Can Hardware and OpEx Work Together?

As you know, one of the things that nScaled does a bit differently from other cloud infrastructure-as-a-service (IaaS) providers is we implement a Hybrid architecture, with an nScaled Local Cloud Appliance installed on the customer’s LAN providing business continuity and local backup, plus the nScaled Remote Cloud Data Centers providing the scale-up / scale-out elastic capacity for backup, failover and test/dev.

We think it’s the right architecture for corporate IT shops that want safe, secure and flexible cloud infrastructure. But it brought up a challenge in our pricing. See, customers have come to assume (rightly) that cloud services are billed monthly and move off their capex budget and onto their opex. Sweet. But everyone assumes that appliances are paid for with capex. We sure did.

To be honest, we didn’t realize we were messing with customers’ expectations when we priced our Local Cloud Appliance as upfront spend (capex) and the rest of our services as opex. But customers and our sales team saw the impedance mismatch, complained, and we saw the light pretty quickly!

So we recently reset our appliance pricing so that it’s billed monthly, just like everything else. Now our customers have the 100% opex solution pricing they want, and our sales team has a nice simple story to tell prospective customers.