Australian companies and their channel partners are resisting a move to cloud services because of confusion and uncertainty in the market. Recent IDC research shows 56 per cent of local organisations are using or considering cloud services as part of their IT infrastructure. However, just under 19 per cent are actually using a cloud service. Managing director of specialist distributor, firstservis, Derek Merdith, which formed a partnership with cloud computing vendor, 3Tera, in November last year, claimed there was still confusion as to what constitutes cloud computing. “Enterprise end-users are finding the technology interesting, but some resellers are either focused on traditional technology, or see cloud computing as a threat,” Merdith said. “A cloud solution means far fewer physical resources are required as the pool of resources can manage spikes in application requirements.” IDC’s local associate director of research and consulting, Linus Lai, said that while 75 per cent of organisations claim to have some understanding of cloud services, Merdith’s comments had merit. “If you look at it from a personal opinion perspective, a lot of people still see it as immature, or similar in effect to other hosted technologies,” he told ARN at a Sydney event last week. “There is a little bit of scepticism around the technology still. We find companies most comfortable with cloud services are those that have a lot of business tied up in the Internet. They tend to know more and are more willing to adopt the technology.” Industry director of emerging business for ASXlisted SMS Management and Technology, Paul Cooper, said there was massive confusion among customers, which was abetted by the “buzzword hype” around cloud computing. “Every vendor is trying to reinvent its products as ‘cloud’ offerings,” he said. “The confusion is not inhibiting the uptake of the technology, especially in the SMB space, but there is a lot of caution out there with enterprise and government clients, who are concerned about their data being taken offshore.” The two primary areas of confusion for customers are the speed of adoption and rollouts, along with the number of applications available to them, Cooper said. “There’s a lot of surprise around how much is already in existence and that it’s not a technology myth,” he said. Lai agreed there wasn’t enough awareness of the solutions available through cloud technology. “Enterprises today feel cloud services are just too far off in the horizon,” he said. “The economy is forcing them to look at other things as well – it is forcing them to look at the datacentre, it is forcing them to employ technologies that they know are proven, like virtualisation, rather than taking the bold leap into cloud services.” Managing director of integrator and cloud computing provider Devnet, Craig Deveson, said different vendor views on what cloud represents were causing confusion. “We’ve got the leaders in the space, such as Google and Amazon, who are developing clear messages and really creating the cloud computing manifesto, and then there are the followers, who are coming up with their own messages, which is confusing the issue,” he said. Deveson said those still trying to figure out an approach included large consultants, and traditional vendors such as Microsoft. “Cloud computing is a highly disruptive technology, and I imagine for the next 12-18 months the messages will become better articulated,” he said. To date, main customer verticals showing interest in cloud computing include the banking and finance sector. Public cloud infrastructure will be one of the growth areas for the technology in Australia, Merdith said, following the lead from the likes of Google and Amazon. Meanwhile, analyst firm, Gartner, claims global cloud services revenue will exceed $US56.3 billion in 2009, and hit $US150 billion by 2013. Business processes including advertising, e-commerce, human resources, and payments processing, make up the largest part of the cloud services market. The analyst group forecasts 19.8 per cent growth in the segment this year.