three cloud services trends for 2012

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Fotolia_30652010_XS220x220.jpgIs this the year of the Cloud, like 2011 or 2010 before it? The difference is that it's on the verge of a tipping point. Microsoft, Google and Amazon have already nailed their flag to the mast of cloud services, and with iCloud, Apple has joined the club. It may now be a term that consumers recognise but many businesses have concerns about security, service quality and integration. Here's what the analysts have to say:

security

Security is high on 2012’s agenda. Analysts warn that at least one major cloud-based services vendor will go down in a mass of malware as hackers target cloud services to see how easy they might be to attack.

The need to deploy best-in-class security protection for cloud-based data will drive many enterprises to outsource their infrastructure, particularly as over 50% of the world’s biggest 1,000 companies will store customer-sensitive data in the cloud by the end of 2016.

“While on-premises applications are typically licensed in perpetual license agreements and SaaS in subscription deals, these lines are blurring as customers demand more flexibility in their deals,” predicts Forrester, as it reports the evolution of new “cloud broker” solutions providers.

The impact of bring your own device (BYOD) models and the fervent pace of smartphone evolution will change consumer expectation for what cloud services can do. Those consumers work in your offices. By the end of 2012: “Nearly 1 in 5 professionals with three or more devices will adopt a personal cloud service for online storage, backup and synching,” warns the Yankee Group.

The biggest challenge to cloud-based services? Smaller businesses (sub-500 employees) actually suffer more cyber attacks than larger firms. That’s a market ready to be won by successful cloud service providers, or one to be lost if the security fails.

service quality

To get the business, cloud brokers must provide verifiable proof of independent security testing, Gartner advises.

“While enterprises are evaluating the potential cloud benefits in terms of management simplicity, economies of scale and workforce optimization, it is equally critical that they carefully evaluate cloud services for their ability to resist security threats and attack,” the analysts say. Such low-cost cloud services will cannibalize up to 15% of top outsourcing players' revenue by 2015.

Gartner also expects low-cost managed IT services will become ever more important in the next five years, adding: "The projected $1 trillion IT services market is at the beginning of a phase of further disruption, similar to the one the low-cost airlines have brought in the transportation industry."

That wave of disruption is encouraging existing providers to improve their offering. Forrester: “All cloud vendors are trying to move up the value chain to deliver higher-value cloud services. In 2012, you will see more and more infrastructure-as-a-service (IaaS) vendors offer technology platform services, platform vendors offering software services, and applications vendors packaging business process services into their offerings.”

Large enterprise software companies will start to panic if they don’t have a good cloud story to tell. They’ve either got it under control and they’ll release cloud versions of their existing products or they’ll scramble and start to acquire cloud companies. We’re starting to see it with Oracle’s recent purchase of RightNow Technologies and SAP’s acquisition of SuccessFactors. I think more acquisitions like this are likely to follow,” warns Rackspace CTO, John Engates.

integration

The dream of unified services is that everything - your social and email feeds, your calendar, address book and company data - all the information you need should be made easily available using cloud-based services and all via one single portal.

The shadow here is that while the vision may be unified, today’s early cloud service adopters are attempting to weave together multiple cloud-based services: file-sharing, email, live chat, video conferencing, social media, for example.

“In 2012, we’ll see more collaborative cloud solutions emerging where business partners collaborate on information, business objects, or even end-to-end business processes in the cloud. Cloud collaboration will become a key business driver to move to cloud solutions,” Forrester predicts.

This will also spawn new cloud-based service opportunities in new sectors, including solutions like product life-cycle management (PLM), business intelligence (BI), and supply chain management (SCM).

Last word goes to IDC: “Due to increased use of cloud computing, CIOs will spend up to 20% of their time in 2012 reviewing the terms and conditions of service-level agreements and move toward standardization.”

Stewart Baines

I've been writing about technology for nearly 20 years, including editing industry magazines Connect and Communications International. In 2002 I co-founded Futurity Media with Anthony Plewes. My focus in Futurity Media is in emerging technologies, social media and future gazing. As a graduate of philosophy & science, I have studied futurology & foresight to the post-grad level.