Cloud UK Impact upon the IT Supply Chain

Executive summary

The UK IT channel is both aware of and seeking to, embrace the opportunity of cloud services. 

Over recent months there has been a noticeable increase in speculation over the future of the IT channel as a direct result of the end user adoption of cloud computing and the associated convergence of previously disparate markets which now enable the likes of telecommunications, web hosting and software vendors to also offer IT capabilities to customers as a service via the cloud in what some have perceived to be direct competition with the traditional Reseller, Service Provider and Outsourcer models. What these findings indicate is that the IT channel is in fact evolving and embracing the cloud as part of its value proposition, intending to bring real value to its customer base in turn.

In terms of maturity of adoption, the larger MSP’s and SI’s seem better placed to exploit cloud services today over the more local consultancies and resellers. However, the traditional IT reseller appears to be nearer to the end user organisations current focus on where cloud adoption is most likely to occur. This seeming contradiction is probably best explained by the different IT channel segments’ focus on end user organisations. The traditional VAR and IT consultancies tend to have a broader market reach than MSP’s and SI’s who tend to work with the upper mid market and enterprise scale organisations. And with Cloud services enabling the SMB sector to participate actively at the early stages of the market development, we are seeing a change over historical technological adoption patterns as this capability brings in to play a broader mix of what services can or should be provided to a broader mix of customers.

However, in regard to how well the message is being communicated and received, a contrasting survey of end user attitudes toward cloud computing raised a concern that a primary reason for lack of adoption by some end users was the lack of awareness they had from the traditional suppliers of IT to their company suggesting that the IT channel is not yet striking all the right chords in terms of messaging their value proposition to market.

This White Paper aims to set out the current perceptions of the UK IT channel in regard to their intent and market readiness to offer cloud services, and then to compare and contrast the focus and understanding of the IT channel with the awareness and expectation of the end user customers.

Contradictions do appear in this research, and this is considered to be a reflection of the pace of change that can occur when you have a relatively immature market (in terms of operational maturity) but significant importance being placed around cloud services for the future of the way the IT channel evolve and IT solutions are provided. Whilst we risk being subjective, we assert that what we are potentially seeing is a blurring of aspiration with reality at this pivotal time in redefining the way IT is procured and consumed. Further, we appear to be seeing more activity centred around the natural desire and need to be seen to market cloud solutions more than any real sense of widespread game-changing in the day-to-day activity of IT channel at this time.

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