Is Cloud Computing the Next Disruptive Technology?

We could be on the cusp of another revolution: a c-business paradigm shift, driven by cloud computing.

Remember when vendors started slapping an "e" in front of everything -- when IBM rebranded its server line as eServer and many software vendors pledged to deliver e-business-ready applications? We could be on the cusp of another "initial" revolution, this time prefixing names with "c" (for cloud computing).

That's the conclusion of industry-seer Gartner Inc., which predicts that cloud computing -- the latest and most viable spin on the utility computing vision -- could prove to be as disruptive a technology as e-business.

"During the past 15 years, a continuing trend toward IT industrialization has grown in popularity as IT services delivered via hardware, software, and people are becoming repeatable and usable by a wide range of customers and service providers," said Daryl Plummer, managing vice-president and a Gartner fellow, in a statement. "This is due, in part to the commoditization and standardization of technologies, in part to virtualization and the rise of service-oriented software architectures, and most importantly, to the dramatic growth in popularity of the Internet."

Gartner defines cloud computing as "a style of computing where massively scalable IT-related capabilities are provided 'as a service' using Internet technologies to multiple external customers." The market-watcher might be on to something. When Hewlett-Packard Co., IBM Corp., and Sun Microsystems Inc. (among others) first touted utility computing visions five years ago, the infrastructure -- consisting of hugely scalable server farms and well-defined (and exposed) service interfaces, as well as publicly-available utility computing services -- did not exist. Now, with offerings such as Amazon's Elastic Compute Cloud (EC2), the industry is awash in cloud computing services (see

Gartner senses a rupture or discontinuity -- facilitated by three trends -- that it says will help "create a new opportunity to shape the relationship between those who use IT services and those who sell them." In Gartner's view, the new or coming crop of cloud computing technologies allows users to focus on what the service itself provides instead of on how the services are implemented or hosted.

Cloud computing isn't a Big Fast Server-only play, Gartner insists, citing cloud storage services (which allow users to easily store data and documents without maintaining storage networks or servers); software-as-a-service (SaaS) technologies (which Gartner sees as a subset of a subtending cloud computing model) that offer services such as subscription CRM through multitenant shared facilities.

That is just the beginning, the firm counsels. "The focus has moved up from the infrastructure implementations and onto the services that allow access to the capabilities provided," said David Smith, vice-president and Gartner Fellow, in a prepared release. "Although many companies will argue how the cloud services are implemented, the ultimate measure of success will be how the services are consumed and whether that leads to new business opportunities."

It's a shift that could wholly transform the IT industry, according to Gartner. Call it a collision of established software models and next-gen (Web 2.0, computing-on-the-cloud) methods. "The vendors are at very different levels of maturity," said David Cearley, vice-president and also a Gartner fellow, in a statement. "The consumer-focused vendors are the most mature in delivering what Gartner calls a 'cloud/Web platform' from technology and community perspectives, but the business-focused vendors have rich business services and, at times, are very adept at selling business services."

The cloud computing revolution could turn many non-IT companies into IT services providers. Gartner, for example, cites Wal-Mart, which has well-known consumer positioning (low prices) as well as an emerging business position (as a potential provider of IT supply chain services). Other examples include United Parcel Service (UPS) and Federal Express; both market IT logistical services.

"Companies invest billions of dollars in building up their core competencies, much of which goes into IT," said Smith. "If companies could lease their core competencies to other companies then they would capitalize on both brands, driving revenue both in the consumer-facing market and in the business service market in the same way that Amazon has done with technology."

If cloud computing is disruptive, it's also something of a moving target, according to Gartner. It might take years to come into its own, and along the way it will emerge (both as a technology and a practice) as something distinct from the Internet. "When organizations cross the threshold between the Internet as a communications channel and the deliberate delivery of service over the Internet, then we truly start to head for an economy based on consumption of everything from storage to computation to video to finance deduction management," concludes Plummer.