Jon Howes, VP &GM EMEA at Wasabi, discusses the future of the cloud storage market and the role of specialty providers amongst hyperscalers.
Cloud hyperscalers occupy just over four-fifths of the entire cloud market in the UK, and their overall market dominance has caught the attention of regulators worldwide. The UK Competition Markets Authority has launched a probe into Amazon and Microsoft’s domination of the UK’s cloud computing market, big tech and digital services are being addressed in the upcoming EU Digital Markets Act for fair competition and the US government has hit Google with a record-breaking $5 Billion antitrust case for abusing dominance.
While there is no denying the hold these companies have on the market, the antitrust concerns underscore a longstanding issue with hyperscalers: vendor lock-in, in which customers are stuck using one vendor’s suite of products and services with limited flexibility to customise or benefit from the solutions that best fit their own specific needs. The recent antitrust discussions reinvigorate the argument for moving away from vendor lock-in and into a multicloud approach. The fact remains that there is a clear path for speciality providers and hyperscalers to co-exist in the market.
Debunking the hyperscaler ‘hype’
Managing corporate data under a single hyperscaler umbrella allows IT teams a certain level of convenience and access to adjacent services. However, that convenience must be weighed against risks. Using only one vendor for all company storage needs can mean that businesses become trapped, since migrating apps or data out of the single provider can be expensive. Businesses also get trapped in fixed pricing models that become too expensive as their needs develop, and can be left stranded if a hyperscaler decides to retire an app the business relies heavily on. It’s worth noting as well that if the company depends on the cloud vendor’s apps, moving to a new vendor brings an expensive IT challenge.
Relying solely on one vendor also increases security risk. Having all data, including backups, stored under one provider means that if this provider experiences a security breach, or loses data, the entire company’s data is put at risk. If these backups were in a second vendor’s cloud, then if a breach occurs at least these backups remain accessible.
Navigating hidden fees
Beyond lock-in concerns, fee structures can also be a problem. The IT team selecting the company’s cloud storage is not always the same as those using it and therefore cannot always accurately predict how much storage will be used, and thus how much the hyperscaler model will end up costing.
Companies migrating to hyperscaler clouds also often lose out down the line due to hidden costs. As API calls or data egress do not clearly fall within the ‘pay for what you use’ pricing policies offered by hyperscalers, their expenses might come as a surprise. Customers also often fail to account for how much they update, touch or egress their data, and subsequently how much this costs. This means bills frequently go well over budget: 52% of businesses exceeded their cloud budgets last year alone, with 48% of this spending going to fees.
Getting locked into the wrong provider runs the risk of overspending and wasting company resources which could instead be used for innovation or scaling, especially when some vendors don’t charge for egress and ingress at all.
A best-of breed architecture
Big-name cloud providers are often stretched thin because of the amount of offerings they have and therefore cannot invest the same amount of resources into specific products that speciality providers can. On the other hand, specialty providers have the bandwidth to focus on ensuring their specific product best in class. Think of it like buying running shoes – you can get any old pair at a department store like Debenhams, but going directly to Nike will result in a better product that helps you achieve optimal results. IT teams should have the same freedom to implement the technologies that will help them achieve the optimal results.
Multicloud is the way forward
Adopting a multicloud approach is the best option to avoid risk and to ensure companies can select a wide array of best-of-breed, secure and cost-effective storage solutions. This mixed approach evades vendor lock-in and enables businesses to remain flexible.
As the cloud storage market continues to rapidly grow, companies must educate themselves about their options and learn what their most competitive solution is. By employing multiple solutions from different vendors, the advantages of both hyperscaler and specialty providers can be optimised according to specific business needs, ensuring users get the most competitive prices, highest performance, and strongest security for their data.