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More than just buzz, the cloud represents the most fundamental computing shift in a decade
Cloud computing promises cost savings, more efficient use of IT resources and uncommon flexibility, and those claims have driven it to the top of the buzz list. But at what costs and with what risks? Are Canadian businesses ready to move portions of their business to the clouda shared, virtualized, on-demand IT environment accessed primarily over the Internet? Chief among the problems facing cloud adoption is simple confusion, according to many experts. A recent survey conducted on behalf of software management company CA Technologies found that 62 per cent of business executives and 23 per cent of IT executives admit to being confused by the concept of cloud computing. This broad confusion serves as the biggest barrier to adoption of cloud by businesses, said Phil Shih, Web hosting and Internet infrastructure services researcher at Tien Research. Despite some significant benefits, he said, "If you don't know what it is, you surely can't adopt it." Hazy d e f i n i t i o n s Cloud computing is generally defined as accessing computer resources, usually over the Internet, that are dynamically scalable (sometimes called "elastic") and offered like a utility, on a pay-per-use basis. Need terabytes of storage? More processing punch for a particular project? Cloud computing allows businesses to buy and use what they need, when they need it.
parallels stop at delivery, said John Sloan, lead analyst at Info-Tech Research Group. "Generally electricity goes only one way. If you have a relationship with a cloud service provider, data usually goes both ways. So, how secure is that data? And also, from the perspective of accountability, if you have to comply to certain government regulations around the state your data is in, or where it is and who touched it, it becomes problematic, but not impossible, to move it to the cloud." Businesses looking at a move also need to consider reliability and availability of the applications. Sloan said this is an area that has improved, but he has heard horror stories about cloud providers going down and leaving outages across
an entire ecosystem of startup companies. Data mobility isa further concern, Sloan said, just like the telephone industry before number portability, businesses can feel trapped with a cloud provider since their data and applications could be tied to a proprietary architecture. "We say cloud in the singular, but it's really clouds, and you have to consider that." Finally, the economics are not a guaranteed fit for every company or every application. Although cloud can eliminate upfront capital costs, over time operation costs could climb to a point where it is not effective from a total cost of ownership (TCO) perspective. Michael Redding, managing director of Accenture Technology Labs, cautions business executives to look closely at the costs of moving certain applications to the cloud, as in some cases theonline world will increase costs. "A lot of times with cloud, just because you can do something doesn't mean you should. [There
isn't necessarily] a better total cost of ownership, so for the CIO and for the business you've got to make a business decision on whether the cost of change is worth the pain and agony of moving to the new model." The first place to look, he said, is at functions that are basically commodities, like e-mail. These offer reliable savings with fewer risks. At the same time, some very complex applications are moving to the cloud. For example, BPS Resolver, a Toronto-based governance, risk assessment and compliance company, has offered its software in a SaaS model for more than six years and it recently ported it to a cloud delivery model. "When virtualization became more commonplace, we looked at a model whereinstead of...basically locking into specific periods of time-we would have more flexibility to ramp up and down our specifications, our individual servers and the ability to add more servers or take them away for peak-load periods," said CTO James Patterson.
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But cloud definitions are rarely simple, and different experts suggest various attributes or elements. Shih said cloud must incorporate a number of key attributes: elasticity, a pay-per-use consumption model, and remote management and hosting by a third party. He said technically cloud computing represents only computing and storage resources, and not the business application running over it. John Sloan, lead analyst at Info-Tech Research Group, further points out that cloud is the architecture on which services run, but not the services themselves. To make it cloud, Sloan said it must incorporate four elements: virtualized computer resources (the memory, processing or storage); ownership by a third-party service provider; resources provisioned in a flexible or dynamic way; and resources that are shared between multiple businesses. Sloan said this "classic" definition of cloud is changing though, as more businesses look to the advantages of runbackbonemaq.com / fabruar^/march con
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ning similar virtualized environments, either internally or in a private hosted environment (often dubbed "private cloud"), or combining shared multi-tenant hosting with their own private virtualized infrastructure ("hybrid cloud"). Sloan said the confusion around cloud stems in part from the buzz of the term itself "It's like going to the supermarket and, if oat bran is all the rage, all the cereal boxes will...say "Now with Oat Bran.' It's like the boxes now say 'Now with Cloud.'" Experts also rush to point out that while the cloud is simply the transport mechanismlike the power grid over which home or business electricity travelsprocesses such as Software as a Service (SaaS), Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) are often lumped into the broader definition of cloud. Some, like Robert Miggins, senior vice-president of business development with cloud facilities provider PEER i Hosting,
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"What cloud brings to the table is the opportunity for small businesses to improve their operational or business processes in order to improve their business overall," Edwards said. "This is something they haven't been able to embrace in the past because of on-premise technology costs." Edwards said because of this, a higher proportion of small businesses are looking to adopt cloud-based services in 2011. He Ripe for smaller businesses calls cloud-based Software-as-a-Service and lnfrastructure-as-aBuzz heavy or not, experts say cloud can help level the playing Service the building blocks that small businesses can use to rise field for small- or mid-sized businesses looking to leverage tech- up to operate like a larger business. nology to optimize their business. Sloan likens the small-business cloud use trend to the shift toAccording to Paul Edwards, director of SMB and channels re- ward distributed computing in the early 1990s. "Small businesses search at IDC Canada, the SMB market is ripe to benefit from cloud were a growth engine for distributed computing," he said. "Most services, especially businesses with fewer than ioo employees. small businesses couldn't afford big-iron (mainframe) processing, He said moving to cloud services can give small businesses an op- so they built their businesses on PCs. 1 think that there's a similar portunity to automate business processes they haven't been able opportunity now with cloud, where smaller businesses that need to in the past due to lack of IT staff, restricted capital and a dearth services of some kind can look to the cloud and might have higher of advanced equipment. tolerances for the risks or concerns."
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prefer a broader definition of cloud: it is simply IT outsourcing with flexible terms. He notes that cloud is driving customers to seek from his company moreflexiblecloud-like options for traditional private hosting. "It's kind of like what the term 'green' has become, it really means a lot of things now," Miggins said.
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