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The Public Cloud Arrives in 2013
Source: news.idg.no
Source Date: Friday, January 18, 2013
Focus: Institution and HR Management
Created: Jan 22, 2013

In corporate circles, inside the four-walls of IT, and at executive gatherings, tales of the affair between the public cloud and IT have fed uninterested CIOs with far-from-juicy gossip.

It was clearly a relationship--between IT and the public cloud--that was doomed from the start. A lack of trust, a world of insecurity, and a baggage of unresolved issues had crippled its foundation. A series of public cloud outages wasn't helping. And it seemed like IT would never be able to trust the cloud again.

Well for starters, there was a time when even the very concept of vanilla cloud computing took a considerable amount of time to build credibility. But with the passage of time, the cloud has only matured. From being a bottom-of-the-pyramid technology, cloud computing, in its many shapes and forms has grown to be a respectable and reliable technology for enterprises. This is evident from the fact that it features in the CIO priority list and is gradually making its presence felt in Indian organizations.

Consider this: According to the findings in the State of the CIO Survey, almost 80 percent of all respondents were at some stage of implementing or had already implemented a cloud solution. Also, 35 percent of all respondents thought that cloud computing will have the single most profound effect on the CIO's role in the near future.

When it comes to the type of cloud implementation CIOs plan to deploy, 48 percent said they opted for a private cloud, 38 percent chose hybrid cloud, and only 14 percent went for a public cloud. The public cloud might not be a favourite yet but the percentage of organizations implementing it has jumped by 9 percent--a significant improvement.

This makes the public cloud promising. Its gradual progress to the top is encouraging CIOs to spare a thought for the technology.

Going Public

Taking a leaf from their peers, some forward looking CIOs have already started looking up to the public cloud.

According to this edition of the State of the CIO Survey, a good majority--53 percent--of respondents see the main benefit of implementing a public cloud solution as that of increasing business agility. This was followed by other factors like reducing infrastructure costs and converting capex to opex, among other things. For Jagdish Belwal, CIO, Tata Motors, cost savings, scalability and process excellence are the benefits that he is expecting from his public cloud implementation. Belwal is planning to move his Web-based, external facing portals to IaaS platforms.

In addition, he also plans to explore moving non-production systems--such as development boxes--to an IaaS platform as they are prone to seasonality of usage and remain unused for long periods of time. On the other hand, he strongly feels that the cloud offers niche, expert process solutions. Tata Motors has decided to leverage this through a technology principle. "We will first look at the cloud to deliver any new business process requirement that comes our way. Our technology principle now is that whenever a new process enablement request comes in, we will first look at the cloud as an option, then we will look at packaged products. And then only we will turn to internal development" says Belwal.

Another public cloud champion is Jayanta Prabhu, CTO, Essar Group. Prabhu also wants to reap the benefits of reduced capex and scalability when he looks to expand his presence on the public cloud.

"Going forward, I have aggressive plans to increase the number of apps on--Microsoft's public cloud platform--from four to 10," says Prabhu. "We are also evaluating the possibility of moving SAP to the cloud."

Today, going to the cloud for specific business applications can surely be a cost efficient strategy. M.G. Raghuraman, CIO, Mphasis, says that Mphasis reaped significant cost benefits when he opted to deploy a cloud-based on-demand solution for his CRM system. Through this CRM tool--which has also been integrated with their enterprise applications--Raghuraman says that the company is now able to manage and track the entire sales life cycle, from lead generation to opportunity, right up to finalizing the deal.

"I pay Oracle on a pay-per-use model based on the number of licenses deployed. This helped me cut initial investment costs during implementation and also provided me the flexibility to ramp up based on additional business requirements," says Raghuraman.

Another advantage that Raghuraman gained out of opting for this solution is that it was quick to implement and therefore it reduced his time-to-market.

Cloud Cover

There's no doubt that the issues surrounding public clouds have over-shadowed the various benefits that it offers. From vague SLAs to infrequent availability, and from security to vendor-lock in, the public cloud's shortcomings can't be ignored.

When opting to implement a public cloud solution, Prabhu says there are a bunch of hurdles that CIOs need to cross. "Contracts management is a big concern with public cloud service providers. Appropriate SLAs, availability and performance uptime are still far from being precise. However, this is expected to improve gradually."

However, Raghuraman points out that there is an inherent lack of flexibility to customize cloud-based applications as you would see on on-premise enterprise applications; and this is a factor CIOs must keep in mind when opting for cloud strategy. There is a clear trade-off between time to market and customization. Fortunately for Raghuraman, the CRM tool that he chose had most of the features he wanted, and he only had to customize very minimally. He also cited possible degradation in application performance as an additional reason for not opting to overly customize a cloud application. "These cloud apps have been tailored to suit the most prevalent business processes and the best practices in the industry. So, if we use any cloud app as it is, we will perhaps get the best performance. However, if you start customizing it, then it would adversely affect performance and speed although you will get the additional functionality. So you always have to make the best compromise between the level of customization which you need and the performance of the cloud application. As a practice, my strategy is not to fiddle around and do too much customization on a cloud-based application," says Raghuraman.

Another aspect of the public cloud that could be a challenge is getting buy-in and funding for implementing the technology. However, both Prabhu and Raghuraman faced a relatively unencumbered path as far as getting the required finances to implement the project are concerned.

In Prabhu's case, despite a lack of prototypes and successful cloud implementation stories, his senior management was supportive of his efforts and Essar has been recognized as an early adopter of cloud computing by NASSCOM.

Raghuraman, on the other hand, had sold his idea to the CFO on the premise that he was going to opt for a pay-per-use model when implementing his cloud app solution.

"The cost economics of the cloud strategy as stated earlier, found a favor with my CFO," says Raghuraman.

Forecast: Sunny Days Ahead

Cloud computing has had a tough time earning the respect of the sceptics and the naysayers. But it has come a long way from being IT's incomplete invention to a full-blown, promising opportunity for Indian organizations. However, the public cloud has fought--and is still fighting--a long and hard battle to get CIOs' attention.

Sure, there are a number of concerns with the public cloud like security and integration with enterprise apps, among other things. But the advantages it offers--added business agility, reduced infrastructure costs and scalability--are tempting benefits for companies and IT departments to give this relationship a chance to prove itself.

(By Eric Ernest)
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