Technology, Cloud

Are the concepts of B2B and B2C still relevant in cloud?

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I’ve had the opportunity to discuss the issues related to the lack of transparency of public cloud previously. This is forcing users to trust the cloud service provider, not knowing who is actually behind the delivery of a particular service.

In a recent discussion about this needed trust in the cloud some of the people I was speaking to argued we need to differentiate between B2B and B2C when talking about cloud computing. Frankly I did not understand what they really meant. So, I asked them how they would define a “B2B cloud” versus a “B2C cloud”. Here is their explanation, but let me tell you right from the start, I’m not convinced.

A B2B cloud is, in their mind, a public cloud where a specific contract is signed between the customer and the cloud provider. I do know that Amazon for example, has a team recruiting what they call enterprise customers. Those customers are accepting legal terms and conditions (T&C’s) that are different from the standard ones on their website. By that definition, a B2C cloud relationship is one that uses the standard terms and conditions, you know the ones we all read before checking the box “Accepting Terms & Conditions”, the 15 or so pages that you can scroll through on a small window in the middle of your screen.

The debate quickly focused on the necessity to establish regulation to ensure the user would clearly understand what he is getting into when subscribing to a cloud service, and which type of customer should benefit from such regulation. To increase trust in public cloud it is critical that users are clearly made aware of who delivers the service and what it entails. Cloud service providers typically want to limit their liabilities. I can understand that. But many seem to hide behind complex legal jargon. So, their customers do not really understand the limitations and often discover them when the problem has happened.



Negotiate on your own terms.
When you can negotiate your own agreements, you have the possibility of better understanding what you will get and how to protect you from borderline T&C's. But the fundamental question is whether services can be separated between consumers and businesses. If not, the discussion becomes sterile as the same service does have both types of customers and requires the regulation anyway. Actually, are businesses and consumers using different services?

In my mind, the boundaries are blurring very fast. Yes, businesses probably do not use "angry birds", but many SMB's use Skype, office 365, window live, dropbox etc. Is LinkedIn a business or consumer service? And I could go on like that but you get my point. We had B2B and B2C in Web 1.0, and there it made sense. I’m not sure we can just take those concepts and apply them to web 2.0. The fundamental question is actually whether the public cloud can actually be trusted. That’s something I leave yuou to judge, but you’ll have to do your homework.



Shadow IT can be dangerous.
Particularly in larger enterprises, where IT may seem to lack the agility the business would like, users continue to use "shadow IT", risking to put the assets of the enterprise at risk, it's important that appropriate protections are put in place to limit exposure. Cloud service providers should understand that and avoid using T&C's that protect themselves while exposing their customers. 

Education of cloud users is also long overdue. They need to understand what they expose themselves and their enterprises to when signing the proverbial T&C's that they all read completely before checking the box, right? 

To conclude is there a difference between B2B and B2C services in the cloud. Not in my understanding.  Customers may have different T&C’s for consuming the same service. But shouldn’t we make sure all customers are protected and know what the implications of their decisions are, even the ones that are not powerful enough to negotiate their own contracts? Do you disagree? Don’t hesitate to comment.

 

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Discussion
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pcalento
Paul Calento 256 Points | Sat, 01/28/2012 - 21:05

I tend to agree that B2B and B2C cloud computing approaches have little to do with the problem. To me, they are an example of a provider's view of the market (who and how they serve them) over a customer's needs (i.e. desire for transparency, strong cloud security, pervasive cloud management). I wonder however, if I'm missing something. Wondering if this is an issue discussed at the HP Master the Cloud events, currently taking place in Canada? (see event recap one, two, & three on CloudTweaks.com)

--Paul Calento

(note: I work on projects sponsored by EnterpriseCIOForum.com and HP)

 

Warren
Warren Burns 11 Points | Mon, 01/23/2012 - 02:16

In order to differentiate between B2C and B2B there would need to be some differentiation between the two services provided.  Even the custom T's & C's that Amazon offer (relatively rarely) are more relevant to legal recourse in the event of regulatory investigation, dawn raids etc.

Those T's & C's don't differentiate the technical service being provided, nor should they, the standardisation of service is part of the appeal.  Even the agreement to only provide services from a specific geography doesn't constitute a material differentiation to the service.

I also wonder under what circumstances a consumer would make any significant use of AWS?  Developers who play around with prototypes, technical consumers who run up ego sites or blogs.  I don't know the answer (Amazon are famously tight lipped about it) but I am going to guess that the vast majority of AWS useage is provided to companies of one type or another.  You would need to be a pretty special type of person to all of a sudden announce "I really need a RackSpace instance".

Blogger, wordpress and drupal would soak up the real B2C demand, I know that these products all make use of AWS to varying extents but that use is abstracted from the customer (less so for Drupal).

B2B and B2C should not be differentiated because there is less B2C than you think and there is a lot of B2B.

Christian
Christian Verstraete 418 Points | Wed, 01/18/2012 - 13:04

Thanks, Pearl, you are right, but I believe the points you make apply to all type of cloud. We need increased standardization, that's correct, but I argue that, with public cloud, we first need more transparency. When ticking the "I've read the T&C's" we mostly don't know what we are getting into. We have no idea of who really delivers what part of the service, of the security precautions taken. When asking the answer is mostly "trust us". We will probably need, unfortunately, a big security breach before the mentalities change, but what is that going to cost us?

pearl
Pearl Zhu 90 Points | Tue, 01/17/2012 - 17:27

Hi, Christian, very interesting blog to deploy B2B & B2C cloud, beyond what those familiar cloud flavors such as public, private and hybrid, may well indicate the convergence between e-commerce and the cloud world, all like the pillars to the internet of the things. make the world, both physical and virtual world much more connected than ever. I would say, besides speicial T&C with purchasing power, B2B cloud may still need build up more industry standard, the common terms, to embrace the cloud-ecosystem will collective wisdom and best practice.