|Issue:||Europe II 2010|
|Topic:||Cloud computing – you might be missing the point|
|Organisation:||IBM Cloud Services|
Ric Telford is Vice President of IBM Cloud Services. His professional business career highlights 26 years of product and service development experience. During his tenure at IBM, Mr Telford has played a number of key roles in various software and service initiatives, including Autonomic Computing, IT Infrastructure Services, and IT Optimization Services.
Cloud computing has the potential to completely transform and connect entire industries. The cloud computing model goes far beyond the business benefits of energy efficiency, cost cutting and scalability – it has the potential to revive today’s antiquated global technology infrastructure. Cloud computing could be the missing link that provides a deeper intelligence in the systems and processes of our business and institutional infrastructures – enabling goods to be produced, distributed and recycled, and services to be delivered to consumers in new, exciting ways.
A new approach is needed to revive the global technology infrastructure. The broken processes and industries that stunt progress and plague our modern interactions with governments, banks, doctors, etc, are not only annoying and time consuming, but cost society billions of dollars a year. And in the case of healthcare, it can be the difference between life and death. Up until now, there’s been a missing link needed to make this transformation possible. Certainly cloud computing isn’t a new concept; rather it’s an evolving computing model that can be an enabling force behind a smarter, more connected world. By now, we’ve all heard about the benefits of cloud computing – its potential to dramatically lower computing costs and its ability to help companies ‘go green’ by virtualizing resources and maximizing system use while freeing up IT staff to focus on important projects. While the apparent benefits of cloud computing have drummed up a lot of buzz around cloud computing, the model goes far beyond the business benefits of energy efficiency, cost cutting and scalability. People are getting excited, but perhaps not for the right reasons. The truth is that cloud computing has the potential to completely transform and link entire industries. It could act as the means to connect millions of end-user devices, sensors and storage to powerful back-end systems that can make sense of all this information in seconds. Every industry would be different if infrastructures were more connected. While this may sound like an exaggeration, it’s not. Cloud computing could be exactly what we need: it’s networked, backed by extremely powerful systems, highly elastic, instantly available over the Internet and should be grounded in open standards so clouds can talk to each other. As analyst firm Gartner noted in its ‘Predictions 2009: Emerging Tech Markets’ report: “cloud computing represents the fusion of very real trends such as global-class architecture, web platforms, massively scalable processing and the Internet”. These trends point to cloud computing’s potential to provide a deeper intelligence in the systems and processes of our business and institutional infrastructures – enabling goods to be produced, distributed and recycled; oil to be located and drilled quickly and efficiently; and services to be delivered to consumers in new, exciting ways. Consider the amount of connectivity and power that is needed to support the millions of people who check their bank accounts one, two, even multiple times a day, using their mobile phones. Not only do wireless networks need a more advanced global communications system, but the processes and strength behind delivering these services need to be retooled in order for the global infrastructure to continue to function properly. Or, think about the vast array of personal technologies – handheld phones, office computers, cameras, music players – and the fact that the interconnectivity of these elements requires an ever-increasing amount of computing power, intelligent networks and lock-down security. As consumers, we expect these devices to be always available and always connected, and the information contained in these devices needs to be 100 per cent accurate. Think about how frustrating it is when the connection is lost on your cellphone or navigation system. In this new era of wireless handhelds, we’re all easily hooked on devices and other technology that make shopping and decision-making easier. Imagine scanning a product’s barcode with a cellphone and instantly finding out where the product was made and if it works as well as advertised. This type of instant connectivity and access to information not only gives retailers a competitive edge, but also gives shoppers immense satisfaction. Consumers are demanding that anyone they deal with reinvent the ways they interact with each other and share information. Cloud computing gives retailers the ability to create an integrated environment for consumers both in-store and online, as everything, everywhere needs to work in-sync. This link could also create a national healthcare system that actually works for patients, hospitals, doctors and insurance companies alike. From diagnosis and drug discovery, to insurer’s and employer’s pockets, the next-generation of computing – cloud computing – enables a system that is truly connected, resilient and secure. The power and scalability of cloud will allow researchers to test new algorithms and analytics to enable a deeper, more intelligent analysis of a person’s health, from diagnosis to providing treatment in a matter of days rather than weeks or months. Electronic health records stored in the cloud could prevent an estimated 100,000 deaths a year from medical error. Imagine being able to share medical images and charts between specialists, maybe even being able to create a family tree so doctors can more accurately treat your symptoms, and then automatically gain approval from your insurance company for a certain treatment. The health of our financial institutions is another industry that could be greatly impacted by cloud computing. In 2008, a shocking number of banks across the world failed, some were acquired and many were nationalized. The post-mortem analysis shows that cost, complexity, risk, and transparency are factors that must be addressed differently in the future – and much of this boils down to technology. Banks have systems in their data centres that can’t ‘talk’ to each other, let alone understand what’s happening in another bank across the industry. Cloud computing could give banks the real-time risk analysis, back-office automation and secure data processing that is needed. Sure, there are sceptics scratching their heads in confusion over the term ‘cloud’ who pass it off as marketing hype. But in a challenging economic environment screaming for change, the fact remains that businesses, big and small, are looking to cloud computing as a way to cut costs and decrease their footprint on the environment. Small companies are saying ‘goodbye’ to the servers and wires in their back offices and turning to large firms who are, in turn, selling services in the cloud. When you think about it, roughly 85 per cent of most business processes are easily replicable and non-critical – things that need to be done to keep the business running, but aren’t making you any money. As a result, elements such as email, enterprise resource planning systems and the like will move to the cloud first. Cloud computing addresses the IT expense equation in a new way. First, it significantly lowers up-front capital expenses associated with getting an IT project off the ground by allowing companies to only pay for what they use. Even more enticing, cloud dramatically lowers operating expenses over time by increasing standardization and automation. Evolving from technologies like grid computing, utility computing, and software as a service, cloud represents a new, efficient, and highly flexible supply chain for IT. And yes, cloud computing also enables data centres to use less energy, fewer physical machines, less hands-on management, and still be more connected. But more important than all that, this emerging model of computing is compelling entire industries to rethink their IT, and even their business models. Cloud could enable trillions of operations and intelligent things to work together in a world that is not only seeing an explosive growth in information overload, but one that simply does not have the bandwidth or capability to power the relentless, ever-expanding network of information, businesses, governments and processes. Now that is a reason to get excited about cloud.