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Hosting Survey: With Cloud, Being First Counts Just as Much

Being the first in the door to sign a customer is proving to be as important in the cloud as it is anywhere else in business.

"Despite the inherent flexibility of the cloud model, we're seeing very high vendor loyalty rates," said Aziz Benmalek, vice president of Worldwide Cloud and Hosting Services Providers for Microsoft.

Microsoft this month released a survey, designed and conducted on its behalf by 451 Research, of 1,700 IT decision makers worldwide. The survey, "The Digital Revolution, Powered by Cloud" (available here), came out in conjunction with the Microsoft Cloud and Hosting Summit last week.

Benmalek spoke to RCP about the survey and also blogged about it. Supporting his comment about vendor loyalty were three stats:

  • Ninety-five percent of respondents intend to renew their contract with their primary cloud and hosting provider.

  • More than 80 percent of customers have an annual or longer-term contract with their primary cloud and hosting provider.

  • Forty-three percent have a contract of two years or longer with their provider.

Asked how providers were earning that loyalty, Benmalek suggested that range was important. "The breadth of the solution, as well as the breadth of the experience that's going in the cloud space [is important]," he said. "Having that ability to extend from the breadth of offerings, as well as the breadth of services."

Indeed, while the survey suggests customers are loyal and existing providers have clear advantages for now, the market is by no means locked down, nor is spending even close to reaching its potential.

As one example, customers reporting that they are beyond the "discovery phase" on cloud is 85 percent. But those reporting that they have reached "broad implementation"? Only 15 percent.

Says Benmalek: "These findings underscore the opportunity for service providers to drive organic business growth by nurturing long-term relationships."

Posted by Scott Bekker on May 19, 2016 at 11:38 AM