Despite hype, cloud finds traction

MELBOURNE, AUSTRALIA: IT services providers are continuing to invest in cloud computing offerings at an impressive pace – even though ongoing hype around cloud computing is leaving many customers confused as to its potential benefits, according to Ovum, an analyst and consulting company.

Services vendors are attempting to differentiate their cloud computing services for customers through their use of technologies such as virtualization and their IT service delivery experience, and by demonstrating the positive impact of leveraging cloud services’ during a recession, according to Ovum principal analyst John Madden.

“Cloud computing continues to dominate discussions among enterprise IT customers as they look for better and more cost-effective ways to operate and deliver IT services,” says Madden, based in Boston.

“Although cloud-based services hold great promise for customers and the vendors that offer them, for the vast majority of enterprise customers there is still far too much hype surrounding what constitutes a cloud, the kind of services that can be delivered and how those will ultimately evolve.”

Despite that hype, Madden says cloud services continue to attract widespread customer attention – if not actual adoption — due to its potential to provide variable costs, reduce capital expenditures, and provide an ability to match IT resources to real-life business needs.

In addition, for various types of services providers — including traditional services players, outsourcers and telecom/network operators offering enterprise-class services — the evolution of the cloud computing market can bring distinct opportunities and challenges for each type of vendor.

“However one views the cloud market, service providers want to remain active participants in the evolution of cloud services”, Madden adds. “Even if the hype level in cloud computing remains high, providers fear that not talking about cloud as part of their services portfolio could lead to customers viewing them as also-rans in this evolving market.”