the politics of cloud computing
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Cloud Computing is in its infancy, but ITCandor is measuring it. In this presentation Martin Hingley sizes the UK medium-sized corporate IT market and analyses the developing 'political' issues among users and suppliers.TRANSCRIPT
ITC Market Research Report ITCandor 2010
The ‘Politics’ Of Cloud ComputingEvolving Managed Services Adoption In Medium Sized Companies
Martin Hingley
IT Candor Limited
Email: [email protected]
Web Site: http://itcandor.com/
ITC Market Research Report ITCandor 2010
Agenda
• Some Market Sizing
• Outsourcing, Managed Services and SaaS Spending
• The Development Of Cloud Computing
• ‘Political’ Considerations
• Forecasts And Conclusions
ITC Market Research Report ITCandor 2010
UK Cloud Computing developments
• NGD opens a massive Cloud Computing data centre in Newport – BT and Logica become customers
• HP opens and new air cooled data centre in Wynyard
• Centrix Software offers Workspace Discovery and Workspace iQ
• Quest Software builds monitoring and metering products
• HP, IBM and Fujitsu help with Implementation Services and SaaS mainly for large organisations
• Citrix continues to build ‘client access’ offerings, big plans for Cloud
• DataScape Online offers self-service SaaS
• Double-Take Software offers Recovery as a Service
• Storage Online considers offering online storage
• FNZ offers Platform as a Service
• Fasthosts launches Rise SaaS for SMBs
ITC Market Research Report ITCandor 2010
The Effect of The Credit Crunch on UK IT Spending Growth (£)
• Consumer and small businessspending remains positive
• Medium and large business spending remains negative
• Market development is clouded by exchange rate movements
Medium Companies
Small Companies
Consumer
Total IT Spending-10%
-5%
0%
5%
10%
15%
20%
25%
2008 2009
LargeCompanies
Source: ITCandor, 2010
ITC Market Research Report ITCandor 2010
The Declining Value of The Pound
• The massive collapse in the value of the Pound
• Is nearing parity with Euro
• Two dollars to a pound in 2007 is one and a half today
• This is making IT kit more expensive in the UK
0.4
0.5
0.6
0.7
0.8
0.9
1.0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Source: ITCandor, 2010
£/€
£/$
ITC Market Research Report ITCandor 2010
Medium Company Quarterly Spending on IT Service and Software (£m)
• Medium sizedcompanies have 100-1k employees
• IT usage varies between advanced and non strategic
• Implementation Services is biggest category
• Spending on Internet Service larger than on Application Software
• Outsourcing/ Managed Service and SaaS are growing fastest£0
£100
£200
£300
£400
£500
£600
£700
£800
£900
£1,000
2008 2009
ImplementationService
Internet Service
Application Software
Outsourcing/Managed Services
Software Maintenance
Hardware Maintenance
Infrastructure Software
Operating System
Software as a Service
Source: ITCandor, 2010
ITC Market Research Report ITCandor 2010
Medium Company Quarterly Spending on IT Hardware (£m)
• Networking is largest category
• PC is small and similar to spending on Converged Device
• Storage Systemsand Servers are now the smallest categories
• Hardware spending is growing in H1 2010
PC
ConvergedDevice
Networking
Peripheral
Server
Storage System
£0
£50
£100
£150
£200
£250
£300
£350
2008 2009Source: ITCandor, 2010
ITC Market Research Report ITCandor 2010
The Varying Needs of Four Types of Cloud Computer Participants
• Finance Directors also have to consider data protection, environmental and other laws
• CIOs have a difficult task in managing a mixed environment
• End-users have lots of SaaS experience as consumers
• Software Developers use the evolving ecosystem
• These groups often compete for resources and don’t always talk to each other!
End-User
Data CenterManager/CIO•Infrastructure as a Service•Hardware•Management•Virtualization•Cluster•Grid
•Web Apps•Self Service•Pay-per-Use
•Utility Computing•Software as a Service
Cloud ComputingPublic/Private
Software Developer•Internet-wide Distribution
•Scalable Deployment •Free Development
•Simplified SDK
Financial Director
•Maximise Value•Enforce SLAs
•Manage Supplier Contracts
•Balance Cap Ex v Op Ex
Source: ITCandor, 2010
ITC Market Research Report ITCandor 2010
Cloud Computing Supplier Participants by Type and Example
• Lots of Infrastructure development
• Large businesssoftware suppliers offer SaaS versions
• Hostingcompanies offering data centre space and/or dedicated resources
• Telecoms suppliers will find Cloud easier than general IT services
• Plenty of scope for ‘cross the park’ selling to different user types
Cloud ComputingSuppliers
Outsourced Data CentreGoogle Microsoft
AmazonAskNCD HP
OS and MiddlewareGoole Java
Python VMWare
Websphere Redhat
Citrix VMWare
Microsoft
HardwareCisco
Dell
EMC
HP
IBM
Rackable
Sun
VerariMetering/BillingSalesforce
SAS
Fujitsu Software
ApplicationsMicrosoft
Salesforce
Google Mail
Quicken
TelecomsBT
T-MobileOrange
VodafoneNTT
Cloud ComputingSuppliers
Microsoft
AskHP
OS and Middleware
Salesforce
T-
Source: ITCandor, 2010
ITC Market Research Report ITCandor 2010
The Developing Cloud Computing and Hosting Ecosystem
• Cloud development ecosystem is split into 3 camps –Lamp, Azure and JAVA
• Offerings are split in three horizontal layers – IaaS, PaaS and SaaS
• Can be used to design new or ‘Cloudify’ existing corporate applications
hulu
Windows Live
Bing Google Apps
python
JAVA
php
LinuxLinux
Xen
VMWare ESX Hyper-V
IIS7
.Net
php MySQL
Apache
memcached
hadoop
Linux-V
SQL Server 2008
ApplicationLayer (SaaS)
MiddlewareLayer (PaaS)
OS and/orHypervisor(IaaS)
Lamp* WindowsAzure
JAVA
Source: ITCandor, 2010
ITC Market Research Report ITCandor 2010
Virtualising Client Computing for Cloud Computing
• Cloud Computingand Client Virtualisation are highly connected
• Users want Smart Phone access to corporate applications – not just email
• PCs can be used as thin clients
• Users want fully functional PCs
• Citrix, Redhat, Microsoft and VMWare are leaders in client virtualisation
Laptop
Desktop
Thin Client
Smart Phone
Client Devices Virtual Clients
Local VM
Streamed
External Hosted
Internal Hosted
Source: ITCandor, 2010
ITC Market Research Report ITCandor 2010
The Pitfalls of Cloud Computing
• Cloud Computing is in its infancy – has not yet helped in the shift from Capital to Operational Expenditure
• It is being adopted from the ‘bottom up’ – consumers and small businesses use SaaS for social networking and office where no technical expertise is expected
• Modifying corporate computing usually requires significant consolidation activities first
• Data Protection, Environmental laws are often not addressed by US developments
• Location issues are vital for Managed Services and Outsourcing success
• You can get just as locked into pay-as-you-go as other services
ITC Market Research Report ITCandor 2010
The ‘Politics’ Of Cloud Computing – Some Conclusions
• The UK IT market is in recession and the failing Pound makes IT expensive
• Cloud Computing is the hottest IT subject in years
• Outsourcing, Managed Services and SaaS are small but are the fastest growing spending areas for medium companies
• Implementation services include systems suppliers helping convert internal IT into private Cloud
• Cloud Computing ‘politics’
– The needs of financial directors, CIOs, software developers and end-users all differ
– Suppliers will begin to sell ‘cross the park’ to exploit differences of opinion inside organisations
• Cloud Computing can be seen as a natural extension of Managed Services and Outsourcing
• Client Virtualisation and Cloud Computing are linked
• Issues of security, location, responsibility and compliance need addressing
• As always it’s better to partner with companies you know and trust ExternalUsers(mainly)
InternalUsers(mainly)
Cloud Computing
PublicCloud
PaaS
IaaS
SaaS
…aaS
ServiceProvider
ISVHosting(Telco)
IT Supplier
Implementation
Consolidation
Modernisation
Virtualisation
PrivateCloud
InternalUsers
ExternalUsers
Cloud Computing
PublicCloud
PaaS
IaaS
SaaS
…aaS
ServiceProvider
ISVHosting(Telco)
IT Supplier
Implementation
Consolidation
Modernisation
Virtualisation
PrivateCloud
ExternalUsers(mainly)
InternalUsers(mainly)
Cloud Computing
PublicCloud
PaaS
IaaS
SaaS
…aaS
ServiceProvider
ISVHosting(Telco)
IT Supplier
Implementation
Consolidation
Modernisation
Virtualisation
PrivateCloud
InternalUsers
ExternalUsers
Cloud Computing
PublicCloud
PaaS
IaaS
SaaS
…aaS
ServiceProvider
ISVHosting(Telco)
IT Supplier
Implementation
Consolidation
Modernisation
Virtualisation
PrivateCloud
Martin HingleyIT Candor LimitedEmail: [email protected] Site: http://itcandor.com/