Hidden Costs of Cloud Computing - So much of what makes the cloud beneficial to companies – its scalability, its flexibility, its collaborative nature – also adds expense. The fact that IT infrastructure is not in-house means that it's owned by someone other than the company, creating compliance and security risks. The storing of data on foreign servers creates concerns about compliance with privacy standards and regulation of data access. The increased use of cloud-hosted applications creates stressed networks. All these things, by requiring additional resources and manpower, add expense to cloud computing.
Securing Data in the Cloud - Security is an undeniable concern for companies. R&D procedures, clinical trials results, marketing information, industry sales details, and other company-sensitive information must be protected from falling into the wrong hands. Owing to the external nature of cloud computing, where third-party users may be managing servers, unknown personnel may have difficult-to-monitor administrative access privileges. Companies offering cloud computing don't simply allow these security concerns to go unaddressed; most provide extensive firewalls, security codes, and other business practices to build customer confidence and guarantee protection. Yet companies must likewise be active, through encrypting data, monitoring the activities of privileged third parties and demanding greater visibility from cloud providers about how they are securing hosted information.
Compliance of Data Hosted in the Cloud - Most data compliance laws and regulations were written under the assumption that the liable party controls both the infrastructure where data is stored, and the ability to make decisions about where that storage is located. This means that most compliance laws assign responsibility to the user of a cloud computing environment. Such laws have, in the past, tended to limit activity in the cloud to the manipulation of data that doesn't involve intellectual property or patents. To ensure compliance, companies must monitor the infrastructure of the cloud, made difficult by the ever-shifting, adjusting nature of the cloud. As with security, this activity requires a monitoring and service assurance operation to be established.
As IT Becomes less Complex, Networking Complexity and Cost can Increase - By moving to the cloud, companies simplify and streamline IT, concentrating it in a few locations – some of which they control, some of which they don't. This means that the link between the user of the data, and where the data sits, is more complicated than before. In a nutshell, the network is more important and vastly more complex than ever before. If companies can't deliver data, the economics of the cloud will be reduced. A wealth of research and information hosted in the cloud will provide no benefit if it can't move to where it needs to be. Likewise, applications hosted in the cloud will be pointless if a CIO can't guarantee their performance. If a company has 30,000 employees working from other offices, it's important they aren't waiting behind their laptops for applications to work.
According to Gartner, average IT costs represent €800 per employee - and the cost of the networks that support the delivery of that IT is only a fraction of the total. Nevertheless, a move to the cloud necessitates investment in the network. As users access more cloud applications, networks can turn into the London M25, with too much traffic competing for network resources. In this situation, rather than adding new costly lanes to the motorway, savvy firms are protecting the performance of business critical applications by practicing WAN governance. The basic premise is to build greater intelligence into the network so that when network resources are assigned priority is given to those users of business critical applications such as an ERP system, rather than bandwidth hungry applications like YouTube or Facebook. You can think of this like adding a priority lane to the motorway, or how Transport for London is planning to help athletes move around the city during the Olympic Games next year.
Conclusion - It is inevitable that business is using the cloud in some capacity. Users accessing applications such as LinkedIn or YouTube are already accessing this software as a service. Gartner, the noted IT analysis firm, has predicted that cloud computing revenues will top $150 billion by 2013 as a large number of firms change their IT model. When considering the cloud, it's important to remember there is no IT nirvana and not all costs are immediately obvious. Cloud computing requires a change in mindset as technical teams become responsible for guaranteeing service and application delivery, rather than 'doing' the nuts and bolts of IT.
(A full version of this article has been previously published on Samedan)
Illustration: « La fée électricité » (details), by Raoul Dufy (1937) – It is a really big painting… and other "fairies".