MIT: Cloud computing to reshape IT

A panel of experts yesterday said that more companies would look to cloud computing in the near future because of its potential cost savings and its ability to deliver flexible scaling.

Speaking at the MIT Sloan CIO Symposium this week, four panelists described several advantages and potential pitfalls for companies that utilize cloud computing to outsource key IT features.

Broadly speaking, cloud computing services use Internet technologies to deliver IT-related capabilities directly to users.

During the panel discussion, Rackspace Cloud General Manager Emil Sayegh described cloud computing as "a set of pooled computing resources that's powered by software and delivered over the Web.

"Cloud computing differs from traditional IT infrastructure because it treats IT more as a utility rather than as a piece of dedicated physical infrastructure that must be managed and upgraded internally. Ed Bugnion, who currently serves as the CTO of Cisco's Server Access and Virtualization Business Unit, said that cloud computing technology is still "nascent" but that it "is something that has tremendous growth potential... it's basically a transformation from IT in data centers to more virtualized technology."

Ron Markezich, the corporate vice president for Microsoft Online, said that cloud computing would give IT customers a new business model where "they don't have to worry about upgrades and capital for hardware" since those upgrades would be provided over the web by the service providers.

This, in turn, would save companies' IT departments both time and money and would allow IT departments the flexibility to assign their top workers to more high-value tasks.

"The benefits of cloud computing start and end with the dollars you can save," he said. "But it can also help getting your best people away from working in areas that can be outsourced to the cloud. This way you can allow your best people to focus on an area that drives differentiation for your company."

The other big virtue of cloud computing, agreed the panelists, was its ability to provide flexibility in scaling beyond what standard dedicated infrastructure could provide. Because cloud services are virtualized and delivered over the Internet, users can more easily increase or decrease capacity depending on their current needs.

Thus, said Sayegh, companies using cloud computing wouldn't have to spend additional money decided how much new capacity they need to build out.

"We're seeing more and more user cases where they're starting new projects and they find a lack of predictability of how much capacity they're going to need," he explained. "That gets expensive very quickly... the advantage of cloud computing is that you can turn over the keys and forget all the issues with scaling."

But even while panelists praised the advantages of cloud computing, they pointed to some limitations that could hinder its widespread adoption. Sayegh, for example, said that certain database-intensive applications would likely perform better with dedicated infrastructure. He also said that industries that are under heavy regulatory control, such as healthcare, would be better off using dedicated systems rather than cloud computing services.

Goss International CIO Bill Rogers, meanwhile, said that one of the impediments to adopting cloud computing was that many CIOs were confused about exactly what cloud computing is. Noting that cloud computing is more of an "industry buzzword" than a concrete concept, Rogers said that he's spoken with several different vendors who have all defined cloud computing in different ways.

The result of this is that many companies come away from discussions with vendors unsure of what they're buying when they purchase cloud services and are thus wary of investing in something that has no standard definition.

In the end, Sayegh said that companies' best strategy for deciding whether cloud computing services are right for them is to experiment and examine how well cloud computing fits in with their business models.

"I would encourage CIOs to dabble with it and look to see what they can use to save themselves money," he said.

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