In one of several keynote presentations aligned with some of the key sponsors of the event, Microsoft’s John Zanni, general manager for the worldwide software and services industry, delivered a presentation he called “Is Hosting the new IT: thoughts on the convergence of managed hosting, cloud and IT?”
In introducing his subject, he says commodity mass market hosting is still a profitable business, but the margins are shrinking. He points to some research data that shows the profitability is moving toward the service layer of the business, and away from the technology and the platform.
Managed hosting is a little different, and it’s a market that Zanni, and Microsoft, are even more confident about than Dan Golding was a little earlier today. The drivers of that business, he says, are virtualization, SaaS, security and disaster recovery and on-demand storage. The challenges include the complexities of enterprise IT and the entry of large system integrators into this business.
Adopting cloud computing services is a big part of the future for managed hosting businesses. And one of the interesting charts he showed was one that demonstrated that the competition for control of customers’ core computing infrastructure, after other managed hosting providers, is internal IT departments, rather than public cloud providers.
Summing up what I suspect is preamble to the meat of the presentation, he says that a combination of cloud and managed services will create “a new type of IT department.” Microsoft, he says, has a strategy for helping hosting providers become IT providers.
He says Microsoft doesn’t want to be in the private cloud market. It wants to build it. For you to be in the private cloud market, he says, what you need is a platform, a way to scale it, and a way to manage multiple platforms and technologies. And given the nature of the presentation, it shouldn’t surprise you that Microsoft has products designed to address each of those needs: Windows Server, Hyper-V and System Center. It’s nicely succinct that those are, he says, the only products you need to know about (from Microsoft) when you’re thinking about building a cloud product.
Of course, within those, there are all kinds of relevant pieces, particularly within System Center, which has Virtual Machine Manager and Configuration Manager components. But Zanni says you can use one tool, overall, to manage the entire data center.
And here he mentioned the Dynamic Data Center Toolkit, which provides guidance on how to build managed hosting and cloud offerings using the Microsoft tools I mentioned above.
We’ve mentioned the toolkit many times since it was announced at the Microsoft hosting partner event early this year. But if you don’t know much about it yet, you can get it at www.microsoft.com/dynamicdatacenter
Microsoft is also doing a lot of work to market the idea that “hosted is good,” and drive business to hosting providers.
I’m not going to revisit the BizSpark program, another very interesting Microsoft project that we’ve done plenty of coverage about. But an interesting step back from that is that Microsoft is announcing a series of “Spark” programs. So, while BizSpark is focused on ISVs, there’s a program “DreamSpark” focused on education projects. And, says Zanni, there’s another “Spark” program coming in the next 10 days.
He talks a bit about Azure – Microsoft is working to communicate its vision for how hosting providers can use Azure to build their business. It’s not a public cloud for straight-up resale, but it’s a public cloud a hosting provider can use to power applications that a hosting provider offers its customers.
Zanni offers the example of a mass market hosting provider offering Azure-hosted applications via its control panel. A provider of a hosted application could use Azure-hosted services to extend its platform.
I’ll have more on exactly how hosting providers can deploy solutions that incorporate Azure soon. I did an interview with Microsoft’s Dave Wright specifically about Azure a couple of weeks ago that focused on the company’s message for hosting providers around Azure and how it sees them deploying it.
