Cloud Computing Business Models on the Horizon

Everyone is wondering what will follow SaaS, PaaS and IaaS, so here is a tutorial on some of the emerging cloud computing business models on the horizon.

Computing arbitrage:

Companies like are buying bandwidth at a wholesale rate and reselling it to the companies to meet their specific needs. Peekfon began buying data bandwidth in bulk and slice it up to sell to their customers as a way to solve the problem of expensive roaming for customers in Europe. The company was able to negotiate with the operators to buy bandwidth in bulk because they intentionally decided to steer away from the voice plans. They also used heavy compression on their devices to optimize the bandwidth.

While elastic computing is an integral part of cloud computing, not all companies who want to leverage the cloud necessarily like it. These companies with unique cloud computing needs—like fixed long-term computing that grows at relatively fixed low rate and seasonal peaks—have a problem that can easily be solved via intermediaries. Since it requires hi cap-ex, there will be fewer and fewer cloud providers. Being a “cloud VAR” could be a good value proposition for the vendors that are “cloud SI” or have a portfolio of cloud management.

App-driven and content-driven clouds:

Now that the competition between private and public clouds is nearly over, it is time to think about a vertical cloud. The needs to compute depend on what is being computed, and it depends on the applications’ specific needs to compute, the nature and volume of data that is being computed and the kind of content that is being delivered. The vendors are optimizing the cloud to match their application and content needs in the current SaaS world, and some are predicting that a few companies will help ISV’s by delivering app-centric and content-centric clouds.

For advocates of net neutrality, the current cloud-neutrality that is application-agnostic is positive, but innovation on top of raw clouds is still needed. Developer’s need fine knobs for CPU computes, I/O computes, main-memory computing and other varying needs of their applications. The extensions are specific to a programming stack like Heroku for Ruby but the opportunity to provide custom vertical extensions for an existing cloud or to build a cloud that is purpose-built for a specific class of applications and has a range of stack options underneath (making it easy for the developers to leverage the cloud natively) is here. Nubifer Inc. provides Cloud and SaaS Consulting services to enterprise companies.

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