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Cloud Computing: Outsourcing 2.0?

Cloud Computing: Outsourcing 2.0?

ARN roundtable attendees debate whether cloud computing is just next-generation outsourcing

Cloud computing is being touted as a completely new way of delivering technology, yet many of the solutions on offer sound surprisingly similar to traditional outsourcing. So what is the difference between the two?

According to Cisco’s Dylan Morison the one difference between cloud and outsourcing is that with outsourcing, you get innovative technology upfront but by the end of three years, it’s not innovative at all.

“With cloud, people expect flexibility and more innovation through their whole contract term. Outsourcing is tied to the infrastructure and equipment itself. In cloud, you’re delivering an SLA-based outcome,” he said.

BlueFire’s Jason Serda compared cloud computing to the security story, which continues to evolve.

“We started with virus, and now there’s spam, anti-phishing and so on. We have never gone back to a customer and said ‘we have a new thing that’s come out, so we’re going to hit you up for more money for this new thing’,” he said. “We are guaranteeing the outcome and evolving the solution over time. They’re not running on the same piece of hardware they were three years ago on our cloud offering. It’s an important point.”

Diaxion’s Tony Wilkinson claimed outsourcing agreements were an old version of what cloud is promising today. Yet Serda claimed as long as providers were delivering the right outcome, customers using cloud services shouldn’t case what technology underlies that.

SAP’s John Goldrick said the equivalent from a software perspective was timeless software.

“You buy once, and you’re not expected to buy it over again, and you just get new functions. The core is continuously upgraded and you buy around the edges of the core,” he explained. “With cloud, you’re delivering your customers a timeless datacentre. It is always at the point in time that technology is at.”

Gen-i’s Safi Obdeidullah claimed outsourcers historically hadn’t offered much flexibility because of technology, constraints, but agreed their solid service management and service desks were also an important piece of the cloud computing equation. But IDC’s Linus Lai was adamant outsourcing and cloud were apples and oranges.

“But managed services are interesting – I think managed services providers are resellers 2.0 and the future cloud resellers,” he said.

Return to the ARN cloud computing roundtable here


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