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Cloud investment explodes - overhype or future vision?

Cloud investment explodes - overhype or future vision?

The billion-dollar rush to get on the cloud has is well and truly underway

When Microsoft all but demands its partners ‘cloud up,’ and Japanese telecommunications provider, Nippon Telegraph and Telephone Group (NTT Group), makes a $US3.2 billion acquisition on the premise of developing its cloud capabilities, it is obvious that there is an incredible buzz about the cloud. But is it realistic? And what about the lingering concerns that Australia is not quite ready to live up to the hyperbole?

At the Microsoft Worldwide Partner conference, which ran from July 11-15 in Washington, the vendor’s CEO, Steve Ballmer, presented a cloud vision in a keynote that included the caveat ‘if you’re not with us on the cloud journey, than we’re probably not the company for you’.

Microsoft is ‘all in,’ when it comes to the cloud, Ballmer added, and would be completely repurposing its business model with this in mind. It has added new accreditation badges for partners properly skilled in cloud selling, and opened up Azure, or its ‘cloud operating system’, for partners to use in deploying their own services. Already, Fujitsu and Ebay have signed on as substantial partners to the Azure vision.

Within days of Ballmer’s keynote, Dimension Data was acquired by NTT Group.

Both companies have stated it was a strategic alliance highlighting the importance of providing high quality ICT services, such as cloud computing. “Dimension Data and NTT share the common vision to create new services and values to succeed in the coming age of cloud computing,” NTT CEO, Satoshi Miura, said. “Our combined strength will allow us to accelerate the execution of our strategies to achieve our shared vision.”

Yet there remains concern over cloud adoption to the local environment. Australia grapples with slow and rurally inaccessible broadband and associated latency issues for data hosted offshore, in addition to security and regulatory concerns for certain vertical markets.

In addition, a core component of Microsoft’s cloud vision includes its Online Services. Unique to the Australian market, Telstra has exclusive access to the Online Services (under the TSuite branding) offering under contract for at least the next year-and-a-half, potentially leaving behind Microsoft partners that don’t also wish to partner with Telstra.

So, then, is the cloud an over-hyped concept in the Australian market?

Not so, according to various Microsoft partners.

Express Data general manager, vendors, David Peach, claimed the hype behind the cloud was merely pre-empting customer conversations and that, ultimately, it was the kind of solution they were already looking for.

“There are a lot of wild thoughts out there of a ‘magical cloud,’ and I do think it’s oversimplified,” Peach said.

“Cloud is complicated and it will take time for the industry and customers to come to grips with it. It’s important that we separate cloud, as a technology, to changing business models – organisations are keen to take on operational expense models, and cloud enables that.”

The words echo comments from CA executive vice-president of products and technology, Dr Ajei S. Gopal, who said at the recent Sydney CA Expo: “Every 15 years or so, we go through a paradigm shift and that is inevitably hailed as one of those moments where everything changes. Those moments come along with a powerful set of technology enablers to meet a compelling set of business needs.”

While the cloud is a buzzword, it is not over-hyped, Fujitsu A/NZ CTO, Craig Baty said. However, it will also become such a standard that its use will go away in the longer term.

“We’re going to see some rationalisation of the word happen – it’s much like e-commerce in the dot com era. We don’t talk about e-commerce any longer, we talk about commerce and the e-part of it is required in businesses of today,” Baty said.

“As with any new buzz word, there will be some successes and failures with cloud, and it will morph with time and eventually go away.”

The compliance and regulatory environment within Australia is not so much an inhibitor to cloud adoption as something for partners to take advantage of, Baty said.

Fujitsu maintains numerous tier-3 datacentres across the country to mitigate data sovereignty concerns, and approaches the market from a staged perspective, understanding that not everybody will dive headlong into it.

Partners also need not be concerned with the ramifications of Telstra’s exclusive partnership with Microsoft around its Online Services.

“For those of us who’ve learnt to partner with Microsoft, surely learning to partner with Telstra will be a walk in the park!” Thomas Dureya CEO, Andrew Thomas, said.

“As Azure matures and the ecosystem built around it expands, TSuite will become less and less significant.”


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Tags azureMicrosoftCloudsteve ballmerTSuiteNTT GroupFujitsudimension dataTelstrabroadbandExpress Data

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