The channel needs strong German providers

vom 01.08.2019

26.07.2019 | by Holger Nicolay

The demand for cloud and managed services is also increasing among German SMEs. But this market is dominated by US providers.

Not only the large German companies are increasingly using the public cloud, medium-sized businesses are also becoming more and more friendly to it. But system houses and managed service providers can hardly keep up with the concentrated market power of US providers. Nevertheless, in addition to hyperscalers such as Amazon, Microsoft, Google and IBM, system houses and service providers can also find new sources of revenue for their value creation, especially in the hybrid cloud, provided they work together with strong partners from Germany. Then medium-sized German managed service providers will also be offered numerous opportunities.

"Cloud only" approach is very rare

Some companies pursue a pure "cloud-first" strategy. But the reality is different in many larger and most medium-sized companies. Here the IT departments go step by step into the cloud - mostly via a partial outsourcing of applications that are operated in parallel in their own data center and a private or public cloud. On the one hand, they want to gain experience and, on the other, cushion peak times.

Market potential of the hybrid cloud

However, data center operators experience the greatest demand for services from end customers directly. Meanwhile, many system houses and managed service providers are still in transformation, equipping themselves with competencies and expanding their business portfolio. The hybrid cloud also offers numerous business opportunities for German channel partners. Many companies are looking for data center space with direct, private cloud connections in order to position themselves for the future and create new revenue opportunities. The internationally active midmarket requires standardization across units and countries - not least when it comes to uniform and reliable IT security.

The drivers are communication solutions, online offerings for consumers such as web shops and comparison portals, online marketing, big data and risk analysis, the transfer of media data and achieving the required agility at low cost. Sometimes, however, not only performance, scalability and flexibility are in the foreground, but also the fear of being overtaken by the competition.

Example gridscale

The "Managed Public Cloud Provider" gridscale shows how a German IT service provider can profit from this demand. With a highly automated infrastructure, it is aimed at business customers and resellers who want to use a reliable cloud architecture in conjunction with modern infrastructure and platform services for their digital business models. In addition to numerous IaaS components such as virtual cloud servers, storage and network resources, complementary PaaS components - such as load balancers, firewalls, S3 storage or automatically scaling databases - are also available.

"We have been operating our productive environment at a data center service provider in Frankfurt since 2016," explains Henrik Hasenkamp, co-founder and managing director of gridscale. "When selecting a provider, we drew up a shortlist of three providers based on our specific requirements. We evaluated not only the service offering, the number of connectivity providers on site, scalability and certifications. The competent and trusting cooperation in the development and implementation of our projects was also decisive".

At the German Cloud Hub in Frankfurt, the IaaS provider found the desired access to all important cloud and connectivity providers and thus the largest possible number of interconnection possibilities. In addition, it benefits from round-the-clock availability, security, high flexibility when trying out solutions and in the contractual design.

"With the established partner, we can strengthen the awareness of our brand," continues Henrik Hasenkamp. "Our cooperation is an example of the success and growth of a cloud "Made in Germany". We are primarily targeting resellers, SMEs, developers and open source projects".

Currently, gridscale is already working with 40 larger and 65 smaller system houses. With their help, the IaaS provider generates around 60 percent of its revenue in Germany. The revenues generated via the channel are far more significant than the revenues generated via the website in direct sales. This is because the customer clicks together the desired services in self-service and manages his cloud environment independently.
In contrast, customers acquired via system houses are closely tied to the provider. This is because the recommendation of the service provider provides basic confidence in the provider's services. This is one of the reasons why gridscale wants to win more of these "Trusted Advisors" as sales partners. The system houses can also offer this solution under their own brand name.

IoT and Industry 4.0 will boost demand for cloud and managed services

The demand for such cloud and managed services - for which high-performance data centers form the basis - will continue to rise in Germany. This will be ensured not only by media reports and increasing competition, but also by industry 4.0 due to the mass of IoT devices and sensors. The tracking of products - not only in the logistics industry - and 5G is also driving data growth and the data center capacity required for processing.

In order for system houses and managed service providers to benefit from this, they must build up the appropriate expertise. This is possible with the appropriate partners. For example, managed public cloud providers are increasingly looking for resellers who will sell their solutions after they have been trained. This pays off for both sides. System houses can then migrate their customers' existing Microsoft, Oracle or SAP infrastructures to the cloud and offer additional services.

The close networking of customer IT with public clouds is made possible by the networking partner. Here, customers not only receive the classic colocation advantages such as numerous connectivity providers on site, but also a test environment for new projects. This gives gridscale the necessary experience and technical expertise in the area of infrastructure to accompany system houses on the path to digital transformation. After all, the channel today needs more than just a service provider - it needs strong partners at eye level.

The original article in german can be found here.

 

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