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The shift to cloud computing is starting to have a profound impact on how and where IT service providers are setting up operations centers. Historically, many IT service providers would either build their own data centers or employ infrastructure they housed in a hosting facility. But as more customers move workloads into the cloud, many service providers are starting to view public clouds as the next logical place to set up operations centers.

A Voice of the Service Provider report published by 451 Research this week forecasts 77 percent of service providers will require some level of IT transformation over the next three years to meet the changing needs of their customers. A big part of the transition will be more reliance on cloud infrastructure to reduce costs and optimally locate operations close to where application workloads are running, says Al Sadowski, research vice president for Voice of the Service Provider at 451 Research.

Juggling multiple clouds

The challenge service providers will face is finding a way to differentiate their services at a time when cloud service providers themselves are investing heavily in managed services, says Sadowski. The good news, notes Sadowski, is that as IT organizations embrace multiple clouds the more likely it becomes they will rely on a third-party service provider rather than the managed services of a cloud service provider.

Sadowski says IT service providers should especially focus on hybrid cloud scenarios where customers are trying to support workloads running in the cloud and on-premises. IT organizations faced with those challenges are likely to be the most stretched, notes Sadowski.

Success, however, is not a given in a multi-cloud world. Sadowski says being able to support multiple clouds will require major investments in automation. The need to be able to operate at scale coupled with ongoing pricing pressure means service providers need to reduce costs wherever possible, says Sadowski.

“Automation of processes is now a necessity,” says Sadowski.

Automation vs. IT labor

Historically, IT service providers have preferred to throw engineering labor at IT operations issues, which in part accounts for why so many service providers rely on open source tools. Rather than license commercial tools, most service providers would rather maximize investments they have already made in IT labor. That approach, however, leads to an uneven reliance on IT automation that winds up being based largely on poorly documented custom scripts. Every time an engineer moves on, the service provider usually ends up hiring a new engineer that wants to rewrite many of the existing scripts simply because it’s not clear how they were constructed.

To properly embrace IT automation, most service providers will need to aggressively embrace the best practices being espoused by a rapidly growing DevOps community. Making that transition, however, has more to do with changing the internal culture of the service provider than it does with adopting any specific set of tools or frameworks.

MSPs today are bearing witness to unprecedented levels of change within their customer base. The time may have come, however, to start asking questions about how those lessons should also be applied to their own business.

Photo: winui/

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Mike Vizard

Posted by Mike Vizard

Mike Vizard has covered IT for more than 25 years, and has edited or contributed to a number of tech publications including InfoWorld, eWeek, CRN, Baseline, ComputerWorld, TMCNet, and Digital Review. He currently blogs for IT Business Edge and contributes to CIOinsight, The Channel Insider, Programmableweb and Slashdot. Mike blogs about emerging cloud technology for Smarter MSP.

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