Although the term “cloud computer service” sounds new, elements of the concept have been around for decades. For instance, timesharing and virtual machines are being used from mainframe era of 1960s. The famous saying of “the network is the computer” was first coined by Sun Microsystems in 1982. Grid computing that has been in use by the scientific community since the early 1990s, has been widely deployed in financial services for the past five or six years, especially in securities and trading operations. Even the on-demand business model dates back to the late 1990s, when it was served up by organizations known as application service providers. What makes cloud computer service real now is the Internet becoming an IT platform, virtualization, hardware commoditization, standardization, and open source software. A key catalyst is the success of major Internet companies like Google, Amazon and Microsoft. The highly global and scalable infrastructure these companies have built to power Internet search, electronic commerce, social networks, and other online services forms the core of the current cloud phenomenon.
Cloud computer service has its origin in the segment of the IT market, i.e., the small and medium-sized enterprise (SME) and consumers, whose need for simpler and lower-cost or even free solutions is underserved by traditional packaged software. As cloud-based services matured, they started to win broader acceptance from mainstream enterprise customers. Now, they compete directly with on-premise and packaged software. The significance of the cloud, however, lies far beyond cheap computing. The Web-enabled, variable cost model represents a huge departure from existing practice, and carries far-reaching implications for IT providers and users alike. A new wave of venture-funded startups is likely to appear, offering an array of innovative solutions ranging from small applications to cloud middleware and infrastructure services. The battle between pure Internet players like Google, Amazon and Salesforce and traditional enterprise vendors has just begun. The emergence of cloud platforms will significantly ease the entry barrier for such small players to develop, deploy, scale and integrate their services.
For IT organizations, the cloud means that more IT functions will be accounted for as variable costs. This change from “buy-and-own” to “pay-as-you-go” has broad implications for activities such as procurement and staffing—and it could lead to a new role for the IT department. As the cloud continues to gain momentum, more business units and users will turn directly to cloud-based solutions to meet their infrastructure and application needs. As a result, the IT department’s role as the sole provider and operator of IT will slowly diminish. At the same time, the IT department will likely see a growing demand for security, procurement, data, and other similar services from the business units.
In general, cloud computer service will act as an accelerator for enterprises, enabling them to innovate and compete more effectively. With elastic and theoretically unlimited IT resources on tap, businesses no longer have to wait for the provisioning of servers or worry about project delays. By tapping into the right cloud capabilities, companies can quickly enter new geographical markets or launch new products or services in existing markets. As demand grows, they can quickly scale up. Conversely, when demand eases, they can just as quickly scale down and, if necessary, they can exit the market entirely with minimum loss of time and capital.
Cloud computer service has its origin in the segment of the IT market, i.e., the small and medium-sized enterprise (SME) and consumers, whose need for simpler and lower-cost or even free solutions is underserved by traditional packaged software. As cloud-based services matured, they started to win broader acceptance from mainstream enterprise customers. Now, they compete directly with on-premise and packaged software. The significance of the cloud, however, lies far beyond cheap computing. The Web-enabled, variable cost model represents a huge departure from existing practice, and carries far-reaching implications for IT providers and users alike. A new wave of venture-funded startups is likely to appear, offering an array of innovative solutions ranging from small applications to cloud middleware and infrastructure services. The battle between pure Internet players like Google, Amazon and Salesforce and traditional enterprise vendors has just begun. The emergence of cloud platforms will significantly ease the entry barrier for such small players to develop, deploy, scale and integrate their services.
For IT organizations, the cloud means that more IT functions will be accounted for as variable costs. This change from “buy-and-own” to “pay-as-you-go” has broad implications for activities such as procurement and staffing—and it could lead to a new role for the IT department. As the cloud continues to gain momentum, more business units and users will turn directly to cloud-based solutions to meet their infrastructure and application needs. As a result, the IT department’s role as the sole provider and operator of IT will slowly diminish. At the same time, the IT department will likely see a growing demand for security, procurement, data, and other similar services from the business units.
In general, cloud computer service will act as an accelerator for enterprises, enabling them to innovate and compete more effectively. With elastic and theoretically unlimited IT resources on tap, businesses no longer have to wait for the provisioning of servers or worry about project delays. By tapping into the right cloud capabilities, companies can quickly enter new geographical markets or launch new products or services in existing markets. As demand grows, they can quickly scale up. Conversely, when demand eases, they can just as quickly scale down and, if necessary, they can exit the market entirely with minimum loss of time and capital.
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