OVHCloud Bets on Shift Back to Private Cloud

There is more to the cloud than AWS, Azure, IBM and Google according to OVHCloud - the new name for OVH as it celebrates its 20th anniversary. While the big four have carved up the public cloud between them, the French cloud specialist believes that business needs are changing, which gives them an opportunity in the enterprise market it is now targeting. In short, OVHCloud believes there is a small, but discernible shift back to the private cloud - for security and compliance imperatives.

That does not mean that OVHCloud is abandoning the public cloud to the Americans. At October’s OVHCloud Summit in Paris, CEO Michel Paulin spoke forcefully of the need for Europe (for that, read France) to compete in this space. “We believe we can take on the US and Chinese hegemony. Europe has all the talents needed to build a digital channel that can rival all the other continents.” he said.

OVHCloud needs to shift focus and mature

The company is growing, with 2,200 employees and revenue estimated at around $500m. For comparison, AWS posted revenue of $9bn for its third quarter in 2019 – spot the difference. OVHCloud is doubling down on the Security as a Service (SaaS) market with 100 SaaS products announced for a new dedicated marketplace. The company says the focus will be on collaboration and productivity tools, web presence and cloud communication. On the security front, OVHCloud is promising the following soon: Managed Private Registry, Public Cloud Object Storage Encryption and K8s private network.

If OVHCloud is to take even a chunk of the Big Four’s market, it needs to shift focus and mature. It believes it can by moving from what it terms the “startup world” of digital native companies into the traditional enterprise sector (without neglecting its cloud native customers). Gained customers so far include insurance, aviation, big IT services and some finance and retail customers. OVHCloud believes the enterprise market is lagging its traditional customers in digital innovation and transformation.

Security reasons and better data oversight bring customers back to private clouds

Crucially, the company thinks that enterprise customers are coming back to private clouds for security reasons and better oversight of data in the age of big compliance. At the same time, it predicts that the future of cloud should remain open and multi-cloud, something I and others would agree with.

In terms of business strategy, OVHCloud is moving from a product approach to a solution approach along with the shift towards enterprise customers – this makes sense. OVHCloud makes much of its ability to build its own servers and cooling systems, and sees this as a USP, claiming the industry’s lowest TCO for energy usage. Such an advantage depends on scale, however, and in an open multi-cloud, multi-vendor market, the cost savings may make little difference to enterprise customers. But the green message may play well in today’s climate conscious market for some buyers in the startup crowd and potentially in the more digital parts of larger enterprises.

For more insight into the enterprise cloud market please read our reports or contact one of our analysts.


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