Platform as a Service: Current vs Future Returns

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Privately, Platform-as-a-Service vendors are disappointed. Public pronouncements to the contrary, purveyors of PaaS offerings remain frustrated by anemic adoption. And, of course, the relentless progress of Amazon. “What we’ve built is substantially more clever than Amazon,” one PaaS vendor told me. “Sooner or later the market will realize this.”

Perhaps. But timing, as ever, is everything.

In the present day, customers heavily advantage IaaS solutions, as the accelerating success of Amazon Web Services indicates. While we can debate the reasons for this – the comfort level with cloud environments that closely resemble their existing infrastructure, the fear of being locked in to a given platform, and so on – the fact is that in the battle between infrastructure and platform, infrastructure is winning. However clever the latter might be.

This should and in some cases is informing vendor strategies relative to the cloud. If all that you have to offer an infrastructure hungry market is platform services, it might be worth considering your approach. Business Planning 101.

Equally dangerous for cloud vendors, however, is assuming that the current state correctly anticipates the future state. History suggests that future market preferences will look substantially different than those governing purchasing today. The trajectory of Software-as-a-Service applications is likely to be instructive here. As Matt Asay put it:

Clearly, it’s going to take time to get enterprises comfortable running their businesses on the public cloud.

But let’s get this straight: It’s just a matter of time. Salesforce.com proved enterprises will put their most sensitive data — their customer data — in the cloud. It’s unclear why a vast array of other applications and associated data would be any different.

Neither are such examples difficult to come by. The enterprise technology landscape is positively littered with technologies that were dismissed for one reason or another. PC’s. Virtualization. Open source. The internet. Each of these has been ignored for the same reasons that enterprises are reluctant to embrace PaaS: they were insecure. They weren’t enterprise grade. Compliance regulations prohibited them.

Which is to say that they were new and that enterprises didn’t yet know what to make of them. Like PaaS.

The point here is not to guarantee a bright future for PaaS offerings. There are many legitimate reasons for enterprises to be cautious about building on a platform controlled, top to bottom, by a single vendor. The point is rather to remember that the market reaction at present to PaaS is unlikely to be predictive of its future prospects. Attitudes are impermanent, especially in technology.

Disclosure: Numerous companies offerings cloud services are RedMonk customers, including IBM and Microsoft. Amazon is not a RedMonk customer.

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