Why cloud computing is ahead of its time

Another day, another cloud computing launch. This time it’s Adobe with their AbodeAcrobat.com Google Docs/Microsoft Office Live look alike.

If you like your user interfaces then you will like this one. Very slick and very glossy. Given the exclusive use of Flash and my liking of Firefox plug-ins I don’t think that this one will be featuring on my list of favourites. It is very pretty though.

What it did do was to get be thinking about cloud computing again. Before I start on cloud computing in general a quick quiz. There are three pairs of words below. You have to choose the missing link word from the following list. See if you can get it right and then spot the theme. Ready. Go!

Office Live (                 )  Microsoft

Docs          (                 )  Google

AdobeAcrobat.com (    ) Adobe

Various      (                 ) Amazon

a) Silverlight   b) Gears   c) Flash d) EC2

(I may not have got this exactly right but you can see where I’m going)

Could it be that we are looking at the new Web 2.0 platform wars? Is this merely the warm-up round where the vendors limber up with a quick word processor before moving on to the tougher stuff like HR, finance and logistics?

What this neatly leads us on to is the conclusion that the platform vendors of tomorrow are on the starting grid, warming up their engines. It is also interesting to note who hasn’t yet shown themselves. Are IBM cooking something up back in the workshop? My guess here is that the guys in research built it 5 years ago but no-one in marketing can agree on a brand name or sales plan yet. Facebook, MySpace and the other social networking guys think that the race has already started and are already half way round the first lap. Little do they know that they are just the warm-up act before the main show. One of them may make it to the main event, I just wish I knew which.

Perhaps it will be Salesforce.com who are already well established? However they are really in a different race altogether. The application vendors fight a slightly different battle and SAP is the obvious favourite based on dominance. I haven’t heard what they are up to but you can be sure that them and Oracle are busy. Interesting to consider whether Oracle is platform or application in this arena.

The point is that despite what you read in the press or watch on webinars most companies are fairly conservative about their technology decisions. When you may have to live with the consequences for twenty years then you tend to take your time. You want to be sure that this is going to still be around then. Remember the network computer?

Another big factor is cost. The cloud vendors may well argue that by subscribing to a service a company avoids big capital outlay which is true. Subscriptions help to spread the cost for the first few years. If you like to renew your systems on a regular basis then this makes sense as you are likely to depreciate over five years and then re-invest in a new system. This is certainly what the vendors would like as to do, much as car salesman do.

But there’s a catch. What if, after the five years is up, my system (or car) is doing fine. Sure it’s not as shiny as it was but it still works. It doesn’t have the latest gadget, gizzmos and buzz words but it still meets my basic needs. What the company is doing is simply sweating the asset. It’s fully depreciated, off the balance sheet but still delivering value. I could replace it but the business case, quite rightly, isn’t there.

As an example I was recently working with a customer still using Office 2000 and Windows 2000. Both getting on for 9 years old and working fine. Put Office 2000 next to my nice, shiny Office 2007 and it certainly looks dated. Office 2007 is certainly better but not that much better to justify replacement.

The point is that at the end of the depreciation period the business has a choice. Do I renew or do I sweat. With cloud computing or software as a service (SaaS) I have no choice. I’m on the escalator whether I like it or not. I will get those new gadgets, and pay for them, irrespective of what value they provide me. I’ve lost control.

Control is another big area. There are several areas here which are more or less important depending on your business. The obvious case is where businesses are subject to some form of regulation. This covers a wide range of organisations notably finance and pharmaceutical. I have worked with companies covered by Federal Drug Authority rules and this involved having screen shots of the complete software installation process. Not particularly practical for a cloud environment when you may not even know where your data is, let alone the code executing on it. The data protection issues are very real as well, especially considering the various government and regulator led campaigns. Would you risk a stretch in jail?

It is also more tangible than that. People like to know what is going on. They like to know where their data is. Giving up that control is not in the natural psyche of executives.  

So it looks like Cloud computing has a lot of real and perceived issues to overcome before it can really enter the mainstream. In future posts I plan to look at questions such as when cloud computing is right for businesses and what it needs to do in order to gain adoption.

I am always interested in your comments so please feel free to leave them using the buttons below or e-mail at info@conceptech.co.uk