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Cloud Computing and the Enterprise

Leveraging both on-premises and Cloud systems

Cloud Computing - a topic that has been steadily growing in popularity and interest in the IT industry over the past decade - has the potential to significantly change how IT works by offering ready access to new capabilities, less expensive IT resources and unrivaled flexibility for businesses. Enterprises have typically viewed Cloud Computing as a service delivery trend that applies primarily to small-to-medium businesses. But with large vendors like IBM, Dell, Microsoft, and Google adopting positions on Cloud Computing that view appears to be changing and will continue to change as larger enterprises gain a better understanding of how to match software and service delivery models to particular types of users.

Google and Microsoft provide good examples of Cloud-based services. Google is a leader in the Cloud Computing space and its Gmail and Apps provide well-known and trusted alternatives to on-premises dedicated infrastructure, yet issues around data security, service resiliency, and access remain such that most large organizations are unlikely to opt for an "all or nothing" approach to Cloud Computing.

Despite the cost-savings advantages that Cloud Computing can provide, most organizations seem unwilling to choose between their existing on-premise infrastructure and Cloud-based services. If the idea of abandoning their existing infrastructure doesn't scare them off, the thought of managing yet another system most likely will. Take the real life example of a 1,000-person software company in Silicon Valley that spends roughly $580,000 a year to maintain its on-premises messaging/collaboration infrastructure (including the Fibre Channel SAN) compared to about $80,000 a year (according to the Google Cost Calculator) to maintain Web-based service costs.

The reality is that most large organizations would prefer a scenario where they leverage both on-premises and Cloud systems based on cost, flexibility, and user needs. That said, supporting two different mechanisms doesn't make much sense unless you can manage them both without increasing IT overhead. Other challenges involved in adopting Cloud Computing include issues such as the security and privacy of business data in remote third-party data centers, fear of platform lock-in, and concerns about reliability and performance. But what if organizations could switch over some percentage of their users and leverage the best of both worlds to meet requirements for different types of users? Many enterprises are realizing that they can no longer ignore the flexibility and cost-savings potential of cloud computing and are choosing to mix their on-premises collaboration applications with it.

When a development team creates an on-premises application, most of the requirements for that application already exist. An operating system provides basic support for executing the application and interacting with storage, while other computers in the environment offer services such as remote storage. Similarly, cloud applications can be built on a cloud foundation. Both kinds of applications can access infrastructure and application services provided on-premises and in the Cloud. Just as on-premises platforms support today's applications, Cloud platforms provide services for the applications likely in the future.

Organizations want to get the best of both worlds with tools that allow them to save money by deploying software based on user requirements rather than be forced into a one-size-fits-all plan. Before IT organizations look to external cloud providers, they may opt for internal Clouds - "cloudy" environments that are implemented in a company's own data centers. Since on-premise and Cloud platforms can be used together as a "shared resource," enterprises are seeking tools and technologies that enable them to share management and avoid the complexity and IT overhead of managing two very different environments.

In some instances, large organizations are deploying their own Cloud Computing environments, using service-oriented architecture (SOA) and the Internet to allow users to access global IT resources. Organizations can also combine services and resources housed in their own data centers with those of third-party service providers, or integrate services from third-party providers into their environments. Internal environments deliver many of the benefits of Clouds and position enterprises to use external Clouds in the future, as supplier offerings improve and barriers to enterprise adoption are overcome. Software-as-a-service (SaaS) is playing a significant role in integration and building internal cloud environments, and represents a major component of the enterprise cloud computing model.

Companies, including Intel IT, are taking advantage of SaaS and niche infrastructure as a service (IaaS) implementations whenever possible to build internal Cloud Computing environments from the inside out. Using SaaS for Cloud integration allows enterprises to integrate multiple SaaS services such as those provided by Salesforce.com and eAutomate, but also offers the wherewithal to blend Cloud services into their traditional IT resources.

There are now dozens of companies scoping out this SaaS-IT integration market. The growth of SaaS applications and Cloud-based computing has been staggering - it's estimated by Gartner that worldwide SaaS revenues will grow to $19.3 billion by year-end 2011, while the market opportunity for Cloud-based computing is in excess of $160 billion. SaaS is becoming increasingly more flexible and customizable than ever before, with more and more new tools and strategies available to help IT departments work out integration issues.

Cloud Computing is no longer just for small and mid-sized companies. The scalability and cost efficiency that it provides make it appealing to much larger enterprise organizations looking to compete more efficiently in the global market. The odds are good that within the next five years the popularity of Cloud Computing in the enterprise will grow significantly. Yet Cloud Computing alone is not the answer. The Cloud doesn't yet provide the full spectrum of an on-premises environment and enterprises are not inclined to completely abandon their multimillion-dollar on-premises investment. The key to achieving the greatest success is for enterprises to use efficient software to integrate their existing on-premises infrastructure with the cloud.

More Stories By Scott Young

Scott Young is vice president of marketing and product management at Ensim Corporation, Santa Clara, CA. He has over 17 years experience working as a senior executive in technology industries including enterprise software, internet services, and semiconductors.

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