CTO Blog
Over the last few weeks there has been a succession of ‘serious’ conferences. By this I mean gatherings of people trying to make sense of, and come up with answers to, issues that matter around people and technology. Sadly the so called ‘Chatham House rules’ mean it is impossible for me to report on the details, but the breadth and depth of the discussions provided fascinating insight into why the topic of clouds seems so confusing in terms of what it covers and delivers.
Is cloud computing the next generation of IT systems offering tremendous cost cutting potential? Is it the ability to create new markets and marketplaces? Or is it an entirely new business model to enable innovation in smaller companies and start-ups by reducing capital, time and skill requirements? Moreover, beneath each of these statements sits differing attitudes about the core approach to the technology elements involved.
During the presentations and the debates something simple, yet quite surprising, hit me. The three major regions – North America, Europe and India’s perspective on clouds are all quite different, and all based on the business models of the leading commercial organisations in their regions. This may be an oversimplification, but it is both recognisable and, I would argue, understandable. So how do I see the drivers that are defining clouds in each region?
North America: the market is largely created and driven by the group of major technology vendors who quite naturally want to be able to grow their current installed customer base and sell more of their products in an upgrade cycle. This leads to their marketing messages emphasising how to change existing IT with improvements and reductions in operating cost positioned in a manner that will appeal to their existing customers’ IT challenges.
Europe: has a market driven by ‘services’ companies, and diversity of the environment at a local level in terms of how European enterprises go to market in different countries and regions. It also has the EU driving policies to create common business markets through which citizens will access government services not only at a country level but at an EU level – the Malmo Initiative. Taken together this has produced an emphasis on creating externalised shared markets in which to do business.
India: is more complex being a stakeholder in the North American and European markets with concerns on how ‘services’ as software objects will be built and sold. On the other hand – together with China – there is the issue of their local markets, where dynamic rapid growth across large geographic areas calls for the use of ‘as a service’ models to cut capital costs, time, and skill requirements of conventional IT. Here, the ability to use ‘cloud’ models to shape new economies is a real game-changer.
And there you have it. Three different drivers and goals in three major regions, each of which calls for a definition of cloud technology to suit the core focus. Yes, for each primary driver there is then an overlap with various aspects of the other two drivers, but much of that is getting ‘drowned out’ by the marketing messages championing the primary driver.
Is this a stunning insight that helps explain the confusion and mixed messages, or have I got it all wrong?? I hope that we can move this debate along to clarify for all our sakes exactly what the primary driver for our enterprise will be.
Look forward to your views!!
About the author
Capgemini Global Chief Technology Officer, Andy is a member of the Capgemini Group management board and advises on all aspects of technology-driven market changes, together with being a member of the Policy Board for the British Computer Society. Andy is the author of many white papers, and the co-author three books that have charted the current changes in technology and its use by business starting in 2006 with ‘Mashup Corporations’ detailing how enterprises could make use of Web 2.0 to develop new go to market propositions. This was followed in May 2008 by Mesh Collaboration focussing on the impact of Web 2.0 on the enterprise front office and its working techniques, then in 2010 “Enterprise Cloud Computing: A Strategy Guide for Business and Technology leaders” co-authored with well-known academic Peter Fingar and one of the leading authorities on business process, John Pyke. The book describes the wider business implications of Cloud Computing with the promise of on-demand business innovation. It looks at how businesses trade differently on the web using mash-ups but also the challenges in managing more frequent change through social tools, and what happens when cloud comes into play in fully fledged operations. Andy was voted one of the top 25 most influential CTOs in the world in 2009 by InfoWorld and is grateful to readers of Computing Weekly who voted the Capgemini CTOblog the best Blog for Business Managers and CIOs each year for the last three years.
Andy
Agree with your assessment on the regions North America and Europe and doubt if India can be grouped the same way continents are grouped [ except it is related to Population..]
Cloud computing that started out piggy-backing to Virtualized Compute & Storage environments has made all IT and Product & Service vendors spin their own definition, potential solution set etc. The Software as a Service – SaaS vendors also use the same paradigm. However Enterprise clients getting their feet wet on Virtualized Compute/ Storage thru’ their own GRIDs or few applications on CLOUD (that has less impact to their backend business systems – but reaching out to Customers in the CRM/B2C space..).
Many enterprises copying the trend from IT Service/product vendors have started praising themselves on calling their data center consolidation, virtulization as PRIVATE cloud and also reaching out to PUBLIC – Internet clouds for Consumer marketing and advertising based applications.
“Is CLOUD a cost saver really? ” is making those in the “To-Be or not To-Be” procastinators of emerging technologies waiting for every technology blip to pass them like a cloud.
I see more of Business Technovators using the CLOUD as a channel for reaching consumers. All of a sudden with the CLOUD wannabe’s vs wish-its-not-truer’s, many thoughts seem to be taking place including adding a COST model to include – figure out the cost of MOVING out of the CLOUD also while considering Moving into Cloud – like the real estate problem of RENT, LEASE vs BUY issues.
I think 2010 would be clearing the CLOUD for more applications that may expand furhter than sales & marketing, Intense Compute jobs into other areas as SECURITY, GOVERNANCE, Monitoring and managing CLOUD and internal or hosted environments are becoming closer and in some organizations – may become BOUNDARYless. This again is a trend of B2C/ B2B / B2E blur of applications thru’ very innovative technology solutions from the areas of Social Computing and Mobility. Cloud may become App Store of Global Enteprises with appropriate security! (Santa’s elves from Cloud product/service providers working on GIFTS!)
Hi Sundar
a good observation on vendors writing their own definition and that it will start to sort it self out in 2010.
The clear point that i have seen again and again and heard confirmed by others is the differences around coming at it as a technology infrastructure move to cut costs for IT on its current funding model, versus coming at it as a business solution for business users based on new business requirements funded not by the IT budget but by a seperate business budget.
i suspect that we will see these two directions becoming clearer and more clearly defined
Hi Andy,
With all various thoughts on cloud and too much of it everwhere I tried to understand in a simple clear way.
What is cloud?
It is a On-demand Provisioning of IT Infrastructure enabled by a scalable and Virtulized IT infrastruture as a Service.
Now it’s up to every CIO/CTO to play a part in the CLOUD. (Software/Hardware products , Software services, Package solutions ….etc)
mmm – its interesting how existing IT is referenced back into the cloud model. Its logical i guess but if you go back to the begining and the decision to call this new emergent approach to using technology the goal had little or even nothing to do with existing and conventional IT.
Infact it was deliberately a move to by pass the technology and applicaiton of applications, statefull and close coupled client server systems in favour of using a model based on Web architecture meaning loose coupled and stateless infinately scalable delivery of an ‘any to any’ environment driven around people and interactions rather than computors and data.
The objective was – and is – to allow users and workgroups to do what they want and need including orchestration without having to think about or know anything about the supporting technology which was represented to them as a ‘cloud’ rather than a specific architectural diagram.
The XaaS – everything as a service – model came along after that as a commercial model to change the funding method to direct user consumption and payment as the annual budgeting and overhead recovery funding model is clearly unsuited for such a dynamic quick to change environment.
Thanks Andy – that’s a point i really didn’t know and yet we (all) refer to chatham house rules from time to time. I must say that i had always understood it to mean not to reveal anything that was said in the room.