.


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