Cloud wars heating up on Indian turf
Experts say the fiercest competition in cloud computing is in the public cloud pie; battle lines are most visibly drawn among Amazon Web Services, Microsoft, Google
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Mumbai: Cloud services providers such as Amazon Web Services Inc. (AWS), Microsoft Corp., and Google Inc., are pulling out all stops to increase their market share in the country even as they are making, or planning to make, significant investments in local cloud infrastructure.
The Indian cloud market has already seen “over $1 billion of investment”, according to Praveen Bhadada, partner and digital practice head, Zinnov Management Consulting Pvt. Ltd. He pointed out that most cloud companies have either set up local data centres in India, or are in the process of doing so to better serve the needs of Indian enterprises and SMBs (small and medium businesses).
Microsoft, for instance, announced the availability of its three data centres located in Mumbai, Pune and Chennai in September 2015. With over 75,000 “India-based active customers”, India represents a “significant opportunity” for AWS, according to Bikram Bedi, managing director of Amazon Internet Services Pvt. Ltd. Last year, the company launched its so-called Asia Pacific (Mumbai) Region. AWS defines ‘Region’ as a physical location that houses multiple Availability Zones that comprise one or more data centres, each with redundant power, networking and connectivity, housed in separate facilities.
Cloud providers are setting up local data centres for two reasons. One, having a data centre close to where an enterprise is based cuts latency, the time taken by data to travel from point A to point B in a network. Second, it takes care of the regulatory requirements in sectors such as banking that mandate business-critical data to be hosted within India. Bedi said AWS’ existing and potential customers had asked for “an AWS India Region so they can move their applications that require low latency and data sovereignty”.
IBM, on its part, has been trying to up its bid for the public cloud market—in addition to its dominant play in the private/hybrid cloud markets—ever since it acquired SoftLayer Technologies Inc., a cloud infrastructure provider, reportedly for $2 billion in June 2013. Although considered a relatively late entrant in the public cloud space globally, IBM, in India, seems to be leaving no stone unturned to capture the burgeoning cloud market. On 13 October last year, the company announced the opening of its first public cloud data centre in Chennai. “Before the Chennai data centre, we already had a private cloud data centre in Mumbai,” said Chetan Naik, vice president of sales, IBM India/South Asia. Naik says, worldwide, IBM has 46 data centres almost half of which are for public cloud services.
Google is yet to build a data centre in India but has announced it will launch one sometime in 2017. Rick Harshman, managing director, Asia Pacific & Japan, Google Cloud, said, “We have been buoyed by the interest we have received from prospective customers since announcing the Mumbai region coming in 2017.”
Who leads the pack?
Experts point out that the fiercest competition in cloud computing is in the public cloud pie—and the battle lines are most visibly drawn among AWS, Microsoft and Google.
According to 2016 third-quarter data compiled by Synergy Research Group for the overall cloud market (and not just for public clouds), while AWS still has a 45% share of the worldwide public IaaS (Infrastructure-as-a-Service) market, on an aggregate basis, the big four—Amazon, Microsoft, IBM and Google—control “well over half of the worldwide market and all continue to grow their market share”.
India figures are hard to get since cloud services providers do not break up their local market revenue figures. But industry analysts say AWS leads among start-ups and SMBs while Microsoft is ahead of the pack in enterprises.
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India has one of the largest bases of SMBs, around 53 million. Around 10 to 15 million of them are using some kind of technology solutions for their business, and the base of SMBs for which technology is relevant continues to increase, with the fundamental readiness around the Internet, smartphones, basic infrastructure, etc., getting into shape, noted Bhadada.
One of the key drivers, he added, is the software-as-a-service (SaaS) sub-segment, which is estimated to grow faster than IaaS and PaaS (platform-as-a-service).
According to Meetul Patel, general manager of marketing and operations, Microsoft India Pvt. Ltd, “Microsoft is the first and till date the only cloud service provider with a full range of offerings that include SaaS and PaaS, in addition to IaaS delivered from local data centres in India. Microsoft offers its complete cloud services—Azure, Office 365 and Dynamics CRM Online—from local data centres.”
All the four companies are set to leverage their respective strengths in realising their cloud ambitions. According to Harshman, “Our services include infrastructure (Google Cloud Platform), business applications (G Suite), hardware (Chrome and Android) as well as customer support with an emphasis on technical expertise. Besides offering interconnected core services, we have also taken technology behind a number of Google services and made it available for businesses to take advantage of the best of machine learning in their own operations. Once the data silos are broken down by moving to the cloud, a number of high-level possibilities open up for businesses to make their data useful. Also, Google Cloud customers are able to take advantage of other business offerings including digital advertising and location services.”
Naik of IBM cites the company’s strengths in “cognitive computing, a full-blown cloud offering and its SmartCloud Orchestrator”, which is an open and scalable cloud platform that makes it easy to switch between multiple clouds.
Microsoft is relying on its expertise in enterprise software, Office productivity suite and a wide network of channel partners in India. “Microsoft has also expanded its cloud access for local customers by enabling Web Direct and Cloud Solution Provider channels that makes it easy for SMBs and start-ups to use the local cloud,” said Patel.
Bedi of AWS believes that, among other things, it’s the “Amazon Way of listening to customers” that sets the cloud pioneer apart.
While all the big cloud providers try to woo enterprises to sign up for their particular cloud offerings, analysts believe they will continue to co-exist. The RightScale 2016 State of the Cloud Report, for instance, points out that cloud users are running applications in an average of 1.5 public clouds and 1.7 private clouds.