Monday, October 17, 2011

Episode 13: Where all for one leaves you on your own.

Consolidation in the Irish datacentre & hosting industry is something that those in it have spoken & written about over the last number of years. In the last number of years in the Irish market, we've seen the likes of Novarra bought by DigiWeb, Register365 bought by Namesco, Hosting365 by SunGard, Aventure by DediServe, & recently, one of the biggest buyouts of DEG by Telecity Redbus.

As is natural in times like this, the merging/buyout of companies competiting by each other is a natural course of evolution in the market. Less competition tends to make alot of people nervous, especially in trying financial times. But then there's others who view these buy-outs as important for securing services held by customers by them not waking up one morning to find their service provider is closed, in administration & their business as a result is in limbo. In the end, in either circumstance,  the customer actually loses.

Yes, you read that right. The customer loses. Forget the fact competition evaporates into a consolidated & captive market, the real loss is diversity of solution & redundancy. In Ireland, the managed services industry has been extremely poor at promoting redundancy in solutions. It was common when customers suggested to one of their providers they were seeking an additional back-up, or co-existing solution in another provider's centre to provide some level of redundancy that a provider would put the customer wish first, & a sense of betrayal felt.

For a long time in the Irish market, the customer was not the focus of the business, & that was obvious from the number of failed companies, companies whose customers left in their droves to other providers, & the fact that in the last few years even with so many of the small companies being bought out by bigger companies, the big boys have been totally incapable of dominating the market, & that smaller players have entered & been so successful.

Apart from the frequent criticisms of extremely poor customer care being levelled at some of the big players; horrendous contractual terms, complete inflexibility in the solutions to serve the customer in the way they want & need, horror stories of entire systems not working, & support that just never gives answers, with no real support. Sure, some of these complaints existed before consolidations happened, but afterwards, many have spoken to me of worsening service levels.

But the single biggest complaint many have had is the complete inability due to the sheer myriad of cloud solution platforms used by different service providers meaning people cannot obtain true redundancy. Performance of high-read software systems on many of the virtualisation platforms used has proven hugely problematic for many who have 'been around the houses' in the cloud in Ireland. Moving away from a cloud provider leaving contractual disputes aside proves the most problematic when trying to extract your data to move, or diversify with another provider due to vendor platform lock-in.

Cloud right now in Ireland should be a total no brainer. Traditional services shouldn't stand a chance on the cost argument, or the resilience argument. Cloud providers should be 100% customer focused. The customer is absolutely king right now, but they're not. Ireland yet again continues to prove that customer service in our country is given absolutely little consideration as a factor, along with the customer coming first.

I remember many years ago going into a store to buy a brand new electric guitar, & sure I wasn't parting with two grand for one, it was around 800 to 900 euros for the one I wanted. The first store I went into, I was going to pay the asking price of the model I wanted, & I asked about a case of some kind for it to be thrown in for free (just a simple soft case - they maybe retail for 20 to 25 euros) since it was a mid-range model. I got told in the store that if I bought a Rolls Royce would I expect a garage to be thrown in too?

And sure, you migt read that & think, you can't expect something for nothing. The four other Irish stores that carried the model I wanted gave me the same run-around. At first I thought to myself, maybe I shouldn't expect a garage to be thrown in. Then I said to myself,I'm sure there's someone out there who will. So after a short online search, I found & rang a store in Glasgow, Scotland who not only had the guitar, but were willing to throw in a hard case for free, & ship it for much less than the guitar on its own in a cardboard box here in Ireland. Just to be clear - this wasn't a scale/purchasing power issue. The store was much smaller than the ones we have here in Ireland.

The day after it was delivered, I got a call asking me if I was happy with everything, & was there anything further they could do for me. All this for a guitar I in the end picked up for 670 euros, hard case included. The end result? I have never bought a single guitar here in Ireland after that. In fact, the company I bought from in Glasgow, I've since bought two other guitars from.

Earlier in the year, I went into a very well known store that has pretty much taken over as a guitar megastore in Dublin for another guitar. I was almost laughed out of the store over a discount on a guitar I know they have a huge markup on. The end result, I bought it in from the same store in the UK at a saving of over 300 euros. Again, I received my call the next day thanking me for another purchase & asking me if everything was okay, & even had some on-the-phone support given to me regarding a set-up issue I had with a feature on it.

Consolidation is fine, as long as the efforts on customer service, customer satisfaction & meeting the needs of the customer get concentrated. In Ireland, it's a lesson we still need to learn. Shop around, demand more & don't accept the same-old same-old. It's hard to earn money as a business today. When you go spend, always remember, a fool & his money are easily parted. You cannot afford to be fooled more than once in the Cloud in these times, so keep your feet on the ground while your head is in the clouds.