Can the Kiwi channel ride the second cloud wave?

Can the Kiwi channel ride the second cloud wave?

Heavyweight partners come together to debate the future of cloud in New Zealand

As organisations of all shapes and sizes consider cloud as a viable go-to-market strategy in New Zealand, partners are evolving alongside, attempting to keep pace amid frantic channel change.

Partners today must also cut loose from the competition, yet like customers, challenges remain.

But what’s the strategy? Because in terms of product awareness, product interest, product evaluation, product trial and product adoption - have the five stages of cloud acceptance already been negotiated?

“Cloud has levelled the playing field to a degree in New Zealand, but the hype is still well ahead of adoption,” Datacom general manager of cloud services Chong Looi observed. “Enterprise is struggling in that they are utilising the benefits of cloud, but challenges still remain around legacy technologies and monetisation.”

Whether it be public, private or hybrid, implementations continue to increase in 2017 as end-users seek to take advantage of the cloud’s economies of scale to build core applications.

But as cloud becomes default, a default cloud channel strategy still ceases to exist.

“Customers are seeking advice and guidance from the industry as to how to reach the next level in cloud,” DXC Technology New Zealand CTO John Godfrey said. “And it’s coming from different places with business units and development teams rapidly adopting new services and solutions.

“As a result, hybrid conversations are happening more frequently across the market.”

As the demand for agility and flexibility grows, organisations are shifting towards hybrid models, in a bid to leverage the best of both worlds in the context of cloud.

“If you cast your mind back five years ago, the market said cloud was the answer, so what’s the question,” Hewlett Packard Enterprise director of channels and SMB Cedric Edwards added. “The industry thought that infrastructure on site would be dead and that everything would be in the cloud.

"But as we evolve in New Zealand, which is significantly ahead of Australia or the rest of Asia, we see that balance returning.”

Consequently, Edwards advised that hybrid is the play for partners across the country, with customers remaining split between new and more traditional ways of consuming technology.

“Public cloud is wonderful thing for customers until they receive the first bill,” Edwards added. “Many mid-market customers dipped their toe in the water of cloud and now they are coming back.

“Likewise, many small businesses in New Zealand adopted cloud not for cloud sake, but because they could pay per month.

Cedric Edwards (Hewlett Packard Enterprise)Credit: IDG
Cedric Edwards (Hewlett Packard Enterprise)

“So, if you provide that option on-premise also, they will go for that option. The world is hybrid from small to large organisations, with the conversation now moving into how we manage workloads.”

For partners operating in a hybrid environment however, challenges remain around customer deployment, with people and processes arising as sizeable barriers to future adoption.

“Hybrid is most definitely the play but in terms of why cloud is failing in some areas, it’s because the industry forgets about the people,” Dimension Data digital practice lead Steve Wotten said. “When a business goes hybrid, they must change the way they work and the way they think, which means it’s crucial that partners include the entire team from the outset.

“The key is to take your customer on a journey because otherwise, you’ll get resistance. The most difficult part of delivering a hybrid project is bringing the people together who will eventually support and operate the environment.”

Challenges around cloud adoption also come in the form of connectivity, with New Zealand as a nation exposed to issues around uptime and outages.

“Customers want to know what will happen if their internet connection goes down, especially when everything is in the cloud,” Sandfield Associates IT engineer Shane Harris added. “What happens to the business?

“If a business has moved all their information to the cloud, what happens if they lose their data? There’s a lot of factors to consider and it’s not always that straightforward.

“It’s about partners ensuring that customers have the right connections in place, backed up by proper redundancy and disaster recovery solutions, then they can offer advice around cloud services and workloads.”

Across the small to medium business (SMB) sector in New Zealand, Harris said a lack of education still exists with regards to cloud, as business owners struggle to understand the monetary and technological benefits.

“Many customers know the buzzwords but don’t know how they function,” Belton IT Nexus engineer Brad Collins acknowledged. “As an industry, we struggle with terminology and customers have the idea that everything must be in the cloud, but sometimes it doesn’t make sense.

“Education is still a huge challenge impacting channel partners today.”

As a result, partner engagement in the cloud is dictated by the size of the customer being served.

“We’re seeing a difference between the size of the user,” StorageCraft master engineer Karl Thomson added. “We’re 100 per cent channel and through SMBs, it’s still very much a trusted advisor play and the customer doesn’t know that they are using StorageCraft technology.

“They are simply consuming something that is month by month, so partners can provision a service and they don’t care because the customer is getting an outcome.

Karl Thomson (StorageCraft)
Karl Thomson (StorageCraft)

“But then as you start to migrate up towards mid-market, you see the conversation change in that the customer has already made a decision. We must be at the forefront of the outcome that they are looking for.

In terms of end-user spending, technology investments in New Zealand are expected to reach almost $11.8 billion in 2017, up 2.7 per cent from last year and ahead of the global average.

Naturally, cloud forms a key part of such investment, with businesses of all sizes continuing to assess the pros and cons of switching workloads to the skies.

“Firstly, we have businesses that want to move everything to the cloud,” Westcon-Comstor vice president of innovation Darryl Grauman added. “If you’re a new business starting out, why would you even think about infrastructure?

“Why would you go down that route when everything you need is through software-as-a-service (SaaS)? There’s no reason to be lumbered by hardware.”

In offering an alternative viewpoint, Grauman argued that SMBs nationwide are tied down by legacy investments, creating demand to move such businesses to the cloud.

“There’s businesses in New Zealand today that are working with customers to migrate them 100 per cent to the cloud at SMB level,” Grauman said.

“But on the enterprise side, it’s certainly a multi-cloud play. There’s different workloads and different solutions, and making them talk to each other is key.

“Bringing together those moving parts is crucial, which represents an important role for the channel, with DevOps very much a required skill set today.”

Delving deeper into the heart of the cloud market in New Zealand, Grauman cited application developers as central to the future success of the channel.

This however, is a channel that looks, thinks and acts differently.

“They are creating and delivering apps at a global, regional and local level,” Grauman added. “They are building on Amazon Web Services (AWS) and Microsoft Azure and this is an area of the market which requires focus.”

According to Grauman, the channel has a role to play in this space but it’s a different role to that of before.

“It’s all well and good to move a business to the cloud, but then what?” The Instillery chief product officer Jeremy Nees asked. “What can you offer beyond cloud?

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Tags storagecraftveeamHewlett Packard EnterpriseWestcon-Comstor



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