The Science (and Economics) Behind a Carefully Crafted Software Defined Storage Strategy for Cloud Service Providers

Do you remember your high school years–of calculating the boiling point of isopropyl alcohol in chemistry or studying the impact of supply and demand on the costs of goods in economics class? Many of us wondered, “When will we ever use these principles in real life?” For those of us hoping to enter into the booming Software Defined Storage (SDS) space, the answer is now. With the demand for storage continuing to expand at over 40% annual growth until 2018,* it’s a safe bet that we aren’t the only ones that see the growth possibilities in storage as a service–nor are we the only ones who plan to expand their business model to include SDS.

So, how do you develop the perfect go-to-market strategy?

As global Product Marketing Leader for the Cloud Service Provider (CSP) solutions at VMware, I’ve dedicated my career to crafting and executing winning strategies for market entry and growth. And, I’ve learned a few things along the way. At the top of the list is the importance of first impressions and taking the time to create a strategy that differentiates your company from the competition. It all starts with doing your homework – studying the trends, crunching the numbers, learning from your mistakes and coming out stronger in the end.

I recently spoke with one of our independent cloud services providers, IndonesianCloud. Their story is the epitome of how to capture attention across the aggressive cloud market. In 2011, they focused their sights on becoming the most trusted, most reliable and most secure CSP in Indonesia. For those of you who don’t know, Indonesia is a country with 254 million people, and literally millions of companies, and it is currently adopting cloud at a staggering rate. It is estimated that the cloud spend will reach $1.2 billion by 2017–and that’s just across Small and Medium Enterprise (SME) business. Needless to say, it’s a great time to be a CSP in Indonesia.

Here a few examples of how IndonesianCloud did their homework:

1. The Power of Listening: Their customers were growing frustrated with their current storage solutions–of disparate data silos, cumbersome SLAs, and expensive operating costs and scalability options. To address these challenges, IndonesianCloud made the decision to move away from their traditional architecture and embraced VMware’s Virtual SAN (VSAN) in 2014. For them, VSAN offered enterprise-class features, scale and performance, making it the ideal storage platform for VMs. Plus, it deeply integrated with the VMware stack. This is something that current customers loved and their new customers required.
2. The Art of Competitive Pricing: They started by looking at how cost effective they were against other providers on the market. At the time, they were 4X more expensive than the global competitors, and this turned many prospects away from their storage. They needed to match the comparative price of “in-house purchased” solutions without compromising performance or availability. In the end, they found that only VSAN was able to deliver on the cost and reliability they needed. As a result, they ended up with a total cost of 12c/GB (including software and hardware), which they can resell at 24c/GB. That’s double profit for those keeping track! 
3. Test the Scales of Efficiency: IndonesianCloud found that they needed to walk the tightrope between cost-effective and over engineered storage system. If they offered customers the moon in terms of performance, it resulted in skyrocketing costs on a company level. If they lowered costs, performance suffered, as did customer satisfaction. To balance the scales and deliver “just enough performance,” IndonesianCloud consolidated five physically separate datastores (one for each storage tier) into a single VSAN datastore while retaining all storage tiers. This solution gave them the efficiency they needed in addition to high levels of availability through local snapshots and remote replication for disaster recovery.
4. Learn From Your Mistakes:  Following an outage on a previous platform, the customers of IndonesianCloud made it known that they don’t tolerate failures and will be quick to leave if another outage occurs. So, IndonesianCloud designed a scale-out grid architecture solution powerful enough to accommodate failure–one that is NOT reliant on internal mechanisms. They got rid of old-fashioned disk RAID arrays and dual controllers; they replaced those with a “Scale Out, Shared Nothing” solution that is perfect for service providers and large enterprises alike.

What grade would your current Go-To-Market Strategy get? With a little help, it could rise to the top of the class and receive an A+.

Want to learn more tips on crafting a winning SDS strategy?

 Join us for our insightful May webinar series entitled, “Gain Competitive Advantage with VMware Application-centric Storage for Cloud Service Providers.” In it, IndonesianCloud CEO Neil Cresswell and I will share with you real-world deployment experiences, our lessons learned, and the new features of VSAN 6.0. Plus, attendees can take advantage of exclusive incentives. (Think 50% off VSAN list price for up to 2TB usage during the promotion period).**

Can’t attend the webinar but want to learn more?

For additional information about VMware partner programs and solutions for service providers, refer to the VMware vCloud Air Network Program  and Solutions for Service Providers.

* Source: IDC, Yezhkova, Worldwide Enterprise Storage Systems Forecast, November 2013, #244293.
**  Available to qualifying CSP only. Certain restrictions may apply.

Sanjeev Desai  is Global Product Marketing Leader at VMware. He is a customer-centric and results-driven leader with expertise in driving transformative business solutions in the Software Defined Enterprise, End User Computing and Hybrid Cloud domains. His professional experience ranges across high-tech industries from the Fortune 500 companies to medium-sized businesses and entrepreneurial start-ups in Silicon Valley.