By John Dixon, Consulting Architect

Last week, Chris Ward and I hosted a breakout session at Cloudscape 2014, GreenPages’ annual customer Summit. We spoke about cloud service models today (IaaS, PaaS, and SaaS), as well as tomorrow’s models — loosely defined as XaaS, or Anything-as-a-Service. In this post, I’ll discuss XaaS: what it is and why you might want to consider using it.

First, what is XaaS? Is this just more marketing fluff? Why do we need to define yet another model to fully describe cloud services? I contest that XaaS is a legitimate term, and that it is useful to describe a new type of cloud services — those that make use of IaaS, PaaS, and SaaS all neatly delivered in one package. Such packages are intended to fully displace the delivery of a commodity IT service. My favorite example of XaaS is desktop as a service, or DaaS. In a DaaS product, a service provider might assemble it with the following:

• Servers to run Virtual Desktop Infrastructure from a provider such as Terremark (IaaS)
• An office suite such as Microsoft Office365 (SaaS)
• Patching and maintenance services
• A physical endpoint such as a Chromebook or thin client device

The organization providing DaaS would design, assemble, and manage the product out of best-of-breed offerings in this case. The customer would pay one fee for the use of the product and have the all-important “one throat to choke” for the delivery of the product. At GreenPages, we see the emergence of XaaS (such as DaaS) as a natural evolution of the market for cloud services. This sort of market behavior is nothing new for other industries in a competitive market. Take a look at the auto industry (another one of my favorite examples). When you purchase a car, you are buying a single product from one manufacturer. That product is assembled from pieces provided by many other companies — from the paint, to the brake system, to the interior, to the tires, to the navigation system, to name a few. GM or Ford, for example, doesn’t manufacture any of those items themselves (they did in days past). They source those parts to specialist providers. The brakes come from Brembo. The interior is provided by Lear Corp. The Tires are from Goodyear. The navigation system is produced by Harman. The auto manufacturer specializes in the design, marketing, assembly, and maintenance of the end product, just as a service provider does in the case of XaaS. When you buy an XaaS product from a provider, you are purchasing a single product, with guaranteed performance, and one price. You have one bill to pay. And you often purchase XaaS on a subscription basis, sometimes with $0 of capital investment.

You can download John’s “The Evolution of Your Corporate IT Department” eBook here

So, secondly, why would you want to use XaaS? Let’s go back to our DaaS example. At GreenPages, we think of XaaS as one of those products that can completely displace a commodity service that is delivered by corporate IT today. What are commodity services? I like to think of them as the set of services that every IT department delivers to its internal customers. In my mind, commodity IT services deliver little or no value to the top line (revenue) or bottom line (profit) of the business. Desktops and email are my favorite commodity services. Increased investment in email or the desktop environment does not translate into increases in top-line revenue or bottom-line profit for the business. Consider that investment includes financial and time investments. So, why have an employee spend time maintaining an email system if it doesn’t provide any value to the business? Two key questions:

1. Does investment in the service return measurable value to the business?
2. In the market for cloud services, can your IT department compete with a specialist in delivering the service?

When looking at a particular service, if you answer is “No” to both questions, then you are likely dealing with a commodity service. Email and desktops are two of my favorite examples. Coming back to the original question… you may want to source commodity services to specialist providers in order to increase investment (time and money) on services that do return value to the business.

We’ll expand this discussion into the role of corporate IT in a future post. For now though, what do you think of XaaS? Would you use it to replace one of your commodity services? Maybe you already do. I’m interested to hear from you about which services you have chosen to source to specialist providers.