Cloud Computing: Just Another Word for the Internet?

Published: June 27, 2011

by Alex Woodie

When terminology from the IT department breaks through into the mainstream culture, you know you're onto something really hot. This is the case with the term and the concept behind "cloud computing," which has spread like a west Texas prairie fire. However, for all the hype surrounding cloud computing, surveys show that only a fraction of organizations have adopted or are actively pondering a cloud offering. And the most popular cloud application? Email. Apparently, "the" cloud is the same as "the" Internet.

According to a recent survey by CDW, only 28 percent of organizations are actively implementing or maintaining a cloud computing service. The survey, which involved more than 1,200 IT professionals and had a margin of error of 2.7 percent, found that email was the most common cloud application, as it was used by 50 percent of the (ahem) cloud people in CDW's survey, followed by file storage, video conferencing, and online learning with 34 percent.

The lack of enterprise-type applications on CDW's list begs the question: Where are the enterprise cloud apps? Has the real cloud revolution--the one involving real applications that run the day-to-day businesses of regular companies, not the iCloud--yet to begin? Or maybe cloud computing is just (God forbid) a marketing term that's failed to coalesce into a real deliverable for 20th century-type companies that make or move or sell things to consumers and other businesses?

According to Marc Benioff, the CEO of enterprise software company Salesforce.com--which is used by regular 20th century-type companies as well as 21st century companies that push bits and knowledge for a living--we have already moved into a post-cloud world. "I'm sorry for those of you who didn't make it into the cloud," Benioff was quoted by Forbes as saying at a recent event. "We've moved on."

While Benioff is undeniably a success story of the software-as-a-service (SaaS) and hosted computing model, perhaps his view of things is just a bit clouded. Because according to North Bridge Venture Partners' Future of Cloud Computing Survey released last week, cloud computing still hasn't graduated pre-school.

NBVP's survey, which included 413 IT decision makers at regular companies and IT vendors alike, found that only two out of five organizations are "experimenting with a move to the cloud." The results (which didn't include a margin of error), show that, even among more progressive IT organizations (as IT vendors tend to be), the number of people getting their hands dirty with cloud computing is disproportionably small compared to the rampant hype in the market.

The problem with cloud computing, according to Derrick Harris, a senior analyst with the IT research group GigaOM, which helped with the NBVP survey, is that companies are unclear on which technologies they need, how they work together, who the main vendors are, and how to implement cloud technologies effectively.

Even among today's cloud users (again, mostly email), spending on cloud is just one-third of the total IT budget, according to CDW's survey. This led David Cottingham, senior director, managed services at CDW, to comment: "….[B]efore wide-scale implementation, IT managers are taking a hard look at their IT governance, architecture, security, and other prerequisites for cloud computing, in order to ensure that their implementations are successful."

Security is the biggest barrier to cloud adoption, which isn't surprising considering the recent spate of hacks at large companies in recent weeks. If RSA, Lockheed Martin, the International Monetary Fund, Sony, Netflix, Google, and the Oak Ridge Laboratory can't keep hackers out of their systems, how is a cloud computing provider with considerably fewer resources going to keep its clients' records safe? Sure they might guarantee tight security in writing and present a sophisticated SLA, but are those pledges credible?

It's clear we are in early days of cloud computing, and there is still much to work out before--or if, really--regular companies will put their most valuable applications and data in the cloud, which at the end of the day is just the Internet.

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