[BAT Qi Qi force cloud computing market: half of the sea is half the flame? 】
On May 23, Alibaba Cloud held the Wuhan Summit of Alibaba Cloud in Wuhan Optics Valley, and Hu Xiaoming, President of Alibaba Cloud, gave a lecture;
May 23-24, Tencent Cloud's "Cloud + Future" Summit was held in Guangzhou. Ma Huateng was the third platform for Tencent Cloud;
On May 31st, Baidu Cloud held an IoT Summit in Shenzhen. Baidu President Zhang Yaqin attended...
It seems that the BAT preached to the cloud service market almost at the same time. In fact, this “occasion†is inevitable. Because if the Internet industry has become an infrastructure, the "cloud" is the infrastructure of infrastructure. BAT will not and cannot ignore such a huge market of billions of dollars.
For BAT's cohesion, traditional business owners have "hugged" the Internet for years and have their own experiences and conclusions. "The Internet is an advanced productive force, but the Internet is also a barbarian and an expansive agent in many cases. The traditional, simple and traditional industries are often impetuous, drifting, and uproar because of the Internet."
Indeed, there are quite a few friends around the author who hold this view. In fact, it is not just the traditional industry. Even if it is similar to the cloud IT services, CDN, big data and other pan-IT fields, it also brings unexpected changes due to the entry and development of pure Internet companies.
Taking the cloud service market as an example, an interesting phenomenon is that the entry of major Internet companies brings Internet thinking such as “free, participation, single point of breakthrough, dimension reduction attack, rapid iteration†and so on. All vendors, including themselves, have dug all sorts of traps, such as tug traps, capital traps, scale traps, and territorial traps.
All cloud service providers want to avoid falling into the traps as much as possible. They must not only “take history as a guide†for those companies that have already fallen into traps or are about to fall into traps, but also want to look down at the road and see the trend of the entire industry. Flexible response to prevent problems.
When the cloud hits the blockchain, try might be the best option
Nowadays, the TMT industry, especially the Internet companies among them, all like to pursue the exit. Lei Jun’s phrase “Standing on the air, pigs can fly†has a great impact. Unfortunately, many people only see that the wind can make pigs fly, but they ignore it. The strong wind can also make the pig drop the cruel reality.
Thunder seems to be one of the manufacturers who like to chase the air outlet. When the popularity of Blockchain, Bitcoin, and digital currency rose, Thunder quickly captured this slogan, taking advantage of the earliest money makers and downloaders to upgrade and launched the so-called “CDN+ blockchain/digital currencyâ€. Technology's hybrids - playing cloud. In fact, the technology behind playing the cloud is not new, and the nature of BT download technology is no different from the early years. To put it plainly, playing cloud is to use long-established CDN technology to make use of idle user bandwidth and storage resources, to guide the application response needs of users around the nearest computing and storage nodes, to meet and enhance the network response speed with the shortest distance. .
The smart Thunder is a new hot word for this industry's long-established technology, called the "sharing economy." For a time, P2P technology is considered to be a revolutionary technology in the CDN industry and is highly favored by the capital. Thunder's stock also soared.
Unfortunately, blockchains and digital currencies are still in the air, and Thunder has experienced internal guilt: Thunder has accused the former executives of the transfer of benefits. Thunder Big Data has "counterattacked" Thunder and said that Thunder does not use blockchain to play currency. The technology, which is a disguised ICO project, is a swindle in which the top wind violates seven ministries' documents, uses illegal exchanges, illegal mass pyramid schemes, and illegally raise funds.
Although the incident of internal affairs has now subsided, Thunder has encountered many class actions in the United States. Investors accused Thunder of intentionally participating in illegal ICOs and issued false statements on these activities. They believe that these measures have had a significant impact on the stock price of Thunder. In the most crazy time, Thunder's stock price fell within three trading days, from the 27 yuan to 12.8 yuan.
Even if this is the case, the pace of the Thunder's pursuit of the air has not stopped. During the Boao Forum for Asia, Xunlei stated that it is going to launch a new generation of intelligent hardware “player cloud†and a digital license “chain chain†based on blockchain technology, among which playing cloud is the medium for collecting idle resources, and Solve the problems of fairness and real-time in the collection, use, and exchange of resources.
Thunder said that today's mainstream blockchain parallel processing capabilities can be executed in less than a hundred smart contract calls in less than a maximum of 100, but Thunder hopes to be able to handle hundreds of millions of smart contracts in a second.
The success of Thunder's ambition and Haikou has not yet been realized. The only thing that is known is that, unlike the positive reaction of the capital market triggered by the last wave of enthusiasm, the reaction of the capital market is cold and the stock price of Thunder is still at the bottom.
The two sides of financing: it is necessary to have fire and cooking, but also to prevent the burning of rice.
In the cloud service market, and Thunder is not the same as the so-called outlet "greedy idiotic" is not the same, Jinshan cloud is like financing, which also confirms the ancient people's words - the hands of food, the heart does not panic. However, it is known that capital is greedy, giving you a piece of money and you can't wait for them to earn 10 or even 100 pieces of them, and many times the capital does not have the patience of the company itself. In this sense, the capital is really a honey pot. But there are times when it is a hot potato, or even a toxic arsenic.
In recent days, Jinshan Cloud’s financing momentum has been swift and swift. D has just obtained three rounds of financing. In just 47 days, the total financing amounted to 720 million U.S. dollars, and the company’s valuation after the investment reached nearly 2.4 billion U.S. dollars, refreshing the Chinese cloud industry. The amount of financing.
Of course, to see the good side of Jinshan Yun, we must also see its grim aspect. According to Jinshan Software's financial report and other data, Jinshan Cloud's revenue for the four quarters of 2017 was 268 million yuan, 344 million yuan, 358 million yuan, and 401.9 million yuan respectively. In terms of absolute numbers, there are slight increases in each quarter. However, the quarter-on-quarter growth rates in the two quarters and three quarters are 13.4%, 11.8%, and 11.2%, respectively. It is not difficult to see that the sequential growth rate is declining. The latest financial report data for the first quarter of 2018 shows that the quarterly growth rate of Kingsoft Cloud further slowed down. More grimly, according to the Jinshan cloud announcement, in the first three quarters of 2017, the revenue of more than 9 billion yuan, the loss reached 600 million yuan, the annual revenue of more than 1.3 billion, the loss is estimated to reach 7 to 8 Billion.
Not only that, after getting some financing at the end of last year, Jinshan Cloud announced heavy price cuts. It announced that Redis, a cloud database, cut prices by 60%, CDN reduced prices by 50%, cloud servers by a maximum of 30%, and the prices of object storage products dropped by another 10%. In this round of price cuts, "a low level of innovation, a full price reduction, a decline to the bottom, and a breakdown of the industry's bottom line" have become dazzling vocabularies.
Those who know a little about China's TMT industry may have realized that the above-mentioned words that make the cloud service market "sparkling" have long been familiar to everyone in the industries of e-commerce, mobile phones and used cars. Moreover, as a Lei Jun Enterprise, Jinshan Cloud is obviously learning the game of Xiaomi and wants to inherit Lei Jun’s clothes. However, if you do not think clearly about the following four issues, you will most likely fall into the trap of capital.
First, can the efficiency of burning be improved in the end? From the previous data, it can be seen that Jin Shanyun’s ring price increase in recent quarters has been declining in recent quarters. If it is said that burning money will not only increase costs significantly, but also increase revenue. The marginal effect is still decreasing, so is this money worth burning?
Secondly, 7.2 billion U.S. dollars is not too small. However, these rich and varied Ali cloud, Tencent cloud, Huawei cloud, etc., is undoubtedly a trivial matter, these money really dare to burn casually, think about the early days of the Internet industry The handles and other group buying websites, mid-term LeTV and other companies, as well as the current mob, ofo's tragic selling, money should not be a little closer?
Thirdly, Xiaoshan Jin Shanyun now learns from the opposite direction of Kingsoft Cloud. Not only did he not cut prices, but he also tried to continuously improve the tone of the brand and continue to increase the price of his products. Did Jinshan Yun really learn the essence of Xiaomi?
Fourth, and most importantly, the market where Jinshan Cloud is located is the 2B market. The 2B market and the 2C market are not the same at all times. The price reduction can attract a small part of price-sensitive customers, but for more cloud service companies. For customers, the security, reliability, stability, innovation, robustness, flexibility, and responsiveness of products, technologies, and services are more important to corporate customers than prices. In this case, can 2C's price reduction play the same effect in the 2B market?
When the scale effect encounters cost rigidity and anti-leverage, which side will the balance go?
In fact, if you want to use the Internet's thinking and practice to squeeze and compete for the cloud service market, it is far more than Jinshan Cloud's one, and more typical ones are Alibaba Cloud and Tencent Cloud. "Price cut - increase market share - continue to cut prices - squeeze small and medium-sized manufacturers - continue to cut prices - remove small and medium manufacturers - continue to cut prices - monopolize the market - increase prices - to obtain high profits", this may be the ideal market for Alibaba Cloud, Tencent Cloud, etc. The trend is also a gold tactic that has been proven in many 2C areas of the Internet.
This is also the reason why Alibaba Cloud and Tencent Cloud launched a round of price war in the cloud service market. There is no doubt that price cuts are indeed one of the effective means of acquiring customers and markets in the short term, but even for the giants, price cuts are not a panacea. There are four main reasons.
The first is that the scale is not necessarily economic. The concept of "economies of scale" was proposed by the famous economist Krugman and Ai Chenan. Once the concept of economies of scale emerged, it became a magic weapon in everyone's eyes. It seems that only by expanding the scale can we become bigger and stronger in order to reduce costs and obtain high profits in order to be able to monopolize the industry. However, the cloud service industry, the scale effect and the Internet industry are much worse. For example, for an application in the Internet industry, as the number of users increases, the added cost is minimal, and the advertising, value-added services, and capital market valuations that users bring can be increased linearly or even more linearly. .
The cloud service market is indispensable in every aspect of the development, testing, deployment, operation and maintenance of each single service, and the corresponding product, technology, and manpower input are all essential. Therefore, Alibaba Cloud, Tencent Cloud, etc. want to pass through the CDN. It is not necessarily a good idea to make big revenue and scale in such subdivided areas. Hu Haibo, deputy director of the Institute of Industry and Planning of the China Institute of Information and Communication Technology, pointed out that when cloud service companies are doing CDN in the early stages, that is when the scale is small, they can use the large-scale advantages of cloud computing as a whole and can reduce margins to some extent. cost. For price-sensitive users, in the last two years, those who have migrated have already migrated out. Later, for them, the potential market is decreasing and the marginal utility of the price war is weakening.
Second, it is anti-leverage. In the past few years, people have been unfamiliar with the word “leverageâ€, especially in the fields of economy, investment, and wealth management. To put it bluntly, leverage is to use the least amount of capital to instigate the most resources in order to obtain the maximum benefit. However, in the cloud service market, when the giants lifted the price of the big stick, it was anti-leverage. People say that, for example, Alibaba Cloud or Tencent Cloud lowers the price of a certain product because of its large market share, so to maintain a corresponding market share, we must bear much greater cost pressure than small and medium-sized manufacturers. From the point of view of small and medium-sized manufacturers, as long as a little bit of cost, it can make big manufacturers pay a great deal of cost, and it feels a little bit of a drudge. For another example, recent WeChat, QQ and other short video sharing links such as vibrato, fast hand, watermelon, and micro-viewing are typical “anti-leverage†and sacrifice the original microscopic vision that has broad prospects in the manner of “cutting meatâ€. To stop the growing vibrancy and quick hands.
Again, it is cost rigidity. Cost rigidity and scale may not necessarily have some similarities in economy, but they are not exactly the same. The diseconomies of scale emphasize that scale does not bring additional gains, while cost rigidity emphasizes the irreducibility of costs. Taking the CDN of the cloud service market as an example, the number of nodes, total bandwidth, stability, quality, large redundancy, and anti-attack are the core of the service. In particular, the number of nodes and the total amount of bandwidth are the most basic. And these two costs cannot be reduced because of your price reduction, scale increase, etc. The so-called "dilution costs" in the cloud service industry such as the CDN is basically impossible. Therefore, as long as the cost is rigid, this vicious competition will be difficult to sustain.
It is no wonder that Thunder CEO Chen Lei will repeatedly sigh. "Today, this market has become indiscriminate. Vicious competition has caused most companies to lose money. Many cloud service providers are losing money and earn money, regardless of the business model." Giants are still under pressure, small and medium manufacturers It goes without saying.
Finally, there is a lack of neutrality. No matter if it is Ali cloud, Tencent cloud, or Baidu cloud, Jingdong cloud, Jinshan cloud, because these companies have a lot of related online business itself, and the number of related companies in their respective systems is countless, may be a piece of business or a certain An affiliate has a competitive relationship with a potential customer. In the context of this lack of neutrality, many corporate customers will consider issues such as business security and data confidentiality, and choose a more neutral third party service provider. Therefore, in the enterprise market, price is not the most central factor.
When you go to the country, you must follow the rules. What song does you sing?
Not only is the Chinese market in full swing, but also the global market, the cloud service market is more than a knife.
In the past 2017, the Royal Canadian Capital Markets tracked 19 cloud service providers. They invested a total of 63.8 billion U.S. dollars, a growth rate of 22%. In 2018, this figure will increase by 27% to 81 billion U.S. dollars. The giants Amazon, Microsoft and Google are not bad money. According to relevant "Wall Street Journal" website and other media reports, the three companies invested a total of 41.6 billion U.S. dollars in capital expenditures and capital leases, an increase of 33% over 2016. High investment also brought high output. In 2017, Amazon’s AWS cloud business revenue reached US$17.5 billion, an increase of 43%. According to JP Morgan's estimates, Microsoft's Aure cloud business revenue has almost doubled.
However, in the Chinese market, taking the public cloud as an example, according to IDC's relevant report data, in the first half of 2017, besides Google that has not basically entered China for some reason, foreign cloud service provider Microsoft Azure (operated by Century Internet) And Amazon AWS (operated by Halo New Network) did not enter the top five.
To know that even if it is strong like Apple, since February 28 this year, it will also transfer the iCloud service in mainland China to Cloud Big Data Industry Development Co., Ltd., which is responsible for operations. The Internet has brought about the equal flow of information, but Internet companies want to seize the hills but have to consider geographical issues. Perhaps what song to sing in the mountains and do as the Romans do is the most important skill for foreign cloud companies to plough the Chinese cloud service market.
Write last
At the end of last year, Gartner, a well-known market research company, issued a report that the global cloud computing market will reach 411 billion U.S. dollars by 2020. The huge market has also attracted companies from all walks of life. Among them, Internet companies have made great strides in making the cloud service market full of expansive agents, and it is full of various pitfalls. No matter whether it is a giant or a start-up cloud manufacturer who wants to catch up, nobody can sit back and relax, but always be alert to the danger of falling into a trap while advancing. The original professional manufacturers also need to maintain their strategic strength in an increasingly impetuous industrial environment so as not to become trapped in the Internet's thinking.
BAT is going to be deployed, will the cloud service market be insular? Will the cloud service market be sea water or flame in the future? All this can only be given time, and we can give us an answer...
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