Cisco confirms discontinuation of its InterCloud services in March 2017

Not long ago in 2014, Cisco had first introduced InterCloud and in the recent news, Cisco has confirmed that it will discontinue its Cisco InterCloud Services public cloud infrastructure on 31st March 2017. The reason behind this decision is the huge growth of the big cloud services providers like Amazon Web Services, Microsoft Azure, Google Cloud, IBM and other smaller public-cloud services.

Many of the hardware makers in the industry, including, Hewlett-Packard, Hewlett-Packard Enterprises have stepped down from being a public-cloud company and have discontinued their cloud services earlier this year. VMWare, which once viewed AWS as its rival for cloud workloads, has now agreed to partner with AWS and is still offering its vCloud Air hybrid-cloud service.

At the time of the launch, Cisco anticipated a total spend of $1 billion over the two years building “a network of clouds” and “a way to lower the total cost of cloud services ownership and pave the way for interoperable and highly secure public, private and hybrid clouds.” In March 2014, Cisco said that it will be the world’s largest global InterCloud and will be the first of its kind service in the field of cloud IT services.

Cisco wanted to build the product which would be “architected for Internet of everything” and had planned to do this with its partners, including Telstra (an Australian service provider), Allstream (a Canadian business communications provider), Canopy (a European Cloud company), Ingram Micro Inc. (a cloud services aggregator) and others.

Cisco, in a market analysis, predicted that 83% of all data-centre traffic will be based in the cloud. Public cloud services like AWS and Azure are continuously designing their data centres using some off-the-shelf components. Thus, Cisco faced pressure to enter the cloud market but successfully competing in the public-cloud market requires more than what many had predicted and hoped.

According to the Synergy group, AWS’s share of the market for IaaS and PaaS was 30% with 53% growth in the revenue year-on-year. Azure’s was over 10% with 100% revenue growth. Share of IBM was about 8%, Google cloud’s 5% and the remainder collectively by the other companies.

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