As we go into the week of Salesforce.com's Dreamforce conference I was thinking back to last year. I remember walking over to the conference center and feeling a little annoyed that there were "clouds" on almost everything, buildings, buses, cars, people, bus stops...you name it, it had a cloud stuck on it. Now that is good marketing hype I guess but at the time that was about all it was for me. I mean I did understand what the "new" words meant (actually nothing really new, just new ways of saying things). A year later there probably will still be a bunch of clouds on my walk over but I have to say I'm getting used to the term. Ther are finally some new things that I think we should talk about when it comes to "cloud" (and if you know me, you know that it is still a little hard to say the actual word).
Before continuing the discussion let's define a few things just so you know what I'm talking about (and that my definitions may not be exactly like some of the other ones you'll hear). First let's talk about what I use the word cloud to describe (when I'm not talking about something fluffy in the sky). For me, cloud is simply the computing infrastructure need to do some computing work (servers, storage, plumbing to connect to the Internet) but sitting somewhere in a data center. It's essentially computing power served up as a utility (think electricity or cable TV). From that simple thought then, there are 2 basic types of clouds (not cumulus & nimbus), I mean classified based on location: !. Public cloud and 2. Private cloud. The public cloud is, well public (duh), like Amazon Web Services or Salesforce.com Force.com platform. You can pay a fee and use the computing power offered by the public "utility" provider. Private clouds are restricted to some specific individual or group use, like GE's datacenters. You can't call GE up on the phone and buy computing power from them (well, at least not yet). The folks at Appirio put together a very cool interactive map of the Cloud Ecosystem today. They do break out 3 types of clouds, public, private and vendor but for me, I'd just call vendor the same as public (yes, I realize you're buying actual applications in the vendor segmentation but I just don't really see a fundamental difference, I'm still paying for the use of some computing resource AND the use of an app). In all these cases you are essentially using the cloud to deliver some cloud application or other cloud service (like storage or security). You might pay for the use of the cloud app + the computing power underneath but the concept is still the same. The real value to a business with this cloud concept is flexibility, adaptability and potentially cost savings. (there's a whole different line of thinking that I have around the effect of utility computing or perhaps I should say commodity computing on pricing. If it's a commodity and scalable then the pricing should be driven down...anyway, that's not what I wanted to talk about today)
So the new thing that I'm starting to see, or perhaps it's not exactly new but actually the extension of a concept. The idea is something that I've heard called software in a service or cloudsourcing. Its really an extension of the business process outsourcing (BPO) business that exists today. There could be significant value generated to businesses by combining the two concepts, cloud computing and outcourcing a business process to a 3rd party. It takes cloud to the next step and offers the valuable combination for business of leveraging cloud computing + a cloud app (or cloud service) + business process execution in one bundle. The concept is still forming but I think it will be one of the big trends for the next few years as more offerings emerge and businesses look to offload non-core processes to less costly solutions.