Why Early-Adopters Embrace the Cloud

Cloud computing is all about new technology, right? Well, perhaps that depends upon your point of view -- as an application developer, or a business decision maker.

Private Cloud development will grow during the coming year, with 48.9% of developers expecting to deploy applications (via their on-site data center), according to a survey of 500 software developers by Evans Data Corp.

Their survey showed that 29.7% are currently working on applications destined for a private cloud environment, while an additional 19.2% expect to enter development within the next 12 months.

Taking Baby Steps with Cloud Computing
"Software developers are finding many reasons to develop software for the cloud, whether for a private cloud or public cloud," said John Andrews, President and CEO of Evans Data. "Not surprising, while developers want to take advantage of the cloud, our research indicates a strong preference for them to favor a cloud related development environment to simply extend their existing technology know-how."

The survey measured the intentions and adoption patterns of developers. This included Public and Private Cloud development -- types of apps moving first to the Cloud, development dynamics and tools for developing in the Cloud, data centers and virtualization, security, regulations, benefits, and inhibitors.

"Private clouds seem to be appealing for the easier methods of deploying and automating software delivery rather than the elasticity, and different pricing, that drove the initial fervor in public clouds," commented Michael Cote, software industry analyst for Redmonk.

Michael Dortch, acting director of research at Focus, said "Frankly, I'm surprised it's only 48 percent of developers, given that software as a service and other cloud-based elements are the only piece of the current software marketplace showing consistent, significant growth."

The survey results expose the trends. Half of the developers using Amazon public cloud services are adopting them experimentally or for prototyping -- rather than for business critical applications.

Three quarters of developers think that data for applications deployed in the cloud should be backed-up outside the public cloud -- either in traditional on-site storage or in a private cloud.

Fearless Early-Adopters Seek an Advantage
"The buying community is setting themselves up for another cloud spending moment once they decide public clouds are okay and move from private clouds," Cote said. "While security and regulatory concerns are very real, companies would do well to spend time asserting how they might skip some of their computing needs over the public clouds and avoid paying twice for everything."

That said, the primary motivation for business decision makers, that are early-adopters of managed cloud services, can be simply put -- strategic competitive advantage. While their peer group ponders the risks versus rewards, they're already vigorously moving forward.

Public, Hosted, and Internal Clouds Defined

Like any new business technology, the early development of cloud services can be a little confusing -- as some descriptions are still open to interpretation. However, the dialog is helpful, because it enables us to focus on the true business value of data center resources.

According to Forrester Research, cloud computing platforms are more than shared multi-tenant infrastructures on the public Internet. There are three infrastructure-as-a-service (IaaS) cloud deployment options available; each has unique characteristics and economics.

Forrester’s three cloud service scenarios follow:

Which cloud service scenario is a best-fit for your business needs? Well, that depends upon a number of related factors -- such as your organizational bias for direct control, sensitivity to risk, and overall usage requirements for a cloud computing platform.

Public Cloud Scenario
Public clouds are easily accessible, multi-tenant virtualized infrastructures that are managed via a self-service portal. They deliver superior economies of scale to customers, as the infrastructure costs are spread among all users, giving each individual client an attractive low-cost, pay-per-use model.

They are managed and supported by the cloud provider and are typically homogeneous, meaning all customers share the same pool of infrastructure with limited configuration, security protections, and availability variances.

Internal Cloud Scenario
Internal clouds have similar characteristics of a public cloud, but hosted within your own data center. They leverage more of your standard processes and protections, but tend to be limited in size and scale. Your IT organization must incur the full capital and operational costs for the physical resources.

They are best for applications where you want complete control and configurability of the infrastructure and security. This most often applies to applications that manage sensitive information that is subject to strict compliance standards.

Hosted Cloud Scenario
Hosted clouds are hybrids -- a multi-tenant cloud atop rented resources, but dedicated to a single client. They help you avoid the capital and operational expense of an internal cloud, growing and shrinking the size of the cloud as needed by simply renting more resources (often added via a pay-per-use model) but providing more custom SLAs.

They give you more flexibility, where you can adjust the security as needed, specify the infrastructure elements to be used, the SLA to be applied, and set other constraints not available on a shared public cloud.

Plus, the cloud is managed by a Service Provider -- rather than your IT team. However, the economics of hosted clouds are more like managed hosting than public clouds -- since the servers that make up the cloud are typically fully dedicated to you.

Evolutionary Pathway to Cloud Services
Forrester concludes that cloud services are infrastructure deployment options that help businesses better match the needs of the application with computing resources. It’s the integration between these infrastructures that delivers the greatest value.

The goal is to speed IT service delivery, while reducing costs. Therefore, consider all options. Ask your service provider to explain their offerings, and if they can provide a pathway to virtual private cloud services -- between your data center and their cloud infrastructure.

Demand for IT Managed Cloud Services

Business technology has gone through several major changes over the decades. Each transformation brought new ways to perform work -- it also allowed some organizations to leapfrog over their less-agile competition.

"Today's CEO concerns provide an advanced look at what will become CIO priorities in six to 18 months," said Jorge Lopez, vice president at Gartner, Inc. The focus for the IT agenda in the face of economic uncertainty and risk is flexibility, and renewed business agility.

According to Gartner's assessment, CIOs need to ensure that their IT operations are ready for the ongoing challenges and shifts that are sure to emerge.

Defined as the ability to achieve financial and strategic plans, effectiveness gives enterprises the flexibility to meet challenge with change. So, how will CIOs improve effectiveness to meet new economic and operational challenges?

Business Imperative for Cloud-based Services
IT leaders are increasingly being asked to move all non-strategic IT functions to the cloud; to develop IT core competencies and skills to manage virtual resources; and to embrace new applications that capitalize on cloud computing, collaboration, mobility and social media.

Worldwide cloud services revenue will reach $56.3 billion in 2009, a 21.3 percent increase from 2008, according to the latest study by Gartner. The market is expected to reach $150.1 billion in 2013.

Much of the cloud computing news centers on systems infrastructure as a service (IaaS). In 2008, these services accounted for only 5.5 percent of the overall cloud services market and are forecast to reach 6 percent in 2009.

"Cloud-based infrastructure services are expected to see significant adoption through 2013," said Ben Pring, vice president at Gartner. "This segment probably has the largest range of possible outcomes, depending on how aggressively cloud computing is embraced."

Cloud application services, evolving from software as a service (SaaS) offerings, were almost twice as large as the market for systems infrastructure and will continue to show strong growth.

Lower Cost Drives Cloud Services Growth
Over the next five years an increasing array of application functionality will become available as IT managed cloud services -- to supplement those current cloud applications.

"The IT market trends for the next couple of years remain highly uncertain. While short-term growth is expected to be inhibited, the potentially lower cost of cloud services is attractive to customers and will drive growth for these offerings," said Mr. Pring.

Given that backdrop, what new demand are you experiencing for cloud-based services? Are you reaching out to service providers, to learn more about their evolving on-demand service offerings?

BTR Idea Exchange - View, Post, Vote

The Business Technology Roundtable (BTR) provides information and guidance to help you understand the available options, proceed through the buying cycle, and select a best-fit provider of managed services, hosting services and evolving cloud services.

We also provide links to tools, such as a procurement checklist or buyer’s guide, and a build vs. buy calculator that can be used to help you build a business case for service deployment and adoption within your organization.

We also seek to gauge which problems you encounter or solutions you seek -- ideas for new services and new online tools that are most important and most relevant. Visit the BTR Idea Exchange to participate in our open collaboration effort.

This is your opportunity, by contributing your ideas, to tell service providers what you require from them. This is an open public list, and all service providers can view it.

You can either submit an idea or vote on an idea that's already been submitted -- all you need is a Google Account to sign in. We thank you in advance for your participation. The BTR moderator may post a response to submitted ideas.

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