Insight

Cutting through the cloud hype

cloud_computingCloud computing is no longer a new concept, and many organisations have been consuming cloud services for the past several years. The use of cloud computing is growing, and by 2016 will increase to become the bulk of new IT spending, according to Gartner.

While still a very visible and hyped term, I believe it has now clearly passed the phase of over-enthusiasm and unrealistic projections. There are signs of fatigue, rampant ‘cloudwashing’ and disillusionment, particularly from highly visible failures such as Amazon, Microsoft, Google and Apple. Despite this, it remains a major force in IT.

What we are now seeing are businesses changing their buying behaviours. Improving efficiency, delivering operational results, reducing enterprise costs and improving IT applications, infrastructure and legacy, are all top business priorities for CIOs, according to Gartner’s CIO Agenda Survey for 2013. For example, Australia and New Zealand CIOs ranked cloud computing as their number-two technology priority this year, after mobility.

Although it is unlikely businesses will completely abandon on-premise models or soon buy complex, mission-critical processes as services through the cloud, there is a movement toward consuming services in a more cost-effective way and toward enabling capabilities that are not easily done elsewhere.

Gartner believes cloud computing will reach an important transitional point in 2014, as many organisations will look to move cloud computing past the early phase of it being used for low-hanging fruit and constrained business cases, into more widespread, production adoption. We believe businesses will spend 2014 considering and planning how they will use cloud services for more strategic and value-generating business cases. The time is ripe for transition because businesses and providers are both evolving, and patterns for hybrid cloud, applications and risk management are taking shape.

As aspects of the cloud move into mainstream adoption, each technology needs to be looked at and assessed separately. No doubt there will be misunderstanding and confusion specific to each aspect of the cloud, not just to the overall term. Driving a lot of this confusion is ‘cloudwashing’. Technology vendors are grabbing hold of the term cloud and using it for marketing purposes in an attempt to jump onto the cloud bandwagon, even though what they are offering isn’t really cloud computing. Hosting solutions, for example, which have a pay-per-user-per-month pricing model, but without shared elastic capabilities, are being labelled ‘cloud’.

As cloud is used to apply to an ever-widening set of external services, without regard to sharing, elasticity and the other characteristics that set it apart, the term becomes even more unclear. Often what we see are companies that buy these cloud services, then be surprised to find that they do not get the agility and cost savings promised by cloud computing. Since it does not live up to its overinflated expectations, cloudwashing is creating a sense of disillusionment.

Cloud computing is really about a very simple idea—consuming and/or delivering services from the internet. There are, however, many issues regarding the types of cloud computing and the scope of deployment that make the details not nearly so simple.

Everyone has a perspective and an opinion, and although some aspects are coming into focus, confusion remains the norm. Many misconceptions exist around potential benefits, pitfalls and, of course, cost savings. Cloud is often part of cost-cutting discussions, even though its ability to cut costs is not a given. There are also many reasons to talk about the capabilities enabled by cloud computing: agility, speed and innovation. These are the potential benefits that can be overlooked if hype fatigue sets in.

Although the term “cloud computing” is relatively new, it incorporates derivations of ideas that have been in use for some time. Hosting, software as a service (SaaS) and virtualisation are well-established and are being used in many ways. The prevalence of inexpensive computing power, inexpensive bandwidth and companies that have developed extensive capabilities in managing large data centres are all relatively new and are all required for the cloud to come to fruition.

Some concepts born in the cloud have begun to take on largely hyped lives of their own. Private cloud computing and platform as a service (PaaS) are now more hyped than the term “cloud”. Big Data is becoming a popular term and phenomenon. One term in particular, “hybrid cloud computing”, is in many ways replacing cloud computing as a catch-all category that vendors (and businesses) are using as the overall umbrella term.

Cutting through the hype surrounding cloud computing is a no doubt a challenging process. It is important to be educated to assess how your business can leverage the benefits of cloud computing. While the term is being used in many contradictory ways, cloud heralds an evolution of business—no less influential than the era of e-business—in positive and negative ways.

Overall, there are trends toward cloud platforms and massively scalable processing. Virtualisation, service orientation and the Internet have converged to sponsor a phenomenon that enables individuals and businesses to choose how they will acquire or deliver IT services with reduced emphasis on the constraints of traditional software and hardware licensing models. Services delivered through the cloud will foster an economy based on delivery and consumption of everything.

Developing a business case for using a cloud computing solution largely remains an unstructured process because of the hype. As a result, organisations fail to identify or communicate the key benefits of the right solution. This results in poor backing for strategic initiatives, insufficient funding and correspondingly poor results.

To be successful, it is important to understand the context of the current cloud computing market and the key trends, understand the potential risks and opportunities, then determine how you can apply these trends to benefit your organisation.

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