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domino1In the past year, I’ve had hundreds of conversations with client and press about the emerging cloud services model, and its impact on the IT industry.  As you might imagine, more than a few folks question whether the cloud services model will really be as pervasive and transforming as its proponents argue.   The skeptics point, legitimately, to the many remaining challenges of cloud services adoption, particularly around security, availability, performance, limited customization, lack of standards, etc.

My response to the skeptics is very simple: within the next several years, none of those challenges will make a bit of difference to the vast majority of customers.  The public cloud is where the best and richest variety of business solutions will increasingly be found.They will still choose, in large numbers, public IT cloud services as core elements of their IT services delivery portfolios. They will do so for one big reason:  the public cloud is where the best and richest variety of business solutions will increasingly be found.  (You could certainly argue that this is already the case in the consumer IT solutions world.)

The online shift of the latest and greatest business solutions to the Web is happening because the Cloud is winning the war for developers:  a rapidly growing number of developers see the Web as the most attractive “platform” on which to quickly and affordably deploy their solutions.  It’s not a mystery:  the Cloud dramatically reduces the barriers for customer adoption (and upgrade) and dramatically expands the market reach for solution developers. Can you imagine a developer of a hot new solution choosing not to deploy in a Cloud/SaaS mode?  Hard to imagine.  They might not do so exclusively – they may continue to also develop for the big on-premise platforms, and many will also deploy their public cloud solution as a software appliance in a private cloud.  But it’s easy to see that the public cloud will be the number one deployment target for a large majority of solutions.

If this pattern sounds familiar, it should.  We’ve seen this movie before:  in the 1980s, people debated about the relative benefits of “PC vs. mainframes (or minicomputers)”.  If this pattern sounds familiar, it should. We’ve seen this movie before.The PC proponents pointed to dramatically lower “cost per MIPS”, and the PC opponents cited lower reliability or the lack of legacy tools in the PC world.  In the end, the real battle was not about any of these things – it was about the migration of an enormous amount of developer energy and solutions to the PC (and Wintel server) platforms. The new platform (PC, Client/Server) was the place you’d find the best and newest solutions.  (This is why the battle among the “Platform-as-a-Service (PaaS)” players is so strategic – they’re all vying to repeat Microsoft’s 1980s/90s Windows story, by attracting the richest solution ecosystems to their Cloud platforms.)

In the PC and Client/Server era, customers followed the solutions, and money flowed into the industry to develop solutions to the limitations of the new platforms.  We’ll see the same pattern this time – today’s public cloud challenges will not magically disappear or become unimportant to users.  But as more leading solutions pull more customers to the cloud, there will be more incentive for the industry to invest in developing creative solutions to these challenges.

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9 Responses to “The Single Biggest Reason Public Clouds Will Dominate the Next Era of IT”

Good post. I’d add another big item (at least as viewed by the finance department and normally the CEO) to this debate is that cloud-based solutions are free of CAPEX. You can pay as you go, scale up or down as necessary, and add or remove features on the fly, all normally with just a mouse click, and no huge upfront investment that has to be depreciated.

Hi Shawn – Thanks for the comment. I completely agree, the economics are very compelling. If you look at my post on users’ views on cloud benefits, financial/cost considerations come in #2, 3 and 4, right behind #1, speed to adopt. The reason I put the focus in this post on the migration of developers and solutions to the public cloud is that a lot of vendors have recently begun talking about “private cloud” offerings being able to delivering similar economics to public clouds. Their arguments have some merit, and there’s certainly nothing wrong with CIOs trying to mimic public clouds to drive down costs and improve service. But as the argument ensues over the economics of public vs. private, it’s important that folks not miss the bigger point: the economics that will drive the market toward public clouds are about developers’ economics, and customer solutions – not about cost/TB or server utilization %s.

Exactly–economics is one of the key benefits here. I find it interesting that a company can set up shop tomorrow and with a minimal investment of around $150/mo, can have full email, phone, and CRM capabilities (basically everything you need to run a company) that are all cloud-based. And again, no CAPEX.

Frank: first, I absoutely agree that the ultimate benefits of THE “Public Cloud” will keep the momentum going. Although the ultimate “Public Cloud” is still not defined, my vision is that consumers and employees will simply “connect” from wherever they are, using some form of thin client (most likely browser based, but who knows), get the data/function they need, then be billed for it. Analogy – power grid. No more need for corporate data centers. However, I see major complications on the way:

1. What will it really look like? Wintel, Linux, UNIX, ??? This decision will take a long time to resolve. Currently, technologies are daily leapfrogging each other. So many players want to take the lead, and rightfully so – there may not be a second place.
2. User access controls: we are talking about a user population of EVERYBODY. How will it be created? What access control methodology will be the ONE? How will it be maintained? Who will maintain it?
3. It is hard to believe we will end up with a single “Global Infrastructure” vendor. With power, you have many “manufacturers” of power that feed what is becoming a single grid. Is that how IT infrastructure will be? “Processing” providers and “Storage” providers all networked into a single grid? Who will define the standards and policies, especially since this is global.

Frank, I am very excited about the future of IT. The current free-for-all relative to infrastructure (my specialty), combined with the whole social media explosion, is simply wonderful to be part of. Although I am Republican, I have to mention that I believe our new “tech-hip” president is a plus for our industry. Along with EMR, and cybersecurity, maybe he could also focus on The Utlimate Cloud so the USA is ahead of the curve. Imagine the jobs it will entail.

THANK! Let’s keep this dialogue going….

Twitter: ITKLCameron

[...] future of IT is looking cloudy — [...]

In my opinion this is a tug-o-war between affordable development (and vendor control) and affordable use (and consumer control).

Obviously, if a majority of developers shift their attention to the cloud, consumers will have little choice but to adopt cloud-based services if it’s the only game in town.

But I suspect, as adoption grows, we will witness a growing dissatisfaction with the cloud due to a perceived loss of control.

As I wrote in response to a similar blog post, developers may prefer the public cloud but, ultimately, consumers will decide if they can stomach the loss of control. Most customers new to the cloud have yet to experience their first transition cloud-to-cloud, or product-to-product within a cloud.

Right now companies are enjoying that new cloud smell. The question on my mind is, what will happen once it wears off?

good insightful article…

Who, in your opinion, will drive the movement towards public clouds at traditional enterprises – corporate IT, or, application owners/users?

[...] – Frank Gens, Senior VP & Chief Analyst, IDC  Source:  IDC eXchange » The Single Biggest Reason Public Clouds Will Dominate the Next Era of IT [...]

[...] We see 2014 as a “knee in the curve” year for public IT cloud services adoption, particularly in the earlier-adopting markets of the United States and Western Europe. In these markets, we’ll see acceleration in market growth in 2014 as the investments vendors make in 2010–2013 in cloud platforms and the solution and channel ecosystems around them come together with a more educated customer base and better solutions to adoption obstacles such as security and availability. This means that those vendors that haven’t positioned aggressively for cloud in the 2010–2013 time frame will see the market move more quickly away from them in 2014 and beyond.  For more on the impact of cloud solution/application ecosystems growth on public cloud services adoption, see The Single Biggest Reason Public Clouds Will Dominate the Next Era of IT. [...]

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