A cloud service brokerage serves as an intermediary between you and your cloud service provider by aggregating multiple cloud services, integrating then with in-house apps and customizing them to meet your needs. See how this new breed of IT service provider is changing the cloud landscape.
When the Museum of Modern Art in New York took on two cloud projects, it decided to reach outside the organization for some extra help.
MoMA sought to migrate from its on-premises email system to a Google-hosted environment and adopt Salesforce.com's CRM offering to gain more insight into donors and members. MoMA CTO Juan Montes read up on Appirio, a San Francisco-based services provider, after receiving a tip that the company was "a vendor with cloud chops." A meeting with Appirio's CEO sealed the deal: The museum tapped Appirio for guidance on both the Gmail and Salesforce deployments.
Montes cited Appirio's cloud expertise and specialized tooling as factors in its selection. "In the case of Gmail, they had the tools and methods to take information as it was in the on-premise context and port it to a cloud context," he says. "It would have been very difficult for us to develop those tools in a timely way. It would have been very costly to us. They had the tools and the know-how and were ready to go and we could do the implementation in a very short period of time."
Cloud Service Brokerages Will Be Big ($100 Billion Big)
Setting up cloud services with third-party assistance is becoming an increasingly common approach among enterprises. Gartner refers to those intermediaries as cloud service brokerages, or CSBs. The market researcher forecasts the annual IT spend on CSB services will reach $100 billion by 2014.
Gartner research published earlier this year defines three roles for CSBs: aggregation, integration and customization. A CSB-as-aggregator pulls together multiple cloud services and provides them to the end customer, essentially acting as a reseller.
The integration role, meanwhile, calls for the broker to link cloud services and on-premises systems, while customization involves the tweaking of cloud services to meet the customer's needs or the creation of applications to run in the cloud setting.
The IT spotlight periodically shines on intermediaries, particularly in times of transition. Systems integrators emerged in the 1980s as custom software began to drive solutions rather than the underlying mainframes. A decade later, the big iron-to-client-and-server transition coincided with the rise of specialty integrators able to assist with that shift.
Commentary: How Cloud Computing Is Forcing IT Evolution
"Cloud brokerage and aggregation is today's version of systems integration," says Jeffrey Kaplan, managing director of THINKstrategies, a consulting firm that focuses on software-as-a-service (SaaS) and cloud computing.
Michael Cohn, senior vice president of marketing at Atlanta-based cloud solution provider Cloud Sherpas, suggests that cloud brokers mark the latest iteration of the IT channel, noting that such companies represent a merging of resellers, systems integrators and ISVs.
"The need for a channel has existed since the beginning of IT," he says. "The role we play is changing as IT moves from on-premise and data centers to the cloud. What you are seeing is the rise of the cloud solutions providers-or the cloud service brokerage, if you want to use Gartner's parlance."
Cohn says enterprise IT shops may not necessarily be skilled in conducting cloud migrations. In the case of mission-critical apps such as email, organizations don't want the added risk of a deployment going wrong, he adds, citing Office Depot and Dillard's as recent customers who have signed on Cloud Sherpas for help with a Google cloud rollout.
Enterprises, however, can-and do-serve as their own cloud brokers. Kaplan notes that CIOs and IT departments may build internal skills that let them tap external cloud resources, which are then deployed based on the cloud brokerage and aggregation idea. "In these cases, the IT department might acquire provisioning technology, which can be used to provide end-user/business unit access to their cloud services."
Examples of the in-house approach include the Defense Information Systems Agency, which the Pentagon earlier this year designated as its enterprise cloud service broker. DISA has been given the task of making it easier to integrate and consume cloud services, whether those services originate in the Department of Defense, other federal agencies or commercial vendors.
The broker provides an organizational focus point to consolidate cloud service demand at an enterprise level and negotiate for the best service usage rates across the DoD," Department of Defense CIO Teresa Takai wrote in a June memo.
Cloud Service Brokerages Help With Transition, Tools
Other IT organizations may prefer to work with an external brokerage. Appirio CIO Glenn Weinstein says an IT group that reduces its infrastructure workload can spend more time with its business customers. It can also devote more time to innovation as opposed to keeping things running. He suggests 70/30 as the typical breakdown of IT resources between run and innovate.
Overall, the pace of change may compel IT to seek out assistance. "The cloud technology is moving so fast now; there is a great need to partner," Weinstein says.
In MoMA's case, the museum partnered with Appirio for help with its cloud migration, which was especially tricky on the Salesforce side. The challenge: MoMA had to ensure it could still take donations and process transactions during the transition from its home-grown, on-premises CRM to the Salesforce SaaS application.
For a time during the cutover, both systems were operational, Montes explains. The on-premises CRM served as the system of record for one set of data, while Salesforce acted as the system of record for another. The situation required data synchronization. "Migration to the cloud is not trivial," Montes says. "You need someone who knows the landscape and has the tools to help move you from point A to point B."
Appirio's toolset, its Cloud Enablement Suite, includes a component for managing cloud migration and application development. Montes, meanwhile, also cites integration skills as a partner plus. "The ability to have data flow seamlessly between cloud apps, and between cloud apps and on-premises apps, is another big value-add."
As for the future, MoMA may also turn to an outside vendor for managed services. The museum currently manages systems on its own, using its change management process. But if MoMA were to deploy a multitude of cloud apps, it might contract out for at least a basic level of monitoring and notification, Montes says. Such a managed service would provide a single point of contact for tracking cloud apps.
Cloud Arbitrage: Moving Workloads From One CSP to Another
Another service associated with cloud brokerage is arbitrage. With such a service, a broker moves cloud workloads from one cloud service to another based on cost and other factors.
Some cloud executives contend that this aspect of broker model has yet to fully emerge. "An intermediary or broker who can transfer workloads based on price arbitrage-we don't see that taking hold. I don't see clients interested in it," says Erik Sebesta, chief architect and technology officer at Cloud Technology Partners, a Boston-based consulting firm that helps customers design and build cloud solutions.
Sebesta also notes that arbitrage providers will need to be big players in order for enterprises to trust them in that role. Moreover, from a technology perspective, moving workloads around can prove challenging. "It's just hard to move a workload from one environment to another," Sebesta says. "It is not a quick or easy process, especially if you are dealing with complex, mission-critical applications."
Weinstein also notes the workload migration challenge, observing the lack of high-level interoperability among Infrastructure as a Service platforms. He believes interoperability will expand over time and a role for cloud service brokerages will exist in general arbitrage.
In August, consulting and technology company Infosys debuted its Cloud Ecosystem Hub, which provides an arbitrage-like function. The hub aims to provide a single view of what would otherwise be a fragmented enterprise ecosystem of private clouds, public clouds and on-premises systems, according to the company.
Vishnu Bhat, vice president and global head of Infosys cloud business unit, says the company has built connectors that link cloud providers such as Amazon Web Services and Salesforce into its hub. A smart brokerage feature helps determine the best cloud service for a given workload, taking into account such parameters as cost, regulatory compliance and technical compatibility, Baht explains.
Indeed, the cloud offers enterprises a new way to deliver solutions as well as a new option for rolling them out. However, the fundamentals of hiring a partner endure.
Montes says the cloud is governed by many of the same principles that a CTO or CIO would address in an on-premises scenario. The viability of vendors, contract management and security remain important considerations. "It's just that the context has changed and the potential payoff has changed-but one still has to think through all of these issues."
John Moore has written on business and technology topics for more than 20 years. His areas of focus include mobile app development, health IT, cloud computing, government IT and distribution channels. Follow everything from CIO.com on Twitter @CIOonline, on Facebook, and on Google +.
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This story, "Cloud Service Brokerages Emerge As New Integrators" was originally published by CIO.