Will Apple’s iCloud be a reality or a flop for business?

The recently announced iCloud capability from Apple Computer has been looked at from several angles. One overlooked angle is the view from the business sector. The critical issue for the enterprise is iCloud’s business capabilities. By examining those capabilities we can make some predictions on whether we have a success or a potential flop on our hands, particularly as it relates to business users.

iCloud provides new and important capabilities, but are they really providing any functions relevant for business? When Apple made their significant announcements on June 6, 2011, it made consumers happy. But, what about business users of iCloud, particularly in the short term?

Generally, we will define cloud computing as a service that provides applications and storage on demand. This functionality is particularly beneficial to small businesses. It allows the small business to buy the right amount of services for their operation. The Apple idea is to make iCloud the hub of your digital life, but what about your business life? At this point there is no clear answer.

iCloud functions

The iCloud announcement included: 1) – iTunes in the Cloud, 2) – Photo Stream and 3) – Apps, books, documents, and backup.

iTunes in the Cloud enables the music you purchase in iTunes to appear automatically on all your devices. You can also download your past iTunes purchases, where you want, when you want. Thus synchronization as a function will be a huge technology capability that must be provided.

Note that Amazon and Google both have similar web based services as this trend to store music in clouds is accelerating because the iTunes store is one of, if not the largest seller of music today.

Photo Stream in the cloud allows you take a photo on one device and have it automatically appear on all your other devices. No syncing. No sending.

Apps, books, documents, and backup are a set of functions that provide synchronization services across all of your devices for all of your information so that you have access to all of your purchases and information no matter what devices you are currently using. Further, back up and restore functions are available to keep your information safe.

The book app even keeps your current bookmark so if you move to another device you can start at the correct spot on the next device. However, document editing needs a native app so there does not appear to be any cloud editing capability.

The key to the iCloud strategy is that your information is stored on the Web and automatically pushed to iOS-based devices, PCs, and Macs

iCloud is made up of a total of nine applications and is free. Up to 10 devices are allowed to be connected to a single iCloud account. Users will receive 5GB of free storage for e-mail, documents, and backups. But, you can buy more storage if you need it. Music, books, and apps are not included in that storage limit. The Apple idea is to make the system low price so you don’t worry about your storage needs and costs.

When it’s launched the product will be available in the US with other locations coming online later. It essentially replaces Mobile Me and will also sync your calendar and other apps. The idea is to have seamless apps across all your devices.

iCloud will become available in the fall, and will include the basic 5 gigabytes of storage per user.

Synchronization is the key to making the system work properly and is the key to the user experience. How well iCloud works will be totally dependent on the synchronization system’s success. Watching the system eat up your network bandwidth as it moves items everywhere will be real interesting because many devices have a constrained bandwidth due to carrier contracts unless you are on Wi-Fi.

Prediction – Apple will meet its success goals with iCloud if it can engage heterogeneous business system capabilities

The iCloud provides both new and copycat functions.

What’s new is the integration of a plethora of devices onto a cloud-like platform. But, the platform that will be serving up the capabilities is a set of large computer systems where for fees ranging from free to “low cost” users can store and synchronize their data, apps, photos and songs. This is a good thing because the iCloud promises to provide a single seamless interface from “all” of your devices to your information.

The copycat is in the details. There are other offered services in the “cloud” that either provide similar functions or the capability to access similar functions. Thus, depending on the end devices that you use, you could have similar low price capabilities available to you without iCloud.

One of the technical problems that must be solved is the amount of bandwidth that is needed to synchronize all of these applications and push that data around in the cloud. A clear winner is the provider of 3g wireless services and a clear big wave opportunity is available to communication system operators who can make Wi-Fi even more ubiquitous than it is now. However, the key to business use is to extend the iCloud to encompass applications and product extensions relative to business enterprises!

Enterprise iCloud issues

A serious concern for users of the iCloud will be security and privacy. But these are not the only issues facing Apple in the enterprise environment and potential enterprise partners.

The first issue that must be addressed is applicability. One of the key issues in Apples favor is that the information in iCloud can be accessed from both MACs and PCs, but there are bigger issues. Even though MACs, iPhones and iPads, are used within large companies,. iCloud services will need to be adapted to meet both individual corporate and government rules and regulations that govern data; i.e., Sarbanes Oxley, HIPPA, and other assorted privacy regulations.

Cloud computing can be used to offload back-office applications. This can free IT staff from having to deal with simple functions such as e-mail. Non-proprietary data or non-critical information can be hosted in public clouds such as Amazon Web Services or Windows Azure. IT staff can focus on functions and services that provide a competitive advantage. Some types of information can be stored in hybrid clouds depending on their characteristics. Specialized or proprietary information will likely be stored in a private cloud.

Regulations will dictate industry use of the cloud! Apple must address this issue if they expect to provide enterprise clouds for businesses. Further, they will have to beef up their computer center capabilities to store the massive capabilities necessary for businesses. Apple may have to provide a new set of applications bundled into a suite to be able to catch the enterprise market!

Small companies reliant on iOS and Mac OS X hardware will find iCloud an appealing way to simplify file management and distribution. Larger organizations will find obstacles. Someone must address enterprise concerns to create a large organization system.

There are a number of specific enterprise system issues that must be addressed including: 1) – Applications, 2) – Security, 3) – Storage, 4) – Management, 5) – Service Level, 6) – System Compatibility and 7) – Interoperability.

From a business perspective applications and services are the key to being considered as a partner for the IT department. Yet Apple announced no applications of significance to the enterprise at product launch. It is acceptable to focus on the consumer market first, but soon applications for accounting, invoicing, lead management, MRP, etc. must be introduced. Realistically there is no current business level software for the iCloud.

Apple must provide details about all areas of security including encryption, intrusion detection, virus protection, data partitioning between clients and access control. Apple has not been a company whose products are attacked on a regular basis by hackers. But that may be due to the fact that the PC installed base is so large and robust that hackers don’t want to bother with Apple systems unless they gain more market share.

Apple provides individuals storage up to 5 GB free. But, five GB is a drop in the bucket in an enterprise system and Apple must address this critical storage issue. IT departments will want large amounts of storage at a reasonable cost and with announced plans to put up an initial three data centers, Apple will have to have a great strategy to entice the IT departments to commit to iCloud in large organizations.

Synchronizing all this enterprise data could be problematic so bandwidth will also be critical. Bandwidth limits and requirements are not known for a large organization at this point and Apple must determine and price realistic enterprise options to penetrate the corporate market.

Information management is a critical function. If Apple is to address the corporate market they must determine how documents can and will be managed in a multi-domain environment in which documents can and will be accessed from a variety of platforms ranging from an iPhone to a PC.

How complex documents, forms and other examples of documents are manipulated is critical to the success of the iCloud. Further, the competitors to the iCloud are not going to go away without a fight so Apple must learn how to deal with hybrid systems if it is to dominate this market space.

Apple does not offer a service level agreement guaranteeing iCloud uptime or QOS (quality of service). Service availability and quality are critical issues to IT departments.

Users and corporate IT departments currently have established ways of doing business and Apple must provide functionality that is designed with system compatibility in mind. And this must be a step up in performance and capability from the users current systems. Otherwise there is no reason for the user to move forward with any changes. This will be a significant challenge for Apple as it does not have that installed dedicated user base within the corporate world.

Interoperability with other systems will be a key issue as users will not expect to give up anything to switch to the iCloud. Running a business in the cloud is going to be a multi-vendor affair. This will be the key and iCloud stands to be part of the initial overall solution if Apple can learn to deal with the variety of equipment and systems in the enterprise.

With iCloud Apple has taken a major step forward in moving beyond a device focus to a system focus! Whether Apple can keep this focus and actually make it work is an open question. Further, learning to play with the established software base will be a significant challenge. The solution to that problem is to provide new functions that get adapted by the end user thus forcing the IT department to provide the iCloud as part of the application solutions offered by the enterprise.

Conclusion

iCloud will solidify Apple’s position as a vendor of smart phones and tablets. The increased functionality of both types of devices will continue to drive Apple’s success. The MAC will continue to be a viable alternative to the PC.

But, the success of the iCloud will depend on three factors: 1 – Can Apple make iCloud more than a new form of a music and photo sharing service? 2 – Can the 3g communication vendors cope with both the consumer cost demands and bandwidth demands so that users do not get frustrated by high costs and bad performance? 3 – Can the iCloud make Apple into a formidable force in the enterprise market or are we seeing a further fragmentation of the computer market into the consumer and enterprise segments?

My bet is that Apple will continue to dominate the consumer market but success in the enterprise market depends on Apple’s ability to address enterprise system issues, in particular the enterprise application space!

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Kenneth J. Thurber has spent his career working in the field of computer and system network architecture. He has written or led nearly 500 technical proposals (winning over 200) leading to billions of dollars in research, development, and product derived work since 1969. He also consulted on the purchase by end users and/or product introduction by manufacturers of over $10 billion dollars worth of equipment. He was the system architect for the specification of Local Area Network and distributed processor concepts that resulted in the deployment of a real time system worth over $7 billion dollars. He developed the concepts of technology big wave surfing as a metaphor for ways to capitalize on the disruption that technology brings to the product marketplace. He is the creator and the world’s leading practitioner of extreme ways to develop, manage, market and invest in the technology product marketplace. In addition to forming and running several companies he has been a consultant to many Fortune 500 companies. He is considered by many to be the “Consultant’s Consultant”.

  • iCloud is a pure consumer play although small businesses will find it useful as well. Despite the name change iCloud is still MobileMe “exchange for the rest of us” with a few tweaks and a new price – FREE. It’s designed for the individual or small business that doesn’t have the resources of an IT department. 

    If you want to know what Apple has in store for the enterprise you only need to look as far as Mac OS X Server. If an enterprise wants the provide services to their mobile Mac and iOS workforce the answer is Server. 

    iCloud can’t be directly compared to Google’s offering because Google isn’t a hardware/software company and is creating solutions based on that reality. It also can’t be compared to Microsoft’s offering because Microsoft is doing what it has always done, following the latest buzz-word trend because it doesn’t have anything original to offer. In this case it is following Google because it perceives Google as a threat to its business just like it perceived Netscape as a threat a decade ago.

  • Silly article.

    iCloud technology is really set of developer APIs. Tools for syncing data.Business users can benefit from this as those APIs are exploited by developers.Data is synced invisibly and automatically. On mobile devices the data is available even when networks are not.  Businesses can, of course, encrypt the data being exchanged if they want to.Oh and Apple makes computers called Macs not MACs – it’s not an acronym or a cosmetics chain.C.

  • Dear oh Dear. 

    You appear to have missed the fact that Enterprise IT isn’t leading the technology curve today – it a long way behind dragging it’s tail behind it. All of the innovation in technology is led by the consumer/retail sector as businesses attempt to dutifully “extract value” from their technology where “extracting value” means not changing, not upgrading, not moving forward for fear of outage, loss or failure. 

    The retail sector has changed voice technology by adopting mobile phones en masse and bypassing the corporate PBC, by adopting tablets instead of PCs, by having email wherever they are instead of only at the desk, by spending money on ease of use and successful outcomes instead of “simple to manage or cheap to own/run”.

    iCloud can be used for the Enterprise, as can ANY technology, but requires much greater foresight than an MBA can probably grasp. 

    Disappointing. 

  • Walt French

    Somebody at BusinessComputingWorld should update Mr. Thurber’s copy of WordPerfect 5.0 so that when he types “MAC” it spits out “Mac.” And “Apple Computer” becomes the actual legal name: “Apple Inc.”

    Freed from the perception that he is stuck about 30 years in the past, readers might be more accepting of his comments on iCloud. We might give him credit for being more than about 10% correct.

    Because he DOES have a point or two correct: iCloud DOES provide a bunch of consumer-friendly services that don’t matter to businesses. And bandwidth WILL matter. Too bad he doesn’t get the fact that Apple actually designed its iCloud services for businesses *fully realizing* these facts.

    The #BIGFAIL is that it is not iCloud, but *iCloud Services* available to developers that will revolutionize “accounting, invoicing, lead management, MRP, etc.” Apple is NOT (thank heavens) in the business of providing these applications but provides the foundations for third-party developers to provide them.

    Mr. Thurber’s other major failure comes from not acknowledging that iCloud is meant to keep a single user’s data at hand no matter whether she sees it on her desktop PC, Mac laptop, iPad or iPhone. It is NOT some sharing system where all the company’s customer databases are dumped onto the internet. Companies that need that functionality still need to wrestle with the availability, functionality and security as before: they will need to write mobile apps or web interfaces, pretty much as they have for the last couple of years.

    Some of the iCloud concepts are already working in Apple’s apps such as its spreadsheet and word processing: multiple versions automatically saved, restored, compared and copied, delightfully hassle-free. But the full impact for businesses will come when Apple updates iOS this Fall, and as I said before, when third-party *and in-house developers* build the iCloud power into their applications. The ball is in their court to incorporate those functions or keep up Business as Usual while competitors try out the very powerful and easy iCloud approach.

  • Fresh Ronaldo

    It’s difficult to take the author seriously when he (and the editors) don’t know that Apple Computer is really Apple, Inc. (and it’s been that way for years), and that the Macintosh is spelled ‘Mac’ and not MAC.

    Once I saw those gaffes all I read was blah, blah, blah… or, rather, BLAH, BLAH, BLAH…

  • Ken Thurber

    Sometimes in our gotcha world people miss the forest for the trees.  We are personally big fans and users of Apple equipment, but we note that just because Apple is very successful right now this has not always been the case. Not that long ago Apple was struggling to remain relevant as a computer vendor. Think about Lisa (1983), MessagePad aka Newton (1993) and ROKR (2005). Now they are the most valuable technology company in the world with a significant leg up on competitors in the consumer space. But, competition exists everywhere. While they (Apple) just vanquished H-P in the tablet business, Google is trying to step up its game in the phone business. If you say that the consumer market is driving innovation, you’d be right. If you say that it’s a developer’s world, you’d be right. The point is Apple must be able to execute in the enterprise field for iCloud to be a screaming success. Otherwise, iCloud will simply end up being a place to store your photos and music as you move around the universe. IBM, H-P (currently wounded) and Google are among those who lie in wait. Some competitors have nowhere else to go and  they will fight to the end to retain their place in the enterprise. There is no other door for them to open. The question is will Apple master the enterprise and execute (as they have so adroitly done in the consumer/retail market), or will these giants be able to fend them off. That is the question, and the important element of our article.