BTC LOGIC RANKS: TOP TEN CLOUD COMPANIES

Q2 2010

Executive Summary
BTC Logic is a multi-disciplinary team of experienced consultants, working with technology companies looking to grow more rapidly, and with companies looking to build competitive advantage from technology disruptions. Two of the major technology disruptions now impacting enterprises are the adoption of Cloud Computing, and the expansion of services for the mobile enterprise. Cloud Computing offers a unique opportunity for enterprises to generate new revenue by getting new applications built and deployed more quickly, and scaling these applications with greater ease. Enterprises are also harnessing the processing flexibility of the Cloud to reduce costs. However the Cloud Computing marketplace still has a confusing array of vendors each promoting its own solution, and a steady increase in the number of new Cloud product and services. Enterprises have only slowly been embracing Cloud because of the need to evaluate multiple vendors; valid fears about security, privacy, data integrity and governance; and a widely held belief that Cloud Computing is an IT opportunity more than a key business lever. Vendors have mostly focused on the multi-tenant aspects of the Cloud, but now also have to address the need for multilandlord options and the whole related issue of trust services in the Cloud. This updated Top Ten Rankings report is intended to provide a holistic framework for looking at the Cloud Computing space beyond the traditional three tier split, to give an independent summary of the leading vendors in each of the key Cloud segments, and to present a shortlist of the top vendors in each segment that enterprises should consider as they pursue their Cloud initiatives. It tries to give some structure and nuance to companies offering Cloud products, and go beyond alphabetical Cloud company listings. One of the major trends in Q2 has been a broader recognition that enterprises will not significantly move applications and data into the Cloud until issues related to security, privacy, and data location (trust services) are fully resolved. Another strong trend is that enterprises want to retain more control over governance and have the ability to oversee applications and data running in a broad hybrid Cloud (in-house, private, and public Clouds from more than one infrastructure or platform provider).

Contents Executive Summary Purpose of Report Cloud Computing Trends Top Ten Company Rankings
Cloud Infrastructure . Cloud Foundation . . Network Services . . Cloud Platform . . . Cloud Applications . Cloud Security. . . . Cloud Management . Cloud Up and Comers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 .10 . 11 .12 .13 .15 .16 .17

1 3 4

Methodology Notes Processes and Definitions About BTC Logic

18 19 20

www.btclogic.com

To recognize these trends, BTC Logic has expanded its Cloud classification to include two new segments (Cloud Security and Cloud Management), giving seven major segments: 1. 2. 3. 4. 5. 6. 7. Cloud Foundation Cloud Infrastructure Cloud Network Services Cloud Platform Cloud Applications (further divided into two sub-segments) Cloud Security (new) Cloud Management (new)

Another major trend in Q2 has been the very visible investment and commitment in Cloud Computing by major technology players and their move up to positions that look increasingly dominant going forward. From our perspective, the most important vendors for enterprise customers in 2010 can now be divided into three groups (where each company is a top 5 contender in at least one segment): Cloud Champions Amazon (Cloud Infrastructure, Network Services, Platform, Management) IBM (Cloud Infrastructure, Platform, Security, Management) Cloud Heavyweights Cisco (Cloud Network Services) Citrix (Cloud Foundation) EMC (Cloud Security, VMware investment) Google (Cloud Applications) Level 3 (Cloud Network Services) Microsoft (Cloud Foundation) Oracle (Cloud Infrastructure, Management) Red Hat (Cloud Foundation) Salesforce/Force.com (Cloud Platform, Applications) Symantec (Cloud Security) VMware (Cloud Foundation) Cloud Contenders ATT Network Services (Cloud Network Services) Aylus Networks (Cloud Network Services) Rackspace (Cloud Infrastructure) SAP/Business Objects (Cloud Applications)

www.btclogic.com

 Sonoa Systems (Cloud Security) Taleo (Cloud Applications) Terremark (Cloud Infrastructure) Other companies vying to be Cloud Contenders - and who find themselves competing with the 20 companies above - will need to refine their businesses to compete successfully. This group includes the familiar names of 3Leaf Systems, Boomi, CSC, Enomaly, Eucalyptus, GoGrid, HP, RightScale, rPath, and Savvis. Noticeably absent from the Top Ten Ranking other than AT&T are the larger Telcos, although Comcast and Verizon do seem to have aspirations to become more significant players. Looking ahead, most major technology vendors now recognize that they need a significant Cloud Computing offering in order to remain competitive in the future, and are rolling out more integrated solutions and consciously building Cloud ecosystems. This has created a more crowded marketplace with well-funded fast followers devoting significant resources to improved product and service offerings, and an uptick in vendor marketing efforts. However, enterprise customers remain cautious about moving applications into the Cloud, still see Cloud as more of an IT priority than a business priority, and are rolling out Cloud initiatives in an environment of downward pressure on most IT budgets due to a prolonged weak economy.

Purpose of the Report

The purpose of this report is to provide a structured and holistic view of Cloud Computing, current Cloud trends, and of the vendors to help enterprise decision makers successfully embrace the opportunities that arise with the Cloud. The report provides a framework for senior enterprise executives to break down the Cloud into meaningful segments, and start to prioritize how they engage with potential vendors, before addressing the details of their own Cloud initiatives where they will need to choose between different vendor technology offerings. For vendors, this report is intended to provide an overview of how their strategies, product/service offerings, and current execution compare to others. It also gives them a framework in which they can demonstrate to an enterprise why their product/service offering is superior to the Cloud Champions and Heavyweights. The content of this report, derived from our database and its analysis, is different from other published lists in three important respects: 1. We take the viewpoint of an enterprise leader, decision maker, or key influencer who is plotting a course to get their enterprise more involved in the Cloud: Enterprises have significant concerns about availability, security and scalability that can differ from consumer or SMB needs

www.btclogic.com

 Decision makers need to link emerging Cloud technologies to their companies strategies and performance 2. We are vendor neutral: Most of todays information and insight regarding the Cloud still comes from vendors who have inherent biases to their own solutions BTC Logic is an independent and autonomous group of business, technology and creative professionals with no internal bias regarding the Cloud and its opportunities and services 3. We categorize the Cloud marketplace into meaningful segments and subsegments for our enterprise clients: This approach helps enterprise leaders and decision makers accelerate decisionmaking and consensus building Enterprise leaders can break down problems they are solving along the lines of the major segments and sub-segments, allowing the organization to move forward more quickly.

Cloud Computing Trends

Key Cloud Trends We have found it useful to separate Cloud trends into those that are helping to drive adoption of Cloud Computing by enterprises and those that are inhibiting the adoption of Cloud. These drivers and inhibitors in turn affect enterprise behavior and vendor responses to both the trends and the enterprise behavior. BTC Logic does not believe that Cloud Computing has yet crossed the chasm for enterprises as many of the issues involved have not yet been fully resolved (e.g., security of data in the Cloud), but that greater adoption and an increased sense of urgency within enterprises is likely within the next two years. Cloud Adoption Drivers Enterprises are looking at Cloud solutions that can integrate mission critical applications in their data centers and private Clouds, in a way that provides the processing flexibility of public Clouds. Thus the hybrid Cloud is becoming the model of choice. It is almost impossible to take advantage of a hybrid Cloud without virtualization of at least some of the data center, but it is estimated that only about 25% of major enterprises have adopted virtualization, so the pace of virtualization will impact the pace of Cloud adoption. Major technology companies are improving their Cloud products and services, and there has been a notable increase recently in investment and commitment to the Cloud (e.g., Oracle, Red Hat). Cloud providers now offer meaningful, measureable service level agreements

www.btclogic.com

(SLAs) with service penalties (and remediating actions or compensation) if SLAs not reached. New technologies in Cloud management and Cloud enabling vendors are improving Cloud use and performance. There is a move to simpler Cloud pricing models based on true unit costs, not average or hypothecated rates. Performance monitoring will become standardized and cross platform and infrastructure capable. This will facilitate seamlessly managing private, public and hybrid Clouds. Commodity Cloud provider price-cutting continues, with Amazon and Force. com leading the way. Credible Cloud Management tools and services are emerging, allowing for greater control and use of multiple platform/infrastructure vendors simultaneously. Many of these tools and services are provided by the large vendors such as IBM, Oracle, and Amazon who may have a vested interest in driving a client towards their own infrastructure offering, but there are also credible independent Cloud Management services such as RightScale. Many of the new Cloud product offerings provide much greater transparency on the cost of running a particular application or series of infrastructure actions. The ability to directly cost an application is an improvement over the current data center practices of charging back on an allocation basis, and will increasingly be a driver of moving new and existing applications into a hybrid Cloud. In the consumer space, Cloud Computing has motivated and enabled rapid growth in multi-tiered mobile applications - good examples of this include gaming and online retailing and the lessons learned will cross over into enterprise Cloud Computing. Cloud Computing will be important for changes to the mobile enterprise and in location-based services, and in many cases an established hybrid Cloud may be a prerequisite for launching mobile enterprise services quickly into a competitive market. It is also noteworthy that companies like Google that have been very successful in offering Cloud-based services to consumers and small businesses will find it much harder to sell into enterprises. Cloud Adoption Inhibitors The primary inhibitors for Cloud adoption are the major and related issues for enterprises of security, privacy, identity management, data location, global regulations, and governance. Enterprises are concerned that complex rules and procedures that they have to manage their security and handling PII, for example, or complying with privacy laws, HIPAA, and Sarbanes-Oxley, must be maintained in any move to a hybrid Cloud. There are still a very confusing array of vendors each promoting their own Cloud solution, and enterprises harbor a lingering fear that smaller companies will disap-

www.btclogic.com

pear through economic failure or change business direction through acquisition. A good example of this is CAs recent acquisition of 3Tera. Enterprises also remain concerned about vendor lock-in, and would prefer a Cloud strategy that allows them to work with multiple vendors and have the management tools to switch workloads more dynamically to the best or cheapest vendor. Within enterprises, IT centric departments are still driving Cloud Computing initiatives, and many business executives still largely see Cloud as an IT issue. Many enterprises have not fully grasped - as some start-ups have (e.g., Dropbox with Amazon) - how Cloud Computing can help rapidly launch new products or services on a growth path that would have been impossible with a conventional data center approach. Indeed many major enterprises are emphasizing their private Cloud primarily as one of their initiatives to reduce costs. The move to open standards for Cloud Computing at the global level, and the advance into the ANSI and international standards is now well under way. However progress while steady is slow and enterprises are concerned about the costs of switching vendors in the event of an irresolvable dispute. Enterprises are struggling to deal with likely internal change that accompanies a move to Cloud Computing. The Cloud will decentralize IT decision-making and force business heads to more directly manage Cloud costs and organizational direction. Many small-scale uses of Cloud Computing have been started by business heads without even consulting the relevant IT departments. Enterprise Behavior Cloud services have been fully embraced by many small businesses and by start-ups where investment in large numbers of servers would be extremely expensive and impede growth. Cloud computing has also allowed companies to experiment with alternative business models in a way that would not have been possible even five years ago. However smaller companies and start-ups rarely face the significant security requirements and legal constraints that are such a challenge for larger businesses with existing data centers. This has led to many enterprises continuing to take a wait and see approach for their applications, and to sticking to low risk trials as they consider the larger opportunity. Hence there is no evidence of a sense of urgency yet in adoption amongst enterprises although there is urgency is appearing amongst vendors as they position themselves for the future. For enterprises, of all the factors involving a move to the Cloud, security and governance have risen to the top. Increasingly frequent revelations of loss of customer data (e.g., AT&T/iPad) and privacy problems (e.g., Facebook, Google) have only heightened the need to get security and governance right. Note that a cross industry and government collaboration called the Cloud Security Alliance is addressing Cloud security and governance issues (www.cloudsecurity-

www.btclogic.com

alliance.com). They are now working on the second release of Guidelines for Cloud Security, and current work is expected to deliver a mapping from 98 Cloud Security controls to a Cloud Security Reference Architecture, by the final quarter of this year. This will include a comprehensive set of design patterns and templates. One of the behaviors that became more apparent in Q2 is that enterprises are becoming more interested in engaging at the Cloud Infrastructure or Cloud Applications level and less so at the Cloud Platform level. This is because they require more control over their IT activities and are willing to spend more up-front time and money to get the Cloud setup that they feel is right for their business. Enterprises also have a strong desire to implement established procurement and vendor best practices in their Cloud relationships. They want the ability to buy Cloud services from multiple vendors and be able to switch Cloud providers if necessary this seems especially true for Cloud Infrastructure, Network Services, and Platform. Hence, overall, there is currently little perceived downside risk among enterprises from engaging with the Cloud only slowly. This implies we have not yet reached the inflexion point where enterprise CEOs sees Cloud Computing as a core part of their business. This seems reminiscent of the enterprise view of ecommerce in the mid-1990s and SaaS in the early-2000s. Vendor Behavior Vendor behavior in the Cloud space with the notable exception of virtualization is running ahead of customer demand. There seem to be two main reasons for this. First, three significant and relatively new entrants to the technology big league Amazon, Force.com, and VMware - are looking to gain traction for their products and services quickly with enterprises, and with some success. They are closely followed by many other start-ups, such as Rackspace and Terremark, looking to carve out a defensible piece of the Cloud Computing market. Second, existing enterprise technology vendors have recognized the value that Cloud Computing can provide and the threat that some of the smaller vendors pose to long-standing customer relationships. By way of example, who foresaw five years ago that Amazon would be competing directly with IBM and Oracle? IBM took the lead in its response to the competitive challenges, and more recently Oracle made a very public U-turn on its view of the Cloud when it launched its own services. Microsoft and Google have established their positions as Cloud heavyweights through in-house development, while Citrix and others have made strategic acquisitions to ensure that they too are considered heavyweights. Major vendors have also been improving their products and services as they engage more seriously with enterprise clients and better define the customer need. This has seen some firms rising in the Q2 Rankings. Microsoft is better integrating its Cloud product suite and benefiting from a

www.btclogic.com

shift in enterprise customer emphasis from Platforms to Infrastructure Amazon has successfully amended its product suite to facilitate more control for enterprises EMC is gaining ground, fueled by its clear understanding of virtualization Force.com has been successfully growing its own business ecosystem VMware continues to grow rapidly, and to be the dominant Cloud Foundation tool Rackspace has introduced a large number of managed hosting tools increasing its position as a Cloud Contender IBM continues to be a trusted partner for enterprises as they move towards hybrid Clouds, even if it does not necessarily offer the fastest implementation Oracle is now publicly promoting Cloud trends and its own capabilities Red Hat has launched its Cloud Foundations offering built on RHEL and JBOSS Other firms are struggling to hold their positions in the Rankings HP seems to be losing ground to faster moving rivals Computer Sciences Corporation has launched a major Cloud Computing and Services capability, and is in the process of packaging these offerings as a coherent brand product strategy. Google is increasingly perceived as more of a consumer offering, and lacking the tools that enterprises need; there are also greater security and privacy concerns with Google SAP has not kept pace with its rivals in the Cloud space, but clearly has been putting its emphasis recently on building a stronger position in mobile enterprise through its acquisition of Sybase In this increasingly competitive environment as we exit Q2, many smaller vendors will need to clearly demonstrate the value of their product/service offerings to the enterprise, and build scale in order to carve out defensible long term businesses and make themselves more attractive to potential acquirers. The question of whether M&A activity in Cloud Computing will increase or decrease in the second half of the year is not clear. Amazon, IBM, Force.com and Microsoft have mainly been growing their Cloud Computing presence through allocation of internal resources, whereas others such as Oracle, Citrix and CA have taken a more acquisition-oriented approach. It does seem likely that some of the Cloud Contenders will need to make selective acquisitions if they are to stay competitive with the Cloud Heavyweights (HP and Computer Sciences Corporation being the obvious examples), and that all companies will likely use select acquisitions to fill out their Cloud offerings.

www.btclogic.com

Cloud Infrastructure
The Cloud Infrastructure segment includes those vendors who can provide Cloud infrastructure as a solution in a scalable, secure, cost effective way. Amazon now tops this category with the changes it has introduced in the last few months. IBM Cloudburst represents a well integrated set of Cloud services for an enterprise and IBM has invested considerably in delivering private and hybrid Clouds, but is ranked second because a decision to go with IBM Cloudburst forces the platform decision and impedes an enterprise from realizing any benefits of working with other platform vendors. Both Oracle and Rackspace have moved up the tables, and Terremark has held its top 5 ranking despite increased competition. Oracle has moved up the rankings through the integration of its Sun acquisition and leveraging its considerable internal resources to publicly release its Cloud Computing services. Rackspace has introduced a large number of managed hosting tools that increase its attractiveness in a number of Cloud categories. We define Cloud Infrastructure based on features, regardless if the solution is infrastructure as a service or delivered directly, and use publicly available information pertaining to these ranking criteria: Agility in delivery of Cloud infrastructure Ability to deliver public, private and hybrid Clouds Ability to integrate the Cloud services with a diverse set of vendors (vs. being locked into a proprietary platform) Ability to provide Cloud infrastructure as a turnkey solution Degree to which the Cloud infrastructure services can be integrated for an enterprise Cost effectiveness Device independence Tenancy that enables sharing of resources, permitting Multi tenancy Single tenancy Utilization and efficient resource allocation Attainable reliability Available scalability Security that fits an enterprise perspective Metering Maintainability 1 2 3 4 5 6 7 8 9 Top Ten Cloud Infrastructure Companies Amazon Infrastructure Srvs IBM Cloudburst Oracle Cloud Services Terremark Rackspace AT&T Cloud Services Savvis GoGrid CSC Cloud Services

10 HP Cloud Assure

www.btclogic.com

Cloud Foundation
The Cloud Foundation segment includes those companies providing the tools and software that make building the Cloud infrastructure possible. VMware remains the clear leader in this category and we believe that an EMC / VMware ecosystem has the potential to become a Cloud Champion. Microsoft has made impressive progress during Q2 through working hard to integrate MS HyperV more fully into their enterprise product offerings, and through increased focus gained from the formation of its Cloud Services group. Citrix has leveraged its Xen acquisition to make its Cloud Services group a leading player. Red Hat continues to progress in its Cloud offerings through the formal launch of its Cloud Foundations platform in late June, but it is still a little too early to see the marketplace impact of this action, and so in our rankings sits behind Microsoft. Microsoft, Red Hat, and Citrix all benefited from developing a clearer vision of the Cloud product offerings, successfully consolidating their Cloud efforts, and from devoting increased resources to Cloud initiatives. Microsoft and Citrix derived some benefit from having IT and business relationships that are higher up the stack. We define Cloud Foundation by following the examples set by Project Reservoir, the European joint program with IBM, ElsagDatamat, CETIC, OGF.eeig, SAP Research, Sun Microsystems, Telefonica I+D, Thales, Umea University, University College of London, DSA-Research at Universidad Complutense de Madrid, University of Lugano and University of Messina: The definition considers what technologies enable deployment and management of complex IT services across dissimilar administrative domains. Cloud Foundation products and services needed to support the developing open standards of Cloud Computing, allowing the enterprise to build its own private, public and hybrid Clouds. We examine solutions that understand Cloud Computing as a complex service, potentially containing groups of interconnected virtual machines with variable purposes that can run across different computing environments, using complex network services, and running a diverse set of applications. Consequently, we rank Cloud Foundation offerings utilizing publicly available information pertaining to these criteria: Ability to integrate with other Cloud segments, providing the groundwork of any fundamental Cloud decision Analysis of foundations performance in creating various Cloud configurations Software development and performance analysis as a foundation Strength of the foundations ecosystem of supporting companies, willing platform and infrastructure providers Strength of relevant offerings in market place today Basic foundational support services Top Ten Cloud Foundation Companies 1 2 3 4 5 6 7 8 9 VMware (vCloud, vSphere) Microsoft Hyper-V Red Hat Cloud Foundations Citrix Cloud Services 3Leaf Systems rPath EMC Product/Service Line Rackspace CA (including 3Tera)

10 IBM Tivoli Federated Cloud

www.btclogic.com

10

Cloud Network Services

The Network Services segment represents the interconnection between all players and provides services on the network to satisfy the enterprise business needs. Choices about network services are largely independent from the choices about Cloud Foundation, Infrastructure, Platform and Applications. It is well worth conducting a competitive tender among several suppliers once network service needs are defined. The Cloud Network Services segment includes the companies that you would expect to see, including Cisco, IBM, HP, Level 3, and AT&T, but also ranks new competitors that have invested heavily in this space, such as Amazon and Aylus Networks. Level 3 retains the top ranking in mid-2010, but Amazon has made impressive gains as it works to provide a complete range of Cloud products and services and remain a Cloud Champion. We define Network Services as the communication components that combine with Cloud foundation and infrastructure to form Cloud architecture: While we do not take a hardware point of view, we utilize various network topologies to reveal how Network Service solutions enable private, hybrid and public interconnections We examine solutions that take advantage of existing efficient network services offered on the internet We examine Network Services abstracted from the MUXs, cables, routers, switches, network management solutions and servers, and focused on solutions that make the interconnection possible, reliable, scalable and efficient We rank Network Services utilizing publicly available information pertaining to this criteria list: Architecture Benchmarked performance Existing momentum in the network services segment Failover, disaster recovery plans Performance, scalability, and reliability Planning for seasonal and holiday spikes in web traffic Quantitative analysis of services Service management platform for networks Software development analysis Specific business problems addressed Strength of investment in space and resulting breadth of offering Ability to upgrade or virtualize infrastructures over network services Top Ten Cloud Network Services Companies 1 2 3 4 5 6 7 8 9 Level 3 Computing Services Amazon Network Services Cisco Network Services Aylus Networks AT&T Network Services IBM Network Services HP Network Services Radware MPI- Reliant Services

10 Akamai

www.btclogic.com

11

Cloud Platforms
The Cloud Platform segment covers on-demand platforms in the Cloud, allowing for quicker development and deployment of applications. Amazon continues to benefit from its early insights into how Cloud Computing can be offered as an external service to enterprises and its strategic commitment to becoming a Cloud Champion offering compelling services across all core segments. IBM holds its second place ranking due to its IBM Cloudburst offering. Force.com and Rackspace have both moved up the list resulting from the introduction of tools that make them a more improved and flexible platform. Boomi has been overtaken in our rankings as it seeks to redefine itself as leading integration as a service and focuses more on Boomi Atmosphere. Red Hats announcement of its Cloud Foundations platform might cause it to be included in this segment in the future. Enterprises should look closely at the top five in this category to gain an understanding of the differences between them, as well as form an appreciation for the challenges of migrating to a different platform at a later date and the ramifications of their choice on other aspects of Cloud decision making. We define cloud platform as the category of the Cloud Pyramid that provides a cloud perspective or cloud computing dashboard for the business user. With cloud computing, the user no longer directly manages the foundation, infrastructure, network, operating system or storage, but needs access and control over the deployed applications (SaaS) and possible application hosting environment configuration. With the platform category, the access to SaaS and hosting environment is given - there is access to all the capability and power that a cloud provider can supply Top Ten Cloud Platforms Companies 1 2 3 4 5 6 7 8 9 Amazon AWS IBM Cloudbursts Force com Rackspace Platform Srvs Boomi Oracle Platform Services Enomaly Google AppEngine NetSuite SuiteCloud

10 Microsoft Azure

www.btclogic.com

12

Cloud Applications
The Cloud Applications segment covers a wide range of possible solutions such as CRM, HR, and document management, and actual choices will depend on what an enterprise is seeking to achieve in the Cloud. Given that applications represent well over half of the predicted Cloud spend, it is necessary to break out this segment into its sub-segments and look at the competitive offerings within these sub-segments. For this report we have broken out the segment into two, reflecting the underlying sub-segments and giving greater visibility to these companies. Hence we have pulled out the most successful Cloud Applications that provide broad companywide benefit into a group called Companywide and moved those Cloud Applications with a narrower focus into the Other group. The leading Applications such as Salesforce.com, Google Apps, SAP/Business Objects, Oracle/Sun Apps, and Microsoft Services remain unchanged from our previous report, but the new format provides greater visibility on other valuable Applications. BTC Logic can provide further detail here, but it is beyond the scope of this report. For example, Salesforce is an excellent Cloud-based CRM solution and is creating its own ecosystem of support companies such as Jitterbit, but there are several other competitors e.g. Zoho who may offer a cheaper or more appropriate choice for a particular enterprise. We define Cloud Applications delivered as a service (SaaS) or directly over the Cloud Computing architecture: 1. We ruled out Cloud Applications that do not eliminate the need to install and run on dedicated or local computers. We looked at design decisions that allowed installation, service, and maintenance across network services, platforms, infrastructure and foundational elements. We examine Cloud Applications that: Utilize Network Services and other Cloud Computing elements Offer remote application access Function in a multi tenancy mode Are designed to take advantage of Cloud Computing architecture, infrastructure, platform, and Cloud provisioning and management benefits Explain how the application could be maintained, enhanced, and supported specific to the Cloud Computing environment We rank the Cloud Application segment based on publicly available information for these criteria: Breadth of offered solutions Capability within application sub-segment, i.e. the relative superiority of the application 1 2 3 4 5 6 7 8 9 Top Ten Cloud Applications (Other) Companies SAS Cisco/Webex FICO Ariba BMC Financial Resources Mgmt Microsoft Portfolio Oracle Virtual Apps NetSuite PayPal 1 2 3 4 5 6 7 8 9 Top Ten Cloud Applications (Company-wide) Companies Salesforce com/AppExchange Google Apps SAP/Business Objects Sun/Oracle Apps Microsoft Live Services/BPOS Taleo Constant Contact Rightnow Technologies Workday

10 Concur

2.

10 Alfresco

www.btclogic.com

13

Cloud Applications (contd)

Functionality in a sub-segment Customer feedback mechanisms Deploying new initiatives, such as enhanced mobility services. Failover, disaster recovery plans Flexibility in running in various Cloud environments Launching and enhancing with new features Performance measures Portability Quantitative analysis of software as a service Software development analysis Strength of ecosystem of supporting companies Version control on applications and features

www.btclogic.com

14

Cloud Security
Cloud security in this report really means Trust Services in the Cloud i.e., BTC Logic seeks to rank the companies that specifically have trust services for the Cloud. Note that existing enterprise email, antivirus, identity, authentication, and encryption product offerings by themselves are not sufficient, but for inclusion companies must have identified the new challenges that operating in a hybrid Cloud presents and have developed products for this area. When an enterprise moves applications and data into a hybrid Cloud, the concept of a secure perimeter to a data center building disappears, as applications and data are run in remote locations whose physical security is controlled primarily through SLAs. Use of the Cloud inherently implies multi-tenancy and therefore it is unclear who was using a virtual machine (VM) before a Cloud application runs and it is unclear who will be using the VM afterwards, both of which raise huge issues for trust services that go beyond traditional data center management challenges. As we analyzed the hundreds of security companies that exist today, we ruled out some companies that have a large security presence but are beyond the scope of this study, including: Companies that add value by combining and selling other companys security services Security Consulting Services, such as Accenture, HP, Unisys, and Deloitte, who provide a valuable cloud service. Security Accreditation and Approval Services, such as the Cloud Security Alliance (CSA) Academic or scholarly research into cloud security, such as performed at The SPAR Lab research group at the Johns Hopkins University Computer Science, CERT Coordination Center at Carnegie Mellon, University of Californias work in coordination with IEEE, and Stanford and University of North Carolina work in cryptography and government intervention. Our review shows that EMC/RSA (including its product offering with Cyota), Symantec, IBM, and Sonoa Systems stand out as the clear leaders for enterprises seeking to understand trust services in the Cloud and seeking to overcome the new challenges. Given the importance of the Cloud Security issues to most enterprises, they would be well advised to engage in a dialog with at least these four companies to understand the new environment. Ping Identity, Kaavo, and Zscaler all have good technical solutions that round out specific Cloud trust service issues that enterprises face and will likely be part of an overall solution. Top Ten Cloud Security Companies 1 2 3 4 5 6 7 8 9 EMC/RSA (incl Cyota) Symantec IBM Sonoa Systems CISCO Ping Identity Kaavo Oracle Zscaler

10 Trend Micro

www.btclogic.com

15

Cloud Management
As noted in the Cloud trends section, our customers are telling us the importance of service level goals, cloud operations, control, integrity and administration before making a substantial cloud investment. Those companies categorized in Cloud Management are playing an active role in building an agile cloud management process. Our process of ranking cloud management consisted of analyzing each companys offerings and experience with the following parameters: Architectural frame work for Cloud Deployment strategies Economic analysis of cloud functions Interoperability with other solutions Experience with policies, compliance and security guidelines A global Legal perspective Privacy solutions Standards approach It should be no surprise and perhaps telling that all the Cloud Champions identified in the Summary have a strong Cloud Management offering, and that enterprises would like these management tools and services to work with all the major platform/infrastructure options. Lack of interoperability opens up opportunities for more independent players to better represent the needs of the enterprise and to provide Cloud management platforms that can work with Amazon, IBM, Rackspace, and other major platform/infrastructure players. RightScale has been moving quickly to try to establish itself as this neutral Cloud management player. Top Ten Cloud Management Companies 1 2 3 4 5 6 7 8 9 IBM Cloudburst Sun/Oracle Direct Link Amazon S3 Force com Rackspace Cloud Servers/ Sites/Files SOA Systems RightScale Eucalyptus EMC/VMware

10 Novells Zen Cloud Management

www.btclogic.com

16

Cloud Up and Comers

The Up-and-Comers segment is drawn from a database of smaller, innovative firms that might not be able to offer complete solutions, but that offer novel approaches to specific Cloud problems that we believe warrant wider attention. There has to be some disclaimer when looking at Up and Coming companies because reasonable people can disagree on which companies should be included or excluded. However these companies may prove more interesting to IT executives who already have a broad view of the Cloud as detailed in the report so far. For our part, we think companies like 3PAR, Appistry, Engine Yard, Joyent and SunGard are all interesting to track, and as we did our research we were intrigued by product offerings from firms like Abiquo, Airset, Appirio, CloudPort, CloudShare, CohesiveFT, Egnyte Local Cloud, Elastra, FathomDB, GoodData On Demand, Navajo, Nasumi, OpSource, Skytap, Viewfinity, Virtual Ark, VMLogix LabManager, VPEP Technology, and WorkXpress. As we have a passion for the innovative potential of cloud computing, and also believe in the entrepreneurial power of startups to offer novel approaches to specific Cloud problems that warrant wider attention, we will expand this section in future reports to make our readers familiar with emerging new technology providers.

www.btclogic.com

17

Notes on Methodology
Our Top Ten rankings reflect the likely approach that a typical enterprise may want to use to engage with vendors for information and advice, and to test internal perspectives on technology choices. As such, the key audiences for this document are organizations wishing to adopt part or all elements of a Cloud Computing setup, as well as organizations that wish to participate in this market place as one of the providers. Compared to other Cloud company lists of which there are many published already (one just needs to enter Cloud Computing companies into Google to be exposed to about 20 million hits), we believe our efforts add more insight and are more relevant to the above targeted audiences. Cloud Computing offers a unique opportunity for our clients to reduce costs by leveraging Cloud services and generate new revenue by expanding their presence in the Cloud. BTC Logic has developed a multi-variable, trademarked ranking database of over 600 companies offering a Cloud product or service. We employ this database to help our clients select and engage with appropriate vendors, and enable our business partners to define their businesses and to engage strategically in a dynamic, global Cloud Computing marketplace. Enterprise leaders and decision makers must align overall business goals and objectives for the Cloud before committing significant investment dollars. In this report, BTC Logic breaks down the Cloud market into seven primary segments, recognizing that these are the segments where key investment decisions need to be made. Understanding these segments allows enterprises to simultaneously classify company service offerings in a meaningful way, and to have a top-down view of the Cloud Computing market place. Our decision to publicize the rankings is based on several factors, most prominently being that there are now hundreds of companies promoting Cloud products and services. As an enterprise prioritizes and evaluates numerous Cloud vendors, our goal is to support fact-based decision making and separate spin from reality. This report is intended to provide a more informed starting point for all enterprises looking to move forward into the Cloud. In this report we identify the seven key Cloud technology segments and rank the Top Ten players in each as we see them today. Because these segments can be further broken down into sub-segments that are more meaningful in the context of a particular enterprise challenge, we have also provided here our selection criteria within the segments.

www.btclogic.com

18

Rankings Process and Definitions

The process we use to generate our rankings involves several steps, including the creation of a proprietary database of nearly all companies claiming to offer a Cloud product or service. Each of these companies is then classified into Cloud segments and sub-segments. We recognize that vendors can have multiple offerings that cross different segments and sub-segments. We break out these services into multiple offerings. An example of one enterprise that has multiple offerings is Microsoft. We recognize that certain enterprise decisions preclude working with other vendors and may or may not cause issues when trying to add Cloud capabilities to existing data centers or use Cloud capabilities to replace existing data center functions. For example, a decision to go with IBM Cloudburst, Amazon AWS, or Microsoft Azure may be justified based on prior data center decisions; however, it could prove more limiting than a decision to go with, say, Rackspace because of Rackspaces greater flexibility in accommodating other elements of a Cloud foundation. Decisionmaking within a particular enterprise needs to be strategic and built on previous decisions regarding data centers and investment in staff skills, and as a result any one of the leading vendors in the Top Ten may prove to be the right decision. Our framework provides a solid point of entry for enterprises to begin evaluating vendors in a systematic way. Our segmentation of the Cloud space is essential to the value of the rankings. It would degrade the rankings to directly compare companies like Rackspace, CAs 3Tera and Citrixs Xen against each other as they offer fundamentally different services. We recognize that the segments in our framework can be further broken down into relevant sub-segments within which additional vendors stand out. For example, within platforms, vendors can be further broken out into horizontal development, vertical development, media platforms, test environments, etc., and depending on the enterprise need other vendors beyond these Top Ten lists may complement baseline solutions. To help smaller, often innovative players, with much smaller marketing budgets to also get noticed, we previewed our Cloud Up-and-Comers list of smaller organizations that bring novel approaches to the market. For those interested in following this effort, we will continue to blog about it (see http://blog.btclogic.com), as well as make additional descriptions of our approach available to interested parties; e.g. a description of the rationale for the sub-categories underlying the seven main categories published in this report.

www.btclogic.com

19

About BTC Logic

BTC Logic is a multi-disciplinary firm delivering measurable improvements in revenue and performance for technology clients. We apply proven methodologies and deep experience in product development, sales and marketing to create lasting impact for our clients. Our hybrid team of Business, Technology, and Creative professionals augment your own internal teams to quickly resolve revenue and performance issues, and to deliver results. Signature demand generation services include Technology Assessments, Precision Segmentation, Lead Cultivation, ROI Tool Development, Messaging & Design Services, and Quick Launch Toolkits. We build competitive advantage for our clients by leveraging disruptive technologies, like Cloud Computing or Web 3.0 user innovations, and aim to provide thought leadership and insight. The Cloud Computing Ranking Report is part of this service to existing and future clients, and is highly regarded by organizations attempting to sort through the crowded Cloud marketplace and to develop an effective Cloud strategy. To learn more about BTC Logic, or to make contact, please visit us at www.btclogic.com.

www.btclogic.com

20