What is the state of the public cloud in South Africa?
Charles Lalieu, BCX: Locally, quite a few public clouds are arriving. From our view specifically, we're trying to address it from the IaaS, PaaS and SaaS components. The path of least resistance is to make sure from an SaaS perspective that we address the requirements of companies. There is a lot to be done around moving non-cloud legacy workloads, as well as address concerns such as data sovereignty.
Ravi Bhat, Microsoft: There was a boom last year. Lots of service providers are building capabilities, platforms and services on top of it. Digitally-first companies are adopting cloud faster. We're also seeing more decisions being made at board level and those cascade down.
Is the availability of Tier 1 business applications in the cloud pushing adoption?
Kirtan Sita, EOH: We're seeing more cloud-first decisions in the enterprise than on-premise. There is still massive investment in legacy environments, so there is a shift to running business solutions first before considering core enterprise solutions. More and more of the service providers are giving cloud-ready, out-of-the-box offers, so deployments are happening faster. That's what's helping drive adoption right now. Licensing does factor into the move, but right now, the motivations appear to be around competitive advantage and first-to-market with services.
Thomas Lee, GM Cloud Services, Wingu: We are not a HyperV or VMware platform, so we are experiencing slightly different adoption on our platform. Microsoft makes up less than 14% of the workloads on our environment, so we're starting to see the emergence of cloud built to serve a particular market, not just enterprise workloads: a lot of IoT workloads, lots of interactions between environments, lots of web scale applications.
How is the rest of Africa adopting cloud?
Jeremy Matthews, Panda: We should keep in mind that the technology doesn't have to be pure cloud. Our consoles are cloud, but there are a bunch of other endpoint technologies that use an agent. What is favourable for cloud in this part of the world is that Africa is a really mobile continent. But the products need to be bandwidth-optimised, something we've worked hard to accomplish.
We're also seeing more decisions being made at board level and those cascade down.
Ravi Bhat, Microsoft
Dave Funnell, VMware: We're seeing exponential growth like everyone else. There is still huge investment in legacy systems and enterprises are learning how they will manage workloads in-house, in- and across the cloud. We're looking to empower and enable those partners quickly. In Kenya, one of my partners went from hardware being delivered to onboarding their first cloud client inside six weeks. That is pretty powerful. They are targeting the same sorts of enterprises and organisations, but those are often tailored solutions where bandwidth is not as prevalent or resilient.
Many services are being built on international hyperscale platforms. Do we need them locally? *
Kevin Hall, Elingo: I wish we could get them locally. We're asked that question all the time. Some of the platforms we are building internationally are on Amazon Web Services, so having them locally would help. Getting international datacentres locally will drive some of the adoption. Your international brands, such as US banks in the country, might also like to use vendors like Amazon Web Services, because they know them.
Richard Webster, Vox: If you look at the maps for international datacentres, they have none here in Africa. That's a huge gap and it only makes logical sense that they would look at South Africa or Nigeria to launch.
* Microsoft announced it was it was going to open hyperscale datacentres in Johannesburg and Cape Town to deliver cloud services soon after the hosting of this roundtable.
Is South Africa running the risk of being a net consumer of cloud services?
Ravi Bhat: The simple answer is no, since both local and international organisations are working in partnership. Clients are not adopting cloud for cloud's sake. It depends on the workloads. But the customers adopting cloud at the business level do so because of the technology it provides, whether it is machine learning, IoT, agility, etc. They are trying to get closer to customers, change their products or optimise operations. If you look at that, partners who are creating solutions to help customers reach those areas are building value-added services. So, we as an ecosystem will build that.
There is a shift to running business solutions first before considering core enterprise solutions.
Kirtan Sita, EOH
Jonathan Kropf: Amazon, Microsoft and those platforms will arrive here. For people like us, who run our own local platforms, the value lies in niche applications and services to address line-of-business requirements that need to be local. Where it is a broad-based application, the hyperscale global providers have a compelling argument. But where there is a little more architecture and more consulting around that, local services will always be there.
Thomas Lee: When you look at what is happening in our customer base, three things are important: agility, agility, agility. The shift we need to make is customers don't need to think. `I'm going to be an Amazon Web Services or Azure', or this or that. They will want to be a customer to all of those, as it suits their needs. If you look at companies adopting cloud, they tend to adopt broadly. So it's likely some stuff will sit in one place, but other things that are niche or latency sensitive is where local cloud has an advantage.
Kirtan Sita: We're seeing a market that co-exists with the international players. But we build specialised solutions in this industry for localised markets that are cloud-first solutions. These require different value propositions, such as hybrid. So there is a marketplace for coexistence, but depending on the type of differentiated value.
Are cloud customers following market shifts or leading change?
Charles Lalieu: People may be consuming cloud for basic services, but that's transactional. The vendors moving to this model are pushing customers to re-evaluate and that is also driving some of the model.
Jeremy Matthews: Both those dynamics are happening. You have situations where you have no choice. If you want the latest version, this is how you buy it. Then we have situations where there is choice between on-premise and cloud. That's where the market can say what option they want and business drivers come into play.
Kevin Hall: What we're seeing is this approach of taking every API and web service and trying to integrate the heck out of it. The problem is that we try to communicate that cloud is bringing a simpler world to you, then we have this mindset to say that if I don't do the integration, I'm not going to be as competitive as I want to be. So complexity is almost seen as a way to compete, where the cloud story is sometimes a bit different. What we're trying to say is, let's compete on a different model. But a lot of the companies are not there yet. A lot of our companies are still saying what we have on-premise, we want in the cloud with all the bells and whistles in the same places.
Will the local cloud market hit the wall if data prices don't come down?
We should keep in mind that the technology doesn't have to be pure cloud.
Jeremy Matthews, Panda
Jonathan Kropf: You have to separate out the mobile costs. There is a mobile data element that I think is priced too high compared to other markets. But in terms of fixed line fibre, the pricing isn't that bad. The prices are dropping every single year. We can double our bandwidth in international breakout every year for the same amount of money. That is significant. That changes how people interact with cloud providers. If you can put in a redundant 1GB local connection to a datacentre for R40 000 to R50 000 a month, it starts to negate the need to actually have your datacentre on-site. The local fixed-line pricing is at a level where it's starting to accelerate cloud adoption quite drastically.
Charles Lalieu: The amount of data we are generating day on day is exploding. The very reason why we have hyperscale is because the data has grown so much. With the amount of data being pushed out, the cost has to come down.
Yaron Assabi: There are a lot of new types of networks that allow you to reduce the costs dramatically. A tenth of the price on the base station and the connectivity requirements are not as heavy. We're seeing a lot of mesh networks coming to Africa. But we do need more competition. From a support of SMEs perspective, they want to grow their business using cloud-type models and applications. They don't have the ability to support multiple clients and build huge teams. So if you want to scale, you want to be able to adopt a cloud model. Clients want business benefit. Connectivity is how they get there, but really what they want is to get the benefit of the software. They want to create services for their customers, a lot of which is driven by mobile. So mobile data is important because the end-customer is using mobile.
Richard Webster: The SME angle is important. Thanks to cloud, they have access to applications such as ERP. Many will grow their adoption through both fibre and mobile. So all connectivity discussions are important.
Do we have a cloud skills shortage?
Dave Funnell: In many ways, the skills are there. It's more about organisations transforming themselves to take out silos. There are a lot of cases of an enterprise not wanting to run the infrastructure anymore and then not invest in those skills. So you're seeing private cloud delivered through a public cloud provider. Obviously skills are going to be in demand globally. But I think it's more about transformation and maturity around organisations.
Jonathan Kropf: We need to define what cloud skills are. In my mind, the traditional IT skillset is not equipped for cloud. The typical skillset we see a huge shortage of is around integration, API development and getting systems to talk to each other and do something meaningful. The typical IT person in the market is not irrelevant, but their skillset has become commoditised and there is a new skillset emerging from cloud that we are battling with in South Africa. I don't think it's all going overseas, but that these are not being taught and developed enough.
From the service provider view, are skills a concern for building the local cloud industry?
Thomas Lee: Absolutely. For us, it's an unwritten rule that we really would like our engineers to not have LinkedIn profiles, because they continuously get hunted. On our side, if you look at the specific platform we have, Openstack skills are few and far between. Generic Linux skills are in very high demand. So we have a challenge where we build our platform with automation and orchestration in place, so we can scale the number of people we have in relation to the equipment. Among our customers, the comment about traditional IT skills not translating into cloud is absolutely true. When we look at traditional IT guys, they have an infrastructure-up thinking. For cloud, you have an application-down mindset. Some companies are making that jump.
Jargon Buster
API: A collection of tools and protocols that allows systems to connect with each other Cloud-native: Services and applications built specifically for cloud
Hyperscale provider: Cloud platforms with huge room for scale, such as Amazon Web Services and Azure
HyperV: Microsoft virtualisation
IaaS: Infrastructure as a Service
IoT: Internet of Things
Openstack: A market-leading cloud operating system
PaaS: Platform as a Service
SaaS: Software as a Service
VMWare: VMware virtualisation
Web service: a service made available over the internet
Attendees
Charles Lalieu, managing executive, Business and Technology Strategy, BCX
Dave Funnell, vCAN Business Development manager, VMware
Jeremy Matthews, regional manager, Panda
Jonathan Kropf, CEO, Tarsus Cloud on Demand
Kevin Hall, sales manager, Elingo
Kirtan Sita, GM, EOH SAP, EOH
Ravi Bhat, Cloud and Enterprise Business Group lead, Microsoft
Richard Webster, senior product manager for Cloud Computing, Vox
Thomas Lee, GM, Cloud Services, Wingu
Yaron Assabi, CEO, DSG
This article was first published in the July 2017 edition of ITWeb Brainstorm magazine. To read more, go to the Brainstorm website.
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