Cloud Brokers: If You're Not Targeting SMBs, You're Missing Out


The cloud brokerage model, in which a third party helps customers to select and manage cloud offerings, may be a perfect solution for the SMB, but at least one industry consultant believes that the providers of such services are often more focused a lot farther up the food chain.

"It seems to me like everyone is focused on the enterprise space," said John Ross, an independent architecture consultant based in Dover, N.H. "But the midmarket and small-business space is actually more likely to work with brokers because brokers enable them to consume services much more robustly."

Ross is helping two companies prepare to launch brokerage initiatives at the SMB space and expressed surprise that there are not a lot more companies already competing there.

 

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"Most people are pointing to the enterprise for cloud brokerage because they have all the complexity, but the actual growth is often at the small- to medium-business level," he said. "There's also a very solid opportunity for managed service providers to move in the direction of cloud brokerage because they often work with smaller and midsize companies that don't have IT staff or a great deal of resources. So this is an area where they can add a great deal of value."

If a cloud brokerage bias favoring the enterprise does exist, it may be caused by the investment in time and resources necessary to build the value proposition.

"It is hard. This is heavy lifting," said Ricky Santos, vice president of cloud and technology services at New York-based Presidio. "To do a cloud brokerage, you start with the selection of a preferred service among several cloud-based services, which is then orchestrated and provisioned. Typically this involves a hybrid cloud solution that allows them to reduce the footprint of IT. You then need to integrate the on-premises environment with the service provider's environment, and perhaps even other cloud providers. And you also have to engage the analytics that are necessary to meet the compliance needs.

"All of this requires a solid integration strategy," he continued. "There is also a major investment in the necessary infrastructure and management capabilities that enable you to do this in an effective way. In order to subsidize this, some of the providers find themselves focused on the enterprise."

Santos added that much of this capability is more likely to roll downstream into SMB, once the processes, procedures and investments become more mature.

Meanwhile, Forrester Research cloud analyst James Staten said that the cloud brokerage model is actually very similar to the managed services model, thereby providing MSPs with an opportunity to bridge their service offerings into the cloud.

"There are opportunities at both the enterprise level and in the SMB level," said Staten. "Part of the challenge is that the cloud broker concept is still a little bit nebulous, and the majority of players that we see in this space are not bringing intellectual property to the table as much as they are emphasizing managed services. So there is a very strong opportunity for channel partners to serve small to medium-sized customers because those customers frequently do not fully understand the services and really want somebody else to handle it for them."

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