You may have heard the term Cloud Washing before. It relates to the practice of legacy enterprise software vendors slapping a Cloud sticker on everything they do. That’s how antiquated enterprise software products that were engineered 20 years ago all of a sudden become Cloud-Ready and the vendor’s next Customer Advisory Board becomes a “Path to the Cloud” or some other marketing fluff.
Why Did Cloud Washing Get Started?
Legacy enterprise software vendors started Cloud Washing as a way to hide the simple fact that they did not adapt their products and services to the Cloud-era in time. They found themselves in a situation where they could not move their legacy software to the new Cloud days quickly enough. Their customers are asking for Cloud-based products and the vendors are forced to respond with Cloud-ready offerings.
The easy fix? “Let’s put a Cloud sticker on it, call it Cloud as often as possible, and our customers will eventually believe we have a true Cloud offering!”
How Cloud Washing Works
Legacy enterprise software vendors are sitting on tons of cash. They accelerate the pace at which they acquire younger SaaS companies that have developed true Cloud-based solutions. The strategy is simple: buy the newcomers, slap a Cloud label on your old legacy software and package it all together as a brand new Cloud IT management solution. It goes along really well with a marketing campaign on how we “reinvented ourselves around the Cloud.” On the way, sell your customers new solutions to manage the Cloud in addition to the datacenter management solutions they purchased from you before (“the Cloud broke these, so you need new ones”).
Need evidence? consider these recent examples:
CA acquires Nimsoft, Oblicore and 3Tera and forms a Cloud BU
IBM acquires Cast Iron
Oracle acquires RightNow
and there are probably many other examples.
Why is This a Big Failure?
Customers are quickly educating themselves and understand that the value of the Cloud is about optimizing resources and reducing operational costs. It is pretty obvious that legacy enterprise software vendors cannot offer these benefits with the “old products” being dressed up as Cloud delivered solutions. At the end of the day, customers are smart enough to separate the true Cloud delivered products that are at a position to deliver substantial value from the old stuff and make a decision on which technology to adopt.