Part 4: Breaking through the Cloud - Serving the marketplace / The Cloud on the horizon

In this special report, the editor of Manufacturing & Logistics IT Magazine, Ed Holden, interviewed 13 leading vendors from the world of IT software, hardware, consultancy and infrastructure to ask them what they consider to be many of the current key talking points within this fascinating technology space.

Demystifying the concept - Key selling points - What barriers to greater deployment remain - Serving the marketplace - The Cloud on the Horizon

This article is the final in a 4 part series. You can link directly to the full article in the digital edition of the magazine.  Click here... 

Cloud computing is one of the most revolutionary paradigm shifts of recent times within the IT world. End-user organisations are now able to run their preferred software applications on a highly flexible, shared data centre in the Cloud (Internet), rather than having to configure, customise, test, run and regularly upgrade these apps on their own servers. 

Champions of the Cloud architecture concept will also comment that this type of virtualisation enables companies to benefit from the rapid deployment of sophisticated, flexible and highly scaleable software solutions without having to commit to the up-front capital expenditure of the software licences. Instead, they are able to simply enter into a pay-per-use, monthly or quarterly billing arrangement with the vendor. But there remain some concerns related to security & confidentiality, compliance, quality of service, integration and long-term costs.

Serving the marketplace - plus .......The Cloud on the horizon

How do our commentators organisations exploit Cloud-based technology for the good of their end customers?

Jimmy Harris, Accenture
Our strategy is to extend our services to embrace the Cloud in our existing lines of business; that is management consulting, technology consulting, systems integration and outsourcing. Another part of our strategy is based around creating services that are Cloud-based; that is SaaS offerings as well as Business Process as a Service offerings, while also enabling Accentures business to take advantage of Cloud services.

Michael Klemen, Cisco
We are currently putting a lot of effort into what we call borderless networks. This is about breaking down borders that exist in manufacturing in various areas, to achieve new levels of efficiency, productivity and profitability through being connected everywhere. So its more innovative, responsive customer-, partner- or supplier-focused business processes that transform the way IT manages, scales, secures, governs the whole network. Here you have a kind of umbrella Cloud sitting over your infrastructure, and it enables the benefits of having intelligently connected devices drive your whole value chain.

Colin Bannister, Computer Associates
We use Salesforce.com internally as our opportunity management tool, so we are a user of SaaS-type services. We have increasingly started to deliver our technology effectively through a Cloud offering, so delivering our technology through SaaS. There are a growing number of solutions where we host the software and customers can access it on a pay-per-use basis. For example, our Project & Portfolio Management solution is hosted by us, and customers can either buy it and run it themselves or we can host it through a SaaS offering.

Ron E Brown, CSC
CSC can manage private, hybrid and public Cloud scenarios that help our customers choose the right Cloud for their needs. With our Cloud-related services we can more accurately match demand and supply in terms of the level of IT services our customers require. In this way companies dont have to bear the cost of the burden of carrying peak volume load at normal times, making IT usage more cost-effective.

James Norwood, Epicor
What we have started to deliver and what we officially define as Cloud computing are ancillary and adjunct application capabilities that our customers can access without necessarily having to buy the software and implement it on site. So rather than say to our customers youve got to replace your entire ERP system to get the benefits of the Cloud, we point out that we understand that the investment they have made in ERP is very significant and isnt something that can be changed overnight, so here is a way to get more out of that investment, particularly in the current market where capital expenditure is tight.
 
Steve Strutt, IBM 
One area we are involved in is IBM Research Cloud Computing, or RC2 technology, which is basically a pay-as you-go development environment. This makes it easier for developers and development organisations to get access to computer services, and they basically just pay for what they use. So from an internal delivery perspective, this is driving down some of the costs associated with things like developing new software and applications. We also have our Technology Adoption Programme, which is an internal environment where people within IBM can work on emerging technologies or new innovations; things like collaboration, productivity tools and social networking development. This allows everybody to contribute to the culture of innovation.

Raghavan Subramanian, Infosys
We use Cloud internally within Infosys. We have our own information systems organisation where we run a group of applications that are relevant for Infosys. These applications run in a virtualised environment on top of which we are also running Cloud management. For customer organisatons, we offer a number of Infosys business platform solutions that can be customised for their requirements and then integrated with their own applications. Another example of what we can offer is a platform suitable for telephone service providers that want to have, say, something similar to iPhone, where customers can download applications. Also, entrepreneurs can write applications and promote them using this platform. This is a white-label platform that is suitable for the Cloud environment.

Steve Farr, Microsoft Dynamics 
Where we stand today in this space is not to take the entire application into the Cloud, because this doesnt suit our customer profile. The Cloud services that our customers use are through a core enablement of our applications to interact with web services and to expose their logic and security profile through to other devices such as websites etc. So its not necessarily to expose the core functionality of the Dynamics application to the Cloud, but rather to use what we call an attached service.

Andrew Bond, Oracle
Our offerings include: Oracle on Demand, a SaaS platform that can also be provisioned privately; Real Application Clusters supports the transparent deployment of a single database across a cluster of servers, proving a high level of availability, scalability and low-cost computing; were also about to announce something new with Rackspace a Platform as a Service offering in the public Cloud.

Simon Black, Sage Pay
Sage Pay offers several significant benefits to customers. One is, like any application sitting in the Cloud, it can be accessed and managed from any location. For example, our customer GuitarGuitar is a retail business that has a number of outlets in various cities in the UK, but also has a roaring online trade. So when the company wants to review its online transactions it can log on from the office, or log on from home or through Safari on an iPhone, and look at all the daily transactions. The company can also access reports for how many transactions went through last month and how many people paid with Mastercard or Visa, etc. Another benefit is that our offering is one less application for users to worry about in terms of their internal networks.

Kaj Van De Loo, SAP
Our customers are already using external Clouds to deploy SAP systems. And we see our mission as helping our customers reduce their total cost of ownership of their SAP solutions by best enabling them to utilise both internal and external Cloud infrastructures. We also have a long history of supporting multiple databases and supporting multiple operating systems. And in that same fashion we now support multiple virtualisation technology and multiple Cloud service providers.

Dave Carmichael, Sterling Commerce 
We operate in this space in three main ways. One is we deliver SaaS applications. So at the application layer we provide what would now be classed as Cloud-based applications. We also provide at the Platform as a Service layer a number of infrastructure platforms. So at the platform layer we provide what we call Integration as a Service, which has a twofold capability; one is we use it to enable our customers to use it as a service to connect with their trading partners and trade with them electronically, exchange documents and collaborate generally. The third form we use is that same Integration as a Service technology or B2B outsourcing or whatever you wish to call it combined with our B2B Gateway software, which is used to enable companies to not only connect with and exchange data with trading partners but also connect with and exchange data that is in the Cloud itself.

K Ananth Krishnan, Tata Consultancy Services
Tata Consultancy Services helps its customers with the following five service offerings on Cloud computing:

1) Cloud Advisory Services This consulting offering delivers a customised Cloud adoption strategy and advisory services for our customers. Tata Consultancy Services identifies opportunities for leveraging cloud computing, with a clear technical roadmap, including Infrastructure Simplification, and a business case. Tata Consultancy Services integrated consulting and IT services capabilities bring continuity and consistency to customers strategic programmes.

2) Cloud Migration Services Customers existing applications are migrated to the target Clouds. Tata Consultancy Services brings in our extensive capabilities on application migration with automation assets.

3) Cloud Development and Assurance Services Application development and testing will be a key business activity for organisations, and Tata Consultancy Services provides Application Development and Assurance services to its customers. These include:

 For the Cloud Applications built to run in the Cloud.

 In the Cloud Application development and Assurance happen in the Cloud, so that the organisation does not need to own any development and testing environment.

4) Cloud Deployment and Management Services According to the customers business needs, Tata Consultancy Services delivers SLA-based remote managed services on the ITIL framework across IaaS, PaaS and SaaS layers of Cloud.

5) Cloud Strategic Services Create Cloud-based business models for services, applications and infrastructure. For Tata Consultancy Services, the Cloud offers exciting opportunities around business models based on a different mix of capital and operating expense, and helps Tata Consultancy Services in leveraging this paradigm in its full services play.

How will Cloud computing continue to develop, both technologically and in terms of business advantage, over the next few years?

Jimmy Harris, Accenture
I think the service providers themselves are the being more and more sensitised to the issues around the importance of greater levels of security. We see Amazon coming up with its reserved capacity and its virtual private Clouds; a direct response to the Im nervous about living with everybody else scenario. Microsoft, with Azure, is increasingly moving to offering Cloud services behind your companys firewall or its public Cloud, and it will give you the portability and tools to be able to manage across those environments. I think this is in direct response to some of the general security issues in the marketplace. So I think we will see an evolution in services to address these issues, but I also think that the providers will continue to extend into APIs, into social networking tools and more mobility-type services. They wont ignore the technologies that are defining the way that companies deploy applications and services. 

Michael Klemen, Cisco
Many major players are investing heavily in the Cloud platform concept, so lots of new developments will undoubtedly appear. On the other hand, interesting applications in the Cloud are also appearing. If you consider the iPhone Apple environment new applications are appearing all the time; and the Cloud decides whether the new applications will be a success or not. Another interesting area that will continue to develop is social and business networking. Whenever I go on a trip I put it on Tripit and it automatically connects to my relationships with Linkedin, etc. And through doing this I may find that one of my contacts is in the same city as me; which potentially gives me the opportunity to arrange to meet up. So, Cloud-based applications can make networking and general communication much easier and I think this is only the beginning.

Colin Bannister, Computer Associates
We will certainly see a lot more of our capability delivered through that Software as a Service model in the Cloud. Through our partners and service providers you will see network management as a service, infrastructure management as a service, and more of this type of IT function delivered through the SaaS model rather than organisations having to have the IT skills in-house.

Ron E Brown, CSC
Security technologies will need to be developed further, or made more available, in order to gain the confidence of the user. And in terms of whats on offer, I think what we will find is that people will settle over the next year or so on a blend of services for their enterprise. So the end game is probably something like 20 per cent managed services for the really core activities, 5 to 20 per cent for public Cloud services (depending on the industry in question), and the remainder probably embedded in private Cloud for most enterprises.

James Norwood, Epicor
I think that as virtualisation proliferates application service providers are going to need to support whatever scenario customers require. Providers need to think both commercially and operationally, and if a product has not been architected for use in a Cloud context you could see a similar situation to that of the ASP providers in the post-dot-com period; hosting existing software on a subscription basis and often finding it difficult to get the cost structures in place in line with the returns. Virtualisation in the workplace will increasingly drive customers towards the Cloud. Then the application service providers have to be able to offer their solutions in whatever manner the customer needs; whether thats subscription or one-time purchase or co-location purchase and hosting or in terms of multi-tenant or single-tenant, while also being able to bring it back on premise if required. 

Steve Strutt, IBM 
The Government is looking quite seriously at Cloud delivery, and how it can potentially exploit it and lower the cost of delivery of services to UK citizens. So, there is quite a lot of opportunity there potentially for governments to change and evolve. And although the tooling is not fully in place yet, I also think the Cloud is moving more towards applications being provided by multiple providers. So we will see what could be described as mash up applications where users can take components of different solutions and create their own customised applications. Whether its components from IBM to create an end-to-end logistics platform using a bit of CRM and a bit of customer helpdesk and process logic I see it going in that type of direction. But for this sort of evolution to take place there needs to be more technology development; for example around service management aspects.

Raghavan Subramanian, Infosys
In the world of Cloud I see a Cloud burst to be one of the most significant developments to look out for, and one of the key technologies that could help a lot of organisations to realise the promise of Cloud. A Cloud burst is about organisations using their own data centre assets when it makes sense and being able to use assets from the public Cloud service providers when they need to in a seamless manner. Something else to look out for is storage optimisation a very important concept. Its not considered a new technology but rather a feature of an existing product. However what it facilitates is better use of storage capacity. As an example, if you send an email to five other people with a privacy attachment that is six copies of the same file. So instead of taking up 5MB in storage capacity it is actually taking up 30MB. What storage optimisation means is that when you store information, whether for back-up or for primary data etc., it ensures that storage capacity is used in an optimal way for example, facilitating less duplication of data. This is another area where you can see the top vendors heating up the water.

Steve Farr, Microsoft Dynamics
There is a case for looking at how on-premise solutions are configured in terms of the web services they expose, such that they better fit a security profile that is more apt in the Cloud than on premise. Even if you have a good on-premise system and you use the Cloud for payment or an e-commerce site etc. you need to think about embedding the security access and logic rules within the web service that you expose rather than have a certain level of security thats right for on premise while simply hoping that the Cloud provider has another level thats right for Cloud. So I think there will be less of a pull model and more of a push model as on-premise providers change their software to make it more appropriate for Cloud computing; thats certainly what were doing at Microsoft.

Andrew Bond, Oracle
In a non-technological sense the capability services such as chargebacks should mean that customers understand more the value of the service theyre being provided with. On the negative side, weve seen concepts emerge such as the rouge Cloud. In terms of technological development, I think standards are key. As we get more interoperability we will need more standards in the area of Cloud computing, and the adoption by the vendor community of these standards is important.

Simon Black, Sage Pay
For small businesses Im not sure whether there is going to be an iPad moment, but if you look back in 12 months time youll probably see that the people setting up these smaller businesses will have increasingly wanted to use web-based applications from trusted providers, and will have learned more from the success of companies such as John Lewis and Marks & Spencers online. When you use, say, an online accounting application remotely it is very important that you trust the provider who you are engaging with because you are talking about all your critical business data. You also need your provider to be stable and reliable and know it is going to be around in five or ten years time. With more awareness and confidence in the marketplace then we will see much greater adoption.

Kaj Van De Loo, SAP
The real premise of the Cloud is this infinitely and elastically scalable computer storage resource infrastructure. Most developers over the past few generations of developers have been trained to deal with finite computer resources and finite storage. What we see now is that some of the consumer-based websites particularly the larger ones such as Face Book and Google have come up with new database technologies that are open source with more net capacity. And I think we are going to see a new generation of developers thinking about applications in new ways to be able to build applications that assume infinite Internet computer storage resources. These things of course come at a price, and we may not get the immediate consistency that we get from a traditional database, but with near unlimited storage capacity we would be enquired to think about application architecture and application programming in new ways. We will be able to build applications that we couldnt have built before. Over the next few years we should see enterprise applications come out that are radically different from what we are used to because they will take advantage of this much more highly scalable resource.

Dave Carmichael, Sterling Commerce
We are currently in a hype cycle, where everybody is getting exciting about the Cloud, but I think there will be a moment of sobriety when everybody starts to really ask themselves how do we actually join it all up?. So you will see a proliferation of Cloud-based vendors that will help join it all together. This is currently being referred to as Cloud brokerage. Im not talking about infrastructure, Im talking about the tools and services that can help make the Cloud work better. This is where the major growth will be. We will also anticipate a lot of Cloud companies coming along and there will subsequently be a lot of consolidation in the marketplace.  

K Ananth Krishnan, Tata Consultancy Services
The public Cloud vendors will continue to make progress around meeting all enterprise requirements. It is likely that community Clouds will become more popular for specific verticals or use cases. We are already seeing governments adopting Cloud as a means of simplifying their infrastructure and are also providing massive amount of public data through this delivery channel, so newer classes of applications operating on massive volumes of data and scalability requirements will become common. While there are ideas around a Federated cloud model, in which workloads are dynamically deployed to the right Cloud, this may move closer to reality. Also, more product vendors will announce their licensing policy for Clouds.