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BW Businessworld

The Future Is Cloudy

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For about two years now, people involved in the technology sector have been discussing both the promise as well as the potential perils of cloud computing. For those who have not been following the cloud computing movement, here is a brief explanation of why there is such a buzz about it.

The current model of computing followed by most enterprises involves buying all the hardware and software that they require for their various departments and functions. The cloud follows a different principle. Here, most of the infrastructure as well as software applications lie with a vendor outside the firm's own IT facilities. This is far more cost-efficient — and it also levels the playing field quite a bit. A small firm which might lack the capability of buying a complete ERP (Enterprise Resource Planning) package, say, might still be able to use the software in a pay-for-use model. Even for big firms with big budgets, cloud computing promises to bring down IT costs quite dramatically, thus improving the return on investment.

The downside of cloud computing is that you are depending on the reliability of the vendor as well as a good broadband connection to utilise the services. Also, you are essentially trusting the vendor to maintain security, instead of building firewalls in your own system.

While the buzz about the cloud has been there for some time, it is only now that enough people and firms are signing up for cloud services. The Indian market for cloud computing is still quite small — barely $900 million or so, according to the estimates of one market analyst. On the other hand, thepotential is huge — there are millions of small and medium businesses that have IT requirements but cannot invest in their own hardware and software. Two big cloud players — Microsoft and Salesforce.com — were quick to recognise this and have put in plenty of effort in the past year or so to make their cloud services very popular. The others are also getting serious now — IBM, HP, Google, Amazon, etc.

Analysts expect the cloud computing market in India to grow to $3-4 billion by 2015. Assistant editor Vishal Krishna takes a look at the cloud opportunities in the country and also what the big players are doing to tap them.

(This story was published in Businessworld Issue Dated 06-08-2012)