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C-Special 3: Customer's Own Recipe- Make Cloud Rain Revenues

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CIOL Bureau
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Mamma says- Wash your hands. Thank God chemist Constantin Fahlberg did not listen to that advice.That day he was trying to come up with new and interesting uses for coal tar. After a productive slog at the office, he went home and well, happily forgot to rinse his hands before dinner. Strangely enough, he noticed the rolls he was eating tasted particularly sweet.

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He asked his wife if she had done anything interesting to the rolls, but she hadn't. They tasted normal to her. It soon dawned upon Fahlberg that the taste must have been coming from his hands. The next day he went back to the lab and started tasting his work until he found the sweet spot- No prizes for guessing! It was — Saccharin.

Now ‘funny’ things happen to a lot of folks.

Like it happened in the lab of Atlanta pharmacist John Pemberton one day. He was trying to make a cure for headaches. Mixed together a bunch of ingredients that turned out great enough. But he didn’t know what momentous proportions the secret mix would acquire. Eight years of being sold in a drug store, the drink was popular enough to be sold in bottles.

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And people drink it as Coke today!

Another yarn about an absent-minded professor. Wilson Greatbatch, an American engineer reached into a box and pulled out the wrong thing one accidental day, when he was working on making a circuit to help record fast heart sounds. Well, he reached into a box for a resistor in order to finish the circuit and pulled out a 1-megaohm resistor instead of a 10,000-ohm one. Whoa! The circuit pulsed for 1.8 milliseconds and then stopped for one second. Then it repeated.

And the sound that was born was the most beautiful sound in the world: a perfect heartbeat! Wilson had created Pacemaker.

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Being absent-minded is not the only way. A perfunctory day can aid too. Or for that matter being cheesed off. Cook George Crum was having one of those days when a fussy customer kept sending french fries back to the kitchen for being soggy. To silence the smellfungus Crum sent back something. Something that is happily nibbled by lots of people today - Potato Chips.

And we can’t skip the mention of Alexander Fleming of course. He didn't clean up his workstation before going on vacation one day in 1928. When he came back, Fleming noticed that there was a strange fungus on some of his cultures.

Even stranger was that bacteria didn't seem to thrive near those cultures. And that’s how Penicillin, the antibiotic opened its eyes to the world.

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Magic in a mistake, set-back, or coincidence, that’s how most stupendous stuff comes about. We fondly call it — Serendipity.

But the weird charm of serendipity doesn’t not sound that palatable while it is happening.

Like when someone told me that Clouds won’t be all about saving costs, becoming agile, lean, as it is being primarily intended for, but ….but about spinning out money. And guess who would be doing it? CIOs themselves!

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Doesn’t sound like a happy co-incidence right? More heretical, I would say.

That’s how I reacted to Brian’s crystal ball peek.

And why not? Cloud is still too inchoate a season to precipitate into revenues of all things.

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Am I wearing blinkers?

There’s more on the radar

It is not a co-incidence that Nicholas Carr gingerly points at Cloud’s not-so-good effects for the IT function per se.

But what if the warning were to indeed come true in full force? What if Internal IT is really made impotent as an organ and relegated to being just an appendix!

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Ah, now that’s where the new world order that Brian Prentice, Research VP, Gartner postulates comes as a whiff of relief.

Revenue — would be one unrelenting mandate for CIOs ahead. And exactly the word that is going to flavour Cloud’s leverage now.

By 2015, as Brian predicts, new revenue ways would be created by IT only. And that could also determine annual compensation packages of CIOs.

“Now If we look at this prediction, how can CIOs start proactive applications. It is by externalizing their processes. IT Department would be more of a revenue enabler.

Being made redundant is what we want to avoid. The reality is that increasingly businesses understand what IT does.”

He goes on to explain how being a revenue-spinner would require CIOs and Internal IT teams to turn multi-dimensional in their skill-sets and expertise. And yes, to turn more creative than ever. More pro-active than ever.

“Cloud allows you to extend the data model. Data can be generated outside the organization. Data can be aggregated using Cloud to deliver a cohesive view to an organisation’s final customers.”

This might make organizations give away what they traditionally thought was of value or ‘chargeable’ but it will help them convert their core offerings and processes into a Cloud-based product which makes sense for the end customer when s/he consumes it.

Like what Mint.com, a free web-based personal financial management service for the US and Canada has already done. It allows consumers to manage their personal finances by aggregating content from bank accounts, brokerage accounts, mortgage accounts, and other online sources.

Of course, These Web-based services must offer some feature that's uniquely suited to the cloud -- like collaboration with peers or content sharing, or, in this case, aggregation across a wide variety of personal accounts plus the ability to access one's information from multiple platforms and locations. 

Quite similar to what Google, Yahoo and Amazon have actually been doing all this while.

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It is these companies that have dramatically leveraged their internal and originally Private Cloud Computing infrastructures to significant economic benefit, as an avid blogger on Cloud, Kent Langley illustrates.

And that is very much feasible and worth it.

Dennis Drogseth, Vice President, Enterprise Management Associates, Inc concurs about the power harboured inside Cloud platforms.

“IT’s emerging role as a broker of services and business model transformer is in the end transcendent to cloud.”

You can sell more into a Cloud because the connectivity is improved, avers Kartik Shahani, Country Manager, RSA India & SAARC.

“Can it become easier? Yes it would, but it would be restricted to the level of security involved.”

He asks whether one would have enough security assurance to give it up externally. Because interconnects are very important in a Cloud. “How to get all the data in a Cloud and then out of a Cloud? These would be factors that actual issues would come up around.”

Thankfully, Mint too off to a large extent, as young professionals weren’t scared of putting financial data into the cloud.

Cloud, as he outlines, is made of three major stacks — applications, infrastructure elements and connectivity. The questions that CFOs and BOD ask would be crucial. Compliance for instance, will be key area to watch out for while taking a decision like this. When it comes to information, CEOs would not like to go behind bars for sure.

Sudev Muthya, President, IT Business CMS Infosystems agrees to the revenue potential of Cloud as well.

‘If you have to take advantage of Cloud, great. But the communication part has to be better. It is then that you actually spike sales.”

Competition from your customers!

Aren’t there enough rivals to elbow out in the throbbing market of Cloud? Now the backyard would turn into a graveyard too.

If CIOs indeed are able to materialize their own revenue/product arms with the magic wand called Cloud, where would it leave the usual league of Cloud vendors?

Well, if your own customers start flexing knuckles, their own recipes around Cloud won't be too orthogonal for the infrastructure products they use. It can be a strong cause of alarm. Should Cloud vendors start worrying already?

No, maintains Brian. The market as he sees it, is expanding very large. “But yes, asymmetrical competition can be felt.”

Co-aptation instead of competition could be the new equation between everyone.

Manoj Chugh, President of EMC India & SAARC and the Director of Global Accounts, Asia Pacific & Japan (APJ), for EMC Corporation feels a win-lose equation just won’t work.

“The relation between vendor and client has to evolve in a new formula- around trust. CIOs will continue to accept best-of-breed technology. CIOs will see and exercise a slew of choices ahead.”

It looks like the lines of territories in competition will get fuzzier when customers start looking at Cloud with much bigger dimensions than what one sees from merely a consumption vantage point.

As Praveen Bhadada, Manager-Consulting, Zinnov, remarked in a recent report that the management consulting firm came out with, “We see a lot of initiatives coming in from the government in the shape of e-governance. There are huge amount of investments that are taking place and administrators in India are trying to implement cloud computing in e-governance.”

UID Authority is creating a platform (identify, authentication and payment) onto which they would like to get solution providers and startups.

Who knows what the future landscape might shape up to be if the rarefied levels of eclectic and intense collaboration actually happen. It could no more be about the tables turning between conventional vendors and customers but about the tables vanishing altogether.

We all were harping on Cloud as a cost manna till now. We are already touching the Midas world of revenues today.

But then in life and in science - like Constantin and Alexander Fleming would surely agree — You just never know!