CIOTechOutlook >> Magazine >> December - 2015 issue

The impact of Cloud on traditional IT models

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Schneider Electric, headquartered in France, with Indian head office in Gurgaon, Haryana, is provider of services for energy management and automation. The company provides solutions for Power Management, Security Management, Industrial software design, simulation and optimization.

The Internet’s exponential rise since the 1990s has ushered a new era where innovation rules in almost all spheres. With its inherent ability to create a level-playing field between small and big players, the Internet has fuelled numerous disruptive technologies that have upset the applecart of established businesses. A classic case is cab aggregator Uber’s meteoric rise, which has upended the business model of traditional taxi operators.

Over these years, the Internet has also spawned the Internet of Things (IoT) and the Internet of Everything (IoE). The former comprises the network of physical objects or ‘things’ embedded with electronic chips, software, sensors and network connectivity, allowing these objects to collect, store and exchange data. The Internet of Everything (IoE) takes this to a higher orbit, acting as a networked connection of people, process, data and things. As per estimates, around 200 million things were connected to the Internet at the dawn of the new millennium. After the number of Net-connected things soared, which includes digital devices, social media and Cloud, this number was estimated at around 10 billion more than 12 years later.

By 2020, a staggering 50 billion devices are expected to be connected, indicating the criticality of Cloud as an enabler for the Internet and IT-driven tasks.

On-demand Services
Globally, the traditional IT model of buying servers and hardware and then installing software is becoming passé. This tedious, tiresome process also requires more space and infrastructure. The transition to Cloud leapfrogs most of these hurdles, allowing access to IT databases on the Internet via Web-based applications.

The main features of Cloud are: on-demand self-service (users sign up and access services without long delays); broad network access (ability to access services via standard platforms such as desktop, laptop, mobile, etc.); resource pooling (across multiple customers); rapid elasticity (capacities can be scaled during demand spikes); and measured service (metered billing delivered as a utility service).

Since Cloud comprises a wide collection of services, users can decide when, where and how to deploy Cloud Computing services – generally termed Software as a Service (SaaS), Platform as a Service (PaaS) and Infrastructure as a Service (IaaS).

The Cloud Pyramid
Cloud Computing is akin to a pyramid with IaaS at the base, PaaS in the middle and SaaS at the top. These could therefore be differentiated as: applications for end-users delivered over the Web (SaaS); tools and services meant to make coding and deploying of applications speedy and efficient (PaaS); and the hardware and software that power everything – servers, storage, networks and operating systems (IaaS). For easier comprehension, this can be compared to a highway (infrastructure), with cars and other vehicles (platform) used to transport goods and people (software).

Overriding the traditional IT model, SaaS benefits users by: Web access to commercial software; management of software from a central location; delivery of software in a ‘one-to-many’ model; freedom from handling software upgrades/patches, among others. Despite the benefits, SaaS may not be the best software delivery option for applications where: extremely quick processing of real-time data is involved; legislation or other rules debar data being hosted externally; and an existing in-house solution meets all the organisation’s needs.

What SaaS does for applications, PaaS does for software development. As a computing platform, PaaS permits the creation of Web applications swiftly, easily and without the hassles of buying and maintaining the software and the infrastructure that supports it. Though PaaS is akin to SaaS, instead of being software delivered over the Web, it’s a platform to create the software delivered over the Web. When different developers work together on a development project, or where external players interact with the development process, PaaS can be particularly useful.

But PaaS isn’t suitable where: the application has to be extremely portable vis-à-vis the hosting location; proprietary languages affect the development process; a proprietary language will hamper moves to a different provider later; and application performance needs customisation of underlying hardware and software.

Trumping Traditional IT
The emergence of Cloud has also impacted IT contracts and conventional delivery models. Instead of fixed-price contracts, some companies prefer time-and-materials contracts, although each has its pros and cons. But combining DevOps and Agile practices can make it easier to manage enterprise application development and deployment. Companies that can combine these practices need not face problems with either fixed-price or time-and-materials contracts.

Coupled with lower operational costs, these can enhance a company’s competitiveness via higher automation and the ability to focus on their core competencies, allowing Cloud adopters a distinct competitive advantage that boosts bottom lines, which is what business is all about.


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