Judging by the customer demand we've experienced at Virtustream, with many enterprises moving infrastructure and mission-critical applications into the cloud, it's safe to assume that we are nearing a true tipping point for cloud adoption. But with adoption comes demand for superior performance and improved reliability and security.

Changes to SLAs
Cloud service providers (CSPs) can expect clients and prospects to demand more detailed and comprehensive Service Level Agreements (SLAs). In many cases, enterprises leveraging cloud platforms from leading service providers have assumed that their SLAs covered more than they actually did. For instance, many existing SLAs have covered availability of compute, but not storage. A select few CSPs that have always had comprehensive SLAs in 2012 look for the industry as a whole to offer SLAs that cover the entire application stack.

Further, now that enterprises have experienced deploying a wide variety of applications in the cloud, they have learned that performance does not always meet expectations. This is largely a result of a cookie-cutter approach by many CSPs. Moving forward, application response times and performance are going to be key motivators for cloud migration and clients will expect these metrics to be covered by SLAs.

Better Security or Bust
The industry has been in the "honeymoon phase" for a while now in regards to security. While we haven't seen a seen a major cloud security breakdown yet, that doesn't mean that Cloud Security is mature and robust. The effort that hackers expend is often in direct proportion to the value of the systems and data. Today the majority of the infrastructure and applications that have been moved to the cloud represent less-critical applications. But that is about to change.

Because we're going to see mission-critical applications and content/information moving to the cloud, these platforms will become a more desirable target for hackers. Many CSPs begin with a secure design, but some don't. Regardless, rapid growth and adoption can lead to serious challenges around compliance and implementation. Even those with secure designs must have robust compliance monitoring, change control, and security event and information monitoring systems. Constant vigilance and attention to detail is required to ensure that implementation does not stray from secure designs, and that vulnerabilities are discovered and patched on a timely basis. Otherwise, cracks in the system will open doors for hackers.

In the inevitable event of a cloud security breach, we'll see the industry impacted in two significant ways. First - and most damaging - we could see companies that were considering cloud migration pull a full stop, taking a step back to reevaluate advantages vs. potential issues. Alternatively, a breach and the resulting security concerns could weed out some cloud service providers.

Expect companies to get tough with cloud service providers, asking more specific questions about security frameworks. The service providers that don't have all the answers will ultimately lose business.

Cloud Migrations and Impact on Software Vendors
Adoption of cloud computing to deliver cost efficiencies will lead enterprises to expect similar efficiencies from software vendors and the demand for "-as a Service" models will increase. This demand will bring about a few changes. First, vendors will need to rethink their licensing models and restrictions around multi-tenancy. Second, the role of the cloud service provider will evolve, especially if they deliver more services to end users. This expands the relationship between the cloud service provider and the end user while minimizing the independent software vendors' engagement with the end user. That said, as cloud service providers take on a larger role, the end users will expect software performance and security requirements to be built into SLAs. Full circle to end user expectations for more detailed SLAs.

While 2012 will likely not mean the end of the world, it could mean the end of the line for cloud service providers that are not tuned in to enterprise cloud computing needs. The cloud is no longer a test/dev sandbox. It has become a viable, scalable environment that yields cost advantages and improved reliability and security when built with complex enterprise IT demands in mind.