The IT industry is known for using terminologies that are hyped. In some cases, it appears that renaming an old approach with a catchier name leads to an increased usage of that old approach. In reality, however, more things have changed than just the name. "The cloud" has become increasingly popular as a term, although many developers have been using some sort of remote, scalable, hosted service for decades. But the cloud environments that are being built today, are really game-changers.
I am very fortunate to be in close contact with engineers working on the biggest cloud systems. At Gluon, we have a SaaS product called Gluon CloudLink, which allows enterprise developers to extend their enterprise services into mobile apps. We offer Gluon CloudLink as a SaaS, and the service itself is hosted on AWS EC2 instances, using Amazon services as RDS and DynamoDB.
As a SaaS provider, the advantage of hosting your SaaS solution in a cloud environment is that developers can access it, regardless where their own infrastructure is hosted. While that sounds great, there is also a downside. Companies that require an IT infrastructure are often a customer with one of the bigger cloud providers, e.g. Amazon, Pivotal, Oracle, Google, IBM, Microsoft. Those companies have a trust relationship and a single account with that provider. While they can shop for third-party services and easily do a technical integration, it requires them to setup a separate billing process.
The move that we are seeing today is a tendency towards cloud marketplaces. In such a marketplace the cloud provider allows third-party SaaS providers to offer their services towards customers of the cloud provider. This is a triple win:
- The end customer has a single point of contact (and billing), which is the cloud provider
- The cloud provider has a more complete offer for his customers, which keeps the customer happy and loyal
- The SaaS provider benefits from the customer ecosystem and infrastructure provided by the cloud provider
In the past, when you had an account with a cloud provider, you almost exclusively used the services developed and provided by the cloud provider. But in many cases, developers want to use other services as well. Rather than developers having to deploy the other services on the cloud systems, it is often more beneficial if those services are offered by the cloud provider as well, and integrated into their infrastructure.
This concept makes it possible for cloud providers to offer services in different vertical markets, that require specific expertise. Their offering can become much wider than today.
I see similarities between this evolution and opening Apple AppStore and Google Play Store to third-party developers. In both cases, the big providers (cloud providers or mobile providers) realized the advantages of working together with third-party software developers, rather than doing everything themselves.
SaaS developers, on the other hand, benefit from more visibility and easier integration. Depending on how the cloud provider organizes it, the partner network can be extremely valuable for the SaaS developers, as it can facilitate the sales and marketing process for them. In the end, the customer of a cloud provider expects a fairly complete offering from its provider, hence the latter benefits from hooking the customer with the third-party service that best matches its requests.
All big cloud providers either have this in place, or are working on it. And it's going at a high speed. Personally, I am pleasantly surprised to see how fast this evolution is taking place. The cloud vendors are typically big companies, and it is not always easy for them to innovate quickly. But the amount of flexibility and innovation that I have been seeing over the past year in some of the biggest cloud providers is really astonishing. I have the greatest respect for the engineers working on those systems, as they have to fit a number of old and recent requirements into a single product, e.g. security, microservices, container support, scalability, availability, service discovery, binding, etc.
While it is hard for a small company to create their own IaaS/PaaS infrastructure like the big cloud providers do, there is a myriad of other opportunities. Those cloud marketplaces can only work when there is a sufficient amount of third-party services that is being offered via the marketplace. Hence, it is a great time for SaaS companies to offer their product via the cloud marketplaces of the different cloud vendors.