Is Verizon’s Cloud Pricing Too Complex to Succeed?

It’s not that I have a one-track mind pointed directly at cloud computing, but week after week the paradigm dominates discussions around cutting-edge infrastructure. This week, for example saw several new players – some of them rather large companies – step into the cloud ring with entirely new platforms. LongJump announced its all-inclusive PaaS offering; Computer Sciences Corp. said it will be launching an enterprise- and federal-grade cloud; Contegix introduced Zeus, its managed-hosting-style cloud;  Akamai outlined its cloud strategy; and Tibco previewed its upcoming cloud application platform, Silver. But it’s Verizon Business, which took the wraps off its cloud service called, fittingly, Computing as a Service, that has me asking the most questions.

The good: Verizon’s CaaS should have enterprise appeal. According to Computerworld, customers can access either physical or virtual machines, which can be located either in Verizon’s data center or on the customer’s premises. Each installation will be customized to that customer’s needs, and security is solid because the service sits upon the Verizon MPLS network. All of these features address legitimate corporate concerns, and all help to differentiate Verizon’s CaaS from other large clouds — particularly Amazon EC2.

The bad: Verizon’s pricing model might prove too convoluted. With a one-time setup fee, a per-month subscription charge, per-day pricing depending on the type of machine, per-CPU software charges, and per-gigabyte storage and bandwidth charges — well, it’s a little much. As much as it’s about flexibility, the cloud is about simplicity and savings. Verizon appears to be nickel-and-diming CaaS customers with different charges at every turn, which not only adds cost but also makes predicting those costs more difficult. By contrast, platforms like EC2 have gained popularity in large part by the simplicity of being able to spin up some instances and pay a flat per-CPU-per-hour rate.

But considering that Verizon’s CaaS has yet to launch, it’s too early to tell whether customers will come aboard. I understand that enterprises have different needs than individual developers or small companies, but I also understand that enterprises want to adopt the cloud for the same reasons everyone else does. Contracts and higher prices for better guarantees likely would be acceptable, but a plethora of charges for every aspect of the system — including a subscription charge — might defeat the purpose of moving to the cloud in the first place.

Question of the week

Should enterprise-grade cloud platforms try to maintain the simplicity of mainstream platforms?
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