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Datapipe Puts Private Clouds on Amazon AWS

Announcement’s a Sleeper, Offering’s a Killer

This week, managed services provider Datapipe made an important announcement about something they are doing with Amazon Web Services that reminded me of a Zen kōan.  That's a paradox intended to defy logic and to cultivate intuition, like the question, "What is the sound of one hand clapping?"  Alas, the tech press beat seldom ascends the craggy path to satori and, so, the announcement did not receive much attention, despite its Amazon angle.  I guess it was just too oblique to allow even the reflexive rewrite given to most Amazon cloud-related press releases these days, let alone the in-depth analysis this one deserved.  And, that is a real shame.

Datapipe is a decade-old, Goldman Sachs-backed company that has heretofore provided IT infrastructure management, server hosting and colocation services to mid- and large-sized companies around the world.  In other words, they manage your IT stuff for you, either on your gear or in one or more of their data centers.  They have a first-class customer list that includes a range of well-known brands, including Adobe, Carnegie Hall, Expedia, KPMG, T-Mobile and the BBC.

What they announced this week is a new line of business for them and an apparent first for Amazon, called the Datapipe Managed Cloud for Amazon Web Services.  It's a set of "managed services" that sits between the customer and the Amazon cloud that includes planning, implementation, monitoring, management, and maintenance services for applications and infrastructure running on Amazon Web Services.

The Datapipe Managed Cloud also provides a range of SLA options, from pass-through support for Amazon's standard EC2 and S3 service level agreements to custom agreements providing up to 100% availability, made possible by combining multi-region AWS deployments with dedicated Datapipe server resources.

And, finally, the service also offers a selection of "cloud accelerators" to enhance infrastructure performance and functionality.  It includes modules for LDAP management, CloudFront integration, Varnish application caching, email relay services, and global load balancing.

What makes this announcement cognitively elusive is that it turns our nascent notions about managed services, hosting and the public cloud inside out.  Other managed services companies have taken to the cloud by extending their services into setting up and managing private clouds in customers' data centers.  Most other hosting companies have gotten into cloud computing by hosting private clouds on their servers as an outgrowth of their colocation and managed server business.  Some hosting companies, like Rackspace, have created public clouds as an outgrowth of their virtual server hosting business, effectively competing with pure-play public clouds like Amazon.  And, for its part, Amazon has largely gone it alone, offering its public cloud infrastructure services directly to customers.  The Datapipe Managed Cloud is a departure from all of that, providing an unfamiliar but very compelling vision of an alternate cloud universe.

The new Datapipe offering creates and manages private clouds on Amazon's public cloud infrastructure and in so doing addresses a potentially huge untapped market for both Datapipe and for Amazon.  Until now the appeal of Amazon's economical PAYGo utility computing model as an alternative to the more CAPEX-intensive private cloud has been blunted considerably by four main issues: security concerns, weak SLAs, budgeting uncertainty and the technical complexity of managing, using and integrating with Amazon's "raw" cloud.

Datapipe interjects people, processes and technology between the customer and the cloud that includes rigorous security provisions not all found in Amazon alone, like keystroke and I/O logging, dedicated monitoring, and two-factor authentication for Datapipe personnel.

As for SLAs, Amazon is certainly getting better all the time, but, on their own they are still in the 3-4 nines level of availability.  With its multi-instance management software and integration with its own high availability infrastructure, Datapipe takes availability into the carrier-grade territory of five or even six nines.

Cloud pricing, both on Amazon Web Services and elsewhere can be quite complex.  While the abstract appeal of usage-based pricing is considerable, the concrete reality of cloud pricing, bound as it is to potentially dozens of consumption variables, can make budgeting quite daunting.  The Datapipe Managed Cloud offers simplified pricing based on only four cost factors and with a choice of fixed monthly pricing or variable scaling plans.

Finally, Datapipe addresses the growing complexity of using Amazon's expanding family of cloud services, including the Elastic Compute Cloud (EC2), CloudFront content delivery, Simple Storage Services (S3) and Relational Data Services (RDS), with a full array of professional services and added automation.  The services offered include architecture, design, migration, configuration, storage/backup, security monitoring, and more, all services that are familiar to managed services and managed hosting customers, but not available on the raw Amazon infrastructure.  And, Datapipe also provides customers with a management dashboard for reporting, support tickets, monitoring, server/network views, and configuration provisioning that makes it considerably easier to manage AWS infrastructure.

In my view, this is a momentous milestone on cloud computing's path to maturity - a best of all worlds proposition in realm where agonizing trade-offs are the norm.  But, if I am not wrong about that, why did it only get about a dozen hits on Google News?  In part, it is probably due to what I mentioned earlier - it is an unconventional inversion of what has become familiar, vexing to the fourth estate.

But, some of the coverage that the story did get hints at another reason why many may not be as impressed as I.  One story suggested that it is virtually certain that eventually cloud service providers will cut out "middlemen" like Datapipe.  Another proposed that new software packages would somehow make value-added cloud management services obsolete.  In sum, to these skeptics and cynics, Datapipe's Managed Cloud is a manifestation of transient opportunism and not an indication of a progressive sea change.

I see it differently by taking a lesson from the previous generation of technology.  Datapipe is to Amazon what software VARs and ISVs were to database and applications server vendors.  Amazon and other public cloud service providers are in the high-volume infrastructure-as-a-service (IaaS) delivery business.  They are not in the business of database architecture or applications management and their business model will allow them to only do so much hand-holding without snuffing their slim profit margins.  The cloud ecosystem needs value-added service providers and consolidators to reduce the friction of IaaS service consumption; these are enduring roles that benefit everybody and that an Amazon would subsume at its own peril.

If Datapipe has anything to worry about, it is effective competition from imitators and not Amazon cutting them out of the equation.  But, right now, they have the first mover advantage, they seem to really know their MSP stuff, they have Goldman Sachs backing them, and their customer base is blue-chip.  They are off to swell start in this endeavor.

If Datapipe has a critical weakness, it is marketing.  It comes with the territory in which they have been living until now.  The vendors and the customers in the managed services and hosting business are a little like the Freemasons, a low-profile fraternal order whose members speak to each other in succinct, repetitive code, and to the outside world not at all.  Look at Datapipe's "About Us" paragraph:

"Datapipe is a leading global provider of managed services and data center infrastructure for IT and cloud computing. As one of the originators of the Managed Services Provider model, clients trust Datapipe to manage and secure mission-critical services, including cloud computing, hosted servers and storage, data center services and colocation."

That is not exactly the ringing clarion call of a fierce warrior.  They have found a compelling vision; now they must find a compelling voice.


More Stories By Tim Negris

Tim Negris is SVP, Marketing & Sales at Yottamine Analytics, a pioneering Big Data machine learning software company. He occasionally authors software industry news analysis and insights on Ulitzer.com, is a 25-year technology industry veteran with expertise in software development, database, networking, social media, cloud computing, mobile apps, analytics, and other enabling technologies.

He is recognized for ability to rapidly translate complex technical information and concepts into compelling, actionable knowledge. He is also widely credited with coining the term and co-developing the concept of the “Thin Client” computing model while working for Larry Ellison in the early days of Oracle.

Tim has also held a variety of executive and consulting roles in a numerous start-ups, and several established companies, including Sybase, Oracle, HP, Dell, and IBM. He is a frequent contributor to a number of publications and sites, focusing on technologies and their applications, and has written a number of advanced software applications for social media, video streaming, and music education.

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