Where did the Cloud model go wrong?

In our last post, we talked about the emergence of the Cloud and we feel this is where the Cloud model went wrong.

As the Cloud grew, Cloud providers took the open-source technologies off the shelf and started hosting them in the cloud without collaborating with the open-source innovators for the most part. The challenge with this model is that open-source technology providers are left with all the hard work to build and maintain their projects while cloud providers completely monetized it for their own profits.

The other challenge is that cloud providers don't contribute back to the community for the most part. In fact, they are creating new proprietary technologies by making some of the open-source technologies cloud-native, luring decision-makers into them, and charging more premium for them. In a nut-shell:

Today's cloud providers are NOT built with a win-win mindset

Not only the open-source community, but even customers also suffer from this innovation model. They have to fundamentally make a choice between cloud-native solutions vs. proprietary lock-ins. As an example, AWS offers RDS or MSK that are inherently not cloud-native and rely on the community to make the bug fixes. On the other hand, AWS offers cloud-native solutions like Aurora or Kinesis but leads to lock-ins.

Cloud trend

As a result, we are seeing another paradigm shift where open source innovators are taking their offering to the cloud and offering it directly to customers as a managed offering. This shift not only balances the equation for open-source technology providers but also benefits the end-customers as they no longer have to make a tradeoff between cloud-native solutions vs. proprietary lock-ins.

Moreover, there are other benefits with this new shift like multi-cloud and getting offerings directly from the original authors. As an example, open-source inventors like Databricks or MongoDB offer a fully managed Saas offering over multi-cloud for better flexibility, resiliency, compliance, cost-effectiveness.

It’s no surprise that there has been a sudden rise in Saas providers from MongoDB to Redis Labs. Here is an interesting article from coss.media. As you can see there is a massive increase in #startups from 4 in 2018 to 27 in 2021 so far.

Do you folks agree? Do you think this trend is short-lived or here to stay in the longer term?

We would love to hear what you think.