The disruptive nature of cloud computing

Cloud computing not a disruptive technology in and of itself, but a disruptive IT delivery model which leverages key technology ideas to deliver IT in a much more efficient model.

Over the past decade, numerous shifts in business have been described and hyped – for better or for worse – as “disruptive.” Playing off the term coined by author and Harvard Business School professor Clayton Christensen in 1995, true disruption occurs when an innovation in technology or business model unexpectedly displaces an established one. Examples include: the light bulb vs. the gas lantern, the mini steel mill vs. the vertically integrated steel mill, iTunes vs. purchasing CDs, and digital cameras vs. film.

In the IT industry, we have a history of self-proclaiming a “disruption” with the advent of new technologies and solutions, but only a select few have withstood the test of time and proven to be genuinely disruptive. For example, the introduction of Internet standards such as HTML and HTTP forever changed the face of computing, both inside and outside the enterprise. Linux and open source changed the way technology giants like IBM, Microsoft, Sun Microsystems and others operated their businesses. Now it’s becoming clear that another entry can be added to the pantheon of truly disruptive innovations: cloud computing.

The rise of cloud computing could radically change the way companies manage their technology assets and computing needs. With the continued exponential growth of electronic data, the information infrastructure that exists throughout the world today will not be able to keep up with ongoing demand. It simply doesn’t make sense – from both an economic and environmental perspective – for organizations to build more expensive, energy-hogging data centers to handle computing requirements of today and beyond. This is why cloud computing is an attractive option for enterprises and why the concept has built up so much momentum in recent years.

Peering through the hype to see real value for the enterprise

The buzz around cloud computing has reached a fever pitch. Some believe it is only hype because it uses established computing technologies, which is true. But that is exactly what makes cloud computing work – it is not a disruptive technology in and of itself, but a disruptive IT delivery model which leverages key technology ideas (like grid computing, utility computing and Software as a Service) to deliver IT in a much more efficient model. Because of this, cloud computing has undeniable characteristics of a truly disruptive innovation.

First, cloud computing turns the economics of enterprise IT on its head. Delivery of IT services (including infrastructure, platform, and applications) from the cloud has both capital expense advantages and operation expense advantages. The ability to pool resources, virtualize them, and then dynamically provision from the resource pool yields a much higher utilization rate and thus better economics -- sometimes from 15 percent to 90 percent utilization, according to IBM research. The cloud aspects of standardization and automation greatly reduce the overhead required to deliver IT services. By focusing on a few common IT configurations (like software stacks, storage allocations and application options), and then automating the provisioning of these configurations, the amount of labor required to deliver that service is greatly reduced.

Second, the cloud model can yield better results for the consumer of an IT service. For example, at IBM, a compute cloud was built for researchers to develop and test applications. Before the cloud, if the researcher needed a small network of servers and storage to conduct research, it could take weeks to deliver on the requirements. The IBM Research Compute Cloud gives researchers access to systems in mere minutes. The more usable and approachable IT becomes, the more it can be leveraged for new ideas and innovations.

So, cloud computing provides enterprises with a two-fold solution: from an organizational perspective, the cloud delivers services for consumer and business needs in a simplified way, providing unbounded scale and high quality of service that drives the potential for growth and innovation. From a user’s perspective, it’s a means of acquiring computing services in a simpler, more responsive model and without having to fully grasp and understand the underlying technology. It’s an effective service acquisition and delivery model for IT resources, and if properly implemented within an overall technology strategy, cloud computing can help improve overall business performance while controlling the costs of distributing IT resources to the organization.

Leveraging the Internet to change the world

Furthering the argument around cloud computing as a disruptive force is the fact that it’s transforming the way individuals harness, access and utilize technology. And as cloud-based services are delivered via the Internet, it realizes many of the far-reaching promises and ideals that were associated with the World Wide Web as it began gaining widespread adoption nearly two decades ago.

Bridging the so-called “Digital Divide” has long been a goal in the Internet age, wherein technology becomes a conduit for leveling the world’s playing field between have’s and have not’s. With the rise of cloud computing, this goal becomes more attainable as a result of innovative cloud projects and applications. Examples can be found across multiple industries, most notably in the field of higher education.

Educators and technology experts at North Carolina State University (NC State) are currently embarking on an initiative to provide every student in the state – from kindergarten through college – with access to advanced educational resources. This is made possible by a cloud-based technology developed at NC State called the Virtual Computing Lab (VCL). Through the VCL, students in K-12 schools, along with colleges in the North Carolina University system and other institutions in the state, will be able to access valuable learning content, select software applications along with other computing and storage resources. This initiative is designed to apply cloud computing technology to the broader objective of democratizing education for students in North Carolina and around the world as similar projects modeling this approach emerge.

At a more basic level of responding to day-to-day business demands, cloud computing is delivering innovative solutions to organizations in numerous fields, from healthcare to telecommunications, to retail and others, spanning enterprises of all sizes. Those taking advantage of cloud computing recognize the tangible benefits of this unique technological approach. They’re not standing pat while the world around them changes. They’re boldly embracing the next generation of computing service and choosing not to shy away from the disruptive nature of the cloud.

Undoubtedly, cloud computing will continue to grow in the years ahead. And when industry observers of the future look back at these early days of adoption, they’ll recognize the tectonic shift caused by cloud computing, which has both transformed enterprise IT delivery and established the Internet as an effective enterprise computing platform.

Ric Telford is Vice President, Cloud Services, IBM.