Cloud Services - The promise of transformation

Cloud services hold a promise for communication service providers (CSPs) and the small and medium enterprises that they serve – the promise of transformation.  For the consumers of cloud services, or X as a service (XaaS), businesses can instantly access enterprise-grade applications and services from any location with an internet connection.  Cloud services are available at a lower capital expense, lower cost to entry, and lower cost to operate for the end user.  The marketplace is full of choices for cloud consumers, to the point that business customers are looking for recommendations to provide their IT needs.

Communication service providers are faced with a different kind of transformation, specifically in the way that they offer and manage cloud services.  CSPs will benefit by offering cloud services to differentiate and drive value of their current IP offerings, but the change must go beyond simple bundling.  Customers are demanding converged services from the cloud, services that can be sourced from a single provider for ease of acquiring, using, and paying for the services.  Who can better deliver cloud services with network services than the CSP?  They already provide secure and assured connectivity to the network and manage orders, provisioning, and billing the customer.  Cloud services are a natural extension, and with a market worth $150 billion by 2013, the providers will need to differentiate through a significant transformation by converging their cloud and network services in a truly unique and valuable offering.

The value of cloud services will depend upon the number and variety of SaaS solutions that can be integrated as a service through a concept Gartner calls cloud service brokering.  The integration of cloud services has been classified in the following three areas, listed in increasing complexity, and value to the user:
1.    Cloud Service Intermediation – features and services that are added to cloud services to improve their capabilities
2.    Cloud Service Aggregation – combining multiple cloud services into new services
3.    Cloud Service Arbitrage – real-time, dynamic service aggregation of endpoints based on metadata

Cloud Service Intermediation is widely available today through resellers that provide security and identity management.  These abundant services offer simplicity on the operational side – consolidated billing, flow through activation, simple identity management - and light integration from a few SaaS solutions from the same vendor.  The opportunity for Intermediation as a brokerage capability is just starting to develop.

On the horizon is Cloud Service Aggregation, combining several cloud services into new solutions in a cloud brokering delivery platform.  The requirements for aggregation demand a canonical data model, integration framework, and service orchestration of capabilities in the cloud.  This is a service that small and medium enterprises will be resistant to do on their own with limited IT expertise, making the CSP the perfect intermediary to provide aggregation brokerage.  Standards will be necessary to ensure interoperability of the OSS and the cloud, supporting  the CSPs role in cloud brokering.  Businesses will leverage aggregation brokerage to bring together many critical applications that must share information between them, beyond identity.  An example would be using a cloud broker to correlate a CRM contact list with call logs from the UCS and comparing the result with an accounts receivable application that measures the performance of agents.  In addition to business features, one additional critical requirement is that the cloud services broker must provide a security model that is able to authenticate, authorize, and audit these transactions so that the customer’s valuable data is secure.  CSPs currently solve this problem with private clouds and network security offerings.  A serious problem arises when attempting to bring in public cloud XaaS products into the mix.

To deliver Cloud Service Aggregation, a new kind of service fabric framework is needed that can operate with the CSPs legacy B/OSS as well as services in the cloud.  This type of dynamic and flexible middleware fabric must interact using a common data model and industry standard interfaces.  The multitude of XaaS offerings presents the classic n-squared (n2) problem (http://www.eaipatterns.com/ramblings/03_hubandspoke.html ) of integration that can be solved by a cloud broker that manages the transactions and messages.

Without the flexibility to easily add, change, or remove nodes, the solution runs the risk of lock-in and being unable to take the next step toward Cloud Service Arbitrage, a capability that will be quite common in the near future.  Think about how simple it is to provision and deprovision applications on your mobile device.  There will be a similar demand for cloud services as technologies change and new business applications emerge, XaaS suppliers will be competing at the speed of innovation.  Automated and simplified B2B interactions of aggregation can deliver on the promise of internet products delivered and integrated in internet-time.

Cloud Service Arbitrage is the third type of cloud brokerage, and the one that will truly transform how we interact with the cloud.  Unlike cloud service aggregation, arbitrage brokerage will have loosely coupled endpoints that are orchestrated in real time with little human involvement, dynamically leveraging capabilities in the cloud based on metadata.  Imagine a situation similar to browsing for a restaurant and having the semantic web pull information about your location, preferences, friends’ preferences, budget, past patterns of restaurants and creating a personalized recommendation.  Cloud Service Arbitrage would act in the same way.  I would like to email a large, confidential file to a colleague across the world.  The arbitrage brokering service would provision a storage service that is equally accessible to myself and my colleague, adequately provisioned for size and with both of us as users, upload the file, create the download link, email it, and securely manage and monitor the transaction to ensure only he and I have access, and debiting my account once the transaction is complete.

The complexity of cloud brokering from an operational standpoint should be the first large step that CSPs take toward their cloud service offerings.  Indeed, the pain of transformation will pay dividends with the unique offerings that customers will see as they are able to use applications that share data, securely, and in real-time.  Customers will trust the CSPs as the natural aggregator for cloud services in their proven ability to securely deliver their mission critical enterprise applications, as the CSP currently delivers this functionality in the connectivity and is able to drive increased demand in larger data services.  The delivery and management of converged cloud and data services will soon be as basic of a customer expectation as internet access on a handheld device.  Standards in cloud brokerages will be critical to leverage the countless solutions on the cloud.  Diversity without standards is chaos, diversity with standards is competition.