OnApp CEO Ditlev Bredahl has a message for the current community of hosting providers: “If we don’t [band together and take on Amazon Web Services], we will look back on these years as the years when the long tail of our industry disappeared.”
It sounds hyperbolic, sure, but Bredahl is a true believer — something he made clear during a Thursday discussion at Structure:Europe. OnApp has built an entire business around doing just that. It has 2,000 service provider customers spanning 84 countries, all sharing resources among each other and outside customers via a standard user interface and tooling. He thinks this federated approach gives the OnApp community a leg up against a provider like AWS that has a much smaller global footprint and set of capabilities.
Tony Lucas, founder and SVP or product at Flexiant, isn’t so sure that’s a bright idea. Lucas’s company also counts service providers among its customers, but its goal is to let each one focus on what they do best. “Viable scale” is actually much smaller than most people think, he said, but it doesn’t take dozens of your own data centers across the world to compete with the cloud behemoths.
“Certainly, none of our customers are ever going to out-market Amazon in terms of cost of capital,” Lucas noted. What they can do is build niche businesses that are unique from AWS and provide flexibility that Amazon can’t. If scale were such a concern, he added, AWS could easily add more data centers in Europe aside from its one Dublin, Ireland. But customers aren’t showing much hesitation to use that one.
It’s hard to say who’s right, but Bredahl says he once lost a customer to AWS in a previous life because, without a one-year contract, he couldn’t justify the expense of bringing on 1,000 new servers. With the OnApp federation, he’s confident other service providers don’t need to suffer that fate.
Check out the rest of our Structure:Europe 2013 coverage here, and a video embed of the session follows below: