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Alternatives to Hyperscale Cloud Providers

451 Research analyst Liam Eagle explains what the Alternative Cloud is and where it could fit within your infrastructure approach.

Video Transcript

LIAM EAGLE:  Hi, I'm Liam Eagle. I'm a research director at 451 Research, and I cover cloud hosting and managed services.

To define an alternative public cloud, you need to start with what it isn't. So it's not one of the handfuls of hyperscale public cloud vendors. That obviously doesn't refine the list all that much, but what we find is that a lot of companies, when they're out there looking for cloud services, want a credible alternative to the hyperscalers. And so what they need is a bar that kind of helps define what a credible alternative is.

There are a few components to that. So the first is the components of the service. Does it have the object block storage, does it have separate compute functions, does it have things like DNS and load balancing? The next category would be the controls. Does it have APIs for provisioning and for operation? Third would be the quality of service. Does it have a quality of components and a level of performance SLA that are comparable to the leading vendors? And then next would be the regional footprint. Does it have a presence that extends globally? And then finally would be compliance. Does it meet the key regulatory standards that companies are going to come up against?

So you can see that there's a bar for being considered a credible alternative public cloud. And I would imagine that bar is going to continue to rise over time, as things like container management become more standard functions of the cloud platform.

The core benefits of the alternative public cloud are the same benefits as the public cloud in general. Cost, performance, availability, security, agility for the organization. But what we find is that a lot of organizations struggle with the complexity when they're trying to accomplish those benefits in the cloud. And so for a lot of the alternative providers, some of the key benefits are actually this addition by subtraction approach.

So the first category there would be simplicity. Simplicity of the user interface, simplicity of the catalog, simplicity of the pricing, and then the next would be the simplicity of the learning curve. So it's a shorter time from starting to use it to accomplishing, or being able to accomplish what you want. And then the third would be pricing. And this is probably the biggest thing for a lot of organizations, is the pricing is less complex, and in a lot of cases, is more affordable for the use case. And then on the flip side, a lot of the alternative providers, or there are some cases where the alternative providers would offer something more than the hyperscaler. So for instance, they may bundle more management or more customer service in with the core offering.

The company that's going to benefit the most from working with an alternative public cloud provider is one that understands the value of the public cloud, but doesn't necessarily want to deal with the complexity, or doesn't have the technical capabilities to deal with the advanced features of some of the hyperscale platforms.

For example, a company that wants to build a small application in a simple environment, and maybe wants some management help with the infrastructure that's underlying it. But they still want to use Kubernetes, and over time, they want to be able to scale when the demand arrives. That's a good example of a use case for the Alternative Cloud.

Some companies are looking at alternative public clouds instead of the hyperscale public cloud. But many companies are looking at them in addition to. In our survey research most companies say they're using multiple different public cloud vendors, and they're doing that for the sake of diversity, but they're also doing it to access the key individual features of those different public lot vendors. So if you think of the alternative vendors and their key features being simplicity, cost, ease of use, that begins to illustrate what the use case for those kinds of services in a broader portfolio of cloud offerings might be.

For instance, you might have a dev team within a large organization that is doing some experimentation and testing on an application that they're building, and they want to do it in a simple and cost effective environment, and maybe they want to experiment with it there, and even take it to production there. Or you might have a marketing team that doesn't have any technical skills, or at least not the technical skills necessary to work with the advanced complex functions of a hyperscaler, but they're building out the digital side of a marketing campaign. So there's examples where alternative can mean instead of, and then there's examples where alternative can mean in addition to.

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