The Speed of Cloud Management Acquisitions Tells Us 3 Things About the Cloud Market

The Speed of Cloud Management Acquisitions Tells Us 3 Things About the Cloud Market

There has been a rush of cloud management acquisitions lately, with VMware, Apptio, and Flexera making major acquisitions in the last three months alone (and more to follow). I thought it would be useful to compile a centralized list, so we can take a look at the trends in this market and why these acquisitions are accelerating.

The Multi-Faceted Cloud Management Industry

First, let’s be clear: the cloud management industry is broad and a bit ambiguous but as it matures industry analysts have begun to define specific categories. We found the below put together by Gartner in a recent blog:

ParkMyCloud fits into the “Cost Management and Resource Optimization” category, which in and of itself is broad, but in a nutshell these vendors help enterprises monitor, manage, govern and control cloud spend in a variety of ways. The other category we find intriguing is “Provisioning and Orchestration”. That’s where we feel a lot of the DevOps tools fit, and that is the go-to-market model we like to fashion ourselves after — technical user/buyer, self-service trials, SaaS, and freemium model.

Cloud Management Acquisitions, 2013-2018

So it should be no surprise that we have collected the following data points listed below – we would welcome your feedback on others we should add to this list.

 

 

Company Founded Year Category Raised Acquirer Acquisition Price
FittedCloud 2015 2018 CMP Apptio
Rightscale 2006 2018 CMP $62.1MM Flexera
Cloud Ranger 2014 2018 CMP $1.1MM Druva
OpsGenie 2012 2018 DevOps $10MM Atlassian $295MM
CloudHeath Technologies 2012 2018 CMP $88MM VMware $500MM
Relus Cloud 2013 2018 MSP Cloud Reach
VictorOps 2012 2018 DevOps $34MM Splunk $120MM
Codeship 2011 2018 DevOps $11.4MM CloudBees tbd
N2WS 2012 2018 CMP ~$10MM Veeam $42.5MM
cmpute.io 2012 2017 CMP Cisco N/A
Botmetric 2014 2018 CMP $2MM Nutanix $50MM
Cloud Technology Partners 2009 2017 MSP $34MM HPE N/A
Cloudyn 2012 2017 CMP $20.5MM Microsoft ~$50MM-$70MM
CloudMgr 2011 2017 CMP $1.45MM Cloudability N/A
Cloudcruiser 2010 2017 CMP $19.8MM HPE N/A
Cloudamize 2012 2017 CMP $2MM Cloudreach N/A
Cliqr 2010 2016 CMP $38.4MM Cisco $260MM
ITapp 2012 2016 CMP ServiceNow N/A
Gravitant 2004 2015 CMP $40.3MM IBM N/A
ClusterK 2013 2015 CMP Seed Amazon $20MM-$50MM
Servicemesh 2008 2013 MSP $15MM CSC $295MM

In the last 45 days or so the cloud management platform (CMP) space has been hyperactive as VMware acquired CloudHealth, Apptio acquired FittedCloud, and Flexera acquired Rightscale. Good news for all but we are most excited for CloudHealth given we are a commercial and technology partner with them.

What These Cloud Management Acquisitions Tell Us about The State of Public Cloud

So what does this tell us about the cloud management space, and in particular the cost management and optimization space? We have some opinions:

  1. Multi-cloud is truly here. The benefit of these cloud management tools is that they are agnostic and can help enterprises manage and optimize AWS, Azure and Google services alike.
  2. Companies like Cisco, HPE and VMware understand the importance of being in the public cloud game, each basically failed at competing against AWS et. al. head on, so they are now ensuring they have tools that help enterprises manage public, private, hybrid and multi-cloud services.
  3. The cost management portion of cloud management is always a “top 3” concern of CIOs and CTOs according to any cloud survey published, so cloud cost optimization is front in center in enterprise IT and ISVs must be able to address this concern.

Clearly, cloud management acquisitions will continue, and new solutions and companies will evolve as this market grows and matures. The cloud providers are launching new services at a rapid pace, and like any large scale utility there needs to be tools to help manage, govern, secure, and optimize these existing and new services.

Even if you’re not (yet) multi-cloud, you should use cloud agnostic tools

Even if you’re not (yet) multi-cloud, you should use cloud agnostic tools

There’s a simple fact for public cloud users today: you need to use cloud agnostic tools. Yes – even if you only use one public cloud. Why? This recommendation comes down to a few drivers that we see time and time again.

You won’t always use just this cloud

There is an enterprise IT trend to multi-cloud and hybrid cloud – such a prevalent trend that even if you are currently single-cloud, you should plan for the eventuality of using more than one cloud, as the multi-cloud future has arrived. Dave Bartoletti, VP and Principal Analyst at Forrester Research, who broke down multi-cloud and hybrid cloud by the numbers:

  • 62 percent of public cloud adopters are using 2+ unique cloud platforms
  • 74 per cent of enterprises describe their strategy as hybrid/multi-cloud today

In addition, standardizing on cloud agnostic tools also can alleviate costs associated with policy design, deployment, and enforcement across different cloud environments. Management and monitoring using the same service platform greatly reduces the issue of mismatched security policies and uncertainty in enforcement. Cloud agnostic tools that also operate in the context of the data center — whether in a cloud, virtualized, container, or traditional infrastructure — are a boon for organizations who need to be agile and move quickly. Being able to reuse policies and services across the entire multi-cloud spectrum reduces friction in the deployment process and offers assurances in consistency of performance and security.

How do you decide what tools to adopt?

We talk to different size enterprises using the cloud on a daily basis, and always ask if they are using cloud native tools, or if they are using third party tools that are cloud agnostic. The answer – it’s a mix to be sure, often it’s a mix between cloud-native and third-party tools within the same enterprise.

What we hear is that managing the cloud infrastructure is quite a complex job, especially when you have different clouds, technologies, and a diverse and opinionated user community to support. So a common theme with many of the third-party tools we see used tend to include freemium models, a technology someone used at a previous company, tools recommended by the cloud services provider (CSP) themselves, and open-API-driven solutions that allow for maximum automation in their cloud operations. It also serves the tools vendors well if deploying the tool includes minimum effort — in other words, SaaS tools that do not require a bunch of services and integration work. Plug and play is a must.

For context, here at ParkMyCloud support AWS, Azure, Google and Alibaba clouds, and usually talk to DevOps and IT Ops folks responsible for their cloud infrastructure. And those folks are usually after cloud cost control and governance when speaking with us. So our conversations tend to focus on the tools they use and need for cloud infrastructure management like CI/CD, monitoring, cost control, cost visibility and optimization, and user governance. For user governance and internal communication, Single-sign On and ChatOps are must have.

So we decided to compile a list of the most common clouds and tools we run across here at ParkMyCloud, in order of popularity:

  • Cloud Service Provider
    • AWS, Google Cloud, Microsoft Azure, Alibaba Cloud – and we do get requests for IBM and Oracle clouds
  • Infrastructure Monitoring (not APM)
    • Cloud Native (AWS CloudWatch, Azure Metrics, Google Stackdriver), DataDog, Nagios, SolarWinds, Microsoft, BMC, Zabbix, IBM
  • Cost Visibility and Optimization
    • CloudHealth Technologies, Cloudability, Cloudyn/Azure Cost Management, Apptio
  • CI/CD + DevOps (this is broad but these are most common names we hear that fit into this category)
    • Cloud Native, CloudBees Jenkins, Atlassian Bamboo, HashiCorp, Spinnaker, Travis CI
  • Single Sign-On (SSO)
    • ADFS, Ping, Okta, Azure AD, Centrify, One Login, Google OAuth, JumpCloud
  • ChatOps
    • Slack, Microsoft Teams, Google Hangouts
  • Cloud Cost Control
    • Cloud Native/Scripter, ParkMyCloud, GorillaStack, Skeddly, Nutanix (BotMetric)

Beat the curve with cloud agnostic tools

Our suggestion is to use cloud agnostic tools wherever possible. Our experience tells us that a majority of the enterprises lean this way anyways. The upfront cost in terms of license fee and/or set up could be more, but we think it comes down to (1) most people will end up hybrid/multi-cloud in the future, even if they aren’t now, and (2) cloud agnostic tools are more likely to meet your needs as a user, as the companies building those tools will stay laser-focused on supporting and improving said functionality across the big CSPs.

The Cloud Managed Services Market is Growing – and That’s Good for MSPs

The Cloud Managed Services Market is Growing – and That’s Good for MSPs

Lately, we have been talking to quite a few providers of cloud managed services that play in both the private and public cloud spaces. These conversations have centered around how cloud management needs are evolving as enterprises’ hybrid and multi-cloud needs have accelerated.

Most refer to this market as cloud managed services (for once, no acronym associated), and many of these managed service providers (MSPs) also sell migration services to bring customers from private to public cloud, and cloud services between Amazon Web Services (AWS), Microsoft Azure, and Google Compute Platform (GCP). So these MSPs can help you move your applications to the cloud, sell you the cloud services you’re using, and manage and optimize your cloud services. It’s a rapidly growing market with a lot of M&A activity as MSPs race to provide differentiated cloud managed services that enable them to help enterprises get to market faster, better, and cheaper.

The global cloud managed services market size is expected to reach USD 82.51 billion by 2025, according to a study conducted by Grand View Research, Inc. Enterprises are focusing on their primary business operations, which results in higher cloud managed services adoption. Business services, security services, network services, data center services, and mobility services are major categories in the cloud managed services market. Implementation of these services will help enterprises reduce IT and operations costs and will also enhance productivity of those enterprises.

Taking a step back, I had a look at Wikipedia to make sure we were all aligned on what managed services provider are and cloud management is (cloud managed services):

  • A managed services provider is most often an information technology (IT) services provider that manages and assumes responsibility for providing a defined set of services to its clients either proactively or as the MSP (not the client) determines that services are needed.
  • Cloud management means the software and technologies designed for operating and monitoring applications, data and services residing in the cloud. Cloud management tools help ensure cloud computing-based resources are working optimally and properly interacting with users and other services.

Cloud managed services enable organizations to augment competencies that they lack, or to replace functions or processes that incurred huge recurring costs. These services optimize recurring in-house IT costs, transform IT systems and automate business processes allowing enterprises to achieve their business objectives.

The “net net” is that MSPs providing managed cloud services enable enterprises to adopt and manage their cloud services more efficiently.

In March 2018 Gartner published a Magic Quadrant for Public Cloud Infrastructure Managed Service Providers if your interested to see who they rank as the best of the best in when implementing and operating solutions on AWS, Azure and GCP (note this includes multi-cloud but not hybrid cloud). Several large SI’s are on the list like Accenture, Capgemini, and Deloitte, along with newer born in the cloud pure play MSPs like 2ndWatch, Cloudreach and REANcloud.

What’s interesting to us about this list is the recent M&A activity we have seen with many of these companies, here’s a few we were able to remember over a beer (shout out to Crooked Run Brewery in Sterling, VA):

As you can see, there is a clear bias towards buying “born in the cloud”, public cloud focused MSPs, as that’s where the lack of enterprise expertise lies, and of course the hyper growth is occurring as companies migrate from private to public cloud. Many of these providers started off supporting just AWS, and now need to or have begun supporting Azure and Google as well to support The “big 3” cloud service providers in this new, and emerging multi-cloud world.

MSPs that want to get into the cloud managed services game need to realize the pains are different in the public cloud, and that their focus needs to be on helping enterprises with security and governance, managing cloud spending, the lack of resources/expertise, and the ability to manage multi-cloud.

Should Your Company Adopt Google’s Site Reliability Engineering Approach?

Should Your Company Adopt Google’s Site Reliability Engineering Approach?

Over the past year or so, we have spoken with quite a few prospective users who have defined their responsibilities as site reliability engineering (SRE). If, like me, you’re not familiar with the term, I’ll save you the Google search. SRE is a discipline that incorporates aspects of software engineering and applies that to IT operations problems. Practitioners aim to create ultra-scalable and highly reliable software systems. According to Ben Treynor, founder of Google’s Site Reliability Team, SRE is “what happens when a software engineer is tasked with what used to be called operations.” And its origins can also be traced back to 2003 and Google when Ben was hired to lead software engineers to run a production environment.

The site reliability engineering footprint at Google is now larger than 1,500 engineers. Many products have small to medium sized SRE teams supporting them, though not all products do. The SRE processes that have been honed over the years are being used by other, mainly large scale, companies that are also starting to implement this paradigm, including ServiceNow, Microsoft, Apple, Twitter, Facebook, Dropbox, Amazon, Target, IBM, Xero, Oracle, Zalando, Acquia, and GitHub.

The people we talk to on a daily basis are typically charged with operational management of their company’s cloud infrastructure, and thus governing and controlling costs (that’s where we come in). I got to wondering, how is this approached different by, say, a site reliability engineer vs. someone who labels himself as “DevOps”?

How Does Site Reliability Engineering Compare to DevOps?

In simple terms, the difference between SREs and DevOps seems clear based on our conversations with folks. SREs are engineers focused on production environments, while DevOps is a philosophy as well as a role. DevOps folks are definitely less concerned with production vs. non-production, and more concerned with the overall cloud management and operations. Side note, DevOps was coined around 2008, so a SRE actually predates a DevOps engineer.

A site reliability engineer (SRE) will spend up to 50% of their time doing “ops” related work such as issues, on-call, and manual intervention. Since the software system that an SRE oversees is expected to be highly automatic and self-healing, the SRE should spend the other 50% of their time on development tasks such as new features, scaling or automation. The ideal SRE candidate is a highly skilled system administrator with knowledge of code and automation.

When I first encountered it, site reliability engineering just seemed like another buzzword to replace “IT” or “Ops”. As I read more on it, I understand that it’s more about the people and the process and less about the technology. There is rarely a mention of the underlying infrastructure or tools, and it seems like the main requirement is just the desire to improve. With that, you can align your development and operations (funny, right – DevOps) around the discipline of SRE.

Should Your Company Implement a Site Reliability Engineering Approach?

So while all the hype is around implementing DevOps in your organization, should you really be adopting the idea of site reliability engineering? It certainly makes sense based on the name alone, as “site reliability” is synonymous with “business availability” in our modern internet-connected culture. Any downtime for your service or application means lost revenue and dissatisfied customers, which means the business takes a hit. Using site reliability engineering to keep things running smoothly, while employing DevOps principles to improve those smooth-running processes, seems to be the best combination to really empower your company.

How Cloud Trends are Changing (& Happy Birthday, ParkMyCloud!)

How Cloud Trends are Changing (& Happy Birthday, ParkMyCloud!)

ParkMyCloud just turned 3 years old, and from here, the future looks great. The market is growing, cloud is the norm, and cost control is always top of mind for companies big and small. In fact, over 600 enterprises in 25+ countries now use our platform to “park idle cloud resources (including instances, databases and scale groups) in AWS, Azure, GCP and now Alibaba.

As we look to the future, we’re taking a moment to consider current cloud trends and how cost control needs are changing. To provide context, let’s take a quick look at where the market was three years ago.

The Problem that Got Us Started

When we founded the company three years ago, we set out to build a self-service, SaaS platform which would allow DevOps users to automate cloud cost control and integrate it into their cloud operations. We saw a need for this platform as we were talking to enterprises using AWS about broader cloud management needs as a service play. They wanted a self-service, purpose-built easy button for instance scheduling that could be centrally managed and governed but left up to the end user to control – enter ParkMyCloud.

Our value proposition started simply and has stayed relatively constant: save 20% on your cloud bill in 15 minutes or less (it’s 65% per parked resource). The ease of use, verifiable ROI, and richness of our platform capabilities allow global companies like McDonald’s, Unilever, Sysco, Sage and many others to adopt ParkMyCloud on their own, with no services, and begin to automate their cloud cost control in minutes – not days or weeks.

I went back and looked at our pre-launch pitch decks. At that time, the cloud Infrastructure-as-a-Service (IaaS) market was $10B or so, and dominated by AWS, and others like Rackspace and HP were in the game with the other usual suspects. Today, Gartner estimates enterprises will spend $41B on IaaS in 2018, and it’s still dominated by AWS, but the number of players is really down to 4 or 6 depending on where you want to put IBM and Oracle.

But the cloud waste problem is still prominent and growing, most analysts and industry pundits estimate that 25% or more of your bill is wasted on unused, idle or over provisioned resources – that equates to $10B+ based on 2018 IaaS predictions being wasted – that’s a BIG nut. In fact, if you break that down that’s $1MM in wasted cloud spend every hour. And it’s important. Most enterprises rank cloud security/governance and cost management as their primary concerns with cloud adoption.

Cloud Trends Driving the Market

So how are things changing? We see three key trends that will drive our company and platform vision over the next 3 years:

  1. Multi-cloud – it’s been long discussed, but it’s now a reality: 20% of the enterprises using PMC manage 2 or more CSPs in the platform, and that number is growing. As always, cost control is an important factor in a multi-cloud strategy.  
  2. PaaS – Platform as a Service (PaaS) use is growing, so users are looking to optimize these resources. ParkMyCloud offers optimization for databases, scale groups, and logical groups. We plan to expand into containers and stacks to meet this need.
  3. Data-driven automation (AIOps) – our customers, large and small, are pushing us to expand our data-driven policies and automation – everyone is becoming more comfortable with the idea of automation. Our first priority on this front is to optimize overprovisioned resources – often referred to as RightSizing … RightSizeMyCloud!

 

Cloud trends are not always easy to predict, but one thing is for certain: costs will need to be controlled. Good fun ahead.

Page 1 of 1812345...10...Last »