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Embracing the cloud

Cloud computing is evolving into a commercially viable option, writes Nivedan Prakash

Cloud computing has the potential to change how organizations manage IT and transform the economics of hardware and software at the same time. As it happens, the perception of this technology as a commercial one is not because of public clouds but to a large extent it is because of private clouds and this has had an impact on procurement patterns and IT investments.

“As we are looking to utilize hardware to the maximum, the economies would improve significantly. With cloud computing, the on-demand computing power will increase the utilization and deliver cost savings,” opined Rajesh Patil, VP–BFSI and Life Sciences, AppLabs.

R Ravichandran, Director–Sales, Intel South Asia, said, “We believe that organizations would continue to have mixed environments of traditional IT and cloud IT, where the mission-critical applications that are core would remain within the traditional IT space and some services that are not vital could move into the cloud.”

PN Anantharaman, Director-Engineering, Adobe was quick to point out that cloud computing had emerged as a core technology with a definite value proposition, which was that it reduced cost and increased agility. “We are witnessing start-ups and SMBs embracing cloud computing that reduces the upfront investment or the fixed cost and offers greater flexibility in terms of the variable costs and so on. This is a pivotal year in terms of the maturity of this technology, wherein we are seeing quite a bit of adoption,” stated Anantharaman.

Trends at the forefront

Today the focus is on ease of setup, operations, security and scalability. On-demand services and Software-as-a-Service (SaaS) solutions have become the preferred mechanisms for organizations to better leverage the power of cloud computing.

A Gartner report says that cloud computing represents the fusion of trends such as global-class architecture, Web platforms, massively scalable processing and the Internet.

Diptarup Chakraborti, Principal Research Analyst at Gartner, said that while cloud computing has been present for a long time; full scale migration onto these platforms hasn’t taken place. “If it picks up the way it is supposed to, then it will have a profound impact and IT organizations will buy computers as a service and not as products,” said Chakraborti.

Dr. Nataraj Nagaratnam, Distinguished Engineer and CTO, IBM India Software Labs, commented that small companies were doing away with the servers in their back offices and turning to large firms who were, in turn, selling services in the cloud. “We are seeing elements such as e-mail, ERP systems and the like moving into the cloud,” said Nagaratnam.

Cloud service providers are moving beyond specific verticals to offer integrated platforms that support other developers in creating new services. “The emergence of platforms represents a new phase in the evolution of cloud computing,” commented Adarsh Parekh, Lead-Accenture Technology Consulting India.

The other significant trend is the growth of the private cloud network, which is a hybrid of the external and internal cloud that utilizes resources from both pools. Large enterprises are building their own private cloud. Here a company builds a cloud computing infrastructure within its own data center rather than relying on a third party.

Simon Dale, SVP-Business User Organization, SAP Asia, pointed out that cloud computing will see a shift in the skills needed by IT workers. It is no longer enough for a CIO to oversee rollouts, integrations and development projects. Instead, IT professionals need to focus on extracting business value from new technologies. Cloud computing helps them shed the burdens of technological implementation and concentrate on business processes.

Andrew Knott, VP–Marketing, APAC Region, Salesforce.com said that cloud computing was enabling a new class of entrepreneurs who did not need to build offices, distribution centers, data centers or infrastructure of any kind, as everything could be managed in the cloud. This, he felt, would unlock huge pools of innovation around the world, since the cost of developing, distributing and supporting applications would decrease.

Vendor strategies

The cloud has become a priority for many businesses in both the public and private sectors, as it has been found to reduce IT operating costs and save energy. However, many companies and government agencies have been reluctant in accepting cloud computing because of concerns regarding data security, service reliability and regulatory compliance. Therefore, vendors are addressing these issues by introducing private cloud services and taking a top-down view of all IT resources within a cloud-based location.

“Cloud computing is being proposed as the single answer to the challenges of IT silos—inefficiencies, high costs, and ongoing support and maintenance concerns—and increasing user demand for services. It is demonstrating its ability to handle the increasing Internet data from rich Web applications and services from online service providers,” asserted Balaji Kesavaraj, Head Marketing-India, Cisco WebEx Technology Group.

Shuja Mirza, Advisory Technical Consultant, EMC India and SAARC, stated that cloud vendors were looking at growing from the inside out by building an internal cloud and then migrating to an external cloud as the market matured and security and privacy concerns were addressed.

Meanwhile, service providers (SPs) are still offering either co-location or managed services. Eventually they will move to a pay-per-use model where they will have servers in multiple geographies. To offer this, SPs require a higher degree of automation. Providing these services will also make economic sense for the SPs as they can then charge based on the value that they provide to customers.

Shreekanth Joshi, Associate VP–Practice Head for SaaS and Cloud, Persistent Systems is of the view that cloud vendors are providing a complete offering including infrastructure, platform, tools and development environment. They are also creating a community around the cloud offerings for all stages of the lifecycle from application development to end-of-life.

Examining the attributes

It is necessary for providers as well as potential consumers of cloud services to examine the attributes of cloud computing to determine whether these services can deliver the expected outcomes. It is vital to establish if a business case exists within an organization for an investment in cloud computing.

Any organization should first identify and prioritize IT issues and challenges within itself; next the attributes and benefits of cloud computing should be mapped against these IT issues. Then the benefits should be scored financially for ROI consideration and business case justification.

“Since each organization has its nuances and could be following unique practices and processes, care needs to be taken by both the vendor as well as the potential customer that the cloud computing solution fits into its business needs,” averred Anand Ramkrishnan, GM–Cloud Computing Services, Wipro Infotech.

Karthik Ramarao, Principal Consultant–Unified Communications, Datacraft India, highlighted the fact that a core characteristic of cloud computing is the division of concerns between the cloud service provider and the consumer. The consumers of a service only need to care about what a service does for them and not how it is implemented.

The risks involved

Although the benefits are tangible, the risks regarding security and compliance, novelty of the service and concerns about stability are all barriers to adoption. There are some areas within cloud computing that need greater clarity. Customers also have concerns about the cost, compatibility with existing applications, lack of a migration path from existing applications to clouds, freedom of choice, federation of internal and external resources, lack of SLAs for policy-based management, and interoperability.

“The main challenge is in understanding the implications of commercial models being offered by the cloud providers. The primary reason for contemplating a move to the cloud environment is cost savings,” added Satish Joshi EVP and Global Technology Head, Patni.

Here it will also be right to say that cloud computing continues to attract widespread customer attention, if not actual adoption, due to its potential to provide variable costs, reduce capital expenditures, and provide an ability to match IT resources to real-life business needs. The benefits that could be derived are enormous and will continue to get better. As and when the challenges around security are resolved, it will see wider adoption.

nivedan.prakash@expressindia.com