Look for new partnerships to identify and fully capitalize on market opportunities.
Cloud computing to bring “mainframes in the sky”?
The technology industry is on the cusp of transformation based on the potential of cloud computing. Cloud computing is based on the idea that computing itself will be delivered as a web-based service that accesses huge data centers — rather than having all the processing power and applications located in the computer at your home or office.
Think of it as a virtual “mainframe in the sky”, though in reality, the millions of servers will be located in data centers firmly connected to terrestrial power grids.
If the idea of cloud computing sounds vaguely familiar, that’s because it is — the internet already works that way. But imagine if you never had to have another computer or software upgrade, because it was done seamlessly at a data center?
Partnering for action
Although such a transformation in computing has been discussed for decades, it became feasible only since the advent of high-speed broadband networks, increased storage density and more powerful microprocessors.
Nevertheless, IT buyers have significant concerns about reliability and security and are challenged to assemble their own customized solutions from a range of vendors and offerings. An important remaining barrier is that few, if any, single vendors can offer the entire package of services required by corporate IT buyers.
In late 2009, however, a partnership between Cisco, EMC and VMware established the Virtual Computing Environment Coalition to accelerate the use of data center virtualization and private cloud infrastructures. The coalition became the first to offer an end-to-end solution for data center virtualization that will improve utilization of assets, reduce power consumption and enhance security, while lowering the total cost of ownership.1
Potential benefits are high, but so are risks
Cloud computing offers a number of benefits, including:
- Immediate access to innovation in processing technology, software and storage capabilities and seamless upgrades
- Ability to deliver cost savings and cost variability from improved efficiency, reduced technical support staff, real estate, energy costs and potentially lower upgrade costs
- Opportunity for a company to focus on true core competencies
- Simplification of customers’ business models
However, there are also risks that need to be addressed. Cloud computing brings disruptive change and fierce competition to win customers. Communication to raise awareness of the value proposition and to address people’s security and trust concerns is essential. Perhaps even more critical is the ability to deliver the privacy, security and flexibility in capacity at an attractive price point.
Lessons learned
While it’s too early to determine the ultimate winners and losers in the area of cloud computing, it’s clear that global competition and disruptive innovation afforded by restructured networks create market opportunities for both incumbents and new entrants.
Looking for new partnerships to identify and fully capitalize on market opportunities can help mitigate risk, speed time-to-market and develop a portfolio of solutions to better serve your customers.
1 “Cisco NetApp VMware Map Out Unified Data Center Architecture,” eWeek, 9 February 2010, via Dow Jones Factiva.
