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.

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The Politics Of Cloud Computing

  1. 1. The ‘Politics’ Of Cloud Computing Evolving Managed Services Adoption In Medium Sized Companies Martin Hingley IT Candor Limited Email: Web Site: ITC Market Research Report ITCandor 2010
  2. 2. 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
  3. 3. 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
  4. 4. The Effect of The Credit Crunch on UK IT Spending Growth (£) 25% • Consumer and 2008 2009 small business 20% spending remains positive Consumer 15% • Medium and Small Companies large business spending 10% remains negative Large • Market 5% Companies development is clouded by 0% exchange rate movements Medium Companies -5% Total IT Spending -10% Source: ITCandor, 2010 ITC Market Research Report ITCandor 2010
  5. 5. The Declining Value of The Pound 1.0 • The massive collapse in the value of the 0.9 Pound • Is nearing parity 0.8 with Euro • Two dollars to a 0.7 £/€ pound in 2007 is one and a half today 0.6 • This is making IT 0.5 £/$ kit more expensive in the UK 0.4 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Source: ITCandor, 2010 ITC Market Research Report ITCandor 2010
  6. 6. Medium Company Quarterly Spending on IT Service and Software (£m) £1,000 • Medium sized Implementation companies have £900 Service 100-1k employees £800 • IT usage varies between advanced £700 and non strategic • Implementation £600 Application Software Services is biggest category £500 Internet Service • Spending on Internet £400 Outsourcing/ Service larger Managed Services £300 than on Hardware Maintenance Software as a Service Application £200 Software Maintenance Software • Outsourcing/ £100 Infrastructure Software Managed Service Operating System and SaaS are £0 growing fastest 2008 2009 Source: ITCandor, 2010 ITC Market Research Report ITCandor 2010
  7. 7. Medium Company Quarterly Spending on IT Hardware (£m) £350 • Networking is largest category £300 • PC is small and Networking similar to spending on Converged £250 Device PC • Storage Systems £200 and Servers are Converged now the smallest Device categories £150 Peripheral • Hardware spending is £100 Storage System growing in H1 Server 2010 £50 £0 2008 2009 Source: ITCandor, 2010 ITC Market Research Report ITCandor 2010
  8. 8. The Varying Needs of Four Types of Cloud Computer Participants • Finance •Maximise Value Directors also •Enforce SLAs have to consider •Manage Supplier data protection, Contracts environmental and •Balance Cap Ex other laws v Op Ex Financial Director • CIOs have a difficult task in managing a mixed environment Data Center • End-users have Software Developer lots of SaaS Manager/CIO Cloud Computing experience as •Infrastructure as •Internet-wide Distribution Public/Private consumers a Service •Scalable Deployment •Hardware •Free Development • Software •Management •Web Apps •Simplified SDK Developers use •Virtualization •Self Service the evolving •Cluster •Pay-per-Use ecosystem •Grid •Utility Computing • These groups often •Software as a Service compete for End-User resources and don’t Source: ITCandor, 2010 always talk to each other! ITC Market Research Report ITCandor 2010
  9. 9. Cloud Computing Supplier Participants by Type and Example • Lots of OS and Middleware Outsourced Data Centre Infrastructure Goole Java Google Microsoft development Python VMWare AmazonAsk Ask • Large business Websphere Redhat NCD HP software suppliers Citrix VMWare offer SaaS versions Microsoft • Hosting companies offering Hardware Telecoms data centre space Cisco BT and/or dedicated Dell Cloud Computing resources T- Mobile EMC Suppliers Orange • Telecoms HP suppliers will find Vodafone Cloud easier than IBM NTT general IT services Rackable • Plenty of scope for Sun Applications Metering/Billing ‘cross the park’ Verari Microsoft Salesforce selling to different Salesforce SAS user types Google Mail Fujitsu Software Quicken Source: ITCandor, 2010 ITC Market Research Report ITCandor 2010
  10. 10. The Developing Cloud Computing and Hosting Ecosystem • Cloud development ecosystem is split hulu Application Windows Live into 3 camps – Lamp, Azure and Layer (SaaS) facebook Bing Google Apps JAVA php MySQL SQL Server 2008 • Offerings are split python php Middleware memcached in three horizontal IIS7 layers – IaaS, Layer (PaaS) Apache hadoop .Net JAVA PaaS and SaaS Linux • Can be used to OS and/or Linux design new or VMWare ESX HyperV -V - Hypervisor ‘Cloudify’ existing Xen corporate (IaaS) applications Lamp* Windows JAVA Azure Source: ITCandor, 2010 ITC Market Research Report ITCandor 2010
  11. 11. Virtualising Client Computing for Cloud Computing • Cloud Computing and Client Laptop Local VM Virtualisation are highly connected • Users want Smart Phone access to Desktop corporate Streamed applications – not just email • PCs can be used as Thin Client thin clients External Hosted • Users want fully functional PCs • Citrix, Redhat, Smart Phone Microsoft and Internal Hosted VMWare are leaders in client virtualisation Client Devices Virtual Clients Source: ITCandor, 2010 ITC Market Research Report ITCandor 2010
  12. 12. 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
  13. 13. 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 Internal External Users (mainly) External Internal Users (mainly) Cloud Computing Private Public Cloud Cloud Martin Hingley Implementation PaaS IT Candor Limited Consolidation Modernisation IaaS SaaS Email: Virtualisation IT Supplier Service …aaS ISV Hosting Provider (Telco) Web Site: ITC Market Research Report ITCandor 2010
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