Cloud Computing: The Road Ahead: Page 2

A look at various cloud computing markets by revenue, along with top research firms’ predictions of the trends to watch.
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Recent Cloud Computing Trends and Views

When other companies secretly guarded information pertaining to their huge data centers, Facebook surprised the world recently by sharing all specifications of their data center in Oregon through their open compute initiative. They claimed that the innovations in its new data center have enabled it to use 38% less energy than other facilities that perform similar functions

The company said the new data center costs 24% less to run than an equivalent data center.  The data center has a power usage effectiveness (PUE) ratio of 1.07. Is it possible for anyone else to provide infrastructure services cheaper than this? Is their intent to spur innovation by creating open source hardware and an ecosystem just like Google’s Android ecosystem?  

Cloud storage-as-a-service was a hot topic of discussion about a year ago. This section of the industry, once considered promising, is running into trouble. Companies like Iron Mountain, VaultScape and Cirtas have closed their storage service offerings.

One of HP’s VP had laid out some points on his LinkedIn public profile which talks about having different services such as object storage, compute, networking, block storage and other common/shared services. He mentioned an innovative and highly differentiated approach to cloud computing – a declarative/model-based approach where users provide a specification and the system automates deployment and management. Its platform could play nice with Java, Ruby and other open source languages. HP may release specifics of their overall cloud strategy at VMworld conference later this month.

Siki Giunta, VP of Cloud Computing at CSC, says that in the future, professional services firm would provide a set of standardized cloud services that the clients would pick up from the firm’s services catalog. The client would sign appropriate SLAs with the firm to meet their business needs. IT services would become more commoditized. Half of all IT workloads, she says, will become cloud services by 2016.

On the other hand, Diane Bryant - CIO of Intel, talks not about IT as providing standalone IT services but strategically enabling and enhancing business services and being central to the overall corporate strategy.

An article by Phil Wainewright (blogger, analyst, consultant) clearly identifies the crux of the enterprise strategy that cloud players should be mindful of: “If an enterprise is focusing on the infrastructure layer to build its cloud strategy, then it’s looking in the wrong direction.” 

Last, but not the least, there is a flurry of acquisitions taking place in the cloud computing sector. The year 2010 saw major players positioning themselves by acquiring companies mostly in the infrastructure and platform domain. Early this year, Verizon purchased Terremark for $1.4 billion in a move to accelerate its "everything-as-a-service" cloud strategy. Time Warner Cable (TWC) announced that it will acquire managed hosting and cloud services provider NaviSite for $230 million.  In April, CenturyLink acquired Savvis Inc. for $2.5 billion. VMware acquired Sliderocket, a cloud-based online presentation application that produces slide shows that rival PowerPoint – perhaps to provide Presentation-as-a-service. VMware most recently acquired IT management firm Shavlik.

The Road Ahead

Joe Tucci (Chairman and CEO of EMC) in his keynote address at EMC World on May 10, 2011 said, "I've never seen in my 40 years (in IT) infrastructure transformations, application transformations, and user transformations going on at the same time."

Here are some important points to be considered by every organization at this juncture, as this cloud computing  journey moves forward with twists and turns, with innovations and acquisitions.

       .   Cloud computing is here to stay despite its recent problems.

       .   So far, a majority of the talk has been about IaaS. This will shift to PaaS and SaaS shortly.

       .    Cloud strategy with focus on IaaS is no strategy. PaaS and SaaS should be important for the overall strategy.

       .    SaaS market is huge compared to PaaS and IaaS.

       .    Every organization should take initial steps to educate employees about cloud computing.

       .    Get on to the bandwagon now – ensure your organization has a cloud computing strategy integrated into your IT and business strategy.

       .    Ensure that you have an architecture updated regularly encompassing all the three layers (IaaS, PaaS, SaaS) and the different deployment models (private, public, hybrid).

       .    Adopt workloads which need limited security. Security is still an area of concern especially with public clouds.

       .    Implementation should start with a pilot and a clear understanding of ROI and scaling for the next 2-3 years. Present changes prevent planning longer than that.

Forrester projects that a massive 80% of spending on public cloud IT next year will be spent on SaaS. A far smaller 11.5% share will be IaaS, and while PaaS is growing fast, it is still set to remain a small proportion of total cloud expenditure relative to SaaS. 

Whatever the numbers maybe from all the different sources, sliced and diced by various categories and sub-categories, one thing is clear. Every category in this cloud ecosystem can claim to grow substantially as compared to almost all of the other non-IT markets.

There will be growing pains, security issues and many instances of ‘cloud-washing’ reducing the credibility of cloud computing during this journey, like any other macro trend. Does it matter whether it is the shadow IT in an organization or CIO or business unit promoting and embracing cloud computing?

There would be tremendous opportunity for innovation and change in this area for years to come before another such wave takes over the market due to constraints and needs of that time. Federal Cloud Computing Strategy released by US CIO earlier this year summarizes it beautifully, paraphrasing Arthur Eddington: Cloud computing will not just be more innovative than we imagine; it will be more innovative than we can imagine.

About the author: Damu Kuttikrishnan has over 20 years of experience  in various areas of IT including  project, program & portfolio management; operations; strategy; planning and change transformation. He is a six sigma lean black belt with experience in developing, streamlining and managing strategic programs. He is a strategic thinker and facilitator with focus on collaborative leadership to accomplish organizational goals. He can be reached by email at maildamu@gmail.com

Disclaimer: The opinions expressed herein are my own and do not in any way represent the thoughts, intentions, plans or strategies of my employer.

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Tags: cloud computing, virtualization, private cloud, public cloud, hybrid cloud

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