Cloud computing has become a huge ‘buzz-phrase’ in last few years, but you’d be forgiven for not knowing what the term actually means indeed. Different people interpret “cloud computing” in different ways. That’s the dilemma because computing “in the cloud” may be important for you and your organization, but if it’s not clear what it actually means, how will you know?

The chairman of the Cloud Summit Executive 2009 conference started the event by a witty comment that when he asked 20 people to define cloud computing, he got 22 different answers. The term came into vogue a few years ago and has generated its share of controversy since then. Here are some descriptions for cloud computing:

  • “Reliance on the Internet for satisfying the computing needs of the users.” (Wikipedia),
  • “The next step in the evolution of software-as-a-service (SaaS) technology.” (Knowledge@W.P. Carey, Arizona State University’s online business publication),
  • “We’ve redefined cloud computing to include everything that we already do. I can’t think of anything that isn’t cloud computing with all of these announcements.” (Larry Ellison, Oracle).

There is an obvious ambiguity on what cloud computing is, and what it isn’t, whether it’s a seachange or just another technology fad. Let’s not to get hung up on definitions focusing whether ‘something’ is cloud computing or ‘Software as a Service’ (SaaS), instead let’s focus on the changing IT equation.

Cloud computing disarrays the traditional IT model where one keep buying servers, PC’s and software licenses  as ones business grows, to offering a new Information technological path for small –to-mid size business: ‘Clouds’ of computing power , accessed over the internet, become your server and your data center. Also, amidst the clouds are inexpensive applications for use on demand from any location and through various devices.

Many people indeed confuse ‘Cloud computing’ with ‘Grid computing’.Both implies data centers filled with computing resources available over the network, so are they, in fact, the same thing? Actually, no. Grid computing implies the provision of computing resources as a utility that can be turned on or off as required. Computing on tap, so to speak. You pay for what you consume, without worrying about how where it comes from or how much is available. A good example of this is Amazon’s Elastic Compute Cloud (EC2) offering. Customers create their own Amazon Machine Images (AMIs) containing an operating system, applications and data, and they control how many instances of each AMI run at any given time. They pay for the instance-hours (and bandwidth) they use, adding computing resources at peak times and removing them when they are no longer  required. Amazon calls this a cloud, but really it’s a grid. The cost of this utility? 10 cents an hour for 1.7 GB of memory, one virtual core, and 160 GB of instance storage, plus data transfer costs.

Cloud computing is slightly different. It implies the supply of applications to end users, rather than just computer cycles. “Cloud-based computing is a type of IT service usually delivered over the Internet, but the defining characteristic is scale — the ability to service millions of users,” said Matt Cain, a research vice president at Gartner. Cloud computing also implies quick and easy provisioning and a simple cost

structure, generally on a per-user, per-month basis, if it is billed at all, he said. Microsoft’s Live Hotmail is a perfect example of an application run in the cloud: It is supplied over the Internet from one or more data centers who-knows-where; it has millions of users; easy self-provisioning; and a very simple cost structure (of no charge per month). So by now most of you would have updated their definitions in your sagacious cerebrum for not to get confused in between them.

When considered is it all really that new to us, I would say,”Ahh! I have heard it somewhere” If some of this sounds familiar, it’s because, excluding the scale, it is an almost perfect description of the Application Service Provider (ASP) model that was in vogue briefly eight or nine years ago ASPs managed data centers and used their expertise to run and maintain all sorts of applications for customers, who accessed these applications down the wire. New applications were written or existing applications were “ASP-enabled,” and these were either shared by multiple customers or hosted on a separate server for each customer. The problem was that very few ASPs managed to get many, and in some cases any, customers. Most disappeared as quickly as they arrived. There were a few successes like Hosted Exchange was a popular offering, and Salesforce.com successfully promoted the idea of software as a service — a low-cost solution to fill a particular need, a commodity rather than a differentiator.

So now definitely one would like to counter the difference between the ASP model and computing in the clouds? You could argue that the cloud is just a fancy 21st-century way of talking about back-end systems that supply software as a service. “The difference is scale,” said Cain. “ASPs never got millions of customers.”  It’s interesting to note that just as ASPs discovered hosted Exchange was one of the few things for which customers were willing to pay, it’s also an application that runs well in the cloud. E-mail being the poster child of cloud computing.

“A move towards clouds signals a fundamental shift in how we handle information,” writes Stephen Baker in Business Week. “At the most basic level, it’s the computing equivalent of the evolution in electricity a century ago when farms and businesses shut down their own generators and bought power instead from efficient industrial utilities.” Moreover it ultimately helps CIOs rationalize their legacy systems and get their “arthritic IT” in order, so who would say ‘No’ to it?

Coming back to Cloud computing, there are many advantages of the approach Low Start up cost makes cloud computing attractive to small businesses. One time use applications and business services like Google apps need not be purchased which is a blessing for sporadic users. There isn’t a need to buy additional licenses and hardware as corporates can expand up to n number of users and locations at modest cost. Cloud computing also gives location & accessing independence. A significant advantage being regular upgraded application versions are available to users with changing requirements.

Cloud computing releases sizeable portions of handcuffed IT budgets for corporates. Instead of purchasing additional licenses and hardware, firms can simply open new accounts with cloud based services providers to expand computing capacity.

Also, Users would be more receptive to the idea since the knee-jerks about security and third parties access to applications are less prevalent these days. And let’s be practical — Google is not likely to run out of money any time soon and is probably far more likely to be around in 10 years time than many of its potential cloud computing customers. When put like that, cloud computing starts to make sense. After all, e-mail and productivity apps are commodities everyone uses. They are not strategic apps that give a firm the competitive advantage apps, therefore, why not let a handful of mega-corporations like Google run and maintain them from data centers built near hydro-electric facilities offering unlimited free power for a fraction of the price now spent to license, install and maintain these applications independently. It may not give you the competitive advantage but definitely gives you a cost edge over others.. In Joseph Heller’s words classic novel Catch-22, “if everyone else is getting their apps from the cloud, you’d certainly be a damned fool to get yours any other way …”

//Abhiraj

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