Virtually all businesses, 92% of them, now use cloud in some form or another. And while cloud has become ubiquitous, its gigantic tailwind hasn’t benefited everyone equally. In fact, when you look at the offerings from cloud’s biggest providers, one group of organizations continues to be overlooked: small businesses.
SMBs continue to face major obstacles to maximizing cloud benefits. For one thing, misalignment between the laundry list of features that mega providers offer and the core services that SMBs actually need introduces unnecessary complexity. That leads to another big hurdle: cost. More than half of SMBs now spend at least $1.2M annually on cloud. But they waste as much as a third of that investment because they don’t fully understand their provider’s features, pricing model, or both. AWS launches around 1,000 new features every single year, offering more than 200 “full-fledged services.” But as analyst Kurt Marko points out, while billion-dollar brands don’t need to worry about service sprawl and overlapping features, SMBs do.
As the cloud market grows and evolves, SMBs need choices that prioritize core functions, supportive services, and simpler pricing. Now, thanks to the rise of alternative providers, SMBs can find a cloud partner to right-size their investments without compromising on essentials.
SMBs Seek Simplicity and Flexibility
SMBs’ digital transformation needs remain largely unaddressed. For example, there is a gap between how much SMBs can afford to spend on cloud computing, storage, and support, and what they actually need to invest to achieve digitally enabled growth. This is in part because cloud costs continue to balloon. Nearly half of all organizations busted their budgets and overspent on cloud services last year, a fact that isn’t surprising when cloud’s biggest providers continue to raise prices and charge fees for crucial services like outbound data transfers (aka data egress charges).
To cut unnecessary costs, what SMBs really need are cloud’s core primitives, the simple “basics,” which include compute, storage, networking and support functions. More specifically, SMBs need computing capabilities that are optimized for memory-intensive workloads in order for them to develop, deploy, run and scale their applications. In addition, the compute function must also provide adequate resources for Kubernetes or other containerization tools that unlock the power of multi-cloud ecosystems.
Storage is another core service SMBs require, and it’s a growing area of competitiveness among cloud vendors. But storage doesn’t just entail keeping data somewhere. It also includes ease of use with regard to accessing, governing, and analyzing data — and flexible scaling for busy or off-peak times and backups in the case of unexpected outages.
Dependable networking and support services are additional pieces of the puzzle. The beauty of cloud is it’s virtually unlimited and can scale with a business — assuming there’s a solid network at its backbone. SMBs, in particular, require a cloud network that can deliver consistency, reliability and security to support dynamic workloads as their businesses grow and their needs swiftly change. If a marketing promotion drives traffic to a site, for example, that network must be ready. At the same time, SMBs need a high level of support to simplify cloud management and ensure primitive functions are performing at their peak, especially when they lack the in-house expertise to manage cloud alone.
However, simplicity also extends beyond cloud itself to include simpler billing and pricing structures. SMBs deserve a real partner that can deliver ROI to cloud with core primitives at a transparent, consistent price, instead of a menu of services and obscure added costs for basic cloud functions like scaling and data egress.
An Alternative for SMBs
SMBs need the proper mix of core cloud services and support functions, with a better price-to-performance ratio to right-size their technology spend. Alternative providers can do exactly this.
In fact, the alternative cloud category now makes up one-third of all spending on cloud services, as SMBs, in particular, gravitate toward alternative vendors thanks to their affordable core primitives, managed support services and open source platforms. SMBs are also finding that alternative providers are primed for right-sizing cloud workloads, providing solutions that are simpler and more manageable for their businesses, without sacrificing performance or living in fear of customer support being slashed.
“The message of simplicity from alternative cloud providers resonates with developers who need to deploy applications quickly, don’t need access to the full suite of advanced cloud functions, and prioritize price, performance and access to a level of technical support,” 451 Research analyst Liam Eagle explains.
While some platforms continue to under-serve and under-value SMBs, alternative cloud providers are stepping up to create a healthier cloud market for smaller companies, who often need to get more value, and more love, from their cloud provider.
Blair Lyon is head of cloud experience for Akamai. In his role, Lyon helps accelerate innovation by making cloud computing simple, easy, and affordable to all. He has over 25 years of experience building businesses and delivering award-winning solutions, and previously served in executive leadership roles with Capgemini and Dynamic Yield.