Cloud computing concerns remain, despite growing acceptance
Jim Schakenbach | Mass High Tech | August 28, 2009
The concept of “cloud computing” has been around perhaps longer than most of us realize. It popped up almost a decade ago as grid computing, software-as-a-service (SaaS) and virtualization began to take hold. Software companies and service providers started developing “pay as you go” products and services that helped reduce computing technology capital expenditures for companies that had the need but not the cash for heavy-duty IT infrastructures.
IT cloud services are entering a period of accelerated adoption, according to a recent user survey by Framingham-based research firm IDC. Cloud computing is ready to cross over from being an early-adopters market to one of mainstream acceptance and use over the next three years.
The term “cloud computing” — as just about everyone who uses a keyboard now knows — originated with the use of a cloud symbol in network illustrations to depict a nebulous, off-premise network environment. While the definition of what really constitutes the cloud remains vague, it is generally understood to include three main on-demand service areas: software, infrastructure and platform. Major service providers such as Amazon.com Inc. and Google Inc. have played key developmental roles in the growth of cloud architectures, having beefed up their data center capabilities and capacity as a result of the technology downturn and infamous dot-com bubble burst back in 2000.
“Amazon has helped define the market,” said Will Kohler, a partner in Needham-based investment firm Prism Ventureworks. “They can offer data storage services at very high scalability levels, which is critical for cloud computing, and that’s a very hard thing to architect.”
Sonian Inc. of Needham is one of Prism’s portfolio companies and, according to Kohler, a good example of one of the few New England companies filling the needs that exist for optimizing the cloud. “We look for companies that are looking to leverage existing cloud infrastructure,” commented Kohler. For Sonian, that means using Amazon’s enormous data center capacity to power its email-archiving software, which it’s offering as a SaaS application.
Sonian founder and CTO Greg Arnette agreed that Amazon’s infrastructure and massive data storage capacity plays a key factor in the services that his company has been able to develop. “If Amazon hadn’t provided access to infrastructure as a service, we’d be doing something else. But because we’re providing a software and innovation layer on top of their hardware infrastructure, we can offer a reliable data management system in a hosted service environment.”
While there has been hype surrounding cloud computing, how quickly it will see widespread adoption and what actual benefits will be realized, there are several things that are clear: Cloud computing is generally fast and easy to use, it can reduce in-house capital expense and staffing, and both the services and costs are scalable. However, there are downsides too. Performance and availability can be problematic, it often can be difficult to integrate with in-house IT infrastructures, and security remains a big issue. There are social and legal concerns as well, according to Michael Stiefel, principal of Reliable Software Inc. and a consultant on software architecture and the alignment of information technology with business goals.
“It all boils down to two main areas of concern, trust and the concept of ‘utility computing’ — of paying for computing service as you would for electrical or telephone service,” said Stiefel. He said Microsoft Corp., Google, and Amazon have changed the way people view and use data storage.
“Whether people know it or not, everyone has data in the cloud, and that can make people nervous,” said Stiefel. “Big companies now store important data for people who do not have relationships with those companies. Do you trust them with your data, which could be stored virtually anywhere in the world? It’s a big issue.”
Stiefel also pointed out a weakness in the cloud-computing space that is not getting as much attention as it deserves: “Utility computing requires an awful lot of social infrastructure — companies, equipment, services and relationships that are used to processing data in the cloud. Suppose a company handling your data and hosting your applications goes bankrupt and their equipment is seized? What happens to your applications and servers?”
Steiefel said that a lot more effort has to be put into updating laws to provide additional protection for people and companies that rely on cloud technology to provide them with data storage and mission-critical applications.
Still, said Stiefel, the benefits of cloud computing outweigh the drawbacks.
“If you need massive amounts of computing power temporarily, cloud computing is ideal,” said Stiefel. “For companies that want to operate on Internet scale — companies with lots of data users or a need for geographically wide data distribution — the economics of cloud computing are compelling, especially for small to medium-sized businesses. The cloud is almost a no-brainer.”
What the analysts are saying about the move to cloud computing
Comments drawn from recent research by IT research firms.
Survey results confirm strong interest in cloud infrastructure-as-a-service (IaaS) but debunk several stereotypes. Large firms are more interested in cloud IaaS than small firms. Firms are interested in cloud services slightly more than internal cloud — not, as conventional wisdom has it, much less than internal cloud. Firms are equally comfortable with all major workload types in the cloud and are almost as comfortable with production apps as they are with test and development usage. For all vendor strategists, this means focusing on enterprise and SMB both — not leading with SMB — while product vendor strategists also need to develop different messages for enabling internal cloud versus supporting use of external service providers.
Forrester Research Inc.’s Frank Gillett in his report “Conventional Wisdom Is Wrong About Cloud IaaS”.
As enterprises seek to consume their IT services in the most cost-effective way, interest is growing in drawing a broad range of services (for example, computational power, storage and business applications) from the “cloud,” rather than from on-premises equipment. The levels of hype around cloud computing in the IT industry are deafening, with every vendor expounding its cloud strategy and variations, such as private cloud computing and hybrid approaches, compounding the hype.
Gartner Inc. in its report on technologies on the “Hype Cycle,” which positioned cloud computing and e-book readers as the two technologies at the peak of inflated expectations during 2009.
Cloud computing is coming. IT is finally catching up with the rest of the Internet by extending the enterprise outside of the traditional data center walls. And although cloud computing is transforming traditional IT, it is still immature. Lack of clarity, risk management and questionable long-term return on investment are creating consumer trepidation and obstructing cloud acceptance. Like any technology, comprehension is vital to creating a competitive advantage. The best organizations will use cloud computing’s unique business model, elasticity and scalability to streamline IT operations, offload lesser-value IT processes and focus on driving core business value.
Burton Group analyst Drue Reeves in the report “Cloud Computing: Transforming IT.”
Numbers in the cloud
Definitely a silver lining
Research firm IDC views cloud computing as “an opportunity in its infancy, but, even conservatively, poised to drive big marginal growth.
Spending 2008 2012
Core IT areas $383.3B $493.7B
Cloud services $16.2B $42.3B
Cloud as percent of total 4% 9%
The breakdown: Storage grows
Where cloud service spending is occurring now, and how it will look in 2012
IT area 2008 2012
Business applications 57% 52%
Infrastructure software 18% 18%
App development/deployment 11% 9%
Server 9% 8%
Storage 5% 13%
25% — The percentage of growth the cloud services will account for between now and 2012 in business applications, application development, infrastructure software, storage and servers
Jim Schakenbach is a freelance writer in Jefferson.
