Cisco Pushes Partners To Become Strategic Service Providers With New Cloud Consumption Service

Cisco is encouraging its partner community to become strategic service providers with a new Cloud Consumption-as-a-Service (CCaaS) offering sold exclusively through the channel.

"It really does empower you," said Jim Melton, technical architect for World Wide Technologies' Business Development, a St. Louis-based solution provider and Cisco Gold partner which has already tested the service. "You end up with amazing visibility into what your user community is consuming as far as external services. … You can look at that data and it really does give you the ability to start making strategic decisions [for customers] based on costs and risks and start helping them plan their future -- it's very compelling in that way."

Emphasizing the opportunity to create new recurring revenue streams, the San Jose, Calif.-based networking giant is offering all of its channel partners the new software tool, which discovers and continuously monitors all public cloud services an organization is using, with hopes that solution providers can wrap ongoing Software- as-a-Service around it.

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Bob Dimicco, global leader and founder of Cisco's Cloud Consumption Service practice, said the new service opens up a $5 billion opportunity for solution providers in the U.S. market alone.

"It's easily a $5 billion opportunity in the U.S., with a range of product resell, professional services, cloud and managed services available to partners to sell," said Dimicco. "A lot of the partners are asking us how they can be more strategic. To go beyond [a reseller] to become a more strategic adviser is understanding what your customer base is consuming. Cloud consumption gives you as a partner that data, the information about what your customers are already consuming, and then it helps you inform your investments and portfolio of what you're going to resell and what expertise you want to build in your professional service capabilities."

Dimicco says shadow IT is rampant and the vast majority of companies do not have an optimized cloud strategy.

A recent analysis by Cisco revealed that the average enterprise customer estimates that it uses about 90 cloud services, when in fact the average enterprise uses about 1,220 individual cloud services. The average number of cloud services has grown 112 percent over the past year and 67 percent over the past six months, according to Cisco.

Businesses run significant risks using so much "uncontrolled" public cloud services, said Dimicco, including data protection, service performance, regulatory compliance and expensive costs.

"We've built this tool that looks at network traffic and based upon the network traffic leaving a customer's premise and going up into the cloud, we can understand the URLs to which they're going, the destination IP address, and basically match that against a master data base we have that's got thousands and thousands of cloud services and millions of websites. Based on that, we can determine how many cloud services are being used," said Dimicco. "Partners are going to have access to all this information."

The CCaaS software features data security tools, cloud service anomaly alters and trigger-based alters, cloud provider risk profiles and redundant service identification.

Solution providers will be able to see everything their customer sees in order to help them understand trends, and Web traffic versus provider traffic, and gain insight to build a deeper relationship with an IT organization, according to Dimicco. Partners can offer ongoing cloud monitoring, business risk and data security risk reduction, and benchmarking for customers.

Dimicco says with CCaaS, partners can compare providers and find the right cloud service for customers.

"Midsize customers and enterprise customers say, 'I can't hope to keep track of all the dynamics that are taking place in the cloud space -- public, private, hybrid, etc. I'm really looking to my partner to be that strategic adviser because I want to rely on my partner to not only resell some of the services and product I need, but also to provide me with the information and perspective on Provider A versus B versus C -- which one might be a better choice for me,' " said Dimicco.

Businesses are increasingly utilizing channel partners as strategic service providers. These providers are seen as an independent trusted technology consultant driving business outcomes with an emphasis on cloud and managed services delivering via a recurring revenue model.

Melton says the initial deployment is straightforward and opens the door for "significant" long-term partner opportunities.

"If you look at the professional services, a partner certainly has an advisory capacity or a consulting capacity that could be upfront and then down the road, the potential for additional professional services, deployment services, equipment -- especially with the hybrid cloud strategy -- it could be very significant for a partner," said Melton, whose company is ranked No. 11 on the CRN 2015 Solution Provider 500.

"It could be an ongoing, long-term engagement as far as data center evolution, hybrid cloud, public cloud adoption -- all those things kind of come into play as part of that advisory capacity as pull-through elements," he said.

In April, Cisco announced it would be creating seven new cloud professional services offerings for its channel community, including CCaaS, a cloud threat defense service model and a Unified Computing System (UCS) Director FastStart.

CCaaS stems from Cisco's already established Cloud Consumption Assessment and Cloud Consumption Optimization services. Although Dimicco says those solutions are built for large enterprises that can afford a higher price tag, CCaaS is geared toward midsize to enterprise customers.

For example, Cloud Consumption Assessment professional services cost a customer around $100,000, while Cloud Consumption Optimization costs $250,000 to $500,000, according to Dimicco.

"That's wonderful if you’re a very large enterprise, but what if you’re a midmarket customer? CCaaS is a software product going to cost a customer about one to two dollars per month, per employee," said Dimicco. "This means if you’re a midmarket customer with 500 or 1,000 employees, you're going to be able to see all the cloud services they're using for only about $1 to $2 per month, per employee. … Now we're ready for the midmarket and enterprise segments."

CCaaS is now available globally for all certified channel partners. Additionally, the service can be purchased only through channel partners.

"It's opened up to the entire partner community," said Dimicco. "We did that because so many of our partners wanted to participate in the cloud space and because to resell this, it really requires just a basic knowledge of routing and switching and all of our partners have that. There are no specializations or advanced certification required."

PUBLISHED JAN. 13, 2015