The Truth About CSBs
Is a CSB really a cloud-based service provider?
Is a cloud service broker really a cloud-based service provider? A cloud's architecture is optimized to respond quickly to sudden, large changes in workload demands.
A cloud typically consists of a highly standardized distributed computing architecture, uses virtualization to create an elastic infrastructure that can automatically provision and deprovision resources in response to changes in workload demands, and includes usage-based metering for chargeback or pay-as-you-go billing.
In the case of Liaison, the bulk of its revenue comes from people-intensive integration and data management services, which it lumps into two groups: professional services for initial integrations, and managed services for ongoing support. Only the subscription piece, which maintains all of the connections for Mohawk and provides a tool for monitoring those, leverages the benefits of a cloud architecture.
What a CSB does is not elastic, "but the reality is that not all workloads and cloud deployments require it," says Gartner analyst Benoit Lheureux. A strong increase in transaction volume for a CSB is more likely to be in the range of 10% a year overall, he says, and CSBs can scale to meet that demand.
The bigger challenge lies in scaling up the staff. "Liaison's biggest problem is hiring the right skills to add to the fulfillment group for things like mapping, EDI, XML and RosettaNet," says Lheureux.
From Mohawk's standpoint, to focus on the technology is to miss the point. Stamas doesn't care about technical details such as virtualization, economies of computing, elasticity of demand or pay-for-use models. Those are Liaison's problems. Mohawk pays Liaison a flat annual fee plus an hourly rate to set up each integration, most of which come in around $1,000 or less.
"It's not about technology," Stamas says. "It's about building business processes in the cloud . That's what we're focusing on."
€” Robert L. Mitchell
"With Liaison, all types of data integration flow through the same service-oriented infrastructure, all [data] payloads are defined as services, all interactions are managed via Web services, and all integrations use a publish-or-subscribe model" in which services are either provided or consumed, Stamas explains. "They have the tools and platforms, the enterprise service bus, messaging bus and service registry -- all of the components of a service-oriented infrastructure. It's a foundation on which we build our own unique integrations."
The Rise of the Cloud Broker
Liaison is on the leading edge of an industrywide trend in which traditional providers of managed B2B services are becoming what Gartner analyst Benoit Lheureux calls a cloud services brokers, or CSBs. In addition to offering data integration and customization services, CSBs provide an aggregation point for all types of business partner interactions.
Sign up for CIO Asia eNewsletters.