Cloud vendors still 'missing a big trick', research shows

Cloud computing vendors are missing a big trick when it comes to targeting small and medium sized enterprises (SMEs), according to the results of a survey conducted by ICM. The independent research, commissioned by Rise, investigated opinions among small businesses towards cloud computing. It found:

58 per cent of small businesses have NOT heard of cloud computing.

Only four per cent of small businesses said they use cloud computing and are comfortable with it.

Of those who have heard of cloud computing, 26 per cent said they are sceptical about its benefits.

A quarter (26%) of those who have heard of cloud computing said they don't really know what it is.

In terms of selling into small businesses the biggest mistake made by cloud vendors appears to be the assumption their website can replace the long-standing relationships that small businesses have with their suppliers.

The research found:

Only 46 per cent of small businesses are confident making their own IT decisions.

47 per cent trust partners and suppliers over any other source, for advice on making IT investments.

That will be cause for concern for those cloud computing vendors hoping their time has come and expecting users to find their own way to cloud services, said Steve Holford, Marketing Director of Rise.

"Cloud computing has been about 90 per cent hype and 10 per cent substance to date," said Holford. "The reality is IT bosses aren't lying awake at night thinking about cloud computing. They are thinking about the very real issues within their business and IT companies who want to sell to small businesses must address those problems, not get carried away with self-important discussions about delivery models."

"Small businesses don't care what it's called, they care if it works. And while the benefits of cloud computing are very real and very compelling, it's the pitch and the approach that's wrong," said Holford. "Small businesses thrive on the strength and the durability of their relationships. They pick suppliers who understand their business, not companies who only appear to exist online with a one-size-fits-all offering and a data centre and a helpdesk in the US. That approach isn't going to ease the concerns people clearly still have about cloud computing."

Holford said this situation could be good news for many smaller UK suppliers and resellers once believed to be threatened by the march of large cloud vendors.

"The biggest cloud vendors are clearly missing a trick. It's all well and good changing the IT delivery model but they can't change the way people want to buy. As such, this is good news for the hosting companies and ISPs selling 'infra-structure-as-service' to software companies and channel resellers who want to offer and manage the benefits of cloud computing for their customers, without stripping them of the reassurance and personal service they've enjoyed for years."

ICM Research conducted 100 online interviews with owners, co-owners, managing directors, board directors and partners at organisations with between 2-9 employees, in the private and voluntary sectors between the 15th and 20th March. Further information at 
About Rise
Rise is a brand new company launched on 31 March 2010 from Fasthosts. Rise provides cloud and dedicated infrastructure as well as end-to-end solutions for channel partners to either resell, or offer as a white label service under their own brand.
Fasthosts is a web hosting provider. Based in the UK and operating 24x7 from their dedicated UK data centres, Fasthosts keeps over 1 million domains running smoothly and ensures over 40 million emails are delivered safely each day. All Fasthosts services can be self-managed through the award winning Fasthosts web-based control panel that provides customers with a high level of online control, enabling them to manage hosted services including domain registrations, shared web hosting, business-class email, dedicated servers, software-as-a-service, internet merchant accounts and unlimited broadband. Fasthosts' maintains an award-winning, highly successful reseller channel.

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