Published: April 23, 2020
As the world is gripped by the COVID-19 crisis, questions have arisen about what this means for providers of digital services, including cloud infrastructure, communications and higher-level software platform services. Most digital providers report a spike in usage, attributable to the now-widespread social-distancing guidelines putting people at home instead of in offices, and ISPs have seen unprecedented spikes in capacity consumption across internet and mobile communications, as have service providers like Netflix. Online meeting platform Zoom has emerged as a dark-horse hit as the work-from-home platform of choice. The company reports that its user base has grown by almost 10x – a bit of a mixed blessing as Zoom has been grappling with the sudden consequences of going from a business meeting alternative to a household name. But it and other providers have ably coped with the load.
The 451 Take
Generalities on Action
Generally speaking, this is a good time for providers to focus on two things: the resiliency and capability of their services under tremendous stress, and what their customers are going through. Regarding the former, this means looking out for staff at every level, from providing sanitization supplies on-site to taking appropriate measures in the workplace and preparing for staff outages. Datacenter and infrastructure operators should have a complete understanding of their facilities, procedures and protocols, and how infection risk can affect them. Providers that primarily operate 'in the cloud' need to do the same on the IT hardware and software upkeep, which has exposed weaknesses for online service providers unprepared for a surge. This is a golden opportunity to fix these weaknesses for good and incorporate lessons learned into resiliency. Ideally, by the end of this crisis, every operator and service provider will be prepared for the next one.
On the infrastructure front, the tech sector – and service providers in particular – have proved robust, but just as importantly, the demand created overnight has shown something else: consumers both at home and in the enterprise are more than ready to make a transition from social closeness to social distancing, meaning there has been no widespread disarray in most functional parts of society. Of course, this excludes huge swathes of the economy like travel and hospitality, which are decimated, and healthcare, which is being subject to unforeseen strain. None of that is a technology problem, and in fact, service providers and platforms like food delivery services (e.g., DoorDash, GrubHub) have ramped up admirably to cushion some of the blow. The near-ubiquitous small-business payment processor Square helps restaurants and takeout shops integrate with digital delivery, and many other examples abound. In part, this is because of the maturity and sense of comfort and reliability of cloud platforms and services like Uber, Square and other distributed digital business-enablement platforms out there, and because thanks to FaceTime and Skype (and now Zoom), videoconferencing has gone from an enterprise business practice to an everyday convenience within reach of almost everyone.
The real harm to the economy is ongoing in areas vulnerable to the effects of mitigating the COVID-19 virus. Service providers that have proved more than capable of keeping operations shipshape may see drop-offs in areas where their own clients are at a standstill, or worse, and specialized providers that target sectors like hospitality and tourism, for example, may be among the immediate losers in this scenario. It will already be obvious which providers and sectors are affected materially – it won't be AWS, Microsoft or IBM per se; it will be their ecosystem partners and software providers using that infrastructure.
This sudden shift to 'online everything' has exposed the weaknesses of some of the online services we may have previously enjoyed as conveniences and now regard as staples. For example, Zoom, as noted, saw a historic rise in users in short order, but this also spawned a wave of innovative problems caused by bad actors – anonymous trolls 'Zoombombing' meetings by plucking invitational codes out of public or semi-public notices. Questions about encryption and security (Zoom requires interfaces with POTS and other legacy telecom networks and can't guarantee full encryption for every meeting) were the focus of controversy despite the company's transparency and acknowledgement of the issues, which already existed and don't change a functional security posture for most organizations.
Carl Brooks is an Analyst for 451 Research's Cloud Transformation Channel, covering service providers, cloud platforms and supply chain/channel for cloud. Previously, he spent several years researching and reporting on the emerging cloud market for TechTarget.