"The Cloud" Continues to Gather

Stephen DeAngelis

March 30, 2011

I posted my first blog about cloud computing in early 2008 [The Coming Age of Cloud Computing (Jan 2008)] and have occasionally followed the subject since [The AIR is getting Blurry with Clouds — Computing that is (Mar 2008), IBM Heads into the Clouds (May 2008), Google brings Cloud Computing to the Masses (Sep 2008) and Update on Cloud Computing (July 2009)]. This week Amazon announced a cloud-based music service that has created quite a stir. Jonathan Zittrain, a law professor at Harvard, notes that an increasing number of applications are being designed that take “us further away from running code and storing our information on our own PCs toward doing everything online — also known as in ‘the cloud’ — using whatever device is at hand.” [“Lost in the Cloud,” New York Times, 19 July 2009] He continues:

“Many people consider this development to be as sensible and inevitable as the move from answering machines to voicemail. With your stuff in the cloud, it’s not a catastrophe to lose your laptop, any more than losing your glasses would permanently destroy your vision.”

Zittrain, however, is not about to jump on the cloud’s bandwagon. He explains why:

“The cloud … comes with real dangers. Some are in plain view. If you entrust your data to others, they can let you down or outright betray you. … Worse, data stored online has less privacy protection both in practice and under the law. A hacker recently guessed the password to the personal e-mail account of a Twitter employee, and was thus able to extract the employee’s Google password. That in turn compromised a trove of Twitter’s corporate documents stored too conveniently in the cloud. Before, the bad guys usually needed to get their hands on people’s computers to see their secrets; in today’s cloud all you need is a password. Thanks in part to the Patriot Act, the federal government has been able to demand some details of your online activities from service providers — and not to tell you about it. There have been thousands of such requests lodged since the law was passed, and the F.B.I.’s own audits have shown that there can be plenty of overreach — perhaps wholly inadvertent — in requests like these. The cloud can be even more dangerous abroad, as it makes it much easier for authoritarian regimes to spy on their citizens.”

Despite such concerns, it looks like cloud computing is here to stay. “Cloud computing,” writes Philip Delves Broughton, “is one of those technological phenomena that has sneaked up on the wider world of business and now has people on either side of a generational divide bickering over its value.” [“Cloud computing is not a passing shower,” Financial Times, 6 December 2010]. He continues:

“The idea is that we can now use computer services as if they were a utility, like electricity, drawing on software and hardware when we need them, rather than each of us owning our own generators and distribution networks. For digital natives, the cloud is as natural to computing as the keyboard. The cloud is Facebook, Zynga and Gmail. To an older generation, the cloud is WikiLeaks and data breaches. For managers trying to weigh up whether this is a fad or here to stay, where you stand may just be a function of your age.”

I’m glad that Broughton insists that one’s view of the cloud depends more on one’s age than one’s intelligence — because there are intelligent arguments both for and against cloud computing. Zittrain, according to Broughton, would fall under the “older” category of people who believe that “the cloud represent(s) a fatal loss of control over your data.” Younger people, he insists, can’t imagine how “anyone could doubt a technological shift with such gobsmackingly obvious advantages.” Let’s be honest — both sides have good points to make. Broughton continues:

“Cloud computing means dispensing with much of your own software and hardware and accessing it virtually as and when you need it. Rather than owning your own servers, you rent whatever server space you need for a monthly fee. Instead of installing a CD into your computer loaded with software, you access whatever software you need through your browser. Instead of storing your data on your computer or phone, you store it virtually and access it with a password. The likely benefits are extraordinary flexibility and access to far greater resources of people and information.”

Broughton seems to dismiss concerns like those raised by Zittrain. He thinks that the problem that the “older” generation has with the cloud is “loss of control.” He explains:

“A manager who controls sensitive data on customers and pricing, for example, may be loath to remove that from his own hard drive and place it in the cloud. A chief executive discussing the possibility of moving to cloud services with his head of IT will almost certainly be told it’s a terrible idea. Far better to have one’s own servers and one’s own people maintaining them than relying on some abstraction like ‘cloud services’. Whom do you call in the cloud when your system fails?”

Broughton claims that the older generation can raise all the objections they want, but he insists that they “are merely delaying the inevitable.” He continues:

“Of course there are security issues to be overcome and technical fears to be allayed, but the basic ideas behind cloud computing seem irresistible: pooling resources to drive down cost and accelerate innovation and liberating people from the tether of physical software. Pat Toole, chief information officer of IBM and an evangelist for cloud computing, likes to say of the cloud ‘it isn’t rocket science but it is computer science’. By this he means that the challenges of cloud computing for business have existed in every phase of computing, challenges around cost, utility and security. For now, Mr Toole says, some workloads are evidently better suited for the cloud than others. Work that requires collaboration, for example, can be made much easier through the use of virtual desktops and web-based services. More data sensitive areas, such as enterprise resource planning and transaction processing, may not yet be ready for prime-time on the cloud. But these are problems that companies will eventually make fortunes by solving. Until then, managers should pick and choose which aspects of their business will benefit from moving to the cloud, and which will not.”

Michelle Price agrees with Broughton that “cloud computing is one technology phenomenon not to be dismissed” [“Pinning Down the Cloud,” Wall Street Journal, 15 February 2011]. She continues:

“Likened by some technophiles to the Industrial Revolution, cloud computing is already transforming the world around us and it promises to shape our future world too. Despite its growing importance, however, many companies are struggling to pin down exactly how this technological miracle can truly benefit their balance sheets. The practice of cloud computing is something with which consumers all over the world are already relatively familiar, even if the term itself leaves the lay technophobe scratching their head. Sending an email using a third-party Web-based email service provider, such as Google Mail, for example, is a basic form of cloud computing.”

To help the technologically-challenged among us, Walter S. Mossberg provides “a very basic explainer.” [“Learning About Everything Under The ‘Cloud’,” Wall Street Journal, 6 May 2010]. He writes:

“At its most basic level, the ‘cloud’ is simply the Internet, or the vast array of servers around the world that comprise it. When people say a digital document is stored, or a digital task is being performed in the cloud, they mean that the file or application lives on a server you access over an Internet connection, via a Web browser or app, rather than on “local” devices, like your computer or smartphone.”

Okay — most of us knew that much already. Mossberg notes that doing things on the Internet isn’t anything new. There have been companies around for years that have been willing to provide backup services for your computers. So what makes cloud computing different? He explains:

“What’s changed is that, in recent years, large-scale Internet-based storage has gotten cheaper, so it’s possible for programmers to create more-sophisticated remote software, and the speed and ubiquity of Internet connections have improved. Also, some users have expressed a desire to share and collaborate in easier and richer ways than emailing files. Cloud-based services let many users view, comment on, and edit the same material. All this has given a boost to cloud computing. On top of that, computers are changing in ways that make cloud services more desirable. Your little netbook may lack the huge hard disk needed to hold all your music or photos, but there are ways to keep this material in the cloud and access it at will. Your smartphone can’t run all the sophisticated programs, or store all the files, that your PC can. But, if it’s connected to cloud storage and cloud-based apps, it can do much more than its hardware specs suggest. And, with cloud file storage and apps that run on remote servers, you could conceivably travel without any computer. A borrowed PC, tablet or smartphone might be all you need to log in and do real work. So, in recent years, a flood of cloud-based products and services have appeared to store and share files; to keep information on all your devices synchronized; and even to perform tasks like editing photos, or creating and editing long documents or large spreadsheets.”

By the way, Mossberg agrees with Broughton and Price that “cloud computing is here, and growing, and quite useful. It will only get better and better.” As the benefits of cloud computing become more obvious, more companies are migrating towards its services [“Companies Slowly Join Cloud-Computing,” by Brad Stone and Ashlee Vance, New York Times, 18 April 2010]. Stone and Vance report:

“Ah, the cloud — these days, Silicon Valley can’t seem to get its head out of it. The idea, though typically expressed in ways larded with jargon, is actually rather simple. Cloud providers, large ones like Amazon, Microsoft, Google and AT&T, and smaller ones like Rackspace and Terremark, aim to convince other companies to give up building and managing their own data centers and to use their computer capacity instead. … Almost every big company is cautiously testing the waters these days. … But most big organizations say they are wary of placing more critical software and business operations on another company’s computers.”

With most analysts predicting that cloud computing will eventually dominate the IT space, you can understand that a war is being waged to carve out territory and win market share among those offering cloud services [“Battle of the clouds,” The Economist, 15 October 2009]. The Economist reports:

“There is nothing the computer industry likes better than a big new idea—followed by a big fight, as different firms compete to exploit it. ‘Cloud computing’ is the latest example, and companies large and small are already joining the fray.”

The article goes on to note that there are concerns that one company might become the dominant player in cloud computing. As a result, the article reports that “there are three areas where users of cloud services should be vigilant, and providers must be responsive, or regulators may yet step in.” They are:

“First is the familiar risk of technological lock-in, as rival companies promote their own, mutually incompatible, standards and formats, as they have done in the past. Moving data from one cloud-based storage system to another, for example, is not always easy. Buyers of cloud services must take account of the dangers of lock-in, and favour service providers who allow them to switch between services without too much hassle.

“Second, storing so much personal information, and using it to target advertising, has privacy implications. Consumers who are unwilling to pay for cloud-based services will have to put up with some advertising based on their online activities, since it pays the bills. Most users will be happy to trade some privacy for free services, but they should have control over their personal data, and be able to amend the profiles which service-providers compile and use to target advertising.

“Third, data stored in the cloud may not be safe. This month tens of thousands of people with Sidekick smart-phones, for example, lost their address books, calendars, photo albums and other personal data, all of which were being stored in the cloud by Danger, an aptly named subsidiary of Microsoft. But a disaster on this scale is unusual: occasional outages are more common. Ensuring that cloud-based systems become more reliable is in the best interests of the firms that provide them, if they want to attract and retain customers.”

Those all are legitimate concerns. Fortunately, The Economist doesn’t see them as an “older versus younger generation” matter of perspective. The article concludes:

“Prodded by users and regulators, providers of cloud services are gradually moving towards new standards and greater transparency and reliability. If they do not move fast enough, regulators may yet have to intervene more forcefully. But cloud computing’s advantages already outweigh its drawbacks for many consumers and business users. In contrast with previous computer-industry battles, a single victor seems unlikely this time around. May the best clouds win.”

I agree with the magazine that a single cloud behemoth is unlikely to emerge. There are already a number of large cloud service providers (e.g., Google, Amazon, Microsoft, and IBM) as well as a number of niche providers. In addition to efficiencies and cost savings, there may actually be an environmental benefit to the cloud. “It is estimated that half of the energy consumed by data centers goes toward cooling computer processors, with most of the removed hot air simply being blown into the atmosphere. Instead, IBM sees that heat being captured to warm the air in other areas of the building, to heat water, or to be converted into electricity.” [“IBM’s annual list of five innovations set to change our lives in the next five years,” by Ben Coxworth, Gizmag, 28 December 2010]. To learn more, watch the video in yesterday’s post entitled No End to Innovation. See you in the cloud.