Demand for private cloud services continues to grow, as recent research from IDC shows.¹ While it may be somewhat more complicated from a technical point of view than some other kinds of hosting business, private cloud also offers some unique niche opportunities for adding value.

Boutique and niche providers — companies outside of the four big hyperscale providers and the hosting giants like Alibaba that make up the “next 10” — made up well over 20 percent of the global market for cloud infrastructure services in 2017,² so if you are serving a different market than Amazon and Oracle there is plenty of demand.

Providing private cloud services means building dedicated virtualized cloud environments on private networks for each client. As explained when we explored “How to start a web hosting company with MULTACOM,” infrastructure, marketing, and tech support are the three main elements of creating a hosting business. Other major decisions, such as those relating to budget, and personnel, must be made with your needs in those three areas in mind.

Infrastructure and Storage

Like any kind of digital service, a private cloud provider can never provide consistent, effective service running on inadequate infrastructure. Quality server hardware and software and a reliable connection with enough bandwidth are what enable the other aspects of your business to shine, even if it is not your key differentiator itself.

Launching a business providing private cloud services requires access to as many private networks as you have clients, flexible offerings to allow you to add servers and capacity as needed, and enough racks of server hardware to enable them to scale their clouds over time. This means an infrastructure-as-a-service provider that operates quality data center space and associated services. You probably need an infrastructure partner certified for compliance with SOC 2 Type II Trust Service Principles,³ with a reputation for reliability and service quality. The data center should also be connected to a network that includes redundant Fiber-Optic connections to major carriers and direct connections to ISPs.

Software is also an important part of private cloud infrastructure. Robust virtualization and cloud management software, typically Citrix Xen, Linux KVM, VMware or Microsoft Hyper-V, powers the virtual machines (VMs) that make up your clients’ private cloud clusters.

When launching a private cloud offering, you will need to be able to create storage clusters with an architecture that provides service to the array of different applications, nodes, and workflows your clients will deploy.

Cloud storage prices have fallen drastically, making private cloud a perfect option for many businesses as their environment for that need to securely store large amounts of data. In addition to the secure storage your clients will need for day-to-day use, automated backups and disaster recovery systems are very common private cloud use cases, and can expand your portfolio of offerings without consuming a lot of time or resources.

Software and Marketing

Private cloud is particularly in demand among businesses in a few particular industries. For companies in those industries large enough to require private cloud, you can offer a lower total cost than big name hyperscale public clouds, where add-on costs can accumulate quickly.

Security-conscious companies serving industries like healthcare, financial services and insurance companies, and law enforcement and other government agencies have enhanced security and/or regulatory requirements. For many of them, therefore, a private cloud offering tailored to the specific requirements of their industry is the only feasible way to achieve the efficiency and flexibility of cloud computing.

Forming partnerships with the service providers offering the best tools for your target market is a key way for private cloud resellers to differentiate their services. Finding, attracting, and converting your customers is a matter of effectively communicating what differentiates your business to the right people. Regularly producing high-quality content that explains how your potential customers can use the tools you provide to improve their business outcomes is a proven way to attract attention in your chosen market, generate leads, and entice sign-ups.

Tech Support

The kind of tech support you provide depends somewhat on the kind of niche you intend to address, or the value proposition you intend to bring. Regardless of those decisions, however, every private cloud service provider needs to give its customers a way that is convenient for them to contact support teams and start tickets.

Some infrastructure and data center providers, including MULTACOM, offer in-house tech support. Outsourced third-party tech support is also an option, both as the sole option or one component of support operations, such as after-hours response. If your private cloud business plan consists of anything other than bare-bones support, you will need to either leverage another provider, or build your own support staff. That staff will likely consist of system administrators, technical support experts able to cover each different major infrastructure and software component you offer, and front-line staff or automated response systems.

Some combination of the above, such as chatbots and automated telephone services starting tickets to be directed by account managers to third-parties for resolution, is likely to be the most effective arrangement.

Final Thoughts

The convergence of increasing SMB and enterprise cloud use with increasing regulatory and security concerns make private cloud services one of the top market opportunities in the hosting industry. Selecting the right partnerships is the key to bringing a high-quality, cost-efficient service with a clear and compelling value proposition to that market.

The first partnership to consider, both in terms of order of processes and importance, is your infrastructure provider. Quality hardware, flexible, customizable server and rack options, and direct access to international networks from a trustworthy data center operator like MULTACOM is the foundation of your private cloud service. Build around it with quality software and support partnerships designed to add value for businesses in your chosen target market. Then explain what that value is, and how to leverage it, in content targeted directly to the businesses you want to serve. Bringing these different elements together is challenging, but those able to do so can tap an enormous opportunity to grow their own successful private cloud company.

Interested in discussing MULTACOM as your private cloud infrastructure provider? Contact us today.

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1. https://www.computerweekly.com/microscope/news/252460633/Private-cloud-infrastructure-spending-on-the-rise

2. https://www.zdnet.com/article/what-is-cloud-computing-everything-you-need-to-know-from-public-and-private-cloud-to-software-as-a/

3. https://www.aicpa.org/interestareas/frc/assuranceadvisoryservices/aicpasoc2report.html