A hyperscaler is a cloud infrastructure provider that operates computing, storage, and networking resources at massive global scale. The term is most commonly applied to Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP), though other providers such as Oracle Cloud and Alibaba Cloud are sometimes included. Hyperscalers build and operate data centers across dozens of regions worldwide, providing the foundational infrastructure on which other companies build applications, deliver services, and run workloads.
Scale, elasticity, and service breadth
Hyperscalers provide infrastructure-as-a-service (IaaS), platform-as-a-service (PaaS), and an expanding portfolio of higher-level services (databases, AI/ML, analytics, security) that other organizations consume on a pay-as-you-go or committed-use basis. Their scale enables economic and technical capabilities that smaller providers cannot match:
- Global data center footprint: Dozens of regions and availability zones across multiple continents, enabling customers to deploy workloads close to their end users.
- Elastic capacity: The ability to scale compute and storage resources up or down in minutes, absorbing demand spikes without requiring the customer to provision or own physical hardware.
- Service breadth: Hundreds of individual services spanning compute, storage, networking, databases, machine learning, IoT, developer tools, and security.
- Marketplace platforms: Digital storefronts where ISVs and partners list, sell, and deliver their solutions to the hyperscaler’s customer base.
- Partner programs: Formal programs that certify, incentivize, and co-sell with technology and services partners.
Reshaping channel strategy for ISVs and partners
Hyperscalers have reshaped the technology ecosystem in ways that directly affect channel strategy:
For ISVs and technology vendors
Hyperscalers are simultaneously platforms, distribution channels, and co-selling partners. An ISV that runs on a hyperscaler’s infrastructure can also list on its marketplace, access its customer base, and co-sell with its field team. This makes the hyperscaler relationship multi-dimensional:
- Platform dependency: If a vendor’s product runs on AWS, the vendor’s infrastructure costs, performance characteristics, and compliance posture are tied to that hyperscaler.
- Marketplace distribution: Listing on a hyperscaler marketplace provides access to thousands of buyers who already have procurement relationships and committed cloud budgets.
- Co-sell programs: Hyperscalers like AWS and Microsoft operate formal co-selling programs (e.g., AWS ISV Accelerate, Microsoft co-sell) that connect partner sales teams with the hyperscaler’s field organization.
- Committed spend drawdown: Customers with committed cloud spend agreements can often apply those commitments to marketplace purchases from ISVs, making buying through the marketplace financially attractive.
For channel partners
Hyperscalers create both opportunities and challenges for traditional channel partners:
- New revenue streams: Partners can build managed services, consulting practices, and implementation services on top of hyperscaler platforms.
- Certification requirements: Hyperscalers require partner organizations to earn certifications and maintain competency levels, creating a continuous training investment.
- Marketplace competition: As more software transactions flow through hyperscaler marketplaces, traditional resellers face disintermediation unless they add value through services.
Engagement models and strategic considerations
Hyperscaler partner ecosystems
Each major hyperscaler operates a layered partner ecosystem:
| Hyperscaler | Key partner programs | Marketplace |
|---|---|---|
| AWS | AWS Partner Network (APN), ISV Accelerate, SI Alliance | AWS Marketplace |
| Microsoft Azure | Microsoft AI Cloud Partner Program, co-sell program | Azure Marketplace / AppSource |
| Google Cloud | Google Cloud Partner Advantage | Google Cloud Marketplace |
Engaging with hyperscalers
Vendors and partners engage with hyperscalers through several motions:
- Build: Architect and optimize the product to run on the hyperscaler’s platform. This may involve leveraging native services, meeting performance benchmarks, and passing technical validation.
- List: Publish the product on the hyperscaler’s marketplace with appropriate pricing models (SaaS, AMI, container, professional services).
- Co-sell: Register joint opportunities with the hyperscaler’s sales team. When a hyperscaler account executive is involved in a deal, close rates and deal sizes tend to increase.
- Influence: Align with the hyperscaler’s strategic priorities (e.g., AI, data modernization, security) to earn higher visibility in the hyperscaler’s go-to-market motions.
Strategic considerations
- Multi-cloud reality: Most enterprise customers use more than one hyperscaler. Vendors and partners that support multiple clouds avoid limiting their addressable market to a single hyperscaler’s customer base.
- Marketplace economics: Hyperscaler marketplaces typically charge a percentage of each transaction (commonly 3% to 5% for ISVs in co-sell arrangements, higher for standard listings). This cost must be factored into pricing and margin models.
- Co-sell investment: Earning a hyperscaler’s active co-sell engagement requires sustained investment: dedicated alliance managers, joint solution architectures, and shared customer success stories. The payoff can be substantial, but it is not automatic.
- Dependency management: Deep alignment with a single hyperscaler can create strategic risk if the hyperscaler changes its pricing, competes with the vendor’s product category, or deprioritizes the partnership. Maintaining optionality across hyperscalers mitigates this risk.