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Debunking 3 myths about cloud syndication

Pavel Ershov, Regional Vice President and General Manager, Asia Pacific & Japan, Odin | Aug. 28, 2015
As the cloud syndication model gains recognition so too do some of the myths that are associated with it.

This vendor-written piece has been edited by Executive Networks Media to eliminate product promotion, but readers should note it will likely favour the submitter's approach.

Did you watch television or listen to the radio sometime today? If so, chances are that you recently participated in a syndication model — but television and radio are not the only media that profit from syndication. The cloud does so as well.

Syndication is becoming an important strategy for service providers to consider when determining the strengths, opportunities, and weaknesses in their portfolios. Like many emerging trends, syndication in the cloud can be easily misunderstood or pushed aside without being critically evaluated.

What is cloud syndication?
A syndicated television or radio program is one that, instead of being shown exclusively on a single network, is licensed to be run on several networks or stations. This model is very similar to syndicated cloud services, where a service provider offers a service and controls its customer experience while the service remains hosted by a third-party data centre. Essentially this means a provider can provision and bill for syndicated services without needing to manage the applications or the in-house servers they run on.

As the cloud syndication model gains recognition so too do some of the myths that are associated with it. Let us look at the top three myths that surround this newly emerging trend.

Myth #1: Syndication leads to lower profits than hosting in-house, so it really isn't worth my consideration.
Hosting all of your portfolio's services in-house may not always be possible, efficient, or the best decision. If a certain service is part of your core business offering it will be likely that it would be best to host the service in-house. However, if it is not a core offering or perhaps even more of an add-on service, it might be worth considering syndication.

Take Cobweb for example, a company that has long been a leader in hosted exchange. Even so, they recently joined the Microsoft CSP (Cloud Solution Provider) program to mitigate any risk of missing out on business opportunities by being unable to offer Office 365. By participating in a cloud syndication model, Cobweb is able to continue to focus on its core portfolio without losing customers who absolutely need a particular kind of service, in this case Office 365.

Syndication also provides the ability to layer on your own value-added services — your "secret sauce" — enabling one to deliver greater value to customers and derive greater profit from that. Admittedly, in a pure comparison, service providers might experience a lower profit margin by opting to not host or manage a particular service in-house. However, when you look at the big picture, syndication creates valuable opportunities for service providers to up-sell and cross-sell on top of an anchor service. A scenario which can help push margins far beyond where they might have been otherwise.

 

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