CRN’s Channel Survey: Cloud Storage Predicted to be Key Growth Driver in 2020

Forecasting areas of growth is essential to give businesses an advantage in a competitive reseller market. That is why Wasabi partnered with CRN to survey the channel about their cloud storage solutions. The survey was presented to a variety of service providers that currently sell cloud storage solutions. Their answers give insight into where the channel is going and what it needs in order to grow and we are pleased to share these findings.

Cloud Storage Needs Predicted to Grow at least 25%

When respondents were asked to predict the increase in their customers’ cloud storage volume through 2020, the responses illustrated the surging importance of cloud technology. In the United States, respondents predict at least a 25% increase in their customers’ data storage needs, while Europe and the Pacific rim predict a 16% increase. This is very much in line with other predictions about the growth of cloud in the next 5 years.

Cloud Storage Partners Have A Healthy Mix of Revenue

With all this talk of cloud growth, the question arises of what is driving this growth. The results of the survey showed that cloud storage partners have a varied mix of revenue streams which break down into five nearly equal categories. The highest with 24% were managed services, which represents the most popular area of the revenue pie. Following close behind is on premises hardware, which 23% respondents reported as a part of their overall revenue. Project based services, representing 22% of partner, revenue is the third largest. These answers, all within two percentage points of each other, are clearly where most cloud storage partners are putting most of their efforts. Combined, they account for 69% of channel revenue. The bottom two options, cloud services at 17% and cloud software with 14%, represent areas where cloud partners have the least involvement.

It is worth noting that on-premises hardware is the second-largest source of revenue for these respondents. This hardware is a cash cow for the manufacturers but a drain on end user budgets, requiring constant maintenance and regular capacity upgrades. By swapping out expensive local, capped storage with Wasabi’s inexpensive and bottomless cloud storage, partners can increase their margins while still passing cost savings onto their customers. This might help increase the share of revenue cloud services bring to partners while still being a cheaper alternative to legacy NAS or tape customers. Talk about a win-win!

Cost and Security Are Top Concerns in Managing Cloud Storage

Participants surveyed expressed concern that cost could prohibit them from keeping up with the industry’s ever-increasing need for cloud storage. Over 50% of the respondents listed the cost of the cloud as a top concern when managing cloud storage for customers. That’s understandable given that the biggest and most recognizable cloud vendor on earth is also one of the most expensive and notorious for charging outlandish hidden fees to access your own data.

But the cloud isn’t uniformly priced. Partners can take advantage of Wasabi’s low cost to give their storage-hungry, cost-wary customers an entry into the cloud. Wasabi’s storage is 80% less expensive than AWS with no fees for egress or API requests, so organizations looking to move into the cloud should have nothing to fear when it comes to cost.

Resellers Leverage Both CapEx and OpEx

Beyond channel partners’ concerns with the price of cloud services, it’s also worth noting how they are paying for these services. CRN’s survey found that 60% of cloud storage providers and their customers are utilizing both CapEx and OpEx budgets in their IT infrastructure. This dichotomy has long been a source of friction between buyers and sellers, but it seems that there is a growing overlap between the two styles.

Knowing this, channel partners might want to offer payment options that cater to both CapEx and OpEx. This way, you’ll always be able to offer a customer a payment method that works for them. Wasabi has already done this, offering the OpEx-friendly pay-as-you-go plan which bills monthly, and the CapEx friendlyReserved Capacity Storage plan that is paid for in fixed budget 1, 3, or 5 year installments.

Wasabi Hot Cloud Storage is a Growth Driver for Partners

Homing in on the priorities and concerns of channel partners can lead to positive changes in service providers. Surveys like this one help us better understand the needs of the channel and what we can do to help these businesses grow. When partners complain of high costs, we respond with 80% cheaper cloud storage without any egress fees or API request charges. When we see widespread use of both CapEx and OpEx, we provide customers with two ways to pay. We at Wasabi will use these insights to better serve our channel partners and customers.