Hosted and cloud computing positioning

They identify three layers – Applications, Platform and Infrastructure. For most non-technical people the application layer is fairly understandable, particularly as it lists many of the business applications, like CRM and Marketing. The platform layer is OK too, as it lists things like Content Management.

They identify 3 columns – Cloud, Hosted and Private Cloud. The distinctions are interesting particularly between Cloud and Hosted. To expand:

“Multi-tenancy is the defining characteristic of cloud applications”. Essentially this is many customers supported by the same code. This provides many benefits particularly economies of scale and agility and innovation. New software releases can be implemented much quicker.

Hosted applications are defined as single tenant or multi-instance. This is seen as offering some benefits to end-user organisations, such as doing the technical set-up centrally and offering lower costs and monthly charges.

From an end-user perspective, particularly for a small business, it seems an esoteric point whether the provider is running one or many customers on each instance of the software. Reliability, availability and security need to be delivered, and surely there are tools to manage multiple machines in a data-centre with a high degree of automation.

One over-riding message though is the weight of support that is now going into cloud and hosted computing from all the major IT suppliers; IBM, Oracle, Microsoft, Sun, Salesforce, HP, SAP, Amazon, Google, and the new Windows Azure platform.

It’s taken the Internet/Worldwide Web more than 15 years to ‘mature’ to where it is today. It will be interesting to see where the Cloud is in say 5 years. Its adoption will be quicker as it piggy-backs on what the Internet/WWW has achieved and it involves less user education.

The main areas I see that will change are:

• a rapidly increasing range of application functionality and application suites for vertical sectors
• cost reduction in end-user pricing from economies of scale
• rapid escalation in the pace of change from central delivery

The ability of businesses to assess, decide and implement the explosion of new functionality from many vendors will be pivotal.

Alignment with a provider or brand will become more important. Previously there has been the polarity say between Apple Mac and Windows PC loyalty. Going forward the major choices will be far greater; Microsoft, IBM, Google, Amazon, Oracle, Salesforce and others in the top tier. Niche players for particular markets and sectors in the second and third tiers.

Who will emerge as the champion and provider of choice for SMEs? I’ll stick my neck out, and of the majors listed I fancy Salesforce for service based SMEs and Amazon for product based SMEs.