This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

The Next Twitter Will Be a Cloud Services Broker

Gartner Group has been talking up the idea for three years, seeing a $100 billion global market as early as next year, and defining that market broadly.

Gartner sees a CSB market with its own "Golden Quadrant" of leaders and laggards, its own hype cycle, and with a host of opportunities within organizations, creating a buy side equivalent to the brokerages' sell side.

I think the Gartner analyst to know here is Daryl Plummer, a former data center manager now based in Woodstock, Ga., an Atlanta suburb. His October 2010 piece, Cloud Services Brokerage is Built on Markets Near $1 Trillion in Spend, can be seen as the starter's pistol of the new game.

These companies have names like Jamcracker, ComputeNext, Appirio, Gravitant, and Cloud Sherpas. Some partner with specific clouds. Others see themselves as marketplaces. Some are consultants. Still others see themselves as offering software that lets customers arbitrage cloud from a variety of companies.

In addition, notes, many cloud vendors offer their own cloud brokerage services and software, including Amazon's AWS Marketplace, Comcast's (CMCSA) Upware, and Rackspace's Cloud Tools Marketplace.

What's clear is they're all growing like topsy. MarketsandMarkets, which defines the market conservatively, sees it growing from $1.57 billion this year to $10.5 billion in 2018, a compound annual growth rate of 46%

What happens next is an often-told story featuring globalization, consolidation and the tapping of public markets to raise capital. You can also expect big players like IBM and HP, which missed the start of this game, to muscle their way in, partly through their own efforts, partly through acquisitions, in order to keep their customers.

This game is already afoot. It's just a matter of time before these companies start calling Wall Street and Wall Street starts calling back. It won't be as exciting as the Twitter IPO because these are business-to-business companies. But it could prove even more profitable.

At the time of publication the author owned 117 shares of IBM.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.

2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
AAPL $93.74 -1.15%
FB $117.58 0.73%
GOOG $693.01 0.29%
TSLA $240.76 -2.81%
YHOO $36.60 0.03%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs