However, cost-savings alone are not encouraging IT directors and business leaders to stampede, en masse, to the cloud.
With over half of cloud services spending already on business applications (including collaboration platforms such as SharePoint), applications - and not reductions in CapEx and/or OpEx - will be the great drivers of cloud adoption.
More and more enterprises are realising business value as they think through what their IT operations will look like in a world of increasing cloud service leverage. Flexibility, scalability, utility-based pricing, expertise, and service orientation are just a few considerations that make the cloud highly attractive.
Where will enterprises start? The obvious is new apps that scream to be transitioned to the cloud: those that are hugely resource-intensive for short and unpredictable intervals, and require massive scalability (video processing, financial computations and large content sites). These have been, among the first, apps that have been migrated and tuned, out of necessity, to cloud services. Equally compelling is when enterprises hit the end-of-lifecycle points that require a refresh of complex legacy production applications. These applications also will likely be retooled and implemented in the cloud. Finally, the cloud is ideal for applications that start at the departmental level - driven from a business need - without IT involvement.
Take SharePoint as another example. Many SharePoint installs start without central IT knowledge or approval, by a local admin who "just" needs a document management solution. Provisioning the same server in the cloud lowers the barrier to entry even further. Because of the leap in terms of capabilities in SharePoint 2010, in the second quarter of 2011, a majority of organisations will either start migrating to SharePoint 2010 or install it for the first time.
As most of the SharePoint implementations are outsourced, the cloud is a great way to collaborate, without complex VPNs and travel. Complex environments need to be instantiated quickly (as in the case of customer demos or training), archived, and pulled up again at moment's notice for the next project.
Integrations involving, management, and workflow apps, connection to Active Directory and federation issues, and the need to move data back and forth quickly is not low-risk, and requires resources and time that even the largest enterprises may not have. Migrations also require storage, archiving, and related hardware and expertise needed to maintain environments may tax even the largest IT departments and data centers.
This is what 2011 will be about. For pre-production, the cloud will become the platform of choice for system integrators working on complex deployments for larger enterprises - where copies of environments can be instantiated in seconds, just by sending an email.
On the production side, hosting vendors such as Rackspace, Amazon Web Services, and dozens of smaller companies will continue to penetrate the SMB market that is loathe to invest in IT infrastructure and resources.
Business top line is always stronger than bottom line. Users are more important than IT managers. The cloud is not different. This is why applications and application development would drive cloud adoption in 2011.
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