Can we expect the big cloud breakthrough anytime soon?

When will we reach the cloud tipping point – when more businesses are using cloud services than not? When will cloud computing be ‘business as usual’ and not perceived as a frightening step into the blue.

Although everybody is talking about cloud computing, only a handful of companies are actually doing anything about it. Can we expect the big breakthrough anytime soon?

The market for cloud computing is growing by more than 25 percent per year according to most estimates, and this trend is expected to accelerate in the future bringing us closer to the goal. But, according to surveys, most companies are still very reluctant to trust their data to the cloud.

While security is still the headline issue, the reality is that many entrepreneurs fear that cloud computing will put too much strain on their IT budget. The message that cloud customers only use those features that they really need- and pay only for what they use, just isn’t coming across strongly enough to outweigh the doubts.

Yet the messages are convincing. For example, data centers in the past had an utilisation ratio of only about 30 to 40 percent of their actual capacity – nobody can afford such wastefulness over the long term.

Large companies and organisations are increasingly interested in the cloud. They have big IT department and budgets to dedicate to thorough risk vs reward analyses and large-scale implementation plans. The potential savings these big businesses stand to make by adjusting to cyclical volatilities in processing demand are very attractive to management and investors. In short, for them it is a numbers game.

But the rewards for smaller companies are equally appealing. Companies that need to generate quarterly financial statements require more data processing capacity in March, but in April things tend to quiet down.

Why should entrepreneurial businesses pay to keep a system that is able to provide large capacities at all times, when they only need it for part of the year? It’s like keeping the heating on during the summer.

The stealth partner to the adoption of cloud services is the consumerisation of IT. Currently, cloud services are strongly driven by the consumer business. But what people use at home, be it Google or Amazon services, they sooner or later start to question why they can’t use something similar at work.

Despite increasing year on year adoption rates, security doubts and a reluctance to be drawn into an expensive IT project are keeping the overall take-up pace slow. But the writing is on the wall. The general public is light years ahead of the business community in terms of embracing technology that makes lives easier.

As with the introduction of the car or televisions, at first very few people have one and then, suddenly, everybody’s got one. The tipping point will arrive much more quickly than businesses expect and many companies could be left looking obsolete.

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Barry Osbiston is Head of Service Delivery for T-Systems in the UK. T-Systems is the corporate customer arm of Deutsche Telekom. Barry is passionate about ensuring that technology enables and empowers business. In his 25 years of working in the information systems and information technology fields, he has driven major changes across numerous outsource organisations, from both operational and service management roles. One of his most significant posts whilst working for a major outsource organisation was Director of Service for the NHS, as well as for other Public Sector organisations.