Some Legacy Vendors Still Underestimate AWS – As They Gasp for Air

“Amazon is propping it up.”

“They are just dev-test.”

“Their security is not up to standard.”

“They will fizz out.”

“They are not suited to the enterprise.”

Not a week goes by that I do not get told these “claims” and “insight” into Amazon Web Services (AWS). Yes, that AWS.

The insight comes from a small number of vendors, and individuals. It is easy to guess who they are, they collectively used to dominate, and still cannot understand why they no longer do. It is a perspective incredibly removed from reality.

Let’s put the dominance and performance of AWS into perspective. On current growth rates, it will be a $20B cloud and subscription platform company by the end of 2017. By the middle of 2018 it will be the same size as DXC Technology, which is the unified HP Enterprise Services, EDS and CSC.  It is larger than European IT Services powerhouse Atos, larger than Cap Gemini, with the list growing with each quarterly result publication.

AWS is not merely an IaaS provider. It has evolved to have a much deeper offering than what that out of date perspective suggests. It is a deep platform, covering IaaS, PaaS, Machine learning, Database and more. While not all offerings are entirely dominant and AWS, is far from perfect, it is still a once in a generation company.

Who is expert at dismissing AWS? The legacy vendors that have had their business hit so badly by AWS. Individually and collectively they hope that AWS is going to disappear as quickly as it has risen. These firms used to dominate, and believe that they have a divine right to continue to do so. Bad news. AWS is going nowhere. It will evolve, and that is perhaps even worse news for the legacy vendors. They cannot change or disrupt at the same pace as AWS, they do not have the customer focus, flexibility or reputation, and now languish, some with revenues that have halved in the last ten years, offering products no-one wants. These vendors included traditional IT Services providers, Telco’s, equipment manufacturers, distributors and managed services providers.

As I have written for many years, the only Tier 1 enterprise vendor who seriously has made the shift from legacy to the innovator, and that can compete up front with AWS is Microsoft. As highlighted, so many of the rest are still sitting in denial without the willpower, capital or culture to shift. (Of the smaller vendors, only Adobe can claim the transformation to SaaS and cloud is complete)

Is AWS perfect? No. Does it still have challenges? Yes, in the enterprise space, in the database space, in the partner area amongst other areas, challenges remain and will continue to. As highlighted by capioIT, some customer events need work as well. One day it may be threatened and toppled as the dominant provider. That day is not today or tomorrow. Old school vendors have to accept this.

Legacy vendors (and in a story for another day, legacy IT departments) have challenges that question their survival every day. They need to stop questioning AWS’s longevity, stop deflecting and make the dramatic, and traumatic from a business perspective, transition that they need to survive. Otherwise, they will still be underestimating and criticising AWS as they sink to the bottom of the IT market. Rackspace has done it, NetApps is trying to do it, still, others think it will pass.

Capture Point

Since its inception, too many competitors have not taken AWS seriously enough, even as their own strategy fell apart and revenue went into decline. While logic would dictate lessons have been learnt, too many individuals and their organisations still take the view that AWS will be a historical footnote in the great book of technology. They are wrong and need to wake up fast.

If you require further information, please contact Phil Hassey, CEO of capioIT. capioIT is an advisory firm focused on helping organisations to understand emerging technology as the world becomes Digital. Phil may be contacted easily in the digital and real world.


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Tech vendors are killing the keynote

I go to a lot of tech conferences a year. Some would argue too many. As a result, I go to a lot of keynote speeches in a drab convention centre or hotel ballroom. As an analyst, we usually get front row seating. We appreciate this, but we then get close to the train wreck that increasingly hitting the vendor keynotes.

Google Next 17 – Ran about an hour late and almost all presenters had to use an Autocue they were that passionate about the topic

IBM Interconnect – Three customers, average age of the firms, 119 years, Bank – Check, Telco – Check, Tax Agent – Hold my seat, I am so excited.

AWS Summit  Australia – Five White Middle Aged Men, and not enough respect for the audience to even localise a local weather application to Sydney, we just got Seattle and Fahrenheit

Any Product Firm – CEO’s going straight to the product and miss the outcome and client benefit, using a demo that inevitably fails.

Oracle Open World – Mark Hurd – “Why does everyone look bored.” I will let you decide that one.

Keynotes must improve. This is the vendor’s time in the sun. Why they continue to not learn from their previous mistakes is beyond me. They need to know the audience, respect the audience and leave the audience wanting more. No-one does it anymore, but the vendor that does crack it will benefit and engage the audience. Use it or lose it. 

If you require further information, please contact Phil Hassey, CEO of capioIT. capioIT is an advisory firm focused on helping organisations to understand emerging technology as the world becomes Digital. Phil may be contacted easily in the digital and real world.


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ANZ is the Guide for Where DXC Technology Needs to Go

In early April 2017, DXC Technology launched. Many were asking; Who is DXC Technology? It is simply the combination of Hewlett-Packard Enterprise Services and CSC, by way of EDS, UXC, Compaq and others, following the merger announced in 2016. Simple, no baggage of complexity, history and in recent years, unfulfilled potential.

Perhaps not. For those employees who made it through all the years of trauma, condition cuts, layoffs and general mayhem, it must be sweet relief to have the past behind them.

The reality is that DXC Technologies must put the past behind them incredibly quickly. No Red/Blue/EDS battles that hamstrung HP Enterprise Services. No talking about where individuals were, it has to be all about the future of the organisation and creating the momentum for it to have any chance of leading the future IT services market.

The new business will have global revenue of US$25B; this puts it behind Accenture, who has a trailing 12-month revenue of US$34B. That fact alone is a stunning comparison of the ongoing success that Accenture has provided shareholders vs. the components of DXC Technology. Accenture revenue is significantly larger than the combined CSC, HP Services (removing Technology Services, which is part of the new HPE), and EDS in 2017. Accenture used to be in each firm’s rear view mirror. No longer.

What is more stunning is the fact that EDS alone had revenues of US$22.1B in 2007 before the acquisition by HP. The decline in particular at the legacy EDS business has been dramatic, and frankly sad, acknowledging the number of employees who lost their jobs resulting from the lack of leadership, understanding, and capability of HP leadership, led by Mark Hurd, towards EDS and services. This was exacerbated by the CEO’s and boards that followed him.

Just a little more of the past to explain the future. DXC Technology has taken the structure of CSC before it from a geographic perspective. Asia-Pacific is broken into two separate entities, Asia and ANZ. The split reflects the traditional strength of CSC and legacy EDS/HPE, in the ANZ region. It also reflects that the market down under is different from most of Asia, although this is only a secondary consideration, as no Asia Pacific market is uniform in requirements, outcomes or capabilities.

UXC is the key reason as to why Australia is so important for DXC Technology? UXC was the largest Australian owned IT Services provider before acquisition by CSC in October 2015 – for capioIT’s analysis of that transaction, please see – More than just an acquisition, UXC provides insight into what the future for DXC needs to be, and how to get there. DXC in the current form is well set for infrastructure integration, management and consulting, particularly with AWS and Azure partnerships aligned with Private Cloud capabilities.

By contrast, it is relatively light in capacity, resources, and revenue in the application space, both in legacy apps such as Microsoft, SAP, and Oracle as well as applications such as Salesforce, and organisational analytics requirements. This is where UXC provides the roadmap. It has a strong capability, resources, and revenue in the Oracle, SAP and Microsoft ecosystems. In fact, this is the strength. Furthermore, it has valuable resources and capability in the Big Data space. This is where the broader DXC Technology business must evolve once it beds down the merger of the two parent entities.

Another key advantage is that it will enable DXC Technology to have deeper organisational relationships. IT services vendors do not win with only having relationships with the IT Director. It needs to develop business relationships outside of IT, and relationships that create business measurable outcomes, not just SLA’s.

The importance of UXC for the ANZ business is further underscored due to the fact that it ensures that DXC Technology is the largest IT Services provider in the Australian and New Zealand market. 

For DXC Technology to replicate the Australian experience, it will need to undertake further acquisitions. As the application services market struggles with the impact of the shift to automation, immigration tightening, and other growth-related issues, finding suitable acquisition targets should not be that difficult for DXC Technology. The likes of CapGemini, Infosys, and Cognizant have to be on the radar at some stage, if course,  the price is Ok.

Capture Point
DXC Technology is finally here. It will be a relief for employees of all the merger entities to get this out of the way and have a refresh. To fulfill the potential and meet more market challenges the new entity needs to look to the ANZ business to get an understanding of how the business must evolve. This is the what the future has to look like if it wants to answer enterprise issues for technology.


If you require further information, please contact Phil Hassey, CEO of capioIT. capioIT is an advisory firm focused on helping organisations to understand emerging technology as the world becomes Digital. Phil may be contacted easily in the digital and real world.


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Google Maps gets Gas

For anyone interested in constant and regular innovation, Google Maps is always a great place to start. For those who are focused on the importance of Location Intelligence, it is, of course, a critical source of insight as well as innovation.

Google Maps is always identifying and leveraging new sources of information aka data for its platform. At the same time, an increasing number of partners are leveraging API’s to maximise this innovation and customer value.

One of the most recent innovations, accidentally found when organising logistics for an upcoming New York car rental drop off, is that Google now provides gas station pricing on the desktop, mobile and tablet version of Google Maps. It is a simple touch, but again one that gives innovation to the consumer. We consumers can instantly identify the cheapest fuel that meets our location requirements, i.e., where the car is, or needs to be.

The two photos from desktop and mobile provide the visual insight into the innovation.

































It also creates competitive tension for the Gas/Petrol station vendors. They know their competitive pricing, and so do the customers. The vendors, therefore, must beat or meet with value added services, the pricing if they are to maximise their business for their well-informed customers. Of course, there have been many apps available to provide this fuel information in the past, and they will still have a role, but the convenience of having this information embedded into Google Maps and the inevitable search is what sets the innovation of Google Maps a part. It is fast, information rich and meets customer requirements, even if the customer does not always even know it yet.

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The Windows Release Acceleration that explains Microsoft transformation.


Microsoft has leapt from a disrupted firm to a disruptor in the digital environment. While legacy peers and competitors alike such as Cisco, Oracle, IBM, and HP have hit shallow water, Microsoft has been able to meet some of the fundamental challenges offered by AWS, Salesforce, et al. in the new digital environment. Arguably only Adobe, albeit at a smaller scale, has made such a shift from legacy to disruptor.

This transformation has occurred across most of the firm’s products and services. While CEO Satya Nadella has rightly been given executive credit, some of the changes and disruptions were set in place before his leadership, in the time of Steve Ballmer.

It is important not to underestimate the depth of transformation that still requires investment from Microsoft. That is no surprise. The current and future state environment for every organisation is a never-ending cycle of innovation and change. Standing still is not an option. 

Microsoft still faces fundamental challenges regardless of the status of individual products and services as a legacy or disruptive capability. AWS is, and will continue to a massive thorn, particularly for Azure, and while the uptake of Office 365 has been very high, Google won’t disappear. AI capabilities lag some in the market despite the inherent natural advantages that Microsoft enjoys.

Arguably the largest issue faced by Microsoft globally and in the major markets is the slowness of IT departments to shift towards where Microsoft is now operating and to develop business outcomes as the centrepiece of engagement.  Microsoft also has the urgent and again, ongoing aligned need to completely redefine the partner environment. The majority of long-term partners for Microsoft will not make the shift to a cloud, consumption and digital model. Microsoft needs new partners, to invest in those that are critical for it moving forward and as brutal as it reflects, discard those that cannot transform at speed required.

One of the most visual manifestations of the transformation of Microsoft has been the Windows operating system release cycles. The timeline compression and the increase in engagement with users is a significant representation of all that is right about cloud and digital transformation. By the same token, the history sums up all that was wrong.

The following chart presented at the Australian 2016 Microsoft Inspire event by Microsoft highlights the shift that has occurred within Microsoft in the development of the OS. 


Windows 7 had taken 800 development days before anyone saw it. Yes, nearly 2.5 years. Two public previews were made available and the release of the system took three years. Sure, it had to replace Vista, but worse was to come. Window 8 took even longer. It took over three years of development time, but on the bright side, there were three public previews. This was, and still is typical behavior of legacy IT. It simply doesn’t understand their customers and cannot have the speed and flexibility that is essential.

Clearly, the world changed for Microsoft in the lead up to Windows 10. Development times shrunk dramatically to just over 400 days, but the real shift was the customer centricity. Instead of three public review opportunities, Microsoft provided 15 PC based previews and aligning with the shift to mobility, seven mobile based opportunities. By the time Windows 10 updates were in development, it had become and remains a never ending beta testing cycle with code hitting early adopters and developers seemingly as soon as it is created.

Capture Point

Microsoft OS processes document a true transformation that is well overdue. Regardless of the process, it is what every organization needs to do on their shift to becoming flexible, customer centric and digital. Microsoft learnt very slowly and allowed many others to flourish, but it is now starting to get the benefits across the organization of this shift. Customers win, so Microsoft wins. Simple.


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Top Five Takeaways from AWS Reinvent 2016



The AWS Reinvent event for 2016 is winding up. This year there was 32,000 attendees. The clear majority were developers focused on the platform. Here are my five quick takeaways from the event. (I will have more detailed insight, at a later date)

  • AWS is a machine. Revenue is now over $13B and it is till growing at over 50% annually. By next year’s event, it will most likely be a $20B revenue vendor. another revolution for the industry. Naturally, this drives innovation through the ecosystem from ISV startups to the largest banks. Take a week off, and AWS has come up with on average 21 new functions or services. Nothing can match this.
  • The innovation AWS creates out is unprecedented. 1,000 new services/functions in a year –  yet another revolution for the industry. This drives innovation through the ecosystem from ISV startups to the largest banks. Take a week off, and AWS has come up with on average 21 new functions or services. No-one can match this regardless of how you measure it.
  • Oracle and Larry Ellison lined up AWS at OOW, and AWS responded in kind at Reinvent. Despite the talk benefits shifting Oracle Database clients to AWS is going require more than just fundamental cost savings. The organisational change is immense. Breaking this maybe the biggest challenge for AWS in the future.
  • Whilst increasing organisations are shifting fully to IaaS, the people and change management aspects of the transformation are underinvested. More investment must be made in the people aspect of disruption by AWS, partners and of course the customer to ensure that the transition and investment works.
  • When the analysts were first told about “Snow Mobile” I thought it was a fun joke being played on us. The reality is much more than that and highlights the innovation of AWS, and with a 100 Petabyte capacity, the volume that organisations drive through the AWS ecosystem. Next year expect a 200 Petabyte truck B-Double.


As mentioned, more thoughts will follow. Please contact me if you require more detail or have any comments or suggestions.

If you require further information, please contact Phil Hassey, Founder capioIT. capioIT is an advisory firm focused on helping organisations to understand emerging technology as the world becomes Digital. Phil may be contacted by email below,





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Too many tech decision makers spoil the broth


Recent and ongoing discussions with industry stakeholders confirm to capioIT that the increasing complexity of technology procurement and decision-making is reaching a boiling point. capioIT estimates that major technology investment decisions now require an average of six to seven individual decision makers to agree to confirm a decision. This creates both a bottleneck to slow the decision process and quality, as well as difficulties in managing different business requirements and perspectives from the technology procurement.

The number of executives required to make a decision, let alone influence one, has increased steadily in recent years. Most will recall a “simpler” time when the number of decision makers, was two or three, and in some cases just the one. The shift to more decision makers is not all bad. Of course, a single decision maker is not the perfect outcome for many reasons, from an understanding of the depth of business, technology and outcome knowledge through to corruption risk. This is why government agencies and large enterprises avoided the single point of decision, not just for procurement requirements, but amongst other business processes such as recruitment.

It is important to accept that this increase in decision maker requirements is a natural outcome of technology increasingly embedded in a greater breadth and depth of business processes, and as a result decision makers. Business processes such as HR and Marketing now have a material interest in the investment and outcomes of technology for their functions. This is of course what an informed and integrated technology solution requires, but the increased complexity can have the downside of making agreed and unanimous decisions impossible.

Examples span the technology budget. Payroll was once a relatively simple, albeit critical business function, (for the average employee, it is often the most critical, we all prefer to be paid painlessly). In 2016, the decision is increasingly complex. The IT department, Legal, HR and finance are all critical inputs to the decision. In some cases, employee scheduling is a separate function with requirements, as is the compliance department. These multiple stakeholder requirements lead to clashes over contingencies, outcomes and vendor selection.

It leads to delayed decision making, and while the need for compromise is a positive to maximise results, it cannot be at the expense of concrete decision-making. Time to decision creates a vicious circle. The lack of a unanimous decision can have a negative impact, especially where implementation may go wrong, and the finger pointing begins.

It also makes the vendor’s life more difficult. Not everyone will have a problem with this, but it will add to the cost of sale and potentially the margin of the business. Identifying the stakeholders and decision makers becomes more difficult.

The worst thing to be for a client of a technology vendor is a loss-making contract. That is when short cuts are made and investment is limited.

Focus Point
The good news. Technology is embedded in more businesses, and as a result, more stakeholders are engaged. The downside. Decisions slow down due to the increased complication. Organisations need to decide the difference between which resources are involved in influencing a decision and which resources are actual decision makers, and “check signers”.

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