CIO Cloud Computing 101: Why Use The Cloud?

by drjim on July 29, 2009

By Dr. Jim Anderson

CIOs Need To Make Sure That Cloud Computing Is Not Just A Fad

CIOs Need To Make Sure That Cloud Computing Is Not Just A Fad

Does anyone besides me remember the big Furby craze that swept the U.S. in the early ’90’s? People went crazy for these little plush dolls and they started collecting them in hopes that they would one day be valuable. Well, that never happened and a lot of people got stuck with expensive toys that they couldn’t get rid of. Is is  possible that the current cloud computing craze in IT could be another Furby fad that will fade away?

What Kind Of Services Come In A Cloud?

If a CIO can move beyond the hype, he/she needs to spend some time doing their homework in order to find out what kind of services a cloud could offer that their company could make use of. Neal Leavitt has spent some time studying cloud computing and has boiled cloud services down into four types of services:

  • Basic Services: this is not glamorous, but it may be the most popular type of service that a cloud environment can offer to your business. Basically simple Internet based services such as database functionality and capacity, middleware, and additional storage are used to supplement what your company already has.
  • IaaS: Buzz word alert – “Infrastructure As A Service”. This is when you are renting a complete computer (CPU, storage, bandwidth, etc.) that you access via the Internet. You would use this infrastructure to run your company’s applications on lock-stock-and-barrel.
  • PaaS: Platform-as-a-service – provides your firm with a development environment that your IT staff can use to create new applications for the rest of the company (and your customers) to use. This is computer plus development tools.
  • SaaS: Software-as-a-service – this is where you don’t care about what the software is running on, you just want to purchase access to the application. The most famous example of this is’s CRM application.

Why Bother With A Cloud?

The Forrester research company has done some investigating and they now claim that most company’s data centers are using less than 50% of their total capacity. Despite the hype that is currently surrounding cloud computing, Leavitt has uncovered three very good reasons for looking into having your firm start to use cloud computing:

  1. Availability: interestingly enough, despite many firm’s misgivings about losing control over their IT equipment, there is a lot to be said to having a professional firm that has the deep pockets needed for redundant systems and tested disaster recovery plans run your IT infrastructure. If you work at a small or even a medium sized firm, this may be especially valuable to you.
  2. Integration Of Applications: sorry, we can’t do anything about those old apps that you are running. However, the new ones that are developed to run in the cloud will almost automatically be easy to integrate because they will use the suite of Web interface languages/tools  (SOAP, XML, etc.) that make this easy to do.
  3. Flexibility: unlike the majority of cell phone vendors in the U.S., currently most cloud computing service providers don’t require users to sign long term contracts that lock them in. This makes it easy to quickly get more cloud resources when your firm needs them.

Final Thoughts

It is all too easy for CIOs who are adverse to change to look at the current excitement over cloud computing and decide that it is yet another fad that will fade away in time. The reality is that cloud computing provides several different types of services that are useful to any IT department. This can’t be ignored.

Additionally, successfully adding cloud computing resources to the company’s existing IT infrastructure will mean that a CIOs will have found a way to apply IT to enable the rest of the company to grow quicker, move faster, and do more.

Questions For You

How much of your existing IT infrastructure do you think that your firm is currently using – more or less than 50%? Which of the four types of cloud computing services would have the most immediate value to your company? Why? Leave me a comment and let me know what you are thinking.

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What We’ll Be Talking About Next Time

Cloud computing is all the rage these days and everyone who is anyone is making plans to implement at least some flavor of it as soon as possible. It turns out that the decision to go with a cloud computing solution for your IT department might not be as simple as some would lead you to believe. There are challenges to successfully using a cloud and we need to talk about them…

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{ 7 comments… read them below or add one }

Jake Burns July 30, 2009 at 5:52 pm

Thank you for this positive post on cloud benefits. I think over the next 24 months the cloud is going to explode with number of users. very cool technology and opportunity for money and time savings.


Dave August 4, 2009 at 6:18 am

The leading figures in Cloud Computing are converging in London this year to discuss the key issues for the future of the sector. Don’t miss your chance to discover how IT and technology decision makers can benefit from this exciting trend. More details here:


Dave August 4, 2009 at 6:18 am

Business opportunities in Cloud Computing; how can CIOs take full advantages of the shift to hosted applications? Want to hear Marc Beniof, chairman and CEO of Salesforce, will discuss this and other key points?
Hear him speak at the first ever Business Cloud Summit in December. More details here:


Cloud Computing Aus August 19, 2009 at 9:02 pm

Thanks for the information. You may be interested to know that Telstra – Australia’s biggest telco has just announced (on 17th August) a $500m investment into cloud computing which is pretty huge.


Dr. Jim Anderson August 27, 2009 at 10:18 am

Wow – I had not heard that Telstra had made that investment. The interesting question is do they know what they are going to do with the cloud that they build? Sometimes firms just make the investment because it’s a “hot” area. Hopefully they have already lined up some customers…!


Mdhavi November 16, 2010 at 10:04 pm


Can someone tell me about the competerors of Cloud Computing


Dr. Jim Anderson November 19, 2010 at 6:48 pm

Mdhavi: Not sure if I fully understand your question, but here are two possible answers. If you are looking for alternatives to cloud computing, then just do it the way we do it today: buy a server, install your software, and maintain it forever. If you are looking for competing companies that provide cloud computing then look to Amazon, HP, IBM, etc.


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