China: The Largest Cloud Player

• China is home to some of the world’s largest data centres, a bit of a triumph considering the heavily regulated environment in which they exist and the initial reluctance of international investors to be a part of them.

• In 2009, the Chinese government funded an experimental cloud platform under development by IBM and the Beijing University of Technology.

• The Chinese government has invested $173.2 billion in the development of key cloud computing hubs.

• A recent survey of Chinese IT executives found that 20% are already using cloud-based solutions, and 46% are evaluating cloud solutions for use in their businesses.

• Chinese policymakers have nominated five new cloud computing zones as part of its “12^th Five-Year Plan.” By 2015, the cities of Beijing, Shanghai, Shenzen in Guangdong province, Hangzhou in Zhejiang province and Wuxi in Jiangsu province should be well established as hubs of cloud-centric activity. Each of these cloud “laboratories” will work with industry to serve as pilot models for how such technologies work.

• The cloud market in China is expected to have reached almost $14.8 billion in 2012, up from $11.4 billion in 2011. At this rate, China is poised to become the world’s number-one cloud market.

India: Technology Hub

• India has been identified as a hotspot for cloud computing growth over the next few years. Its government has regularly indicated its endorsement of cloud with financial investments.

• Gartner has forecast that India’s spending on green IT and cloud initiatives will double, from $35 billion in 2010, to $70 billion in 2015.

• According to IDC, India is experiencing an information explosion, with digital data growing from 40.000 petabytes in 2010 to 2.3 million petabytes in 2020. The cloud is the means to this end, as Indian companies look to leverage cost advantages.

• Some 40% of professional organizations in India currently use cloud computing; 58% say cost saving is their primary motivation for cloud adoption.

• Gartner says businesses in India are adopting the cloud at a much faster rate than originally expected; two-thirds of Indian CIOs expect the majority of IT to be running on the cloud by 2015.

• Gartner has revealed that there are several “urgent and compelling forces” that will come to prominence in India and its 1.2 billion inhabitants in the near future. Cloud computing is prominent among them.
• Gartner has predicted that IT spending in India will rise by 9.1% to $79.8 billion in 2012, as in-country enterprises invest more in IT systems.

• In a recent survey conducted by virtualization platform provider VMware and Forrester Consulting, 91% of participants from India stated that cloud computing is “relevant to their business.”

We’ve said it before and we will again. Cloud computing is a saviour of sorts—and for more than just your bottom line and overtaxed systems. No, cloud computing has a larger calling than that. One might even say that cloud computing is poised to deliver the world to a finer place, one in which waste and excess are recalled as sins of a more reckless age. With this communal data-storage marvel, the carbon emissions that would otherwise be sent heavenward from a churning-away corporate entity can be slashed meaningfully, and the world thus scores a significant reduction to its reliance on carbon. 

This news comes by way of the Carbon Disclosure Project, an AT&T-funded European study whose just-released results suggest that large companies in the UK and France who migrate their data to shared data networks in the cloud could cut their emissions by a full 50% by 2020.

The savings, quite simply, are a result of the decreased call for energy consumption of the new over the old. The cloud’s responsive flexibility means customers only use what they need, sidestepping the wastefulness and redundancy of yesteryear.

Money Savings, Carbon Savings

The study, which focused its attention on large IT companies in Great Britain and France, found that big UK organizations that move to cloud computing could enjoy carbon reductions that are equivalent to the annual emissions of over four million passenger vehicles. Oh, and they’ll also save in energy costs, to the tune of about £1.2 billion—findings that underscore a recent announcement by a British cabinet minister that the UK government’s cloud strategy could save British taxpayers as much as £460 million a year—so it’s not all selfless stuff on offer here.

The figures were understandably somewhat lower in France, where nuclear power reigns supreme in the business of electricity delivery, but blue-chip French companies are also poised to exploit some pretty noteworthy savings, too. And, say the study’s authors, the exploitation will be on a grand scale, as almost 70% of these organizations’ IT resources will reside in the cloud by 2020. That’s up markedly from the 10% at which the services are currently used.

Closer to Home

Closer to home, the report concludes that a large North American company that made the switch to the cloud now could be sitting on top of $12.3 billion in yearly savings, and annual carbon reductions that are equivalent to 200 million barrels of oil, by 2020.

Considering that neither of these diminutions—energy or cost—serve as the most persuasive reason to switch over to the cloud (that distinction remains a function of speed, and the accelerated pace at which all corporate activities can take place in the cloud), the argument is more compelling still. Where developers used to take 45 days to get new servers, one pundit remarked, the much more responsive-to-demand internal cloud has shrunk that lag to just a couple of minutes.

Send your stuff up into the cloud, it seems, and you just might save the world.

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In fact, the looming cloud heralding the next stage of corporate computing, the same one that’s sent nervous naysayers into all manner of anxious fits, has a broad silver lining that these fretful types probably haven’t considered.

The Silver Lining

In a blessedly optimistic editorial published in late October, Pulitzer Prize-winning New York Times journalist Thomas L. Friedman makes the point that the oppressive economic climate currently shrouding the United States is actually conducive to bursts of creativity like no other time in recent memory. And this advancement will unfold, in large part, courtesy of the supremely affordable and eminently functional resource that is cloud computing.

The latest phase in the IT revolution, he says, is being driven by the convergence of social media with the proliferation of cheap wireless connectivity and Web-enabled smartphones—all of it operating under the facilitating miracle that is the cloud. The thousands of software applications stored in this cyber cell transform our handhelds into extraordinarily powerful devices that confer on their users the potential for unprecedented innovation. The cloud has lowered the barriers to entry like nothing else.

Startups to the Rescue

Specifically, goes the argument, this technology shift will clear the way for new companies of all stripes, from insurance brokerages to medical labs, to dip into a nominally priced technological asset and borrow its overarching infrastructure to create from within. With this exceedingly useful tool, entrepreneurs can find their feet more cheaply and easily than they could even five years ago. Where previous eras required serious commitments of capital toward promotion, real estate, labour and technology to establish an operation, the cloud has removed a substantial chunk from the imperatives. The savings to be realized from employing a cloud solution rather than the traditional means and their attendant call for application servers, database servers, various on-premise applications and a slew of expensive IT personnel are genuinely meaningful for a startup. The cloud’s arrival in our midst has delivered supercomputing powers to the masses and, said Friedman in an earlier column, produced a “DIY economy.”

S.O.C.I.A.L

As Friedman describes in this editorial, Marc Benioff, the founder of cloud-based software provider Salesforce.com, this phase of the IT revolution might be summed up with the acronym SOCIAL: S for “speed,” O for “open,” C for “collaboration, I for “individuals,” A for “alignment” and L for “leadership.”

“The emergence of the cloud,” goes the piece, “means than anyone can have the computing resources of Google and rent it by the hour. This is speeding up everything—innovation, product cycles and competition.”

With more and more organizations opting to store their data on cloud computing systems rather than under their own roofs, outsourcing data centres are springing up like mushrooms to answer the demand. That development, say the folks at this Colorado-based thinktank, spins off into all kinds of good stuff, including savings in manpower, savings in money and—here’s where the world’s interests kick in—savings in energy. Indeed, say the analysts behind the research, this cloud business could help reduce the world’s energy costs by almost a third over the next decade.

First up, the stuff that lines the pockets.

Revenue from these proliferating data centres, predicts the new research, will inflate to a compound annual growth rate over the next decade of 29%. In hard numbers, that means a revenue climb from $46 billion in 2009 to $210.3 billion in 2015. More than that, says the report—titled “Cloud Computing Energy Efficiency”—new investments in the stuff will continue to spur greater efficiency for those dollars spent.

Indeed, Pike Research’s analysis suggests that, absent the cloud, only the very largest commercial or governmental organizations would have the capital and expertise required to achieve the same kind of efficiency at a comparable cost.

Green Shoots

But it’s the trending transformation of another kind of green, says Pike’s senior analyst Eric Woods, that’s even more impressive.

“Cloud computing revenue will grow strongly over the next decade,” Woods says. “But the reduction in energy consumption will be even more significant.”

Pike forecasts that, if the world continues along its current cloud-computing adoption curve, overall data centre energy consumption will be slashed by a dramatic 31% in the period between 2010 and 2020.

This news comes on the heels of other publicly stated initiatives that acknowledge the wasteful footprint of the globe’s infinite IT goings on. Facebook, for one, recently announced that it intends to make public the details of its data centres such that others might benefit from this massive operation’s evolving understanding of energy efficiency. According to the social media giant, the servers in its refurbished data house—which apparently took two years and tens of millions of dollars to complete—run 38% more efficiently, and 24% less expensively, than those in their comparable peers.

One Centre, Less Energy

Simply put, goes the report, clouds are better utilized and less expensive to operate than traditional, siloed data repositories are. The more disparate operations they take in under their generous eaves, the more efficiently is this channel of energy expended.

And all signs point to a continued drift in this direction. As increasingly more of the work that was conventionally performed in internal data centres is consigned to the cloud, the world’s basket of energy consumption, associated energy expenses and greenhouse gas emissions suffers ever fewer hands dipping into its bounty.

Consider, too, the very prickly subject of cloud security, heretofore much maligned for its apparently inherently contained contradiction but, in a recent show of enlightenment, perhaps rewritten as saviour rather than villain.

Big Picture Author

In this Wall Street Journal article, a big-picture pundit introduces the extraordinary idea that the cloud may in fact be the safest place to store our data, the deafening cries that have long argued the opposite notwithstanding.

The article’s author, John Bussey, submits that data consigned to the cloud actually enjoys an abundance of sophisticated security-enhancing features that an organization, particularly one in the small-to-mid-sized category, simply couldn’t access on its own.

“The sheer size of cloud businesses like Amazon.com’s Amazon Web Services,” the piece goes, “allows significantly more investment in security policing and countermeasures than almost any company, large or small, could afford themselves.”

Go Big to Stay Secure

More than that, Bussey points out, the average computer user is not as attentive to even the most routine security imperatives as he needs to be. But sign on with just a “plain-vanilla” cloud package provider and you automatically score security basics such as updated antivirus runs and as-needed software patch applications. Any upgrade from there improves your lot further with enhanced security features like data firewalls, high-end encryption and 24-hour tech support.

“Small and medium businesses are insane not to leverage the advantages of cloud computing,” Jim Reavis, of the industry group Cloud Security Alliance, told Bussey. “It ends up being almost in all cases a security upgrade, because they can’t otherwise afford the practices.”

A Lone Voice in the Wilderness

Of course, this voice in the wilderness is still powerfully eclipsed by the hue and cry of the status quo. And it’s a position endlessly reinforced by the studies that continue to pour in with findings that tell stories of organizations’ enduring wariness of the idea of entrusting their data with an off-site third party. And this is the scene even in spite of an ongoing flurry of initiatives undertaken by IT security vendors, cloud providers and industry evangelists themselves to redress this issue.

Still Talking to Ghosts

Just this week, a study unveiled at the V3 Virtual Cloud Summit in Great Britain reported that a full 87% of enterprises remain concerned about security in the cloud.

And some 72% of small (fewer than 100 employees), and 63% of mid-sized (100 to 999 employees) companies told technology research firm IDC, in 2008, that security was their most pressing concern when it came to the notion of transferring their operations to the cloud. That those numbers had contracted to 50% and 47%, respectively, when the same survey was conducted three years later, is a thundering step in the right direction.

Because revolution, after all, is a slow business. Remember how long it took to come around to that broccoli?

10 Things you need to know about PSOs

1. The global PSA software market will hit a staggering $7.63 billion by the year 2017, according to new research from Global Industry Analysts, Inc. The news is surprising, considering the hit this market took during the recent global economic dip, as those companies purchasing such products opted to hold back their purse in infrastructure-enhancing purchases.

2. The tide is turning on this front in a significant way. Indeed, PSA software suites are increasingly emerging as bona-fide recession-proofers for corporate IT department principals inside professional services organizations anxious not to suffer the same shortfalls again.

3. Professional Service Automation is enterprise software that’s particularly designed for companies engaged in the delivery of accounting, management consulting, engineering, and agency and PR services, among others. With it, companies enjoy increased productivity and efficiencies across their operations, along with a much-enhanced view of what’s actually going on within them.

4. Up until fairly recently, PSA was regarded in terms of its individual components only. But its usefulness increases manifold with recent developments that link the software’s various disparate modules in a way that reveals the full breadth of available integrated solutions.

5. Not surprisingly, the omnipresent Cloud hovers above this aspect of operational efficiency, too. As more and more companies adopt the off-site approach to their data-management efforts, the opportunity to bundle all of their corporate activities—from sales to service to finance—under a single umbrella is too appealing to pass by. It’s why a muscular movement is afoot to blend the worlds of CRM and PSA.

6. A recent study conducted by consulting firm Service Performance Insight demonstrates that Salesforce CRM users who shift their interests to the Cloud are rewarded for the choice with higher bid-to-win ratios, greater average revenues per project and deal pipelines that are vastly superior to those of their less forward-thinking counterparts

7. The Service Performance Insight research also shows that PSOs simply cannot realize all the powers of their CRM systems unless they’re well integrated with their PSAs.

8. An integrated CRM-PSA application offers users the ability to track the gamut of their business activity—from fingers-crossed leads through in-the-bag deals—on a single platform, with a single interface, employing a single data repository.

9. By amalgamating their CRM and PSA platforms into one, goes the news, professional services firms benefit from larger project backlogs, improved executive visibility, better success with winning bids, higher billable utilization, an enhanced percentage of billable employees, more revenue from new clients and a greater proportion of projects that are completed on time.

10. Just the same, another burst of research from the same organization, this exploring the challenges of Salesforce CRM customers in the professional services industry, reveals that precious few of them have taken the steps to see through such a profitable integration. The news, still in the pipeline, is clearly yet to be fully put into profitable play.