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Developers, Developers, Developers: Rackspace and Others Aggressively Court Key Cloud Consumer

by Richard Seroter on Sep 06, 2013 |

Recent research has made it increasingly clear that developers hold the key to cloud adoption, and Rackspace is trying to make themselves an attractive option. The Rackspace Developer Discount program is designed to lower the barrier to entry and follows similar efforts by AWS and Microsoft.

The Rackspace Developer Discount gives new users $50 (£30 UK) worth of credits each month, for up to six months. Users can spend more than that, but the first $50 of usage are free. Why create such a program?

The Developer Discount program makes it easy for you to chase something you feel passionate about and simply need a place to build and deploy it. Regardless of what you make, or want to make, we celebrate and encourage your creativity. That’s why Rackspace is dedicated to making developer lives easier. It’s what keeps us passionate about supporting collaborative open source projects and communities.

What does $50 per month get you in the Rackspace cloud? A developer could run a Linux server with 1GB of memory and single vCPU, and have a few dollars left over for object storage in Cloud Files. Alternately, developers could provision a small MySQL database using the Cloud Databases service. Some restrictions exist. The credit can only be applied to services deployed to US or UK data centers, and cannot be used for website hosting in the Cloud Sites service.

Earlier this summer, Microsoft announced a similar program to encourage development and testing in the Windows Azure cloud (see previous InfoQ coverage here). Microsoft not only gives developers up to a $150 credit to use on ANY Windows Azure service, but also offer heavily discounted rates to run software like SQL Server and BizTalk Server. This credit does not expire, but to use it, developers must be signed up for one of the MSDN developer subscriptions. Microsoft does offer a 1 month free trial with up to $200 in Windows Azure credits, but that’s the only free on-ramp for developers who do not have an MSDN account.

Market leader AWS takes a slightly different approach. Their developer-centric program consists of a Free Usage Tier which provides a certain amount of compute capacity for free each month. If a developer never exceeds those pre-defined limits, they never pay for the service. Some caveats apply. The free tier for services like EC2 and S3 apply only for new customers and expire after one year. However, the free tier for services like ElastiCache and DynamoDB apply to new or existing customers and never expire. The Free Usage Tier gives developers enough credits to do a handful of things, including:

  • run a micro EC2 virtual machine for an entire month
  • send 1 million requests to the Simple Queue Service (SQS)
  • operate a MySQL or SQL Server database in RDS for a month

Why is all this attention being paid to developers? Some recent research from analyst firm Gartner lays it out. Gartner just published their 2013 Magic Quadrant for Cloud IaaS providers and it shows that AWS has staked out a significant lead in the nascent cloud market. In a blog post from Gartner analyst Lydia Leong, she points out that other cloud vendors were distracted by listening to IT operations staff that didn’t see the AWS cloud as a viable destination for their systems.

The viewpoint was that IT operations would continue to control purchases, implementations would be relatively small-scale and would be built on traditional enterprise technologies, and that AWS would never get to the point that they’d satisfy traditional IT operations folks.

However, Leong explained that developers ended up becoming the face of business buyers by bypassing IT operations and solving business problems themselves with the help of easy-to-use cloud services (emphasis added).

So what happens is you get a developer who goes back to a business manager and says, “Well, I could deliver you the code for X in six weeks, except IT Operations tells me that they can’t get around to giving me a server for it for another three weeks.” (In some organizations, especially ones without effective virtualization, that can be months.) The business manager says, “That’s unacceptable. We can’t wait that long.” And the developer sighs and says, “Don’t worry about it. I’ll just take care of it.” And then some cloud IaaS provider, probably one who’s able to offer infrastructure, right now, gets a brand-new customer. This is what businesses mean when they talk about “agility” from the cloud.

But the key thing is this: In SaaS, business buyers are bypassing IT to get their own business needs met. In IaaS, business buyers are doing the same thing — it’s just that it’s the developer that is fronting the sourcing, and is therefore making the decision of when to go cloud and who to use when they do, at least initially.

Gartner surveys have shown that business buyers control two-thirds of cloud spending, thus making the developers who help them a highly influential constituency.  Jeff Sussna of consulting firm INGINEERING.IT sees this as clear proof that agile development has put developers back into good graces with the business divisions.

But wait! How did development get ahold of the IT credit card? Someone must no longer be “holding them in contempt”. Businesses have long seen development as The Department of No just as much as IT. What changed? The implication is that development has repaired its relationship with the business side. In other words, Agile worked. You can argue about the details: scrum vs. XP vs. kanban, and so on. But the fact remains that development has proven, in a very visceral way, its business trustworthiness.

The conclusion is that cloud providers like Rackspace are wise to court developers who are increasingly the decision-makers in enterprise cloud adoption. Sussna warns IT operations that they will become marginalized unless they follow the path of their developer peers.

IT should see the Gartner report, and Lydia’s analysis of its meaning, as an emergency alert. Unlike development, IT has not yet repaired its relationship with the business. Meanwhile, budgetary control over infrastructure is being wrested from its grasp. If things continue unchanged, IT will wake up one day and discover its budget has gone to zero.

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