Thomas Edison would have loved cloud computing

A modest attempt to clear up "the cloud"

By Ryan Nichols, Head of Cloudsourcing and Cloud Strategy for Appirio

As we kick off the new year, it's time to bring a little clarity to the concept of "cloud computing," perhaps the most important, but least understood, technology trend of 2010.

To understand the future of technology, sometimes you have to look to the past. So let's go back to this history of electricity, with some help from Nicholas Carr: In the early 1900's, companies spent a lot of time and energy thinking about how to create their own electricity on their own private infrastructure. They even had a "Chief Electricity Officer." Today, we just plug in and use electricity as a service, without thinking much about it. Organizations today can focus on using electricity instead of generating it.

That same shift is occurring in information technology, and it's called "cloud computing." It's a style of computing where scalable and elastic IT capabilities are provided as a service to multiple customers using Internet technologies (according to Gartner). Think about Google-- you get to use their services to get your job done without knowing or caring what's under the hood.

Operating a data center is becoming more and more like operating a nuclear power plant—a task best left to experts. Google has engineers researching how to build data centers in the ocean to harness wave energy for power and cooling. Do you want to benefit from this type of innovation, or try and replicate it within your four walls? Maintaining your own data center will someday soon seem like maintaining your own power plant-- a wasteful distraction for the vast majority of organizations (this is why focusing on building your own cloud is misguided-- a "private cloud" is just a data center with a fancy name).

Driven by the shared infrastructure of the public cloud, industry analysts report that enterprise solutions are delivered 5X faster, with 30-50% lower TCO. At Appirio, we've helped companies use the cloud to cut their email costs in half, support massive business reorganization, and even build Web applications that can scale to handle the "Oprah effect."

One of the most compelling things about the cloud is how easy it is to get started-- here are some principles to guide your exploration of cloud computing:

  • Start small. You don't need a full enterprise architecture to get started with cloud computing. Next time you find yourself setting up a spreadsheet to track some part of your business, sign up for a free Force.com account instead. You'll quickly get a taste for what's possible.
  • Think big. Once you're convinced of the potential of cloud computing, calculate how much you'd save, for example, by switching your email and file sharing from Microsoft to Google Apps. Start building a business case-driven roadmap to the cloud.
  • Ask for help. The cloud ecosystem is a little bewildering, and many vendors have a lot to lose in the transition to cloud computing. You need clear advice and partners familiar with moving to the cloud. This kind of help is evolving into "cloudsourcing" -- where cloud computing meets outsourcing. This allows you to outsource the migration and management of your IT infrastructure to run on a virtual suite of cloud applications and platforms. You can tap experts to move your business to the cloud while you focus on the business at hand.

To see where all this is headed, let's go back to electricity. Today, you probably run your business without a power plant-- imagine running your business without a data center. Impossible? That's how Appirio runs our business today. This "serverless" infrastructure has supported a doubling of our business in the last year with IT spending at 1/3 the level of what most companies our size spend. And this same transition is well underway for organizations of all sizes.

It took companies in the U.S. 50 years to move from generating 90 percent of their own electricity to consuming 90 percent from public utilities. Technology shifts happen even faster today. While it's not clear how long the shift to the cloud will take, one thing is certain-- the time to get started is now.

-Ryan Nichols

Head of Cloudsourcing and Cloud Strategy for Appirio

Ryan Nichols is responsible for driving our organization to deliver cloudsourcing for customers. He has over 10 years of experience bringing together business strategy and technology in the enterprise. Ryan joined Appirio from SAP's corporate strategy group, in the office of the CEO, where he led projects to define and execute SAP's product, platform, and M&A strategy.

Previously, Ryan's background spans consulting and business software. He was a management consultant for McKinsey & Company, serving over 15 leading financial services and technology clients. He led professional services for an analytics software startup, delivering inventory and pricing analytics software and services to retail and CPG clients. He was trained in product management at Intuit, where he focused on new user acquisition for QuickBooks.

Ryan holds a bachelor's degree in Economics from Williams College, and an MBA from Stanford's Graduate School of Business, where he was an Arjay Miller Scholar.

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