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Cloud providers need to build channel trust

The big cloud providers need the channel to help widen sales but Canalys has warned they must generate more trust in those relationships

The large cloud providers need to be straight with the channel and build trust if they are going to deepen the relationship over the course of what is set to be a year of growth.

That call for more transparency comes from Canalys at a time when the cloud infrastructure market has shown continued growth in the last 12 months.

AWS continued to hold its position as the dominant cloud service provider in Q4 but Azure is taking more share as it looks to mount a challenge to its rival.

Numbers from Canalys indicated that worldwide cloud infrastructure spend increased by 46% in Q4, coming in at more than $80bn for the year.

The analyst house pointed out that cloud infrastructure is one of the most important sectors in the IT industry because of the numerical value and the size.

AWS held onto the top spot in Q4 wth its share of customer spend holding firm at 32%. Microsoft Azure increased its share by two percentage points to 16% and Google Cloud reached 9%. In fourth Alibaba Cloud maintained a 4% share.

“Cloud infrastructure services provide the core components needed to support businesses’ digital transformation initiatives around building new customer experiences, deploying IoT to transform processes, using big data and analytics for better insights, and embedding machine learning and AI for automation,” said Canalys principal analyst Matthew Ball.

“Market dynamics have changed over the last 12 months, with more businesses opting for multi-cloud and hybrid-IT environments to use the strengths of different cloud service providers and deployment models dependent on application and data requirements, compliance, cost and performance," he added.

Those changing dynamics have had an impact on channel partners with many being called on to make life simpler for those customers dealing with a multi-cloud environments.

“Cloud service providers are placing greater emphasis on building channel programs to support the growing network of partners beyond the largest systems integrators, especially as they extend to mid-market and SMB customers,” said Canalys chief analyst Alastair Edwards.

“Canalys expects the share of cloud business handled by or with channel partners to increase in 2019. Cloud service providers must therefore find ways to improve their own differentiation to partners and raise the maturity of their channel models," he added.

He then urged cloud service providers to "build trust with channel partners" and avoid rolling out initiatives ot changing Ts & Cs to drive direct sales.

“Microsoft is the current dominant force in the channel for cloud services, through the continued expansion of its Cloud Solution Provider program. But as it offers more direct purchasing options to Azure customers through its new Microsoft Customer Agreement, its partner strategy faces increased scrutiny. This creates an opportunity for rivals to exploit growing uncertainty among Microsoft’s partners," warned Edwards.

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