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Poll: What is the main advantage with cloud computing?

Justin James is curious to hear what TechRepublic members believe is the best advantage to the cloud paradigm. Let us know by answering this poll question.

Last month, I asked developers what is the number one risk with cloud computing, and 59% of the 1,265 respondents answered data security. Now I'm curious to hear what TechRepublic members believe is the best advantage to the cloud paradigm.

I hear pundits talk about cloud's two big advantages: (1) it allows customers to focus on their core competencies and cost and (2) risk mitigation and performance. I can see cost possibly working, but I believe that the cost of maintaining an organization (marketing, salespeople, leadership, etc.) always offsets economics of scale, making the cost a wash; now the customer needs to manage and monitor the relationship, which adds overhead. Regarding the risk mitigation issue, I think the cloud paradigm adds new risks and takes some away. Performance can be a winner, as long as your application does not need to make a lot of roundtrips to the cloud before responding to the user.

So my pick is the core competencies argument. What do you think? Let us know by answering the following poll question and joining the discussion.

J.Ja

About

Justin James is the Lead Architect for Conigent.

34 comments
Screen Gems
Screen Gems

on Small Business and the Cloud. http://www.infoworld.com/d/cloud-computing/the-cloud-just-starting-impact-small-business-509 on the second page, David writes this, which sounds very much like marketing/sales dog and pony show. To quote David Linthicum article: "What does this mean for business? If I'm using cloud computing, my capital costs and, thus, my risks are typically going to be much lower. Moreover, my ability to adjust my IT assets in alignment with new and emerging markets is going to give me a strategic advantage." now my question is how's a small business selling widgets going to adjust IT assets in alignment with new and emerging markets? How does that work? His server changes to align with a new market for widgets? or the mom and pop shop hardware store adapts their IT assets to align with a new market eg advertising their hardware store in the next county? Come on. the only companies that benefit from flexible technology that changes every 6 months is the companies that make em and then try and convince buyers to buy something based on some marketing spin. This holds true with Cloud Computing. The only companies that benefit from Cloud Computing are the Cloud Computing providers in that they get a monthly revenue stream. Businesses end up with a monthly expense, rather than a 1 time capital investment that's depreciated over a period of years. and there's not really any more expense, for small businesses, other than after 5 or 6 years buy new stuff. With the Cloud, they would have a monthly expense just like the cell phone bill, or site rent, or electric and still have to buy equipment.

EFH777
EFH777

Having done a presentation on Cloud computing, we believe that, once we get past the security issues, being able to provision computing resources on demand could lower the cost of running an applicaiton, if a metric could be put in place to measure how much computing an application needs. Most people don't fully amortize the cost of power, cooling, real estate and support costs in running their own "DATA CENTER". This could all be managed by putting their apps "IN THE CLOUD", then directly put those dollars spent on facilities to the business.

cpr
cpr

This will allow businesses/individuals who need to use 'expensive' software on an 'as needed' basis, such as 1 - 2 hours per day/week rather than pay for the suite for the entire 12/24/7 time period. You will reduce your technical support requirements because, hopefully, the cloud service will provide this support. You may also realize savings in hardware because you may be able to avoid upgrading hardware when new versions/releases of the software are introduced.

sjdorst
sjdorst

Asking the poll question immediately after the author presents an opinion that points at only 1 answer may skew the results.

Deadly Ernest
Deadly Ernest

focuses on business, and I see NO business advantage to a business - in fact, over the medium to long term, Cloud Computing will have a severe negative impact on a business cost ratio and it's financial viability. You should see my other posts in other threads for the details on the negative financial impacts on the Balance Sheet and the Profit and Loss Report. See what happens when you speak to an accounting trained, and experienced, techie. However, I see a HUGE cost saving for NON business users in Cloud Computing, it is ideal for students and private individuals. So I voted other.

jck
jck

If the cloud goes down, connect fails, etc., you can now put the blame on "the cloud" rather than "our staff". Not sure if it's a cost saver or not. I know we've side-stepped 2 cloud solutions now because they don't provide what we need...and they are from 2 of the major players in cloud services too. So, I don't think cloud is even ready for the enterprise...let alone having a distinct advantage.

tbmay
tbmay

...the core competencies advantage is a subset up cost. Nevertheless, I'm VERY apprehensive about cloud computing, primarily because of security, but there are other reasons as well. I simply can't warm up to the idea of a company's sensitive and critical data floating around in a "cloud." The problem is people are going to jump on the bandwagon anyway and those of us who argue for caution will probably be called paranoid. Heck, I've already heard that from clients who want to know why we can't "just do it."

Deadly Ernest
Deadly Ernest

reduced capital costs NEVER mention the increased operating costs and how they can NEVER be deferred, the way some asset replacements can be deferred. They also don't mention the reduction in the Balance Sheet due to the lowered Assets entries and the raised Liabilities entries - you ask why raised liabilities, well, your contract for Cloud Services is a liability for the life of the contract as it is a cost that must be met until the contract ends.

Justin James
Justin James

... this is a follow up to the "disadvantages" poll that was done last month. Last month I did a "disadvantages" poll. I wanted this one to go into P&D as well, but they put it into Net Admin instead, thus the confusion. J.Ja

Justin James
Justin James

The one thing I always liked about third party vendors is being able to shift the blame to them. As long as you did the proper research (so the question isn't "why didn't you know this company was so bad?!?!"), it can be a real relief to just kind of wash your hands and say, "not my fault, all I can do is wait for it to come back on." J.Ja

JLVFR
JLVFR

This pool should have been "multiple choice". So I chose the "other" and am writing here. If I could, I'd have chosen all 4 choices... We're a very small IT department, the admin side being just me... for 150 users and 26 servers... and we handle data and services for over 70000 people. So, the term "overworked" tends to apply very well. We're looking at server and storage hardware that is not only getting old (4,5 years) but short or performance. Add severall problems, and we're looking at spending, in hardware and software licences, over 200.000 Euros in the next few months. Add the fact that we simply don't have the skills to do the full hardware and software changes we need (including a dreaded Exchange upgrade...) and costs (and stress level!) keeps rising. So, anything that can save not just money but work and problems is a godsend. We allready have cloud services, based on Google Postini: email scan/anti-spam and email archiving. The email scan/anti-spam not only improved our security 10-fold, it speeded up our email trafic by killing over 99% of the spam, and by allowing the removall of our old Mcafee appliance. As for the archiving, we now have an online archive for ALL our mails, contracted for 10 years. In 1 month, the archive stored 11GB of mails... So: -cost; ofc, this goes without saying. All the solutions that I've been presented with cost far less that the equivalent services set up "in house". -performance; when all you need (basically) is an good internet link, you can (fairly) easily boost performance; just get a better line and router from your local comms company. No need to get more servers, more RAM, more PCs. I couldn't believe my eyes when I saw our mails arriving at their destinations in 5mns tops, as opposed to an hour or more... or receiving only 4-5 spam mails in one day, as opposed to an average of 400+... -risk mitigation; who hasn't had cold sweats just thinking about the next big Exchange/server/whatever-is-core upgrade? Cloud-comp means the service provider will do all that for you. -focus; the less you have to do, the better you do the rest. I know I'd love to have more time to solve some problems and finish projects, but having to admin pretty much every little thing in those 26 servers is crippling my usefull time. Is it safe? Well... as in all things, what is safe? Safe as in "omg data is outside of our control, anyone can get it!"? Almost everyday we hear stories of companies who got their in-house systems hacked/keylogged/etc for some reason. I know that I don't know enough to fully protect my datacenter; we allready have 2 consultants working on this. So where's my in-house safety?... Safe as in "omg they can go bankrupt!"? In the solutions I've been provided with, I can withdraw my stuff any time I choose to. And... your company can also go bankrupt... Safe as in "omg I don't know/control those people, so how can I trust them?!"? How many cases have we read about people on the inside doing "bad things" with company data? Didn't their companies know/control them?... The client list Google showed us included a list of companies and corporations who *have* to be very carefull (banks, insurance companies, etc). Add the set of certifications and audits and I'm faily sure that we did the right thing. But we're not going to shift tour databases to the cloud, those will stay in-house... Technical IT management is getting more and more complex and expensive, requiring greater and greater resources. And, basically, "cloud computing" is just another kind of outsourcing, created to at least partially solve this increased complexity. (PS: posted at wrong lvl, should be under orignal post...)

JLVFR
JLVFR

The cost of the cloud solution can't be seen just in direct-payment cash terms. I'm looking at solutions that will allow us to dump 3-5 servers. If I go cloud, I will: -no longer have to pay for server maintenance contracts that keep increasing due to the age of the hardware; -no longer have to pay licensing costs of the OS on the servers; -no longer have to worry about the costs and dificulties of upgrading; -have lower costs related to power usage from servers and air conditioning; -avoid buying a bigger UPS for the datacenter, because the current one is no longer enough for the current load; -have more time to dedicate to other tasks; -save $$$ on getting outside help for some higher-end admin tasks. It's not just "contract-money". It's money saved on peripheral tasks, and all the trouble and stress avoided. But I also believe this is something each company will have to look at very carefully. In our case, we've grown exponentially in the last 4 years (went from 6 to 25 servers...), with performance and storage needs that completely outstrip our current hardware. So, going cloud for some of the tasks makes sense... for US. Will it make sense for you? No idea...

Screen Gems
Screen Gems

and when you do the assets to liabilities = equity and your a large business that just added a liability to your balance sheet not to mention that monthly check that has to be written out of income, the benefits of Cloud Computing seems to evaporate. It's good for the Cloud provider, they get a monthly check. Maybe not so good for the business no matter how much money they save. For the small or medium sized business that has a good owner or CEO who doesn't buy into the latest and greatest IT craze that purports to increase profits [how does IT increase profits in selling widgets?] create flexibility [again how does IT create flexibility in making and selling widgets?] and allows IT to adjust resources to emerging markets [what does IT have to do with selling widgets and services the company makes?]. Other than an eCommerce site, I can't see how all this IT does anything to sell a company widget or service to customers. An eCommerce site for online selling of widges I can see. However the eCommerce site is probably hosted by a 3rd party vendor anyways so what's the point?

Deadly Ernest
Deadly Ernest

my mind was off in lala land writing a book. I'll have to look into it later, if I remember - I'm getting to the point where I sometimes have short term memory lose. the other day I caught myself sitting down to start the programming on those Jurassic period dinosaurs again, damn that job's well over, and finished, I forgot I'd completed it.

jck
jck

Like when I got stuff from MS that didn't work right or have the functionality needed, aka- Silverlight 2 Beta 1 stuff. Boss: When can you get that working? Me: When they come out with the proper controls, or you give me the needed time to make the custom controls for you. Boss: We'll just do it in ASP.NET then. Otherwise, I just fix it or do it myself. With what we're doing here, we were looking at 2 different cloud solutions to enterprise office productivity. Neither did what we needed, and one provider promised us the world and never delivered what they said they would. So, both cloud solutions got the nix for a 6 month window and we'll re-review in the fall.

Deadly Ernest
Deadly Ernest

no one to pass the buck when the company is under going closure due to vendor stuff up putting them out of business.

Deadly Ernest
Deadly Ernest

Cloud legal - a lot of businesses are not able to do so as the laws covering the protection of Privacy data in their countries make such a process unlawful. And, once you keep that in house, putting the rest outside becomes a debatable cost measure. Your situation sounds more like the IT area has been chronically under funded and under staffed, and it's now about to bite management - big time.

jeffv96818
jeffv96818

All the hype about Cloud makes me worry. When the big guys jump all in, you know there's money to be made. Cloud is not enterprise ready. I call it "poor man's data center" since it makes sense for someone running less than 20 instances and can afford to turn them off when not in use. There's not a company I know of that does that. Most of the companies in the US don't meet regulatory compliance either. Proceed with extreme Caution. Tornado's and Hurricane's are Cloud formations too.

Deadly Ernest
Deadly Ernest

the other costs involved. But, I can see how it would appeal to some businesses, I just hope the do a PROPER check of all the bases. I've already heard of a couple of local companies that were thinking about this until they found out there was NOT a single Cloud Computing supplier that met the current government legal requirements on privacy and general security here in Australia. One big pit fall was they could NOT guarantee the data would not leave the country while in their network.

Deadly Ernest
Deadly Ernest

will cost the buyers a lot more - mostly in the indirect costs and intangibles.

JLVFR
JLVFR

All that is true. You'll need a beefed up internet link, but we allready have it. In fact, we have a twin-redundant link, so we're ready for this. As for costs, we pay a flat, per month, fee, regardless of trafic. Can't companies in your country present a case for a flat fee to their comms company? if they know they are going to have high trafic, they might negociate diferent terms. Like I said, "each company will have to look at very carefully".

Screen Gems
Screen Gems

like insurance companies do. They'll base monthly rates on amortizing costs across all of the subscribers. So that's their cost effective sales pitch. Companies save money because the costs are spread across many companies. IT became a money pit because of the latest and greatest craze which for most businesses did nothing for them except be a money pit. Made the IT mfgs godzillion amounts of money. Cloud Computing is the same thing only now, the IT mfgs don't have to worry about uneven revenue streams, people now pay a monthly fee just like everyone does for cell phones. That if you do the math, it's a lot of money.

Deadly Ernest
Deadly Ernest

to access all this over the Internet, the cost for the extra upload and download - if your country charges that way, as ours does (every damn byte). Also, remember to include an allowance for the days that you can't work as the Internet and your servers are NOT accessible for reasons outside your control - it happens. And remember to put aside the money EVERY month to pay for this service, and it's fee increases, for the term of the contract and beyond. BTW If you outsource the servers, don't expect to have more time for other tasks as the bean counters will see a reduced workload and cut back on staff and budget in proportion to the existing system as per how THEY see it. So you will lose people and budget as well. Just remember, the people with the cloud service will have all those costs you mentioned above, and they will on charge them to you too. Plus the charge for their time and profit. They aren't doing this for nothing.

Deadly Ernest
Deadly Ernest

When you can't dazzle them with brilliance, baffle them with bullsh**. I did notice how the report you quote talks about lower capital, but neglects to mention it will be offset by a higher liability - kind of typical of scam artist style approaches.

Screen Gems
Screen Gems

using IT or the latest and greatest gadgets, of which Cloud Computing is part of that marketing pitch, when in fact IT doesn't make widgets and gadgets that a company produces. IT can sell widgets and gadets a company makes via eCommerce, however, the marketing and sales pitches, like I referenced in David Linthicum's article, here's an excerpt "If I'm using cloud computing, my capital costs and, thus, my risks are typically going to be much lower. Moreover, my ability to adjust my IT assets in alignment with new and emerging markets is going to give me a strategic advantage." ." is simply sales and marketing pitches that try to dazzle rather than actually point out the benefits. If you have to dazzle someone with fancy words, then maybe the product isn't all the dazzle says it is.

Deadly Ernest
Deadly Ernest

and the hosted services can be a cost saving in reduced Internet access and gateway. But Cloud Computing moves your whole IT function off site - and is no good.

Deadly Ernest
Deadly Ernest

was out to lunch. Seriously, though, I do currently have an intermittent short term memory issue, so I'm never really sure if I have done something or not, unless it was about this time last year or before, or in the last few hours.

Justin James
Justin James

DE - You put up a great number of responses to the poll, it was a month ago. :) J.Ja

Deadly Ernest
Deadly Ernest

much happier when I'm in the position to say "That server is my responsibility, get your thieving idiotic mitts off it." Especially when directed at a half arsed vendor tech who's flat chat opening up a briefcase properly.

Justin James
Justin James

As someone who has been on both sides of a very nasty third party vendor scenario (the issues around "cloud" have been around forever, from things like "managed services" to warranty repair to any other scenario where you pay someone else to do a job you could do yourself), I know what you are talking about. I'm not a huge fan of the cloud, especially not for mission critical stuff. At the same time, at the level of being an employee, it is a huge load off of one's mind and back to not be the one who has to clean up messes. J.Ja

Deadly Ernest
Deadly Ernest

finally took the advice they were given back in 2002 and 2003. As to legal advice and lawyers - you know what they say, ask ten lawyers for an official legal opinion on something, and you'll end up with twelve answers. In some legal jurisdiction, the laws state that any organisation that collects any personal or privacy classed data on people must keep it secure to certain levels of security, and some even make it a felony to transfer the data out of the state / country - saying only the person it's about can do that, or the government. The laws in such jurisdictions are written such that the organisations MUST ensure that all privacy data within their operation NEVER leaves the country / state. A business trying to use a third party Cloud can NOT meet their legal obligations to prove that they are ENSURING the vendor does NOT ever move their data outside the relevant jurisdiction at any time, as the vendors often do off site back up at their facilities in other countries, and not all have suitable facilities in every country. Here, in Australia, some business have government contract which require that ALL persons who may ever come in contact with the data or the hardware the data is on MUST be security cleared through a national security clearance system that costs thousands of dollars to do. And the physical facility must meet certain security standards as well. The end result is such legal requirements mean the companies MUST keep their own in house data servers. Yet, I know of three such companies who got legal advice saying they could lawfully outsource data storage services, and corporate execs were getting set to do so, until some low level techie raised concerns about them complying with the relevant DoD requirements policies - the contract refers to the policies, but they aren't spelled out in the contracts and the lawyers didn't go look at the policies themselves. So I do NOT trust a lawyer to be right until they can PROVE, they have fully checked out all related legislation.

JLVFR
JLVFR

I'm aware of the legal problems (we got 14 lawyers!!!), which is why we took a long hard look at the client list. The banks and insurance companies in it make for a very convincing case... As for funding/staff.. we got (most of) the cash we need, but staff is the same as for years ago, so... Btw, since I see you're from NSW, here's something for you. Found it when I started researching cloud mail last year: http://www.misaustralia.com/viewer.aspx?EDP://1214270475399