Cloud Computing. Is it ready?

Attended an IDC breakfast event last week on Cloud Computing. Here're the highlights.

1. In terms of IT growth worldwide, US and Europe are the dark spots. Japan and Asia (ex Japan) are showing positive albeit more tapered growth because of the financial crisis.

2.Definition of Cloud Services = Consumer + Business Products, Services and Solutions delivered and consumer on real time over internet (*note = it's real time!)

3. Definition of Cloud Computing = emergent IT development, deployment and delivery model, enabling real time development of products, services and solutions over Internet (thus enabling cloud services)

4. Cloud Services attributes should have: -

    ~ provisioned off-site and by third party(ies)

    ~ via Internet (a hybrid will be over MPLS network to address the concerns of the large enterprises who are inclined to do outsourcing but not running the apps over Internet. Hey, Mr Telco, you have a part to play here!)

    ~ near real-time deployment; dynamic and scaable

    ~ pricing model = fine-grained, usage based (or at least as an option)

    ~ User Interface = Browser (or subsequent successors thereof)

    ~ Shared resources 

5. Worldwide IT Spending (precrisis estimates): in 2008, On-Premise IT $367M; Cloud IT $16M and by 2012, On-Premise IT$ 461M, Cloud IT $42M (CAGR for On-Premise 5%, for Cloud 27%). I think the economic crisis which leads to spending cuts and more outsourcing will be positive for Cloud Computing. Enterprises will be willing to "take some risks" at a more open system for the less sensitive applications. 

6. Top Apps for Enteprise Adoption over next 3 years include: IT Mgmt Apps, Collaborative Apps, Personal and Business Apps. 

7. Key trends for next year in the ICT area: NextGen Customer Care, Cloud Computing, Thin Client & Virtualisation, Sustainability and Green IT. 

8. Besides Cloud Computing, Enterprise Search and Next Generation Customer Care are equally important. Cloud Computing is primarily driven by the focus on cost savings whereas NextGen Customer Care and Search are new growth opportunities. 

In my view, the most immediate opportunity in cloud computing lies in the SMB segment, particularly those without their own IT departments and are growing. We should focus on the end-user apps that these SMB needs. In my experience, any SaaS apps in the Finance & Accounting area should not be the top priority. Many SMBs are cautious about having their financial data hosted off-premise and many still prefer to entrust it to a service provider (accounting firm) that they trust rather than a SaaS provider. Be patient. If your SMBs have not used other biz apps other than the basic productivity tools by Microsoft Office, it will take some time to educate them on the benefits. However once the trust level is built, they will hardly switch. Besides, SMBs have less complicated decision making process; in fact for the smaller size companies, the owners generally decide on the IT matters. Finally, prepare to offer similar solutions by various providers at different price tiers and complexities (of course, that only applies if you are an aggregator). If you are a SaaS app developer, make sure that your user interface is not too cluttered with too many functionalities. Sometimes a powerful tool may not be the right tool for the SMBs. They only need to meet one objective. Give them a simple software that meets the objective. Don't attempt to offer more if that means a steeper learning curve. Many SMBs are not tech-savvy and if you simply rely on online marketing and selling, that won't work. Work through channels, conduct free educational workshops. Offer incentives to try out and experience the benefits without commitment. 

Posted via email from poohwinn's posterous