Customer success stories always make good posts, and I especially enjoy when they’re stories that how the agility to be gained from using *aaS instead of more traditional approached. I was interested then to gear about Tata Communications, the $2.5B telecom arm of the $80B Tata Group, roll out of its new US based cloud storage and processing offering – “InstaCompute”.
Tata already has a Cloud offering in India. Last October they launched InstaCompute in that emerging market – compute, data transfer and storage targeted to a customer base which is largely ignored by the big cloud players. Their intention was always to extend the offering outside of India, and that now includes the US market launch.
Tata combines traditional hosting with their cloud storage and compute – they wanted to be able to offer their customers highly flexible options around pricing and charging. As I’ve said many times before, building your own billing engine makes sense if your billing methodology is relatively simple – however introduce any complexity to the system and you’ll rapidly discover that you’ve built a millstone around your neck.
Which is where a third party billing and subscription service comes in – by abstracting this non-core part of operations away rom the software vendor, it leaves the vendor to spend time focusing on the core product offering and, most importantly, leaves them able to execute in the marketplace sooner than would have otherwise been the case.
Rather than build its own billing system, Tata turned to Zuora for both the Indian and the US roll out of InstaCompute. Using Zuora’s Z-Commerce for the Cloud, the subscription and billing component took 60 days to deploy according to Tata. The interesting thing here is that Tata is a company that undoubtedly has the smarts to build a billing and subscription engine, and the money to make light of any development costs – there reason for going to a third party platform was the initial and ongoing agility it brought them – a theme with cloud computing that needs to be talked about more.
I spent time talking with Matthew Leonard, Senior Product Manager at Tata Communications – both about their own product roadmap but also about their thinking behind going to a third party billing and subscription service. Leonard told me that Tata already use a host of billing solutions – both built in-house and third party provided, but that an analysis showed that none of them were sufficiently flexible to meet the various subscription needs for their new services – he reflected on traditional two year development cycles for the roll out of new products, part of this time is the back end requirements related to monetization. Tata believe their core differentiator is their ability to mix and match cloud and traditional products but that in such a rapidly changing marketplace, speed is the only true point of difference – they wanted a system that could flex and scale and, from the get-go would allow them to bill in multi currencies and scale into new markets – Cloud billing gave them that ability.
I spoke to Leonard about the cost implications of using a third party service. He broke it up into two specific areas – set up costs and ongoing costs. In terms of set up, Tata did some internal work and by partnering with cloud.com to do the professional services piece of the work (cloud.com have already got experience integrating with Zuora) he believes they actually saved money when compared to integrating with an existing product. In terms of ongoing costs – Leonard appreciates the “pay when you earn” aspects of this particular Cloud service, and the fact that expenditure is directly ties to revenue.
Anyway – below is a video about the offering and the Zuora component – it’s a little marketing-esque but worth a few minutes anyway.
Disclosure – I’ve consulted to Zuora and most of their competitors – but this isn’t a story about them so much as a treatise about cloud agility.