Cloud

App Stores are Crucial When Jockeying for Position in the Cloud

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Editor’s Note: Amazon Web Services “moved the cheese” six years ago, enabling companies worldwide to quickly and inexpensively access cloud applications and infrastructure. As the battle for vendor dominance in the cloud heats up, cloud providers need to focus on building out marketplaces to compete with AWS. Erica Brescia, CEO of BitRock, the developer of BitNami, providing cloud hosting and an app store for Web applications. I spoke with Erica about the challenges in building cloud app stores and gaining users. She shares tips for this crucial aspect of competing in the cloud.

SandHill.com: What are the challenges hindering ISVs from developing cloud marketplaces to offer their software to users? Is it just that Amazon is so far ahead that it’s difficult to catch up?

Erica Brescia: Everyone acknowledges the fact that Amazon is the market leader by a very significant margin in terms of the size of its user base. AWS is heading towards becoming the next Microsoft. But it’s still early days in the cloud space, and it’s not yet impossible for other players to catch up.

Various public cloud providers are planning marketplaces. But before doing so, they must first ensure that they have a robust cloud platform. Only after they have a solid, full-featured platform does it make sense for them to invest resources in building out their app store. Some of the other platforms out there today are still very basic in terms of the services they offer. Many still don’t have the functionality necessary for running today’s applications, such as “block storage.” This is a key feature for deploying existing applications that weren’t architected specifically for cloud environments. Another key piece of functionality is to provide a streamlined process for deploying applications on different operating systems.

SandHill.com: Competition is always good for customers. Is that the main reason for building cloud app stores that compete with Amazon?

Erica Brescia: Yes. And today AWS is so far ahead of everyone else that they are going to have a much easier time attracting software vendors to their platform. This can build a virtuous cycle where Amazon continues to gain more momentum because they’re getting more and more vendors that want to reach Amazon’s expanding user base. Users will choose Amazon because they have the most applications in their marketplace that can easily be deployed to their cloud. If the industry lets that go on for too long, it will be very difficult for the other public cloud providers to take market share away from Amazon.

SandHill.com: What are the top three things that cloud providers need to do to build competitive platforms and app stores?

Erica Brescia: The first thing is to offer persistent storage. Without it, a lot of the applications that people like to use (especially to get started with the cloud) won’t run on out-of-the-box cloud platforms and will have to be re-architected for that environment.

In order to attract software vendors to their platform, cloud providers need to make it as easy as possible for them to port their applications. Offering persistent storage will make this process much easier for most vendors. Without persistent storage, the cloud platform companies will ask software vendors to re-architect their applications to reach a much smaller user base than they can with Amazon – a tough sell to be sure. So, offering persistent storage is the first step.

Second, they need to very actively court software vendors and develop a very streamlined process for their app stores. This includes a simple process for initial submissions and for keeping existing product listings up to date. Providing an API so that people can do this programmatically is ideal. Today, it is a still tedious process to make software available on Amazon’s Marketplace, and keeping it updated is also very manual. Cloud providers that develop tools that make that significantly easier to list apps will motivate software vendors to be part of their marketplaces.

In addition to building out their platform and marketplace tools/APIs, they also need to focus on building a significant user base. If they don’t have enough users, nothing will make the software vendors want to invest the resources to participate. If you look at other marketplaces, such as Apple’s App Store, the ones that have been successful had both the applications and the users.

SandHill.com: How can they grow a user base?

Erica Brescia: That’s a little bit of a chicken-and-egg problem. Software vendors don’t want to spend time and resources making their software available on a cloud that doesn’t have enough users, and the users only want to go to a cloud that has the applications that they want.

That said, there are a lot of ways to attract users. For example, Rackspace heavily promotes its support, which is bundled with its service. This is something Amazon does not provide – its users must pay for support. This can be a great differentiator for other cloud providers.

Pricing may also be a great differentiator. Users often move to the cloud, at least initially, to save money. So, providing competitive pricing can be an important part of a strategy for attracting new users.

Another way that people can save money is by saving time. Providing the types of services that Amazon does, such as RDS, Cloudwatch and others that provide an additional level of automation, can also be very valuable to users since it can save them a lot of time. The pricing and automation won’t be of much use if the user interface isn’t very intuitive, so having a UI that makes it easy to get up and running is also important.

Another way to get more users is to provide certain types of compliance or additional security services pertinent to particular verticals (such as HIPAA compliance for the healthcare vertical, for instance).

SandHill.com: What else attracts users to a particular cloud marketplace?

Erica Brescia: I think we’re past the stage of the very early adopters in the public cloud – and by that, I am referring to people who are highly technical and don’t mind scripting their way around things. We’re starting to get into more widespread adoption by the next phase of adopters. These users don’t have the technical chops or desire to learn new technologies that the early adopters do. They need push-button deployment of applications. They need access to a library where there’s a simple way of getting the apps they want running without any manual work or technical knowledge required.

We are definitely seeing this type of adopter at BitNami. A lot of departmental users in very large companies come to BitNami and Amazon to deploy applications like Alfresco for content management or SugarCRM for customer relationship management. They come because it’s an easy on-ramp to the cloud and they don’t need to invest time in learning a whole new platform in order to get the apps that they want running.

SandHill.com: Please describe how it’s easy. How does the library work?

Erica Brescia: We provide a library of 45 ready-to-deploy application packages like WordPress, SugarCRM, Alfresco, Drupal, Joomla and Redmine, as well as development environments such as Ruby on Rails and Django. These are completely configured so they can be deployed essentially in one click on the Amazon cloud as well as other cloud platforms based on VMware, Openstack or CloudStack.

Users can download a native installer to install software on their desktop or server, get a virtual machine that they can deploy in a virtualized environment or get a cloud template for every app that we offer. All of the BitNami app packages, which we call Stacks, are available free of charge.

We also provide an automation layer on top of that library, BitNami Cloud Hosting, as a commercial service. It gives users automatic backups, monitoring, one-click resizing and other features that make it much easier to run their applications in the cloud. This is specifically for Amazon for now, but we plan to provide this support for other clouds in the future.

BitNami is currently the only cloud provider that enables users to deploy exactly the same application stack natively, virtually or in the cloud. This means that developers can start to develop and test applications locally or in virtual machines and then deploy to exactly the same environment in the cloud, giving them flexibility and portability they can’t get from other vendors.

SandHill.com: So ease of use is as important as a robust menu of apps and services.

Erica Brescia: Yes. If cloud providers don’t make it easy for the users to get the apps they want, it is significantly more difficult to drive user adoption.

Providing billing and mechanisms for charging for the cloud apps also makes it easier to get customers into the cloud, plus it can help to attract software vendors. There are different tools that cloud platform vendors need to develop to make it easier for software vendors to participate in their app stores, and this is a way they can compete with Amazon. Its marketplace is still pretty basic in term of functionality, but given the pace at which they have built out the AWS platform, I don’t expect that it will be that way for very long. There is a limited window of opportunity for other vendors to get their app stores off of the ground.

SandHill.com: Do you have other observations and insights about how cloud providers can compete with Amazon?

Erica Brescia: Aggressively courting and providing outstanding onboarding and ongoing support to software vendors is one way that cloud vendors can compete with Amazon. Amazon has so many software vendors that want to work with them that it can be challenging for them to manage all of those relationships. By giving software vendors “VIP treatment,” cloud platform vendors may be able to woo them to support their platforms as well. I have already seen other cloud providers using this tactic by sending emails saying, “Do you want to work with a company that’s really focused on partnerships?”

SandHill.com: Do today’s enterprise cloud users understand how to choose an app store?

Erica Brescia: There are different levels or sets of functionality of an app store. Some don’t provide many options; others including Amazon have the payment and billing processes built into the back end. That can be very attractive to users because they only have to pay one vendor.

Businesses will be attracted to marketplaces that have programs to help track cloud usage. Businesses can’t do much to stop employees from using a credit card to access cloud services, thus going around the IT department. It’s helpful for cloud vendors to provide services that help companies track and monitor the applications their users run in the cloud so they can make sure they are secure.

Everything sneaks into an organization from the bottom up. When you remove the friction from adoption, and particularly when applications are free or very low cost, it’s pretty easy for cloud purchases to slide under the radar for a while. As long as business users get applications from a reputable app store, they’ll get best-of-breed applications that have already been vetted and tested and are known to work. It’s just a question of how their management feels about having applications running outside the purview of their IT department.

Large companies are already looking at solutions to help them get better control over which applications their employees are using in the cloud. Amazon is developing tools around this to help companies keep track of all their Amazon accounts and have a master account along with and account reps that help manage the relationship. I think the next step will be to provide controls that help companies to put additional security in place and set limits on spending.

SandHill and BitRock are among 40 collaborators for the 2012 North Bridge Future of Cloud Computing survey. 

Erica Brescia is the chief executive officer of BitRock, the developer of BitNami, and has been a key driver of BitRock’s vision and strategy. Prior to joining BitRock, Erica managed multiple sales teams for T-Mobile and served as a liaison to the mobile enthusiast community. Previous to that, she held positions as an analyst at Oakwood Worldwide and as a consultant with Chekiang First Bank in Hong Kong, where she helped to plan the launch of its Internet banking service.

Kathleen Goolsby is managing editor at SandHill.com

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