Verizon leads a long list of cloud conundrums

cloud computing tax
Credit: Thinkstock
RELATED TOPICS

Once upon a time in Florida, there was Terremark, an IaaS provider heavily invested in both IaaS and VMware infrastructure. It was tooling along, looking good like many platform providers in the embryonic stage of Cloud-on-the-Hoof (CotH).

The wild and wooly days had Rackspace, Saavis, AWS, and another half-dozen Managed Services Providers, ISPs-looking-for-more, and startups a-plenty. Azure was only a Microsoft dream. Salesforce was just hitting third gear. ServiceNow was trying to Unicorn. Facebook hadn’t even gone public. Obama was in his first term.

Verizon paid a premium for Terremark. When announced, Verizon offered $19 and Terremark was trading just above $14. Where Verizon could have made an enormous infrastructure steal, it’s now mostly toast. But they’re not the only visible mistake. Look to HP’s Helion and others in the ditch to answer the great question: what happened?

Here’s the one word answer: marketing.

The old axiom, if you make it, they will come, is spoken only by hucksters.

Let’s take some other time-honored axioms to prove the point.

“The smoker you get, the player you drink”*

Yeah, smoke that strange tobacco, and you can be convinced of anything. If you want the answer to the question of why Openstack remains strong while Eucalyptus has drowned, it comes down to reality. As difficult as Openstack is (and certainly not for civilians), it works. Yes, it has some wild and wooly problems, and is like riding nine horses at once. Here’s the upside: a lot of horsepower. Here’s the downside: a lot of oats.

The better mousetrap of computing is a myth. Amazon went low-dough, low-margin, and attracted millions. It hums along, creating itself as an asset every day. It’s approachable on the low-end, while a wickedly-convenient resource on the commercial end. Anyone can use it. No 18 holes with dinner is needed, so its cost of sales is frighteningly low.

New school marketing is: get your name out where your audience watches.

Old school is 18 holes with dinner, but the CEO no longer tells the CIO—we’re going with Oracle, so get ready. Instead, to stay flexible, the CIO has his “kitchen cabinet”, e.g. sources of influence that make sense to him, and watches the trends carefully, making sure that vendors are evolving at the same pace as their organizations and especially, their competitors.

“You Can Tune A Piano, But You Can’t Tuna Fish”*

I look to Cisco’s very successful acquisition machine for how to buy, integrate, and make money from acquisitions. They’re very resourceful, and their M&A team is one of the best in the business. There’s a plan on how to turn the acquisition into an integrated program that its clientele will understand, and evolve their overall goals.

I watched Eucalyptus, purchased by HP, and wondered will HP actually try to become a software company, after much of its software had ended in a ditch—including database software for telecoms, and much other good stuff. HPE is a great engineering company. One go-round with OneView convinces most people that software is done only to make hardware work. Yet their server hardware is killer.

Verizon is a telecom company, worried about its multiple competitors, mobile, datacomm, Xfinity/Comcast, their government business, and has an ugly reputation with the general public. Xfinity does, too, but it didn’t stop them from buying NBC. Verizon now has AOL. See a trend here?

The trend isn’t working with IT infrastructure. Will someone buy Yahoo? Will it be T-Mobile? I don’t think so. Certainly Yahoo is slimming up for acquisition or spin-offs. Does this make you an Internet company? No. You might get a nice chunk of Alibaba. That’s it.

You build communities by using honey, not vinegar. You become fiercely loyal to your clientele. You learn what they like, and offer it at a rational price, and then do this again, over and over. If you’re going to sit in your nice corner office and make pronouncements, you’re already turning to stone*.

*Thanks to Guitarist Joe Walsh for the aphorisms.

RELATED TOPICS
Must read: 11 hidden tips and tweaks for Windows 10
View Comments
Join the discussion
Be the first to comment on this article. Our Commenting Policies