First-mover cloud service providers set to make outsized market share gains, says AMI
New York, New York — December 1, 2015 — Customer churn is an emerging threat to cloud service providers. Over 5% of US SMBs indicated they had switched cloud service providers during 2014, up from 1% in 2013, according to AMI’s annual SMB tracking studies. Shaped by the ease with which they interact with their mobile devices and apps, user expectations around the overall application experience, interaction, personalization, and control are trending higher. Firms – small, medium and large – have become less forgiving of slippages in performance, pricing/value, and the overall user experience offered by cloud service providers.
“Delivering intuitive and delightful user experiences will not only enhance customer loyalty, but also transform those customers into “advocates” – the Holy Grail for marketers,” stated Deepinder Sahni, SVP at AMI. “Consequentially, cloud service providers will expand their customer base, and also enhance average revenue per user (ARPU) on cloud services. SDN and NFV are the key enabling technologies at the heart of delivering these innovative and transformational user experiences. Together, SDN and NFV will make the network more flexible, and enable real-time delivery and scaling of services,” continued Sahni
As part of the Global SDN & NFV Cloud Impact study AMI surveyed over 350 small, medium, and large business (SMLB) cloud services buyers across 11 countries, and quantified specific cloud services-related experiences, preferences and business outcomes. Over 60% of respondents indicated they would add more users, and over 75% indicated they would proactively advocate for their cloud service providers as a result of specific transformational cloud services user experiences.
Service providers that deploy SDN & NFV early will be well positioned to capture market expansion as businesses switch providers, add users, add services, and exchange stories about positive outcomes. Best case scenarios suggest a cloud service provider with an extended period of first-mover lead time advantage may add up to 45% more on top of its planned cloud revenue stream as they bundle multiple services and offer flexible (network-driven) usage experiences.
The routes-to-market (RTM) or purchase channel element is critical to market expansion beyond simply deploying SDN delivered services. Businesses are purchasing cloud services from a vast mix of providers, including VARs/resellers, MSPs, and directly from IT vendors and telecom/cable providers. Understanding which channels buyers are using to acquire these services is essential to building an effective channel presence that will monetize SDN investments.
The study deliverables (in PowerPoint and Excel Pivot tables) provide insights into usage/plans for multiple cloud services, various end-user experiences desired, spending, forecast and market expansion by individual cloud service, and a go-to-market segmentation framework to target high-value SMLBs with a high propensity for cloud solutions.
About Access Markets International (AMI) Partners, Inc.
AMI specializes in IT, Internet, telecommunications and business services strategy, venture capital, and actionable market intelligence — with a strong focus on global small and medium businesses (SMBs), and extending into large enterprises and home-based businesses. AMI’s mission is to empower clients for success with the highest quality data, business strategy perspectives and ―go-to-market solutions. Led by Andy Bose, the firm has built a world-class management team with deep experience cutting across IT, telecommunications and business services sectors in established and emerging markets.
AMI has helped shape the go-to-market SMB strategies of more than 150 leading IT, Internet, telecommunications and business services companies. The firm is well known for its IT and Internet adoption-based segmentation of the SMB markets; its annual retainership services based on global SMB tracking surveys in more than 25 countries; and its proprietary database of SMBs and SMB channel partners in the Americas, Europe and Asia-Pacific. The firm invests significantly in collecting survey based information from several thousand SMBs annually, and is considered the premier source for global SMB trends and analysis.
Quoted Analyst: Deepinder Sahni. Phone: (212) 944 5100 ext 507.
Media Relations: In US (New York): Nancy Carty. Phone: (212) 944 5100 ext 581.
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In India (Kolkata): Jyoti Singh. Phone: (91) 33 4003 3093 ext 223.
In India (Bangalore): Rati Ghose. Phone: (91) 80 4148 2661 ext 36.
In India (Mumbai): Neha Jalan Goenka. Phone: (91) 99300 20420.