Systems integrators will have to face up to cloud computing and recalibrate their business models as the days of large scale roll outs paid up front are numbered the Government CIO has told MicroScope.
As a senior tech advisor to the Government, John Suffolk is creating a blueprint for its private cloud, dubbed the g-cloud and warned of the changes this procurement model signals to the market.
"The world has shifted and the old business model of design, build and operate end to end large scale systems is coming to an end, if it's not an end already. It will be 'how do you add this little bit of value in a different business model," he said.
The pressure that resellers of hosting services are placing on the traditional dealers has intensified in the recession as customers ran down cap-ex in favour of op-ex.
Suffolk said, "I do think [the channel] needs to begin to face up to this".
He added, "The question for me if you roll the clock forward ten years in a cloud base world, what is the role of the SI, what are they integrating when it has been provisioned by a server from an application store?"
There is no doubt that the cloud has been hyped to the hilt and it will take time to more dramatically alter the market dynamics but analysts have forecast strong growth ahead.
IDC reckons the as-a-service model is set to achieve 35% compound annual growth rates from 2009 to 2013 and will represent 20% of all IT spending worldwide.
"80% [of the market] will still be served in the traditional way that they are today, most SMEs and large enterprises will buy under the same model," said Crawford Del Prete, executive vice president of worldwide research.