So What Does It Cost?

It sounds like the simplest of questions:  So, what does it cost?  Yet, for an immature industry like cloud computing, it’s a doozy.  

For 5 years my cohorts and I poured our energy into the singular quest of trying to make complex computing available and affordable to the SMB and mid market customer.  Unlike a lot of purveyors of the cloud, we got our start as a blood sweat and tears IT service shop, which means we only have time for stuff customers are willing and able to buy!   (Incidentally, I truly believe there is a huge source of untapped innovation sitting idle in what the IT Service market calls “The Channel”, but I’ll save that for another day).  

Like most innovators our early inventiveness was driven by a lot of trial and error exercises.  We found no shortage of willing lab rats within our base of existing customers, but each time we thought we cracked the code we came back to the drawing board with something inevitably missing from the puzzle.   Being very, very early adopters of virtualization technologies, it was easy for us to grasp and produce cloud computing deployment.   From the get go we succeeded in putting customer applications into our cloud.  That part was easy.  What was not so easy was what invariable came next in the selling process:  Pricing.

On the surface, it sounds like a simple problem.  Heck, if you already have customers wanting your solution, just ‘givem’ a price’ already!  Right? 

Wrong. 

Herein lies the difference between a company that has build a cloud computing platform and a company that has actually tried to get a customer (and I real, tried and true SMB) to pay for it.  There is a big difference.  Cloud computing is something of a Pandora’s Box, you see.  By unleashing elastic computing with the promise (at least in our case) to a customer that they could run WHATEVER they wanted, you effectively let the lightning out of the bottle.  It is uncontrollable, yet the possibilities are fascinatingly endless.

We quickly (well, 2 years of trial and error quick) realized that what this pony needed was a saddle. 

The power of cloud computing is the stuff of techno-economic paradigms, for sure.  But it needs an effective pricing model and here’s the kicker: It has to be simple.  I mean no offence here to our counterparts that operate public clouds, but pricing is WAY too complex. I know I’m not the smartest guy on the planet, but here is what I also know:  The buying public is not made up of MIT laureates, nor do they really care how many all-nighters you pulled to develop your system.

Let me give you some insight into 6fusion R&D culture and mentality when it comes to pricing, which I think a lot of other companies that take themselves and their technology way too serious should consider: 

1) If you need a whiteboard to explain pricing, you will only sell cloud computing to yourself. 

2) If the customer doesn’t know the cost of cloud computing before giving the P.O, chances are they won’t.  

3) If, when you talk about your pricing model, you ever say “that depends…”, don’t call the Marketing Dept just yet.

I don’t want to sound overly dramatic, but we believe the pace at which cloud computing moves from ‘technological revolution’ to ‘technology paradigm’ hinges on the subject of universal costing.  Put another way, the point at which cloud computing is truly ready for mainstream business is the point at which the customer says “So, what does it cost?” and the cloud computing purveyor says, “I’m so glad you asked!”

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2 responses to “So What Does It Cost?

  1. Pingback: Cleaning Up the Cloud Computing Pricing Mess «

  2. Pingback: Enterprise Customer Uses 6fusion Profiler to Drive Cloud Strategy «

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