Tech Lover 9

The tech market tends to venerate the newest, flashiest innovations. The cloud is no exception, with the biggest buzz surrounding novel approaches to cloud services such as business process as a service (BpaaS).

Buzz does not necessarily equal bucks, however. In fact, the most basic – and, relatively speaking, old-fashioned – part of the cloud is the one really raking in the money at the moment. Infrastructure as a service (IaaS), at its most basic, does no more than replicate the standard virtualized model of business IT infrastructure in the cloud. Hosts still manage virtual machines by way of hypervisor software, and the client is still responsible for setting up the platform and software. The difference is that cloud hosting offers easy scalability, disaster recovery and an efficient means to outsource the hardware infrastructure.

According to a report by French IT consultancy Pierre Audouin, global spending on IaaS is to top €70 billion ($90 billion) by 2016, with the US and UK leading uptake. This shouldn’t be too surprising. Major businesses in both countries, especially the UK, are enthusiastic outsourcers of IT. And IaaS is likely to be most attractive to blue-chip businesses, which already have well-established IT infrastructures, with substantial legacy support requirements. IaaS can provide an effective way to outsource IT infrastructure without significant disruption to business. The biggest concern such businesses have is ensuring smooth integration with existing IT infrastructure, and the big IT companies currently adapting their products to the cloud era – IBM, HP and so on – are sensitive to these concerns.

Of course, there is money to be made from other layers of the cloud – platforms and software as services are highly attractive to young companies and start-ups, for whom maintenance of a dedicated IT infrastructure is both infeasible and unnecessary. A whole generation of tech and other start-ups is now forming, in Silicon Valley, London and other major tech business hubs, who will only ever have managed their data in this way and who may never see the point of a dedicated in-house IT infrastructure. There is also the likelihood that the cloud will increasingly establish itself as the standard way to manage the IT of large organizations – a solid IaaS set-up put in place now can then function as a sound basis for bespoke product, software and business process layers in the future.

Projections as to the shape of the business IT market in five or ten years time are necessarily speculative to an extent – it will not take many high profile security breaches to dampen enthusiasm in business and government for the cloud, for example, and there are other challenges ahead. Still, the numbers do not lie: a technological paradigm that only a decade ago was in its infancy has seriously established itself as a competitor to conventional data management methods. The IT business,
whether in the form of titans like IBM or relatively young upstarts like RackSpace, is well advised to drive this process forward.