Today’s blog on cloud computing comes from Peter Allen, Partner and Managing Director, TPI.
For a natural skeptic, writing about “cloud computing” (go ahead, look it up) comes as a surprise, but the frequent chatter cannot be ignored.
More and more CIOs and CTOs talk about their contracting strategies for IT services in terms foreign to the sourcing industry. Cloud computing is just one example.
It’s generating buzz because it is the next iteration of distributed/utility computing that might take root. The notion that companies need not provision computing and communication resources in advance, but merely plug into the ubiquitous ‘virtual grid’ to run their business processes is a familiar paradigm, but one that is generally met with skepticism.
Predecessor promises around infrastructure-on-demand showed a fair degree of technical promise but rarely carried the business characteristics that most clients demand … the ability to pay for consumption with broad ranges of variability.
If the current cloud computing rancor addresses the contractual dimensions, the provision-on-demand proposition will be a disruptive event for the IT outsourcing industry. The established players will need to reinvent their business models to compete, creating a window of opportunity for new players unfettered by legacy business models and those at the mercy of location focus.
The tempo of interest is riding on the coattails of software-as-a-service (SaaS), where users pay a provider for hosting business applications. The key difference between SaaS and cloud computing is in the service and business model, not the architectural delivery mechanism. In that way, a cloud computing architecture may be the essential mechanism for delivering SaaS.
So, who will be the future players of IT services? How about Dell, Google, Amazon, Yahoo, and that class of online service leadership? Think it’s too far afield? Think again .
But several questions remain unanswered: Is the sourcing industry on the verge of reinvention? Is the global communications fabric strong, resilient and secure enough to support corporations? How are potential pitfalls to be managed?
What is clear, however: There’s momentum and mass, meaning change is afoot.
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