The coming impact of the cloud revolution
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The coming impact of the cloud revolution

Kenny MacIver – June 2014
The cloud computing era may have only just begun, but according to a new report by the Economist Intelligence Unit its longer-term ramifications for business and society will be profound.

Cloud computing may already be the catalyst for new business models, transforming business processes, changing market dynamics and creating completely new markets, but that is just a prelude to the much wider impact the model will have over the next decade.

That’s the conclusion of a new report, ‘The Impact of Cloud’ by the Economist Intelligence Unit (EIU), which draws on a collection of expert views from IT executives, academia and the technology industry on the many frontiers where cloud computing is driving change: from internal operations to the IT industry, from the economy to the environment.

According to the authors of the EIU report, which was sponsored by global ICT company Fujitsu, “the diversity of change compels business and technology leaders not to think of cloud computing simply as a replacement for older computing platforms. It is a revolution in the way information is stored and shared that could prove as disruptive to business practices as the advent of computing itself.”

Mark Ridley, technology director at reed.co.uk, writes that the ready availability of cloud-based technology services will reshape the way businesses are organized. He believes that the notion of an ‘IT department’ distinct from the rest of the business will eventually give way to a network organization of small teams with a mix of technical and non-technical skills.

Cloud will also change the dynamic between IT companies and their customers. With an insider’s perspective on the IT industry, Dr Tua Huomo of the European Institute of Innovation and Technology argues in his EIU essay that moving to a cloud service model forces suppliers to adopt operational and developmental processes that are more keenly focused on customer value.

Other contributions address one of cloud’s thornier issues – data privacy. Controversially, Paul Miller, an analyst and consultant at The Cloud of Data, contends that while the practice of holding personal data in the cloud comes with considerable challenges that need to be overcome, the cloud’s potential to empower individuals to control their own data is far greater.

The powerhouses of the cloud model — the data centers that play host to business and consumer clouds — have come under criticism for their undeniably significant energy consumption. Professor Ian Bitterlin of The Green Grid Association, predicts that the unique technical qualities of cloud computing mean that it is likely to have far less of an environmental impact than preceding computing paradigms.

But perhaps the ramifications of cloud computing will ultimately be most evident at a macro-economic level. In the words of Dr Jonathan Liebenau, reader in technology management at the London School of Economics, “cloud computing has the potential to be economically transformative,” although positive outcomes will depend not just on government and supplier actions, but on “the willingness of managers to adopt the new practices necessary to exploit the technical and economic advantages.”

Download‘The Impact of Cloud’from the Economist Intelligence Unit
First published June 2014
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