Choosing a Cloud: Cost v. Technology v. Hosting Provider

April 20, 2012

If you had to order a new cloud server right now, how would choose it?

I've worked in the hosting industry for the better part of a decade, and I can safely say that I've either observed or been a part of the buying decision for a few thousand hosting customers — from small business owners getting a website online for the first time to established platforms that are now getting tens of millions of visits every day. While each of those purchasers had different requirements and priorities, I've noticed a few key deciding factors that are consistent in a all of those decisions:

The Hosting Decision

How much will the dedicated server or cloud computing instance cost? What configuration/technology do I need (or want)? Which hosting provider should I trust with my business?

Every website administrator of every site on the Internet has had to answer those three questions, and while they seem pretty straightforward, they end up overlapping, and the buying decision starts to get a little more complicated:

The Hosting Decision

The natural assumption is that everyone will choose a dedicated server or cloud computing instance that falls in the "sweet spot" where the three circles overlap, right? While that makes sense on paper, hosting decisions are not made in a vacuum, so you'll actually see completely valid hosting decisions targeting every spot on that graph.

Why would anyone choose an option that wouldn't fit in the sweet spot?

That's a great question, and it's a tough one to answer in broad strokes. Let's break the chart down into a few distinct zones to look at why a user would choose a server in each area:

The Hosting Decision

Zone 1

Buyers choosing a server in Zone 1 are easiest to understand: Their budget takes priority over everything else. They might want to host with a specific provider or have a certain kind of hardware, but their budget doesn't allow for either. Maybe they don't need their site to use the latest and greatest hardware or have it hosted anywhere in particular. Either way, they choose a cloud solely based on whether it fits their budget. After the initial buying decision, if another server needs to be ordered, they might become a Zone 4 buyer.

Zone 2

Just like Zone 1 buyers, Zone 2 buyers are a pretty simple bunch as well. If you're an IT administrator at a huge enterprise that does all of your hosting in-house, your buying decision is more or less made for you. It doesn't matter how much the solution costs, you have to choose an option in your data center, and while you might like a certain technology, you're going to get what's available. Enterprise users aren't the only people deciding to order a server in Zone 2, though ... It's where you see a lot of loyal customers who have the ability to move to another provider but prefer not to — whether it's because they want their next server to be in the same place as their current servers, they value the capabilities of a specific hosting provider (or they just like the witty, interesting blogs that hosting provider writes).

Zone 3

As with Zone 1 and Zone 2, when a zone doesn't have any overlapping areas, the explanation is pretty easy. In Zone 3, the buying decision is being made with a priority on technology. Buyers in this area don't care what it costs or where it's hosted ... They need the fastest, most powerful, most scalable infrastructure on the market. Similar to Zone 1 buyers, once Zone 3 buyers make their initial buying decision, they might shift to Zone 5 for their next server or cloud instance, but we'll get to that in a minute.

Zone 4

Now we're starting to overlap. In Zone 4, a customer will be loyal to a hosting provider as long as that loyalty doesn't take them out of their budget. This is a relatively common customer ... They'll try to compare options apples-to-apples, and they'll make their decision based on which hosting provider they like/trust most. As we mentioned above, if a Zone 1 buyer is adding another server to their initial server order, they'll likely look to add to their environment in one place to make it easier to manage and to get the best performance between the two servers.

Zone 5

Just like the transitional Zone 1 buyers, when Zone 3 buyers look to build on their environment, they'll probably become Zone 5 buyers. When your initial buying decision is based entirely on technology, it's unusual to reinvent the wheel when it comes to your next buying decision. While there are customers that will reevaluate their environment and choose a Zone 3 option irrespective of where their current infrastructure is hosted, it's less common. Zone 5 users love having he latest and greatest technology, and they value being able to manage it through one provider.

Zone 6

A Zone 6 buyer is usually a Zone 1 buyer that has specific technology needs. With all the options on the table, a Zone 6 buyer will choose the cloud environment that provides the latest technology or best performance for their budget, regardless of the hosting provider. As with Zone 1 and Zone 3 buyers, a Zone 6 buyer will probably become a Zone 7 buyer if they need to order another server.

Zone 7

Zone 7 buyers are in the sweet spot. They know the technology they want, they know the price they want to pay, and they know the host they want to use. They're able to value all three of their priorities equally, and they can choose an environment that meets all of their needs. After Zone 6 buyers order their first server(s), they're going to probably become Zone 7 buyers when it comes time for them to place their next order.

As you probably noticed, a lot of transitioning happens between an initial buying decision and a follow-up buying decision, so let's look at that quickly:

The Hosting Decision

Regardless of how you make your initial buying decision, when it's time for your next server or cloud computing instance, you have a new factor to take into account: You already have a cloud infrastructure at a hosting provider, so when it comes time to grow, you'll probably want to grow in the same place. Why? Moving between providers can be a pain, managing environments between several providers is more difficult, and if your servers have to work together, they're generally doing so across the public Internet, so you're not getting the best performance.

Where does SoftLayer fit in all of this? Well beyond being a hosting provider that buyers are choosing, we have to understand buyers are making their buying decisions, and we have to position our business to appeal to the right people with the right priorities. It's impossible to be all things for all people, so we have to choose where to invest our attention ... I'll leave that post for another day, though.

If you had to choose a zone that best describes how you made (or are currently making) your buying decision, which one would it be?

-@khazard

Comments

May 9th, 2012 at 9:13am

It’s not easy to choose a cloud hosting provider for our business.
We are in Tampa, but would have no problems dealing with a stable company with the infrastructure to handle our needs.

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Comments

May 9th, 2012 at 9:13am

It’s not easy to choose a cloud hosting provider for our business.
We are in Tampa, but would have no problems dealing with a stable company with the infrastructure to handle our needs.

Leave a Reply

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  • Web page addresses and e-mail addresses turn into links automatically.
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