Verizon has officially decided to shut down the majority of its public cloud operation. In an announcement sent to its cloud customers, which hit waves in the social media, it announced decision to “discontinue its Public Cloud, Reserve Performance and Marketplace services on April the 12th”, leaving their customers 2 months to migrate their data to another safe haven before it disappears together with the cloud services.
The company is offering its Virtual Private Cloud services as an alternative, which indicates Verizon will now focus its cloud offering on private cloud, probably aimed at enterprises.
Verizon is not alone in its decision. Last October HP made a similar choice to quit the public cloud, and so has Dell. The reason for their decision is the harsh price competition in the public cloud arena, led by Amazon who controls the vast majority of this market, and followed by Microsoft, Google and IBM. In addition to very competitive prices for their infrastructure-as-a-service (IaaS), these leading vendors also offer an ever-growing plethora of platform services (PaaS) which ease the development on the cloud.
Traditionally enterprises have utilized Verizon and the likes for reliable high-quality networking. But the public cloud players quickly stepped up and provided next-generation networking, same as they did with compute and storage (on the expense of HP, Dell and the likes), and gained foothold with enterprises. Even the very conservative banking sector is now going for public cloud with these guys.
Another important advantage of the leading vendors is their global geographical presence, with which local vendors find hard to compete. We are expected to see further consolidation in the public cloud, with traditional enterprise vendors increasingly pressed to innovate and reinvent themselves. IBM is one such good example.We’ll see who else stays relevant in the public cloud age.
Follow Dotan on Twitter!