Are You Growing at 192% Year Over Year?

For the past year and a half, TSIA has been warning legacy product companies that cloud computing will become the consumption model of choice for many companies, both large and small. So from the TSIA perspective, this is a conversation of “when” not “if.” When will cloud computing options begin to disrupt your current business model?

Market research firms like IDC and Forrester predict how fast various markets will convert to cloud computing models. This is not what TSIA does. We are focused on how this shift will impact the business models and service models of technology providers. So we don’t try to answer the “when” question for companies. Having said that, I read an article today that simply blew my mind and is directly related to the “when” question.

Amazon.com offers cloud based storage and web service offerings. They  just announced the growth rate they are experiencing on these services:

 

Year over year growth of 192%. Are there any products or services in your current portfolio currently growing at 192%? The TSIA Service 50, fifty of the largest providers of technology solutions today, grew top line revenues at a tepid 6% from Q4 2010 to Q4 2011.

And the tongues are wagging about this growth of S3:

“This is the largest storage system in the world bar none; there isn’t anything like it anywhere else that I’m aware of unless it’s some secret government/NSA vault.”

“I don’t understand how people can’t see this kind of thing and just have their jaw hit the floor. People are paying for this. At this rate they will have 2 TRILLION objects in another year and it will be a $600M/year business.”

 

“First, broad based adoption driven by consumerization of IT. Second, the shift from transaction to engagement – we have social, mobile, analytical, and other unstructured data. Third, true elasticity has come to fruition as the promise of the cloud gets delivered. People are taking to the cloud because the tools are easy to use and they don’t have time or money to provision expensive servers. Instead they are using elasticity, which was the original premise of AWS. We could see it happening last year but this leap in growth is tremendous.”

“Amazon has established itself as one of the leading contenders. The barriers of entry are high. Very few folks can afford to build the data centers, the software infrastructure, and momentum to be profitable. Amazon is in the same league as Google, Microsoft, IBM, etc. The only other folks that could do it if they woke up are the telco’s – but we’ve all been telling them that for years. They haven’t paid attention.”

So I don’t know exactly when cloud computing will impact your business model. But I will continue to argue it is a question of “when” and not “if.”

 

 

 

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