A “Cloudy” Look for 2013 - Executive Viewpoint 2013 Prediction: Sonian

Greg Arnette (Profile)
Monday, January 21st 2013

The definition of “cloud” will become clear. The years 2010 through 2012 started the “cloud computing” conversation, but there is quite a bit of “cloudiness” - pun intended - about what the cloud really means.

1. Commodity-priced public clouds like Amazon Web Services and Rackspace compete for mindshare with hybrid and private cloud wares from Citrix, VMWare and others. Each camp uses the same terms interchangeably, which confuses the IT decision maker. The truth is - most businesses will use a combination of public and private cloud services. This is because there are some use-cases where the public cloud is simply the best value per IT budget dollar. And there are other examples where a unique requirement calls for a private cloud solution.

Throughout 2013 the public cloud providers will do a better job to differentiate their offerings from private cloud vendors. Public cloud vendors will showcase economics and security postures that will be very appealing to mid-size businesses. As more medium-sized organizations find cloud success, even enterprises will start to investigate their cloud options.

2. Enterprise IT will embrace cloud computing with a minimum of three production or research and development projects using a public cloud. The past five years of physical server migration to server room virtualization pave the way for the next big wave, which is to use “cloud” for some IT workloads. Many businesses have identified a few projects where testing public cloud is budgeted and planned for 2013. Applications that consume large quantities of storage or have dynamic (elastic) compute needs are the first ideal candidates.

However, many IT decision makers do understand we are at the beginning of a decade long migration, and there will be a lot of experimentation before massive wholesale cloud adoption is mainstream in the Global 2000.

3. The "Virtuous Cycle of Cloud Computing" will become obvious. Cloud computing represents new thinking on the "economies of scale" factoring into very large infrastructure purchasing dynamics. For example, as more customers use cloud compute and storage, the cloud vendors in essence, make larger purchases. Buying more lowers their costs, which in turn, allows the cloud vendors to drop prices. Lower prices encourages more customers to buy into the cloud, and the cycle repeats itself.

The IT industry has never before witnessed the positive effect of large bulk purchases, shared across hundreds of thousands of IT consumers. This will commoditize services for a very large buying audience. The closest allegory might be when government sponsors research (examples: the Internet, NASA) and then the private sector continues the innovation after the research phase.