Making Sense of the Cloud-Grab

By: Rob Rousou, Product Manager - ProcServe, March 2011

How the rush to deliver services in the cloud may be obscuring a wider trend

The term ‘cloud' is becoming ubiquitous. It seems every technology company is in the process of remarketing their products as a cloud-based service. But in the rush to join the cloud-grab, are we losing sight of what the term means and what are the implications if everything is in the ‘cloud'?

To understand what is happening, let's take a step back. Cloud-based services are not a new phenomenon; in fact if we take the literal definition of ‘cloud computing', most companies have been using services based on a cloud model for many years. Wikipedia defines cloud computing as follows:

"Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources".

So if a cloud is simply a way of accessing centrally hosted computing services through a single interface, then is a corporate Intranet a cloud? Take the analogy further and it could be argued that a client-server network is ‘cloud computing'!

Some would say this argument misses the point, that the recent cloud-grab is a result of advancements in hosting technologies that allow enormous amounts of data and applications to be hosted by 3rd party providers. However this viewpoint is too narrow. To call a service ‘cloud-based', where do we draw the line and at what point is an application in the ‘cloud' rather than simply sitting on a local area network (LAN) server?

To put some structure around the definition, we can split the concept of cloud computing into distinct categories.

• A corporate Intranet could be given a cloud definition, as it is a network of services that a company's employees access over a single connection. We could as easily describe this as an ‘Intra-Cloud', but this model is hardly revolutionary, as it has been used in standard business processes for 20 years.
• Then there is the private cloud, whereby an organisation provides an Internet-based resource for internal and external users to share data and applications. Daimler Chrysler recently announced that it has developed a private cloud to link its 18,000 employees and partners together. But this again is not a recent innovation; retail companies have been running private networks with its supply chain partners for many years, an example of which is the Tesco Information Exchange. The retail giant has used this ‘private cloud' very successfully to share sales data and enable collaboration on marketing initiatives with its suppliers.
• A more recent trend has seen the formation of ‘communities' of like-minded organisations that wish to share applications or back office services to save money. A recent example saw HEFCE (public funding body for Higher Education) announce that it is investing £12.5m on creating a cloud-based shared data storage infrastructure for universities. This type of ‘Club-Cloud' is very much driven and made possible by advances in wide-area-network storage technologies and is the model most commonly associated with ‘cloud computing'. The ProcServe Trading Network is one such example whereby communities of buyers can club together to lower their costs of procurement.
• Finally we have the public cloud. These are potentially behemoth-scale resources available to all, via the Internet, and not restricted to any particular commercial or community boundaries. The Apple and Google App Stores are such examples, and there will be more as the public thirst for sharing information grows at an exponential rate. According to an IBM Tech Trends survey, applications developed for mobile devices exceeded those for traditional IT platforms for the first time in 2010.

As we can see, the concept of cloud is amorphous. It can be used to cover most computing models over the last 20 years and so should be viewed as a natural evolution of Internet technology rather than a new concept in its own right. The problem is that ‘cloud' has become a marketing buzzword and any technology company without cloud in their brochure will be seen as slow to adapt and lagging behind their competition. The reality is that they will likely have perfectly good business models in place that make use of remote-hosted technology but do not have the marketing punch of being a ‘cloud service'.

Even very large and usually sensible technology companies have caught the bug. Oracle are currently hosting a series of ‘Cloud Summits' that would put most rock bands to shame. Between January and April of this year, they will be hosting a staggering 80 summits across 52 countries.

The only sensible explanation to this mass marketing exercise is to ensure they gain their share of the frenzied cloud-grab currently taking place. Microsoft were paranoid enough about the growth of cloud computing to feel the need to picket a recent salesforce.com conference. It makes uncomfortable watching, like seeing an elderly relative try to dance with the younger generation.

There are interesting parallels of the current cloud-grab to the dot com boom of the late 90's. At this time, too many companies jumped on an over-hyped bandwagon and tried to change their otherwise solid business models to accommodate immature and untested routes to market. Sound familiar? We know what happened then, but have all the lessons been learned?

It's time to step back and put cloud computing into perspective. As the Internet has now become a trusted and ubiquitous way of doing business, so cloud computing will simply be the norm for sharing data and deploying applications. But it doesn't have to happen overnight. It should be allowed to evolve naturally and be used in ways that are compatible with proven business models. Only then can we keep our head in the clouds but still see a clear way forward.