Friday, 11 December 2020 00:32

We're all in the cloud, but how do we make it rain? Featured

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We're all in the cloud, but how do we make it rain? Image by Markus Trier from Pixabay

Where is the money in the move to cloud computing? What's profitable and what isn't?

For this, the seventh in our 'controversial question' series, we asked a broad range of IT vendor executives for their thoughts on profitability in cloud computing. A total of thirty-two responded.

This is the question we asked: "Everything is going to the cloud these days. But how do we make it rain? In other words... Where is the smart money? Where is the profit? Where is the whole thing going? Where are (will be?) the winners and losers?"

The entire concept of cloud computing relies on a simple philosophy. If you aggregate compute facilities at sufficient scale, you can make money on the difference between the cost of one huge facility and the cost of multiple customers maintaining their own infrastructure. Of course, there are added bonuses in the kinds of services that can be offered at scale but we have to aggregate first.

Jonathan Hatchuel, Senior Director at Oracle Cloud attempts to make the problem simple suggesting that "The future of cloud is in self-driving, self-securing and self-repairing Autonomous technologies and the 'winners' will be those who embrace it."

Tony Hudson, commercial director, Vertel agrees, offering, "Moving to the cloud has much to offer in the way of operational, security and cost benefits through consolidation and the economies of scale that come with leveraging shared infrastructure. Cloud data centres are a good example of this whereby customers get state-of-the-art facilities and scale, and data centre providers certainly profit from that as well."

Not to be out-done, Derek Cowan, Head of Systems Engineering ANZ, Cohesity brings in pretty-well every part of modern society. "We live in an era that is rapidly developing with digital technology improvements and is underpinned by the highly proliferating technologies and based on cloud computing concepts. Artificial Intelligence, the Internet of Things, and Machine Learning has changed the way of everything. At present, consumers are demanding the most secure, real-time, intuitive, and mobile or web-based digital services. This evaluation accelerates as fifth generation cellular services will be available within the next few years widely."

Of course, IT executives will broadly be supportive of the chance to profit from the cloud, but their responses still show mixed feelings.

 

Scene setting

Ragavan Satkunam, Senior Manager, Portfolio and Strategy, Ricoh Australia starts by offering a reality check. "Many organisations are still doing the rain dance around Cloud, hoping it might reduce the cost of doing business and improve customer experience. It will only work if the broader organisations' value chain is aligned to deliver it and there is a clear pathway on their digital transformation journey. "

Shad Mortazavi, Managing Director, OpenIQ takes up the theme by noting that, "The move to cloud-based systems started back in 2000 with Managed Service Providers launching products such as Microsoft Exchange. Today, nearly all aspects of the Microsoft Stack are available as a cloud offering.

"Beyond this, the advent of Amazon, Microsoft, IBM and Google cloud offerings provide easy-to-use, cost-effective cloud infrastructure and software. Originally, there was great caution with many financial organisations reluctant to put their data in the cloud. We've since moved on with many major banks and financial institutions leveraging prominent cloud-based systems with aggressive plans to transition many of their remaining systems to the cloud. Cloud is the norm today and most on-premise solutions are either already legacy systems or hanging on before their looming obsolescence.

Stepping back a little, Vykintas Maknickas, product strategist at NordVPN suggests we consider the motivations. "To answer this question, we need to delve into why everything is moving to the cloud and what the actual difference is between the cloud and on-premises as well as on-device options. For a start, the biggest difference is where the computing is done, or, in other words, who provides the resources for the service. Back in the days of DSL, internet speeds were terrible, so, in order to get better usability, one would have to either use software that isn't connected to the internet or make sure the data transferred between the application and the service was very minimal.

"At that time, the industry of personal computers was hell bent on providing computers that were as powerful as possible. So, in order to make predictions about the near future, we need to think of what consumers' or enterprises' experience is at the moment, with all the subsequent consumer browsers. However, Apple M1 chips can slow down browser innovations, because users will be quite satisfied with the experience they provide."

Pointing to the rapid rate of adoption, Theo Hourmouzis, Australia Senior Regional Director - South, Snowflake says, "The shift to the cloud continues at an astronomical pace, and rightly so. For many [commercial] customers, the first phase of cloud adoption was all about elasticity and agility. A step toward regaining focus on their core business, not infrastructure and datacentre management.

"Initially, this resulted in significant cost savings and improved agility; more importantly, the pace of innovation began to accelerate, enhancing existing products and services and delivering new capabilities from the sheer power and flexibility cloud computing afforded.

There's a significant change in philosophy, as Joseph Carson, Chief Security Scientist & Advisory CISO, Thycotic sees it. "Many organisations have adopted a cloud first approach which means they must first consider cloud deployment options unless it is not possible because the services do not exist, it is not technically possible yet, or legal issues prevent a cloud option. Some organisations are ALL cloud meaning they completely deliver all of their business services from the cloud and they don't own any physical servers or locations to place them."

Expanding on that point, Graham Sowden, General Manager APAC, Okta adds, "We've certainly moved into an era where cloud is delivering services that can't be provided any other way. We're also seeing traditionally bricks and mortar businesses — like supermarkets and healthcare providers — now delivering their goods and services digitally. These trends have been accelerated this year as businesses were forced to move to working remotely and find new ways to interact with their consumers online in order to stay afloat. We're predicting that there will be significant opportunities for cloud technology across industries, and specifically in the booming ecommerce and telehealth spaces, as they continue to digitally transform over the next few years to support new consumer expectations and distributed workforces."

In order to make clear the imperative here, Cowan claims "As the pace of business increases, organisations must innovate and innovate faster continuously. To support this goal, IT needs to focus on the core competencies that help businesses innovate more quickly, instead of merely keeping the lights on in the data centre. Enterprises that deploy applications and workloads in the cloud find that the monthly costs to run an application are five times higher than expected. A multi-cloud approach lets customers transfer workloads around, helping them avoid being locked into a single cloud supplier and optimising spending."

Benefits

Carson took the opportunity to lay out a set of benefits that any consumer of cloud computing ought to be able to realise.

"These organisations benefit in a number of ways:

  1. Flexibility, Dynamic and Agility - increase or decrease compute resources as needed on demand
  2. Capital Expenditure versus Operational Expenditure - less upfront costs or dependency requirements
  3. Built-in Disaster Recovery - On Prem you need to two of everything but only one in the cloud
  4. Automated Software Updates - Less downtime and options for automated software updates
  5. Best in Class Security - better security though it must be enabled and configured correctly

Sowden also points to the growth potential - "One of the great things about cloud software platforms is the ability to expand the market opportunity by adding new apps that sit on top of that of that platform over time. Extending this further - opening up APIs and enabling developers to build on top of your platform is the key to ensuring continued growth and success beyond your core capabilities."

Setting expectations

Everything may not always be "sweetness and light." A couple of contributors were keen to reset the expectation level to more closely align with 'sanity.'

Hatchuel offers, "With a large number of people working remotely, businesses are rethinking their security solutions. It's likely that in the next five years, there will be a 600% increase in the amount of sensitive data shared in the cloud. And with a lack of skills and qualified staff as the second-biggest cybersecurity challenge, it can seem as though the world economy is holding its breath waiting for disaster to strike. With organisations deploying users, applications, and devices so rapidly, using automation to address security threats seems like an obvious strategy.

Bruce Lehrman, Founder, Chief Executive Officer, Involta also points out that everyone wants to make a profit. Of course the buying power and efficiencies of the cloud providers means they can purchase physical infrastructure more cheaply than just about anyone else, they still have shareholders to answer to. "As organizations continue to evaluate moving to the cloud, there's more to consider than simply where you choose to locate the data. To create profit from the move, an organization must first evaluate where to generate efficiencies. Believing a simple move of data from on-prem to off-prem will create either or both is an unrealistic expectation. Regardless of where the infrastructure resides, organizations still must rely on the people and the network to devise an efficient and profitable cloud strategy. People are the fundamental masterminds behind the most cost-effective strategy - and one that also mitigates security or other risk factors. There's no easy button."

Hatchuel expands further, "Automation will continue to grow in other areas too. Businesses are becoming leaner and more agile, but users expect an uninterrupted stream of content, web browsing, and social media access. But delivering on that can be a challenge without adequate data management capabilities. That's why businesses using AI to sift through and manage data will have an edge as far as saving time, money, and energy down the road. In turn, it also frees up IT to do what they do best - build more and create more."

The 'politics'

And of course, no matter what we do, we're not in a bubble. First-mover advantage exists only for as long as it takes competitors to figure out what you did.

Mortazavi stresses, "As a technology provider, you should be promoting a cloud first strategy and encouraging customers to retire their on-premises solutions is paramount. Technology vendors who are yet to make this transition will have a long road to catch-up, allowing new players to enter the market.

"Technology aside, vendors should also consider a cost-effective subscription model and ensure easy deployment for success in today's world. Local and international clients are now demanding this capability, which is apparent in the uptake of new cloud telephony and contact centres."

The Virus

In 2020, EVERYTHING changed. EVERYTHING.

Shying away from calling a spade a spade, but still pointing to the problem, Glen Maloney, ANZ Regional Sales Manager, ExtraHop noted, "In 2020, organisations of all sizes were forced to accelerate their use of public cloud and distributed workforces in response to global events. While nobody could have foreseen the forcing factor for such a dramatic shift in such a short period of time, the trend line of increased digital transformation to those environments was already moving in that direction."

Maknickas emphasised the same point, " Since employees are finding themselves reluctant to get back to the offices, we will see enterprises allocating budgets aimed at remote productivity and security. You can't expect people to be happy with their internet routed through on-premises VPN servers designed to accommodate 10% of people working remotely. Budget increases apply to all things security, remote access to internal resources, and the likes. A year ago, most CIOs resisted solutions for zero-trust network access, but now the adoption is accelerating rapidly."

Of course, the pandemic wasn't the start of cloud usage, as Bede Hackney, ANZ Country Manager at Databricks reminds us. "Even before the pandemic, cloud adoption was soaring across industries. The pandemic helped accelerate that adoption as organisations needed to optimise their technology spend and better enable a remote environment. We believe it's no longer a matter of if organisations will move their data to the cloud, but when."

Daniel Harding, Director - Australia Operations, MaxContact agrees. "There has been a steady increase in moving to the cloud of the last few years, but this has rapidly increased in 2020 due to the global pandemic and will likely keep tracking that way in 2021 and beyond."

Expanding on the same point, Claudia Pirko, Regional Vice President ANZ, BlackLine adds, "Remote working is here to stay and having a dispersed workforce can bring about various data management challenges. Cloud technology is fast becoming the backbone of all remote workers during the global pandemic, including the finance technology landscape. For Finance and Accounting teams, cloud technology is key to establishing accounting processes that can be completed virtually, making general ledger data and other financial files available to accountants from wherever they're working.

"But before we can get there, the present reality of the COVID-19 pandemic is causing finance and accounting teams to face substantial real-life challenges, and this is especially true—and difficult—for organisations that are still heavily reliant on spreadsheets and manual processes. For many, it's no longer feasible to pass binders back and forth in a meeting or host the auditors onsite.

"A cloud-based accounting automation system can address these challenges and help organisations with their move to a remote accounting paradigm. COVID has shown everyone that that we can work remotely. Twenty years ago, it might have been catastrophic for finance, accounting, and business in general. Today, with the right cloud technology in place businesses can keep running, and accountants and other finance professionals can keep contributing to their organisations."

Stu Garrow, Senior Vice President of Sales, Asia Pacific, Talend also notes that the smart organisations will see opportunities in this virus-induced reorganisation. "The COVID-19 pandemic continues to reinforce the importance for organisations of all sizes, locations, and industries to digitise their businesses and take control of their data. This accelerated the shift to the cloud and the opportunities it provides. Organisations are looking to be uniquely positioned to identify game-changing opportunities. Cloud migration and SaaS applications are becoming critical drivers of their digital transformation."

Choice

As always, we are surrounded and beset by choice. Something which we dealt with in a previous 'controversial question.' 

Jonathan Jackson, Director, Sales Engineering APJ, BlackBerry says it plainly, "I often get asked if there is such a thing as good cloud vs bad cloud. The answer is obvious so pick your providers carefully, recognising that they will hold all your data, your assets and your ability to execute, scale and adopt new ways of doing business. CIOs who get this will flourish, others will flounder."

Mark Perry, Asia Pacific Chief Technology Officer, Ping Identity offers a similar thought. "And because there's not a "one size fits all" for business, especially those in highly regulated industries, savvy cloud vendors offer choices. There are multi-tenanted services, where your enterprise data is mixed in with other customers', whereas single-tenanted services give organisations a private tenancy, with data separation. Either way, the benefits of cloud adoption, provided by this value-added utility model, are undeniable."

Infinite size

Many organisations are required to cope with the "Mothers' Day problem." Not such an issue now, but in years gone by, by far the biggest day for a telco was Mothers' Day. Compared to any other day, the call volume to be handled was HUGE. But, how necessary is it to build out self-owned infrastructure that might only reach peak usage on one day every year. Presumably in the modern day, the 'black Friday' / 'cyber Monday' period is similar.

This is where 'cloud' has a major role to play.

Yair Lezer, Partner at Noteya Innovations offers an insight into this, "It's no secret that the Cloud is rapidly transforming telcos from providers of commodity communications services to providers of a growing range of managed and value added services (VAS). The market opportunities are expanding to virtually infinite capacities as Cloud environments and ecosystems continue to grow and mature."

Let's be smart about this

Garrow reminds us that we can't simply assert, "we're going to the cloud." Instead, he says that "It is paramount to remain focused on instrumenting the business to operate at speed and scale. A prescriptive approach to the market is critical to ensuring we build a strategic relationship from the first interaction to realising our customers' value. Ultimately, the cloud allows us to deliver fast, meaningful and continuous value for our customers, and these are the underpinnings to create customers for life. Companies that do not make the transition to cloud fast enough risk being left behind in this increasingly virtualised economy. Building a customer-first approach is key to long-term sustainable growth for our customers as well as our organisation."

Shift from bespoke to commercial software

Oddly, only one person commented on this. We at iTWire expected this to be a major theme.

Tim McKinnon, CEO at CloudCheckr reminds us that "The cloud market is moving towards the continued increase of usage of commercial SAAS applications in the cloud, plus the acceleration of customer applications to the public cloud as businesses continue to shift to a remote paradigm, many permanently."

This is really important. As mainstream applications become ubiquitous, everyone benefits. Which leads us to…

Efficiency

Getting right to the (financial) jugular, Perry asserts that "The cloud offers a number of quick wins for resource-strapped IT and app development teams. Want Single Sign On with user-friendly Two-Factor Authentication for your important applications, like Office 365, Salesforce, and that fifteen year old HR app that hasn't been touched since it went live? Register and consume it from the cloud. Need a modern, API-driven service to store user profiles, credentials and consents for a customer app? That's in the cloud too.

"We've moved on from treating the cloud as the new enterprise hosting environment, that slashes the time needed to order and provision hardware and virtual appliances, to a new utility model for IT services. Just like consumers order and consume easily affordable services like Netflix and Spotify, available over an almost ubiquitous delivery mechanism (the Internet), enterprises are now able to rely on highly available and secure managed cloud services that deliver real business value at a fraction of the cost of traditional on-premise services."

Satkunam continues, "Cloud computing will continue to be at the heart of the digital business. For progressive organisations, the rainmakers, going cloud means, enabling the workforce to work from anywhere in getting things done and automating mundane tasks. Truly giving employees the flexibility, applications, and collaboration tools to continually create value for the organisation and value for customers."

Marc Caruso, Chief Architect, Syntax expands on that theme, offering, "The solutions that companies use to store their data continue to rapidly evolve. We are seeing continued migrations into open source relational database solutions, non-relational database solutions, PaaS-based database solutions, and a combination thereof. The primary focus of these initiatives can be grouping under the heading of reducing operating costs, whether they are being undertaken to reduce hefty support contracts from vendors like Oracle and Microsoft (both the open source and non-relational database migrations fall into this category), reduce headcount expense (migrations to PaaS services falls into this category), or gaining performance efficiencies by migrating to a more purpose-built database solution. Data migration is happening right now and at a large scale. Migrations to PaaS solutions are being driven by the hyperscalers, with Oracle, AWS, and Microsoft all vying for market share.

"Aside from savings in hard costs, businesses should benefit from the machine learning capabilities built into many PaaS platforms that have capabilities of self-healing and self-managing. PaaS solutions reduce the administrative burden on some technical staff, like database administrators, allowing them to shift their focus to more value-added activities. Businesses also benefit from engineered capabilities like high availability, automated disaster recovery, and automated scalability to account for seasonal peaks in utilization."

Getting right to the 'coal-face,' Pirko adds, "What many companies are finding is that a distributed finance and accounting team can, in fact, deliver what may turn out to be long-term benefits to the business. In a recent study, Gartner found that 74 per cent of CFOs intend to shift some employees to remote work permanently, while 35 per cent of CFOs intend to reduce investments in on-premise technology, either immediately or in the future."

Similarly, Carson points out the security issues… "Cybersecurity has been a major priority for organisations going to the cloud, both to strengthen security and reduce the risks. One of the main benefits of cloud computing is the potential for better or best in class security - although it must be enabled and configured correctly. However, many businesses continue to struggle to patch systems, apply security best practices and prevent cyberattacks from stealing sensitive data. Many IT resources are struggling with staying up to date on all of these threats and have become overwhelmed as it is impossible to be a cybersecurity expert in everything. In recent years organisations have become more confident in consuming cybersecurity solutions from the cloud as they can then focus on the business priorities and not have to become experts in everything.

"In the era of remote working most organisations will accelerate to cloud solutions as they enable the workforce to be in any location using any device and still be connected and productive. This means that security must be a priority with strong privileged access controls. In the era of cloud and remote workforce this means almost all users are becoming privileged users and that means a top priority for secure privileged cloud access security. Privileged access security has been one of the top priorities for organisations globally and if you want your business to be able to accelerate to the cloud and be resilient to cyberattacks then privileged access security is a must-have solution to protect your investments.

Reminding us that users are the centre of pretty-well everything Sowden says, "Making it rain" requires a nimble approach to product development that responds to user trends as they continuously change. It's already a hackneyed example, but the COVID-19 pandemic fast-tracked dynamic working trends, with many businesses quickly deploying cloud technologies to enable and secure remote working practices. This created a huge opportunity for cloud vendors and will continue to shape the market moving forward. Companies are realising that they need new solutions to support a distributed workforce, to interact with their customers from afar, and to do so securely."

Vested interests

Just like any technical innovation to de deployed, the current IT team often has a vested interest in maintaining the status quo. Alternately, they may-well be chasing the latest 'shiny thing' as it will look good on their resumes.

Caruso reminds us, "There are many considerations that need to be made when transitioning to these new database solutions, including the capabilities of the future state solution versus the current state, the impact to licensing and support contracts, and a method to ensure that the correct solutions are deployed. We are continuing to see use cases in which a sub-optimal technology is chosen because the technical team wants to work with it. From a PaaS perspective, leaders need to carefully consider the limitations in functionality that are imposed by some PaaS solutions and vendors, the impact to application release cycles of vendor-driven maintenance schedules, and how their IT budgets will be impacted by incorrect assumptions on utilization, performance, scaling, and or staff reduction. While PaaS solutions provide some great benefits, DBAs are still required to monitor and manage those systems and work with application teams to drive efficiencies in performance, availability, and security."

 Level playing field

Sometimes standards assist everyone, other times they seem to benefit the major players. Either way, McKinnon points out that this is an important area of consideration. "There will also be increased pressure in the cloud market for standardization, as major vendors seek to commoditize the infrastructure layer in order to focus on the software layer. Microsoft and Google will push hard on standardization as they compete with AWS.I expect that we'll continue to see better and better optimization tools and strategies provided by native tools offered by public cloud providers. Cross-cloud optimization will also become a bigger factor as standardization increases and friction between shifting workloads lessens. The industry will move more towards optimizing architecture and software applications vs. simply infrastructure level optimization."

Selection criteria - it's the network, stupid

Just because you are 'moving to the cloud,' doesn't mean all your problems are solved. Many of our respondents pointed out that there are still a lot of areas where problems may lie.

For instance, Mike Hicks, Principal Solutions Architect, ThousandEyes observes that "Now that the concept of moving business to the cloud is widely recognised as a key to success, enterprises are faced with a new set of parameters that determine just how successful their cloud migration is, and can be. Enterprises often select their public cloud vendor based on pricing, global data centre presence and overall service catalogues but there's one component that sometimes gets overlooked when evaluating different cloud vendors: network performance. The network is the glue that binds all cloud communication, both between end users to the cloud and within the cloud. For A/NZ businesses, it doesn't matter how large a cloud provider's presence may be in the U.S. if their network connection to domestic infrastructure is limited.

"This kind of inter-region performance is a key network performance metric that determines success in the cloud and one that businesses need to consider when determining their cloud strategy. A common practice among vendors is to distribute workloads in global regions but centralise common functions in a single region. That type of tiered geographical architecture, however, can affect network latencies and end user performance. Maintenance windows, for example, may be scheduled out-of-hours for the Americas and EMEA, where user bases are most extensive, but that often puts it inside office hours for A/NZ."

Hudson develops the same point - "Recognition that the wide area network is increasingly critical to the successful use of cloud services is vital. Technologies, such as software-defined wide area networking (SD-WAN), provide the capability to rapidly and seamlessly circumvent telecommunication service interruptions, in many cases minimising service impacts to customers and/or staff."

Perhaps Hackney says it best, noting that "The technologies that empower a simpler architecture and the companies that adopt a unified mindset will ultimately make the biggest impact."

Speed of transformation

In days gone by, a corporate division might request a minor change to a report or process on the company mainframe… and it would be delivered a year or two later. That can no longer be the case.

Mike Reddie, Senior Director Cloud, VMware Australia and New Zealand observes that "As organisations fast-tracked their cloud ambitions this year, they started to appreciate that cloud migrations don't require a multi-year trajectory in order to drive digital transformation and business value.

"Until now, the most common misconception we faced when speaking to customers was the idea that cloud migrations are costly, time consuming and require heavy resources. But this year we have really seen the true value of cloud come to the fore, often with a very short runway to do so. A great example is when organisations had to move entire workforces to remote capability, virtually overnight. Thanks to the scalability and flexibility of cloud technology, we helped businesses across all industries transform systems to support their entire staff to work from home in as little as 48 hours.

It still needs people

To this point, we've largely worked in the abstract. We have observed issues and solution broadly from a technology perspective. However Rod Lester, managing director - ANZ, NICE  reminds us that "To a degree, you can have the best cloud solution on the planet; however, one of the key ingredients is a mechanism to deliver that solution, and a large part of that is people. This includes internal employees as well a partner ecosystem with the depth of capability to deliver the solution in a meaningful way for customers."

Why are businesses moving to the cloud?

No-one moves to a new technology, just because they're supposed to do so. They need a compelling reason.

With that in mind, Reddie observes that "Many businesses began their transformation journey with the goal of optimising IT, moving it from CapEx to OpEx, and gaining the ability to scale up and down as needed. Today, the goals have shifted because customers are focused beyond this, with more emphasis on gaining competitive advantage through the innovation that cloud enables."

Similarly, Satkunam notes that "Smart investment in Cloud is around reshaping service delivery model for better user experience and customer success, integrating applications portfolio, reducing the complexity in managing the workflow through automation and in creating the right virtual environments to foster collaboration."

Vinayak Sreedhar, Country Manager - Sales & Business Development, Australia and New Zealand, ManageEngine echoes our earlier comment about 12-month update cycles - "We have come a long way from the on-premises IT model of yesteryear to a 'cloud-first' approach now being favoured by organisations. According to a recent global survey of the organisations that had moved much of their IT to the cloud, two-thirds felt that this had helped them considerably during the COVID-19 crisis.

"Hardware and associated software cost savings a pay-as-you-go, flexible pricing model ease of use, and strong data security provided by cloud solutions are some of the key benefits prompting organisations to make the move to a cloud setup."

Offering a similar context, Scott Wilson, CEO, Forbury notes that "When considering cloud technology, one aspect which often gets overlooked, is that it's not the arms race people make the data space out to be (i.e. who has the most) it's how organisations can bring together data from disparate sources, at scale to provide insight and meaning to a vast array of people in the system. In this respect, cloud computing is a way to facilitate scale data gathering at low/no cost. The trick is how to get people to open up their repositories for the greater good."

Innovation

During early times, the big selling points of 'cloud' were shared services leading to reduced costs. These days, there is a lot of innovation that could never have happened either on-premise or in this early cloud model.

For instance, Chris Wysopal, CTO and co-founder, Veracode observes that "Cloud-native technologies such as containers, microservices, and serverless functions will be a critical innovation driver. By leveraging cloud-native technologies to build and deploy software, businesses are able to achieve operational and cost advantages as well as scale. Cloud-native technologies also make it feasible to address some of the challenges associated with provisioning infrastructure by rendering the logic to build and configure the infrastructure as code.

"The benefits of infrastructure as code (IaC) include automation, reuse, version control, and more. As IaC becomes the norm, many organizations are adopting immutable infrastructure. In other words, changes to the infrastructure are only introduced when code is pushed to production. In this model, servers are never changed once they are deployed but rather entirely replaced when changes are introduced via standard code automated deployment methods. This approach results in a more consistent and reliable infrastructure as well as more predictable deployment processes. This also will extend all of the advantages of development tools — repository management, version control, code sharing, etc. — across the full software stack."

Wilson continues this thought. "Of course, the data gathering which is going on results in a mountain of data, which is the cloud's best friend. Without the cloud, proprietary systems wouldn't have coped. Warehousing of data is essential, but cloud also offers integration efficiency; they are often hub and spoke systems which are key for integration efficiency. In other words, the cloud is self-perpetuating. We see value in data, the cloud stores, manipulates, integrates, and delivers that information feeding the perception and reality of value and off we go again.

"As we're seeing technology as a business enabler, rapid change is taking place. The cloud is exponentially reducing the cost of doing business at a swift pace, hence the term disruption. Looking at disruption throughout the ages, it is the third and fourth players that win. The takeaway here is to copy the pioneers, to learn from their mistakes and setup at a fraction of the cost with a better, improved offering. Keeping in mind that, regardless of your lens, the competition for intellectual talent is the real focus. In addition, the COVID accelerator effect appears to only be turbocharging the disruption."

Undertaking the transformation

It's easy for someone to assert, "let's move everything to the cloud!" However, it's not necessarily that simple, as Sreedhar tells us. "It's advisable to do this in consultation with the internal IT team, given the vital role they are required to play in transitioning to the new environment. Their decision is likely to be influenced by a host of technical factors, such as cloud behaviour, security policies, network capabilities, add-on features, and API integrations as well as price and geographic availability."

Resiliency

Of course when you pass control of your most important services to some other company, you don't also abrogate responsibility to your owners and shareholders. As Hudson tells us, "Avoidance on total reliance on a single cloud-based data centre provider is also a key consideration for mission-critical cloud-based services. For example, avoiding having primary and backup services provided by the one cloud provider is an important consideration."

Total cost of ownership

Reaching the financial 'pointy end,' Lester makes it clear that "Cloud brings a lower cost of ownership for the customer as they are leveraging a shared platform, eliminating the need to bear the cost of maintaining expensive infrastructure that needs to be upgraded, patched and maintained.

"It's now the vendor that has taken on the responsibility for cloud ownership; however, that also creates cost efficiencies because of the scale being built. For NICE as we continue to get more scale, globally and locally, those savings will be able to be passed on to partners and customers."

Flexibility

Similarly, as well as the financial aspects, Simon Steele, Marketing Manager, Tecala points out that there are broader flexibility aspects. "Hybrid cloud combines a private cloud with one or more public cloud services, through a software layer that allows data and applications to be shared between them. Hybrid cloud therefore provides organisations with the flexibility to move workloads between cloud solutions as needs change.

"If tied to a single cloud provider, an organisation is at the mercy of their pricing structure with any rises unavoidable. However, when there are multiple providers in the mix, the prospect of shopping around for better rates becomes a reality. Rather than being constrained to using a single provider, different services and capabilities can be chosen from a range and combined as required.

"When it's managed well the hybrid strategy is the clear winner, because it enables you to dial resources up and down as your organisation's requirements change, which means you stop paying for storage or compute resources that are not being used.

"Indeed, we're finding that the most progressive companies today have realised that a hybrid cloud strategy delivers the most value, optimising cost and technology capability - with the right technology partners working alongside them, management teams don't need to restrict themselves to one type of cloud. Instead, businesses can take advantage of any type of infrastructure, platform, or software as a service"

Mobility

In addition, by moving services to the cloud, businesses find that their mobile users are better supported with improved access to services.

Kevin Beasley, CIO at VAI tells us, "While there are many bottom-line benefits of moving to the cloud such as the elimination or reduction of IT costs, many companies will find the most success in leaning on the cloud to enable mobile business. Enterprises and consumers are using devices like smartphones and tablets to do more than just communicate and entertain, so hosting applications in the cloud enables accessibility to anyone from anywhere. In today's climate, that is vital for success and where many enterprises will see the most ROI.

"There is not only an opportunity for cloud-based mobile devices in retail, but also in a remote business environment. For example, companies utilizing mobile collaboration technologies are turning to the cloud to automate and handle larger data workloads, and this transition will continue to expedite next year. Mobile devices are also seeing wider adoption throughout the supply chain, such as when warehouse managers are moving to cloud-based devices to generate data insights. The winners will be companies that offer seamless mobile experiences and capabilities in the cloud, reducing limitations caused by the pandemic and opening doors for more usability and additional business growth."

Security

Security is a double-edged sword. The more we secure our 'stuff,' the harder it is to use.

Maloney makes this clear. "With the movement to the cloud comes the need to secure and monitor cloud workloads. All technologies have certain advantages and drawbacks, so enterprises often deploy a variety of cloud workload security solutions depending on their regulatory environment, desired security profile, and tolerance for risk. The natural starting point for cloud enterprises is to invest in foundational capabilities before threat detection. The enterprises who are able to make a pivot toward cloud threat detection are going to be the ones that set themselves up for optimal visibility and security in their cloud environments moving forward in 2021. Along with the move toward cloud threat detection, enterprises who also unify security across hybrid, cloud, and remote deployments will also see benefits in the coming year."

Mick McCluney, Technical Director, ANZ Trend Micro reiterates this, asking "Why is cloud security and compliance so hard? This is hugely impacted by a lack of visibility, skills and knowledge, coupled with both the rate and pace of cloud development and technological change. Also, with everything moving so quickly, the danger is evident when people who aren't specialised in cybersecurity end up making cybersecurity decisions.

"What we also find with businesses we work with, is that there's a huge lack of understanding when it comes to identifying what security responsibility sits with them, and what responsibility sits with the cloud provider. The cost of getting this wrong can be huge - not just in terms of dollar figures but also brand and reputational cost."

Laggards

There are always those who are constrained by their current asset list. "Hey, we only bought that two years ago, we've not yet depreciated it off our books." Of course this applies to end users, but the same is often true of cloud providers who can't find a way to be suffienty nimble in this modern age.

Lester tells us, "Some cloud providers find themselves stuck in the traditional IT sales model, which will serve to hold them back. These are the technology organisations that haven't embraced true cloud and aren't broadening their capability to provide better outcomes for customers. In addition, the ease in which born-in-the-cloud providers can be spun up creates consistent and increased competition."

Growth from adversity

Many worry that the more we put things in one basket, the more attractive that basket is to the bad dudes. However, the opposite is also true - we can commit more resources to protect one big basket than multiple smaller ones.

Jackson makes this point: "While we take advantage of the opportunities afforded by cloud, we can't forget about the security factor. AI and machine learning, leveraging the massive amounts of compute power available through the cloud, can deliver something we call prevention-first security. With the threat footprint expanding significantly during 2020, everything is untrusted. People, data, apps, assets. Everything. And with remote and distributed workflows now prevalent, everything must earn the trust to get access to whatever information it needs.

"Now that COVID-19 has ushered in the global digital transformation storm cloud, it's time to unleash workforce productivity and encourage new ways of doing business, securely. Frictionless cloud workflows will be a key factor in this. Legacy technologies like VPNs will lose favour as end users become exasperated by barriers to quickly accessing the information and assets they need to do their jobs. The security and mobility capabilities should be built into the app, the device, the workflow - not bolted on. Built in AI and ML can be used to dial up the security when needed, or dial back the security when trust is established.

"I see similarities in the march to cloud for many enterprises and governments across APAC. Some are going ahead full bore, and some are stumbling. Australia though, to its credit, has realised that digital transformation and cloud based workflows are crucial to its ability to recover economically in the post Covid-19 world."

 The winners

So, with all that in mind, what do winners look like?

Lezer points to the consumers of cloud technologies. "Who are the winners? Clearly end users with easier access to functionality, managed service providers with more services to sell and technology vendors with a much wider market reach. To no surprise, customers - both end user organizations and individual consumers - will increasingly demand better applications, faster transactions and improved connectivity."

Reddie continues the same theme: "Through this year, business with smart cloud strategies moved quickly from reactive response mode to proactively adopting technology strategies for long term business resilience. The real winners will be those that can accelerate their innovative, digital-first stance to be ready for what the future holds."

Turning toward the vendor community, Harding tells us that the early adopters are likely to be the most successful in delivering cloud solutions. "Most vendors have been supplying native cloud solutions for many years now, and those that already have a strong cloud background, and have been ahead of the curve will likely reap the benefit of being experts in the field. Those vendors that have invested wisely in secure cloud solutions, hosted locally in Australia, with automatic failover systems, are likely to experience success in the coming years.

"This success should also transmit to the customers that choose their vendors wisely. Choosing secure and reliable solutions are critical for business continuity, there is no doubt about that after this year. Those that decide not to move to the cloud, or don't choose wisely, will be treading a fine line and may become unstuck if labouring legacy solutions are not updated.

However, there are pitfalls for vendors as Mortazavi observes. "Microsoft Exchange and Office 365 can now be bought directly from Microsoft and, as we saw in the early 2000s, margins for these products are becoming smaller and smaller. The real money is in writing novel technologies which can be sold in the cloud as a service. Everything else in the stack is a commodity and available to anyone, which limits a customer's ability to differentiate their service offering."

Returning to the customer base, Hourmouzis sees that, "Today, organisations that have adopted a cloud-first or cloud-native approach are the organisations that have a clear advantage and are winning. By leveraging the vast extensibility of the cloud, the rate of innovation has exponentially increased. Adopting newer capabilities such as AI/ML and upgraded capabilities such as data analytics has led to significant competitive advantage, creating new revenue opportunities, and driving meaningful value for their customers."

Hicks agrees - "The winners of cloud adoption will be those businesses that know to consider these kinds of specific operator practices, and know how to calibrate network performance across public cloud providers. Organisations embracing cloud-first strategies must arm themselves with real performance data -- not only to help guide early planning stages, but as a means to constantly evaluate provider performance against established SLA to drive accountability, and make sure they reap the benefits of their cloud investments."

Taking a step back from this, Lerman points to the latest swing of the pendulum and takes an each-way bet on the relative importance of distributed or centralised computing. "For the past several decades, organizations have relied on a centralized approach to data management. As the compute environment decentralizes and evolves closer to the user's location, it impacts strategic decisions more than ever. The human factor is essential to orchestrate the decentralization. Ultimately the companies that will prevail at generating profit will invest in the people and network to architect the journey to the cloud. That's where we're placing our bets, anyway."

Of course we should never put all of our eggs in one basket, as Hudson points out. "The winners in the adoption and utilisation of cloud-provided services will be those that recognise that the cloud computing facility is just one element of the ecosystem needed to provide consistent and reliable service to customers and staff."

Hackney adds, "With that in mind, we believe one class of 'winners' will be the companies that find the biggest value workloads and use cases to prioritise. Two of the drivers to cloud are speed and ability, that's particularly true in the data domain where cloud delivered platforms offer far greater speed to innovation than traditional on-prem approaches. We believe this benefit is further magnified when customers pick high potential machine learning and AI use cases and prioritise them to move to leverage the cloud first.

"The other big "winners" will be companies that find ways to break down silos and empower data teams - data engineers, data scientists, and data analysts - across the organisation to work on a single data platform. In the past, customers had to maintain proprietary data warehouses for BI workloads and data lakes for data science and machine learning workloads, often across multiple cloud platforms. This led to complicated architectures that not only slowed down the ability to get value from data, but were also incredibly expensive to maintain.

Returning to the vendor side of the equation, Lester observes that, "Ultimately, the winners will be those vendors that ensure they spend enough time, effort and investment, which includes in-country capabilities, to ensure clean execution of their cloud offering.

"The whole purpose of the cloud, when it is done right, is continuous value creation, which drives efficiencies through economy of scale. Successful cloud organisations will be those that constantly evolve their solutions and offerings because, if they don't, customers can quite easily just move to another cloud provider.

Similarly, Brendan Maree, Vice President Asia Pacific, 8x8 tells us that "Many organisations this year managed to adapt and deploy operate-from-anywhere strategies through cloud communications. For these organisations, 2021 will be about using their rich data to improve the total experience. That is, a combination of the customer, employee and user experiences that will take the concept of operate-from-anywhere to the next level. Investments will go into upgrading their contact centre capabilities, integrating more business applications, or adding more personalisation capabilities."

Wrap-up

Some of our commenters decided to take the rain scenario to heart. Here's how Singh gave our question their own twist. Braham Singh, CEO, BDx Data Centers says, "Better grab an umbrella; the cloud is headed to the edge and will play an integral role in the global recovery of COVID-19. With uncertainties still lingering, enterprises will rely on the cloud to accelerate recovery efforts. In this tumultuous storm we're in, the cloud has proven itself as the backbone of our data-driven landscape and will continue to support telemedicine, contact tracing, gaming, and more. Powered by data center infrastructure, the future of the cloud will heavily rely on AI to further increase efficiency and speed; that's where you can find the smart money. Winners will simply continue to embrace the cloud, with many turning to either a hybrid or multi-cloud environment. The losers will be those who do not look to the cloud to innovate because, frankly, there's no other path."

Cowan takes a steadier line, suggesting that "A multi-cloud strategy is one strategy which provides businesses with a complete set of benefits that range from cost reduction to improved cloud convenience. If there is one part of cloud computing to look out for in 2020 and beyond, it is the multi-cloud strategy. Whether it's an end customer or a partner, they must consider this strategy essential, as they do not want to be left behind."

Finally, Jackson reminds us that "The global pandemic has changed the way we work and is the driver responsible for the rapid adoption of digital transformation and cloud technologies. It's fairly straightforward to make the cloud rain - you just need to sow the right seeds and align a number of factors to grow a successful and sustainable cloud technology ecosystem."

In summary, John Delaney, managing director, MessageXchange tells us that "The question of making it rain when it comes to cloud all comes back to the key objective of being fully digital both internally with staff and externally with suppliers, customers and partners.

"The winners will be the organisations that win the race to being fully digital and fully integrated, and by being the best at digitally leveraging the strength of their community (of trading partners) against the losers with their less automated, less integrated set of trading partners."

This is a race not-yet won; but the thoroughbreds are clearly emerging from the pack.


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David Heath

David Heath has had a long and varied career in the IT industry having worked as a Pre-sales Network Engineer (remember Novell NetWare?), General Manager of IT&T for the TV Shopping Network, as a Technical manager in the Biometrics industry, and as a Technical Trainer and Instructional Designer in the industrial control sector. In all aspects, security has been a driving focus. Throughout his career, David has sought to inform and educate people and has done that through his writings and in more formal educational environments.

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