Take Your Customers to the Cloud
Before Someone Else Does
Susan DeFlorio, COO
FiberCloud Inc.
Susan.DeFlorio@FiberCloud.com
Agenda
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Introduction
Cloud landscape
The global market is impacting your customers
Change happens at an incredible pace
What is the opportunity?
Take the leap
Who is FiberCloud?
Cloud, Colocation & Connectivity
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FiberCloud is an ISP, Cloud and IT infrastructure service provider
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Headquartered in Seattle, WA
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Over 10 years experience in colocation & managed solutions
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A wholly owned subsidiary of a LEC, understand the CLEC space
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Commercially provisioning SaaS solutions since 2009.
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Focus on offering flexible, scalable best-in-class products and quality
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Dedicated to partnering with providers to transform their business
Cloud landscape
Noise
Noise
Benefits you can deliver to your clients
77%
Will have
access to new
services and
apps that they
wouldn’t have
in-house
71%
Will reduce
costs
SMB Cloud Adoption Study Dec 2010 – Global Report (Edge Strategies)
63%
Can use
application
from any
device
anywhere
50%
Software will
always
be up to date
Macroeconomics– They impact to all of us
• Shaky Global economy impacting foreign trade
• Globally connected geopolitical events –
Europe, The Middle East, Asia are felt here
• Increasing food and gas prices across the globe
• US Elections – Moody’s rating – The Debt
• Restrictions on capital
investment
• New competition –
national players coming
into your market
• Uncertainty
“We always overestimate the change
that will occur in the next two years and
underestimate the change that will occur
in the next ten. Don't let yourself
be lulled into inaction. “
- Bill Gates
Your customers are turning to the cloud
What has happened in the past 2 years?
• Consolidation – M&A, Large Telco/Network
providers buying in
• More applications, choices available
• Significant adoption and acceptance – in house IT
less significant barrier
• Large revenue growth for Cloud Providers
• Tablets have taken off – driving adoption
Speaking of a quick turnaround….
Predictions for the next 10 years
• Cloud Services workload offloaded from PC
“By 2020, most people won't do their work with software
running on a general-purpose PC”
- Pew Research
• Cloud Computing Market Will Top $241 Billion
in 2020
– Forrester Research
• 5 billion Internet users by 2020
- Pew Internet & American Life Project
The cloud means opportunity for you
Solve more of your customer’s problems
 Better tools – access to enterprise grade applications and
services smaller customers don’t have access to
 Scalability – ability to simply expand and/or contract quickly
and affordably
 Mobility - work securely from anywhere, anytime
 Protection - easy first steps to Business Continuity & Disaster
Recovery
 Focus – spend less time & money on software &
infrastructure & more time focused on their core business
Challenges facing businesses today
Breadth of applications in use by SMB today
* Parallels 2012 US SMB Report
Why are your customers moving to the cloud now?
Credit restricts investment
70% of businesses indicate a restricted cash flow due to a lack
of available credit
Increasing capabilities
85% of IT managers & business owners are considering cloud
as part of new IT spend
Desire to outsource
70% of businesses report a desire to outsource IT solution
Catering to a mobile workforce
70% of companies have employees who work outside the
office 3+ days a week
Cheskin Cloud 2012, AMI SMB Pulse 2010, Cisco SMB Survey 2010
These are the players looking for your customers
It’s the logical place for you to go
Not only are emerging cloud providers reaching for your
customers but CLECs, Telcos and ISPs are buying into the
Cloud as well.
• CenturyLink – Savvis
• Time Warner Cable – Navisite
• Verizon – Terremark
• Cbeyond – MaximumASP
Even retailers are getting into the cloud.
• Best Buy (Geek Squad) – Mindshift
Making the leap can be incremental
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The opportunity is real
There is still room for new players
The market is dynamic
Leverages network connections, tier 1 support
Fits well with service-based business
Projected growth in the next 2-3 years
SMB use of paid cloud services
Adoption
Average Paid
Services/Customer
Edge Strategies survey commissioned by Microsoft Corp., “SMB Business in the Cloud 2012”
E-mail
How to get started
You’re already poised to win
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Your relationship & local presence give you a leg up
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You are a trusted advisor, you can guide the way to the cloud
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Monetize your offerings with services you earn margin on
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Stickier relationships increase retention, reduce churn
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Create bundled offerings & solutions
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Move from break/fix to Managed Services, loop to value add
SMBs need your help
52% don’t have the resources to get people trained
60% don’t have resources to implement new
technologies & applications
57% have resources,
but not the time
Most prefer to buy services from
a local provider—
31% feel this is critical
Three basic models
BUILD
• Must select a product platform for the long term
PARTNER
• Quick time to market
HYBRID
• Mix of services offered on the customer premise or through your
existing infrastructure combined with using a Cloud Service Provider
Build vs. Partner vs. Hybrid Considerations
BUILD
PARTNER
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Capital Investment
- Hardware & Software
Facility Conversion
- Central Office to Data center conversion costs
- Develop Multi-carrier network arrangements
- Secure (redundant) power, fuel & bandwidth providers
Support infrastructure
- IP and application centric personnel
- Implementation & management resources
- 7x24 customer support
- License fee administration
Sales & Marketing organization
HYBRID
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Not all applications are appropriate for the Cloud
Often times certain systems/infrastructure need to
stay on the premise
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Pay as you go – no upfront investment
Recurring revenue opportunity
Protection from technology obsolescence in a
highly dynamic marketplace
Trained experts across multiple platforms
Go to market support & sales training
There’s no brass ring cloud solution, a broad
portfolio is required
Data center grade security & standards
Enables focused on customer retention rather
than technology infrastructure
How FiberCloud built its hosting environment
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Offered directly in Seattle, to resellers nationwide
Built in as much redundancy as we could afford (physical, network & hardware)
At least 2x (front end, application layer & storage)
Same story for security (hiring, practices)
Virtualize as much as we could (hardware benefit)
Technology staffing (Windows, Hyper-V, Solution Center, Citrix, User Applications)
Initially, third party provisioning systems
Local & non-local Backup
Defined business practices
Added geographic diversity
Not just technology
Track 85+ competitors
Development cycle
Recurring revenue and bigger margins
Business Strategy
Situation
Your Strengths
• Customer churn
• Startup & capital costs
too high to build it on
their own
Results
• Stickier customers,
• Customer relationships
• Technology leadership
lower churn
• Increased revenue &
margin
•Changing market
landscape
• Build on in-house
customer service, field
techs & sales staff
• Competition adding
Cloud Services
• Local presence
• Competitive
differentiation
•Understand
customer/market
needs
• Expand beyond
traditional markets
• How/where do I start?
•Future revenue at risk
• Limited customer
relationships
• Startup & capital costs
too high to add new
services
• Your expertise
• Not just a reseller
• Transition from break
fix to managed
services
• Increased margin &
recurring revenue
Internet Communications Bundles - CLEC
With the Cloud you can offer:
• Integrate new products with
existing Internet & Bandwidth
• Integrate new products with
existing Voice services
• Your own the billing relationship
• Increase margin
• Add value and strengthen existing
relationships
• Reduce customer churn
Targets:
• Broadband customers
• Voice & data customers
• Small to large businesses
Customer benefits:
• Stay connected & organized
• One inbox, anytime, anywhere
• Protect the business
• Predictable costs
• Eliminate number of vendors
Cloud products to augment with:
• Business Class Email
• Microsoft Hosted SharePoint
• Online Backup for Servers
• Online Backup for PCs
Small Business Bundles - ISP
With the Cloud you can offer:
• Add new, stand alone products to
your catalog of offerings
• Bundle new products with your
existing services
• Offer web site development &
maintenance
• Your own the billing relationship
• Increase margin
• Add value and strengthen existing
relationships
• Reduce customer churn
Targets:
• Customers to protect – stickiness
• Broadband customers
• Small to medium businesses
Customer benefits:
• Stay connected & organized
• One inbox, anytime, anywhere
• Protect the business
• Predictable costs
• Eliminate number of vendors
Cloud products to augment with:
• Business Class Email
• Microsoft Hosted SharePoint
• Business Website
• Online Backup for Servers
• Online Backup for PCs
Managed Services, Desktop - MSP
With the Cloud you can offer:
• Monthly retainer to manage client
desktops
• Adding Email & Backup increases
value
• Add depth to your product
offering
• Your own the billing relationship
• Increase margin
• Add value and strengthen existing
relationships
• Reduce customer churn
Targets:
• Broadband customers
• Voice & data customers
• Small to medium businesses
Customer benefits:
• Stay connected & organized
• One inbox, anytime, anywhere
• Protect the business
• Predictable costs
• Scalable
• Eliminate number of vendors
Cloud products to augment with:
• Business Class Email
• Online Backup for PCs
Managed Services, Applications & Servers - MSP
With the Cloud you can offer:
• Monthly retainer for system
administration – firewall, VPN,
backup
• Software installation &
management
• Monitor and respond to alerts
• Your own the billing relationship
• High margin services
• Add value and strengthen existing
relationships
• Reduce customer churn
Targets:
• SMB needing servers w/o the capital
expense
• Line of business application users
• Customers with aging infrastructure
• Businesses with changing needs
Customer benefits:
• Cost effective server infrastructure
• Anytime, anywhere access to
applications & data
• Predictable costs
• Scalable
• Eliminate number of vendors
Cloud products to augment with:
• Business Class Email
• Online Backup for PCs
Near term opportunities
Taking a pragmatic approach…time to market
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One company can’t do everything in the Cloud
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At the end of the day it is all about the customer & the applications
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Pick a product that’s incremental to your business and get started
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Cloud applications are quickly evolving
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Hybrid deployments (on premise & cloud, multi-provider) are likely
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Choose a cloud provider thoughtfully
build
hybrid
partner
Near term opportunity – Small business Cloud penetration
End user Apps
Systems Infrastructure Software
Email
Web
Conference
Collaboration
30%
opportunity
30%
opportunity
30% cloud
97% use
Backup
Content
Management
Remote access
10%
opportunity
25%
opportunity
20%
opportunity
15%
opportunity
30% cloud
7% cloud
16% cloud
16% cloud
15% cloud
97% use
28% use
82% use
94% use
49% use
App Design/Dev
Business Apps
BI
Intranet
Marketing
Storage
DB System
App Dev Tools
7%
opportunity
10%
opportunity
12%
opportunity
23%
opportunity
14%
opportunity
6%
opportunity
3% cloud
8% cloud
17% cloud
11% cloud
10% cloud
5% cloud
20% use
30% use
40% use
85% use
45% use
15% use
Microsoft Hosting Summit, April 2012
Pick your product, pick your deployment plan
If you decide to build yourself
• Select your new product to bring in house
• Hire experts in cloud, multi-tenant infrastructure, software,
network, hardware and security
• Build or augment your existing facility with a focus on
redundancy, high availability and security
• Invest in the hardware & software to build your platform on
• Create your service delivery plan and processes
• Plan for ongoing maintenance and updates
• Don’t forget to get the word out through marketing materials
• Keep an eye on the market to determine the next best
product to bring in house
Choosing the right Cloud Provider Partner
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License fees
Do you have account control?
Passed security audits like – SAS 70 Type II/SAE 16 or similar
Will they support you with dedicated service & support teams?
Are they easy to do business with? What are their terms like?
Do they have a breadth of products & services you can adopt
Do they offer go to market & sales support or will you have to
do it yourself
• Quality, redundant and highly available infrastructure
• Knowledgeable support staff
• Service Level Agreement (SLA)
Choosing a hybrid approach
• Understand what the gaps are that you want a
partner to fill
• Find a partner who’s strengths compensate in the
areas you need help
• Make sure the partner is flexible & willing to work
with your unique needs in mind
• Make sure you can change partners if you need to
• Determine how you will integrate on premise
resources with cloud based offerings
Go beyond the technology – Choosing a Cloud Provider
Leadership
Support
Breadth of products
Security
• Is your voice heard?
• Solutions for common business
problems
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Implementation & maintenance
Technical support
Sales & marketing
Training
• Common business applications
• Productivity, security, communications
• Infrastructure
• Physical
• Employees
• Adopt best practices & standards
around information security
“The way to get started is to quit
talking and begin doing.”
- Walt Disney
Contact
THANK YOU!
Susan DeFlorio
Susan.DeFlorio@FiberCloud.com