ESG Blog: Google Cloud Next Wrap Up - Opportunities and Challenges
Author: Dan Conde
Google finished its Cloud Next Conference last week, and my colleagues have written several blogs and we have shot an On-Location video for this cloud computing conference.
My take is that Google has come a long way in adding new capabilities including partnerships, product features, pricing, tools, devices, and reference customers. As Google’s offerings expand, it faces new challenges to create a coherent and comprehensive offering for its many customer types including enterprise, ISVs, and end-users.
Cloud Providers Are Not All Alike
People often categorize the major public cloud providers together, but they different in major ways: Google and Microsoft offer apps (G Suite and Office are the most famous ones). AWS is primarily an infrastructure and application platform provider (it does has a few productivity tools such as Chime, WorkDocs, and WorkMail).
What’s more important is whether or not these platforms can be a place for SaaS applications (not just from firms like Google—but from third parties) to be delivered efficiently. I believe that is the battleground on the long term as customers demand applications, and those who deliver these apps look for the best platform providers.
ISVs Are the Lifeblood for Its Future
Of course, all of these platforms provide core, low-level infrastructure (VMs, networks) but it’s more interesting to see how the app platform services grow to make it easy for third-party apps to be written and hosted. The analogy is with desktop operating systems. Microsoft Windows succeeded by not only supporting low-level OS features, but also a rich set of app service capabilities that attracted third-party ISVs. These cloud platforms need to do the same. The photo at the top shows some ISV partners in the Layer 7 networking space and shows how a solution gets "rounded out" with the help of partners.
A cloud provider hosting its own set of apps and services (including ad services) is a benefit since it enables them to learn what makes apps run well, while also collecting a rich set of end-user behavioral data to help businesses perform analytics (while respecting personal privacy, of course). This is a major challenge and opportunity for these providers.
I have confidence that in these technical areas, Google will make strides to complete its offerings. The infrastructure offering grew and was sharpened because it has an extremely demanding customer, which is itself. Its data centers and first class networks grew to serve its search, ad, and apps business that had global scale. Platform issues matter to enterprises since ISVs that host SaaS apps on powerful platforms will be better able to integrate with enterprise infrastructure and data as well. No app works alone and will need to reach out to services and data in multiple areas.
Evolving from Single Offering (Pizza Only) to a Complete Offering (Full Range of Meals)
A major challenge in non-technical area is to establish a go-to-market strategy as a portfolio grows. As Google Cloud offers not just the Cloud Platform but G Suite, how can its sales and marketing organization (direct and via partners) effectively sell a broad set of offerings?
If you’re selling pizza (let’s say you’re Domino’s), the sales strategy is rather simple. You have your dough and toppings, and a few sizes. The characteristics of the customers are clearly defined—hungry people eager to bread + cheese + toppings. So you need an order taker, a pizza-maker/chef, and a delivery person.
If you add products in adjacent categories (sandwiches or pasta), it doesn’t affect the go-to-market strategy too much.
What if you start to make offerings in a clearly different area? Such as groceries or perhaps sit down meals? The processes established for marketing, production, and delivery don’t necessarily scale.
Google and others face the same challenges. For example, when the enterprise engages Google’s customer-facing staff, who will they meet? Is it a single rep who handles infrastructure platforms as well as end-user applications? That may work at a high level, but as details need to be worked out, one needs more specialists, with a different engagement model that includes consultants, pre-sales, and value-engineering, both from within Google and from partners.
I hope that as Google Cloud fills out its sales and customer facing leadership team, it will evolve the go-to-market strategies to meet the ever-complex requirements. It has created a good foundation, and will undoubtedly evolve in the months ahead.
The customers will not only include enterprises but a slew of ISVs as well, so they need a different engagement model—such as working with a developer relations team. Self-help education and certification programs are already there to help, but need to grow to provide the in-depth support that many customers demand.
For enterprise customers, it makes sense to carefully choose the right engagement model—whether it be local partners, a large global SI, a managed service provider (like Rackspace), or directly from Google. A complex set of offerings will require the right set of steps to complete the journey.
This is an exciting time. There are many changes, and we look forward to developments in the months ahead.
Brian: Hi, everyone. Brian Garret here. I'm the Vice President of Validation Services, this is the Enterprise Strategy Group. And I'm here at Google Cloud Next 2017 event, and I'm really, really excited with the energy, and the enthusiasm, and increased attendance here. My key takeaways here, and what I'm most excited about are the enterprise cloud readiness investments that Google has made over the past year or so. These are very, very clear in their go-to market initiatives. There's a huge number of partners here. They've announced partnerships with ISPs like PWC, and with a huge number of growing VARs, and with industry partners like SAP. From a product standpoint, there was just an amazing amount of announcements here, over 50 product announcements were made. Some of the key ones that I believe make a difference from an enterprise cloud readiness are associated with making it be easier for enterprises to do business with Google, and in particularly with GCP.
Edwin: Hi, I'm Edwin Yuen, ESG Analyst for Systems Management, PaaS, and DevOps. And we're here live at Google Next 2017 here in San Francisco. What I'd like to talk about today is some of the announcements that they've made, and the changes that we've seen in Google as a result of this conference. We've seen a really big shift in how they take enterprises more seriously, and how they treat enterprise customers, and how they target them with their products. And we're kinda seeing it in three areas. First, is really the investments that they're making. As Eric Schmidt said during the day one keynote, "They're investing over $30 billion into Google Cloud. And a lot of those investments are on the background core infrastructure, but also to support the enterprises. And they've made changes in terms of their licensing and their pricing, their support model, how their salespeople go after enterprises. So we're seeing a real concerted effort here from Google to go after the enterprise. The second thing we understand is migration of workloads. Much of the discussions in the last couple of days have been about how to move your existing on-premises workloads into the Google Cloud. They've talked about VM migrations, and how they're taking some new tools with live migrations. But not only making those tools available, but the processes and the people in order to support and help people move your x86 VMS into the Google Cloud, as Eric Schmidt. But they're also talking about how to move Legacy applications, and changing code, and updating Legacy systems. Including things like ASP.NET, and Microsoft Windows servers, and getting support for SQL server, and really taking those enterprise workloads seriously. And then finally, we're seeing a big shift in how they're taking consumer products and moving them into the enterprise. A lot of people have been dismissive of Google, and thinking of them as only as consumer-based company, just Gmail, just search, nothing for the enterprise. But they're really taking a lot of those products and pushing them into the enterprise, and giving some great enterprise features. Such as the capabilities within G Suite, and the modifications they've made there. Making Team Google Drive for a lot of sharing. They're changing how Hangouts work, so they can support not just one-to-one communications, but team type communications, and really potentially hit that chat apps market. So we're seeing some really great changes from Google, and how they're treating their existing technologies, extending upon that, and really taking Google Cloud into the enterprise. And I think this is gonna be a company that we really wanna watch, along with Amazon and Azure, for the public cloud.
Brian: Some of the key business announcements that were made here were new innovations in pricing, committed use discounts, a way to add volume to make a much simpler way to lower prices for enterprises that'll be purchasing GCP in volume. And then engineer-to-engineer to support. Taking the reliability engineering expertise that Google has, and extended that, and making it available to enterprises, and purchasing it on a per seat basis for response time based response to customer problems. It's a much simpler way to consume support, and the expertise of the Google engineers, without having to commit to huge expenses. You pay for it as you get it, and you get the expertise of Google.
Dan: Hi, I'm Dan Conde, Analyst at ESG for Cloud Infrastructure. As you have heard from other analysts, we saw a lot of announcements here at Google Cloud Next about Legacy app migration, big data, and so on. But one of the things that Google likes to talk about, and what a lot of people ignore, is the fact that their infrastructure is probably second to none. They have the fastest, the most complete network that spans the world. And that actually does translate into business value. You could connect hybrid clouds between different regions. No need to have SSL VPNs, and so on. These are elements that seem very technical, but do translate into costs and ROI for enterprises who do wanna run their workloads on the Google Cloud Platform, as well. Another thing that's really important about the capability of having a network as a service, is that it allows the network engineers to not consider the importance of keeping the plumbing running by basically outsourcing a lot of the basic things to Google, and focusing their work on enabling the network and security to mirror the business needs of the workloads. So these are some things that seem somewhat secondary, and you could argue is overshadowed by some of the sexier things that you have like Jamboard, or the latest pixel phones. But I think for enterprises that are looking at traditional workloads, and finding where to go to, it makes a big difference. And obviously, all the other competitors, whether it's Amazon or Microsoft, will catch up, or are working on the same things. But I will say that good networking performance is a key thing that differentiates Google's Cloud.
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