Cloud computing mainstream still two years away


Cloud Computing Update

Cloud Computing has passed its hype peak in the marketplace.  Even though cloud computing technology conferences started appearing around five years ago, mainstream adoption is still a couple of years away. The first users of cloud computing are mainly small businesses, start-ups, enterprise test environments and rogue departments.

Large enterprises are adopting a private cloud which are exclusive hosting services allowing IT departments to control services offered and hopefully help split costs based on usage.

We note that many IT “infrastructure-as-a-service players, including those in Australia are offering ability to have a hybrid network where you maintain your existing network and use public resources for peak periods. The reason we claim that cloud computing is still a couple years away is mainly because only a few players are offering the “brokering” service that is required to make it easy to purchase computer (i.e. CPU, memory or storage) resources “on demand”.

A true cloud computing offering gives you a commodity service where you only pay for what you need (PAYG). Most of the cloud services offered are based on signing 1 to 3 year contracts which are not much different from the traditional hosting services offered over the last decade. The best offerings will allow you to pay per month. We are not aware of generic compute services that allow you to pay based on hours of metered usage such as your gas, electric or water bill, yet this flexibility to offer an hourly based service is what is required for true cloud computing.

Issues to adoption

Perhaps it is old news that one of the biggest stumbling blocks to adoption is security, yet those offering cloud computing services often have better security than the average enterprise network. Macquarie Telecom, for example, would have much better security than the average server farm network. They’d have a much better chance offsetting the typical “denial of service” attack.

The real gotcha’s on moving your information to the cloud is more related to control and privacy. If you have no control over where your data is stored, you are more vulnerable to data being made available. As an example, it is easier for US authorities to gain access to data in 3rd party services than it is if stored on a PC.

Privacy is therefore defined differently once you hand over your data. The US authorities can also use national security as reasons to confiscate your data. Even using encryption methods to guard privacy, you’d still lose control. So mandating that the data stay in Australia is a good start.

The other issue of adoption is the plethora of different IT systems. Many legacy systems were not built to work on cloud computing technologies. Small companies usually are more nimble since they are not lumbered with complex legacy systems.

Why are small business early adopters?

Centralised service delivery and utility based pricing are the essence of cloud computing. Software as a Service is part of the overall delivery of cloud computing where you can pay for specialised software to be hosted on a per use bases.

Small companies can shop for cloud based accounting packages, e-mail and CRM which all have pay per user pricing available. The advantage of paying per user is you do not have the huge one-time capital cost and ongoing maintenance. You instead have an operational expense that can be expanded or reduced based on your business needs.

While this is still not true cloud computing, it is a step in the right direction.

Call us today to discuss cloud computing for your business.