Cloud as you need it — and if
In the short term, many organisations will be pursuing hybrid private-public Cloud deployments that let them straddle the two spheres. Indeed, given the extensive customisation most companies have already gone through, it’s unrealistic to anticipate a wholesale move to the public Cloud by any decent-sized organisation in the near future; however, cherry-picking will continue to lead to major processes moving into the Cloud as needs and opportunities arise.
In many cases, the appeal of the Cloud will come as specialised providers offer not only to take over business processes, but to add best-practice knowledge and value that will help customers optimise specific parts of the business.
“About 80 per cent of our customer base have an existing HR system they bought from one of the top three ERP companies, and probably spent millions in implementing them,” says Murray Sargent, Asia Pacific and Japan general manager with Success Factors, whose local clientele includes Australia Post, Jetstar and BlueScope Steel.
“However, their managers and employees are still not given any capability to manage it; it’s all back office and focused on making sure they capture leave and pay people every month. That’s why they have made a very conscious decision to invest in people-focused solutions for talent and performance management.”
In other words, many emerging Cloud providers are in fact positioning themselves as knowledge outsourcers, offering additional value over and above the long-running practice of business process outsourcing. Ease of access to these systems and skills could drive continued major growth in Cloud services, with infrastructure providers falling over themselves to bolster investments in Cloud-suitable infrastructure.
Productivity applications may provide a quick win — Optus and AAPT, for example, recently announced Google Apps resale plans while the latter also announced storage-as-a-service, ‘Solaris-as-a-service’ and hosted call centre capabilities. Growing partnerships between telcos and systems integrators such as Fujitsu — which recently made a major Cloud investment in Australia and is already hosting Cloud-based applications for the likes of Frucor and Toyota — are likely to push more and more functionality into the Cloud.
There’s also likely to be significant latitude for enterprise buyers keen to push a particular part of their IT infrastructure into the Cloud. “There’s no question people want to put their toes in the water,” says Aidan Tudehope, managing director for hosting with Macquarie Telecom, which has boosted its Cloud portfolio with rapidly scalable server and storage infrastructure along the lines of Amazon’s EC2 and S3 — but with the governance advantage of being hosted within Australia.
“We’re now seeing real deployments, websites with real transactions and businesses living and dying by the success of their deployments,” Tudehope explains. “It is a very significant change, and a fundamental change in the way businesses procure services. You can start by moving your Web layer onto the Cloud, then pick the other bits that make sense and do it at your own pace.”
Yet despite its promise, many organisations are still holding back on their Cloud investments. Gartner’s survey found that 45 per cent of respondents had no plans to invest in Cloud computing this year, with many offering sentiment to the effect that the paradigm is not ready for their businesses.
This isn’t only a question of the business-related issues, like data sovereignty and availability, mentioned earlier; technological issues still abound. Specifically, vendor lock-in and portability of Cloud investments has come onto the radar screen of late, with Telstra and the Commonwealth Bank among big businesses actively engaging with Cloud standards body the Enterprise Cloud Buyers Council (ECBC), an initiative of global service delivery body TM Forum.
High on the ECBC’s radar screen are issues like standard product definitions, interoperability between Cloud versions, data portability, and Cloud security issues. Such standards are in their early days and will by necessity need to adapt to reflect future developments in Cloud infrastructures, requiring constant vigilance on the part of standards bodies.
They will also offer opportunities for open-source efforts, whose focus on openness and sharing will appeal to many that want the Cloud to be an enabler for unfettered growth — rather than just the latest tool for vendor lock-in.
“Moving providers today is definitely a pretty invasive operation,” says Frank Feldmann, Asia Pacific director of business and technology solutions with Red Hat, which is angling to maintain its operating systems’ primacy as a development and hosting platform amongst Cloud providers.
“Not only does it mean you may have to re-architect your application stack, but there are going to be networking and other challenges you have to manage. We envision that same movement could become a much more frequent move, as some companies choose to internally reprovision their resources on a regular basis.”
While many vendors may be quite happy to lock in enterprise customers to their Cloud vision, broad standards support and the efforts of a global community of open-source advocates should at least provide a foil for those efforts.
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