Intelligent Enterprise

You know something is getting hot when it's picked up by the larger business press. That's the case with cloud computing, which seems to be all that and a bag of chips, if you ask the business journalism powerhouse "The Economist."

Specifically I'm referring to this recent article, which examined the rise of cloud computing. The Economist did a much better job of explaining its rise than most of the technical publications that I read.

The articles goes on to look at cloud computing from a business perspective, providing some key data points including the rise in software and hardware spending, and also the explosive growth in "as-a-service" applications. Moreover, it touches on the social and political issues of outsourcing computing operations to data centers that you don't see or control.

One of the issues I see with cloud computing is the fact that almost everything you leverage on the Web gets tossed into the cloud computing bucket. That's fine in theory, but the core value of cloud computing for enterprises is the relocation of major business processes to remote and shared data centers that provide resources, as needed, and operate at a cost much lower than on-premise applications.

Indeed, there should be at least a 70 percent savings in IT infrastructure costs when considering cloud computing. Otherwise, it may not be worth it when you consider the cost of migration, the political upheaval within the organization around the loss of control, and operational risk. It's all about the money with cloud computing.

Thus, the best way to look at cloud computing is to learn how to classify the clouds. Right now I see at least five classifications: storage-as-a-service, database-as-a-service, applications-as-a-service, platform-as-a-service, integration-as-a-service, and security-as-a-service.

Each category has its own path to maturation, with applications-as-a-service (or SaaS), such as Salesforce.com, leading the way toward leveraging the cloud, and with explosive growth in that space over the last year, largely driven by the focus on cost cutting in a down economy. That portion of cloud computing has proven to be successful.

The next push as we move past SaaS will be the notion of database-as-a-service, and platform-as-a-service, evidenced by the huge titans of software kicking up offerings like dust devils in the desert including Salesforce.com's Force.com, Microsoft's Azure, and Amazon's EC2, and even smaller upstarts including Cog Head and Bungee Labs. While this has been huge in the press, rank-and-file enterprises have not found their way to complete remote internet-delivered platforms, other than as small pilot projects. This will quickly change.

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