Cloud Market Cascades
The uncertainty and lack of confidence in the United States economy is driving up demand for Cloud Computing. Organizations are delaying or cutting back on capital expenditures and reducing operating costs. CEOs are looking for ways to improve ROI. The Cloud’s efficiency, rapid time to implement, and cost effectiveness has caught the attention of CIOs, CEOs, and IT Managers. Accelerating adoption across a broad range of industries is driving up demand to levels unthinkable a few years ago.
The desire to move into the clouds is quickly turning into a necessity, with a wide range of internal and external forces leading the charge. Redundancy, efficiency, availability, simplicity, stability or just plain & simple economics, every entity has its own unique set of reasons for moving into the clouds. With its inherent time and cost benefits, It’s no surprise that there is a growing wave of support for Cloud Computing, with some of that support coming from some unlikely places.
The adoption of Cloud Computing has had a cascading effect. Once user acceptance is achieved, companies often experience cascading benefits. The main driver for launching the first cloud computing application is usually to save money. Executives want to leverage high-quality applications that would be expensive in an on-premise format. But later, adopters discover other eyebrow-raising advantages. Take scalability, for example. In addition to its cost advantages, cloud computing offers speed and convenience in adapting to growth, new locations, staffing changes, and reorganizations. As some Google Apps fast-growing customers find, all it takes to open new locations is to open new accounts and train the staff. Ultimately the realization comes that cloud computing boosts productivity and fosters innovation through networking, remote access, and collaboration. Examples include real-time editing of documents by multiple authors, the ability to easily share rich media files from web sites, and YouTube-like usage of video within the enterprise.
Recently, a once reserved Gartner highlighted the benefits of cloud computing, stating; “The technologies that CIOs are prioritizing in 2010 are technologies that can be implemented quickly and without significant upfront expense, instead of investing millions of dollars to get millions in benefits, with these technologies, up front investments are measured in thousands of dollars to get those same benefits”. In the same report, where the opinions of 1586 CIO’s were polled, it was discovered that there has been a dramatic shift in global technical priorities. Amazingly, the #1 technological priority for the past five years has all but dropped off the list, being replaced by Virtualization & Cloud Computing.
In addition to the CIO’s of the world, another area where Cloud Computing is gaining serious momentum is within the U.S. Government. It is clear that one of the world’s largest political entities is doing more than assessing the clouds viability, but rather, running down the path towards broad adoption. In an interview with Information week, Obama’s Federal CIO, Vivek Kundra stated: “The cloud computing investment in the 2010 budget reflects the administration’s desire to drive down costs, drive innovation across the federal government, [and] make sure we’re making available technologies to the workforce”.
While the executive branch of the Government is currently in the late planning to early implementation stages, other agencies within the government have already moved into the clouds. Among the front-runners are NASA’s NEBULA Cloud Computing Project, the Defense Information Systems Agencies DoD RACE Cloud, the Department of Homeland Security Cloud Strategy, and a handful of other agency-driven initiatives. One of the more exciting initiatives is the GSA’s approach to centralizing approved Cloud Computing Vendors, as well as plans for the agency to become the central clearinghouse for government backed private, public and semi-public cloud based applications and computing capabilities. To jump-start this effort, the Obama Administration, in conjunction with the GSA, launched www.APPS.gov, an all new centralized government storefront for everything cloud service related. It is apparent that cloud based technologies are becoming so prolific, even the U.S. Government is getting on-board.
While private, public and governmental initiatives are a good sign of progress in the Cloud Services segment, other sure-fire indicators include innovation and investment. In addition to the hundreds of millions invested by leading cloud service providers like Amazon, Google and others, Microsoft and HP have put their hats into the ring with a USD $250 million investment in Cloud Computing. This extended partnership is aimed at building a new cloud based ‘infrastructure-to-application’ service that will “transform the way large enterprises deliver services to their customers”, tackling both the expansion and innovation of cloud services in a single leap. According to Microsoft’s CEO, Steve Balmer; “This agreement, which spans hardware, software and services, will enable business customers to optimize performance with push-button simplicity at the lowest-possible total cost of ownership”.
Worldwide, there are countless examples of how Cloud Services are re-shaping the way we think about our computing needs, but some industries are moving slower than others towards adopting this disruptive technology. The Financial Data Industry, with its transpiring low latency arms race and troubling regulatory concerns, has all but shunned the Cloud Computing paradigm, citing a host of philosophical concerns.