Monthly Archives: October 2012

On the cloud

cloud

The IT world is in a period of dramatic transition. That may be trite to say when it’s been in transition all its life, but things are shifting more rapidly. The evolution and adoption of new technologies is also raising business’s expectations on being able to execute on new business models faster, reduce investment costs, and attract and keep customers. 

The usual suspects are at play here, the ones you keep hearing about: cloud, data analytics, mobile, social networking, etc.

The globalisation of IT through XaaS cloud services (X being whatever you want these days) is  forcing commoditisation and a necessary maturing of the market to deliver the necessary features and service levels at acceptable cost. That’s not a bad thing for either cloud buyer or seller. If you consider the vertical technology stack of (from the bottom) data centre, hardware, networking, infrastructure, platform, middleware, applications, business process, and business service, it’s clear there are huge opportunities for all sorts of vertical and horizontal integration plays, niche players, value-added services, and consolidation. It’s easy to believe that most enterprise services for all but the largest organisations will be outsourced within five years. How that plays for large shrink-wrapped software vendors is a major question, but I can’t see the advantages of buying large suites of software on capex over a pay-as-you-go opex model surviving the market shift to increasingly trusted (and secure) clouds.

It’s a classic disruptive play. Clouds may have been immature once, but they will increase share as they grow upwards, pushing the big players into alternative models or premium niches. Companies  don’t want servers, they want a business enabler.

Cloud will also therefore change the way business is done. The pace of business will increase. Markets will evolve faster. Three-year or even financial-year strategic plans won’t survive sustained contact with the market. The pace of change will only be constrained by the rate that we ourselves can digest change, and perhaps technology will have a solution for that too.

But I’m jumping ahead. “Cloud” right now is increasingly about service delivery, ITIL-style. SLAs will become the mantra of those who pay for services, cloud or otherwise. The challenge has already been articulated elsewhere: how do IT departments maintain their relevance as their company’s legacy systems migrate into the ether, and the business starts buying their own IT per user per month?

 

 

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