Moderator: Peter Burris
Analyst: David Vellante
One of the more important and contentious topics in IT infrastructure generally and storage in particular today is the question of the degree to which "consumerized services" -- storage and other IT services delivered directly to consumers by providers such as Google and Amazon.com -- start to affect critical design, implementation and management decisions for enterprise storage. The trends are clear: consumers are becoming more engaged in defining IT value. They are voting with their dollars at home and in social groups, even if they are not yet participating actively in the workplace, for simpler, more predictably set pricing and more aggressively packaged services as a superior way to gain access to technology.
Additionally, in the storage world we see a dramatic growth in unstructured data often associated with end-user computing as opposed to high-throughput transaction processing. In this user-oriented computing the consumerization effect will be much greater, because end-users can transfer their consumer knowledge directly into decisions regarding how end-user-focused applications are built, deployed and managed.
In the last few years consumer market players such as Google, Amazon and X-drive have fielded some very attractive for-fee storage services, appropriate not only for consumers but also for small-to-medium-sized enterprises (SMEs).
Also, the public infrastructure used in a number of different application domains is in many respects clearly becoming superior to the infrastructure found in many organizations, particularly at the networking level. Consequently, we expect to see a greater effort by third-party service providers to target storage as an opportunity to drive new for-fee services to users who have become used to accessing online services for free. For instance, Google provides Gmail for free to consumers but is making Gmail available as a for-fee service to organizations as well. With these come commitments and promises about how storage capabilities will be administered inside that contract.
We see typical price points of $2/GB/year for renting access to tier 2/tier 3 storage capabilities. This is much less than the $20/GB/year (or higher) price-point for tier 1 and TP-type applications or even the $7/GB/year for midrange tier 2 storage of many internal charge-back schemes.
Regardless of whether these services actually can meet enterprise needs in terms of support for enterprise applications, deduplication, backup, etc., end-users, who include the business executives who write the checks to pay IT's chargebacks, will be asking why internal IT cannot close the gap between what it charges and X-drive's fees for simple storage. Indeed, far from resisting such questions, IT may be asking its storage vendors similar questions. Increasing numbers of shops are struggling to maintain the multiple, complex, and sometimes redundant skill sets (i e., a different encryption algorithm for each storage implementation) imposed on them by their vendors. They may be willing to outsource low-end storage to companies like Google and accept the potentially lower SLAs that may entail to simplify their own environments.
Over the next 12 months we expect to see consumerization become more than just a discussion in enterprise storage circles and in subtle ways find its way into important RFPs. Within three years we expect sizable percentages of storage RFPs at the enterprise level to specifically require consumer-oriented capabilities as part of the decision-making process.
The real question for enterprises is: Will they be able to use products from traditional storage suppliers to build internal storage infrastructures that are comparable in functional simplicity and price to those available in the third-party market? The path to answering this question will be complex and challenging, but if storage suppliers do not put greater emphasis on simplicity of procurement, deployment, and management, they and many IT professionals will find themselves out in the cold within five years.
Action Item: Storage administrators must begin evaluating the packaging, pricing and procuring models of third-party storage services from non-traditional companies such as Google, Amazon.com, and Microsoft. A first step must be to answer the question: What is wrong with the pricing and packaging models provided by third parties? Why can't our organizations answer the challenge from those third parties today? Only answers to those questions can lead to an honest assessment of what reasonable, value-generating internal storage strategies can deliver.
