1. How to Identify and Understand the
Differences in Cloud Software
True Cloud
vs.
Fake Cloud
W H I T E P A P E R

2. 2 | TRUE CLOUD VS. FAKE CLOUD
True Cloud vs. Fake Cloud
How to Identify and Understand the
Differences in Cloud Software
The cloud software marketplace has been exploding for several
years now, as more companies catch on to the distinct advantages
of migrating their business processes, applications, and data off-
premise and into the cloud. It’s no wonder that some legacy software
vendors—in an effort to stay relevant in a changing marketplace—
have made a few tweaks to their service models, and often
communicate a “cloud solution”.
This guide was written to help you understand and identify what is real
or true cloud software, and what is not a true cloud solution, but really
a “fake cloud” option, without all the features, benefits and advantages
of true cloud software.
A Brief History of Business
Management Software
Before we explore the best practices in avoiding fake clouds, we would first like
to take a look at how the market became what it is today—and how fake cloud
applications are becoming a very real threat.
1940-1970: Pre-ERP
Business management software, most notably enterprise resource planning
(ERP) software is nothing new. The 1940s gave rise to calculating machines, the
1960s saw the first materials requirement planning application come into play
to help companies plan and schedule. These initial applications were useful, but
were inordinately expensive and ran on big, clunky mainframes.
1970-1995: The Evolution of MRP and Dawn of ERP
Throughout the late 1970s and early 1980s, new providers joined the fray,
creating a new competitive landscape that improved technology (MRP evolved
into manufacturing resource planning, or MRP II, taking on new functionality
such as finance) but still required vast resources and massive investment from
firms, still limiting this technology to the largest players.
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3. 3 | TRUE CLOUD VS. FAKE CLOUD
Over the next two decades, platforms became more feature rich, easy to use,
and flexible, evolving from MRP II to ERP to represent the expansion beyond one
specific industry and into areas like Engineering, Finance, Human Resources,
and Project Management.
1995-2005: Early Days of Cloud Applications
By the late 90s, web-based accounting solutions for small and medium
businesses became a reality, allowing users to access and manage their
financials from a web browser—rather than run on-premises.
This set in motion the first wave of SaaS applications and began to shape the
way that on-premises applications were developed. By 2002, most ERP systems
were “internet enabled,” allowing on-premises applications to access data
from the internet to accomplish basic tasks. Technology continued to improve,
allowing more organizations to deploy cloud applications during the 2000s.
2005-2010: Cloud Becomes a Reality
New competitors continued to enter the market, providing cloud options
with new features and better functionality. At that time, however, there wasn’t
a debate. A decade ago, the concept of the cloud made sense for certain
applications such as CRM, but any IT person would balk at the idea of the cloud
for a business critical application like ERP. Years passed, cloud applications
continued to prove their worth and stand up to bigger challenges, and the early
2010s saw the cloud vs. on-premises debate begin to take shape.
2010-2017: The Cloud vs. On-Premises Debate
On-premises vendors pushed forward the idea that the cloud couldn’t live up to
the hype, couldn’t meet the needs of major enterprises or global organizations,
and couldn’t provide the security or uptime that an on-site server room could.
Cloud vendors labeled in-house servers and on-premises applications as relics
of the past, unable to provide the flexibility, affordability, or functionality that
businesses today need.
2017-Today: It’s No Longer a Debate—The Cloud Wins
Fast forward to today. It’s 2018 and the debate is over—the cloud wins.
Companies—both growing and global—have found that the reduced strain
on internal resources, increased reliability, enhanced security, and unmatched
flexibility are only a few of the reasons they made the jump. The final death
knell for traditional on-premises-first software came in the past couple years
when Gartner retailored its Magic Quadrants and Critical Capabilities reports
to exclude on-premises applications, only accepting vendors who met specific
“cloud” criteria.
A WALK
THROUGH
HISTORY

4. 4 | TRUE CLOUD VS. FAKE CLOUD
The Rise of the Fake Cloud
Imitation may be the sincerest form of flattery, but when it comes to an
investment that could set businesses back anywhere between a five- to seven-
figure sum, you can’t afford a vendor that’s trying to fake it.
How the Fake Cloud Came to Be
During the latter stages of the cloud vs. on-premises debate, vendors of
traditional models realized that they were losing the war—and had to try to right
the sinking ship. In this they began to develop their own “cloud” applications,
on-premises applications designed to look like cloud applications, feel like cloud
applications, and even act like cloud applications when really they are just legacy
systems with a web-based interface or portal.
In many ways, there is nothing wrong with an on-premises solution, as it can
provide a lot of core functionality. However, when a company expects a cloud
delivery and receives one of these fake cloud solutions, they get a lot less than
they paid for, and a lot more than they bargained for.
How the Fake Cloud Works
Before we talk about the dangers of fake cloud, we’d like to
take a second to discuss how it works. Often, when people
think of the “cloud,” they are referring to as “software we can
access using the internet,” referring to a product like Dropbox,
Salesforce, or Google Apps. These are called public cloud
applications. Additionally, there are private clouds, which
allow more control over location and the ability to comply with
industry regulations. We will discuss both public cloud and
private cloud in greater detail below.
The fake cloud is different than either of these. As we said
above, it’s just an on-premises solution mirrored on whichever
device needs to access it.
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FAKE
FAKE
FAKE
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