IT Pricing committee points out Cloud's disadvantages

IT Pricing committee points out Cloud's disadvantages

Claims consumer's dependence on a given ecosystem could impact pricing

In making its recommendations on IT pricing, the House Committee on Infrastructure and Communications, has also warned on the potential 'disadvantages' of Cloud-like subscription models.

Taking into account the ongoing shift towards digital delivery, and subscription models, the inquiry cited references to evidence it heard during the inquiry in relation to Cloud and subscription-based services.

In the report, it has thus attempted to defined the Cloud as a “network of connected computers which can be used to provide shared computing resources for specific applications (e.g. software services like email, web applications, or synchronisation services) and which are accessed remotely, either through a web browser or via a particular service’s application programming interface.”

While acknowledging that Cloud services may enable consumers and businesses to reduce their up-front IT costs by paying for shared computing resources rather than purchasing IT assets outright, it also brought to light certain concerns.

In particular, it cited the Australian Industry Group (Ai Group), as noting that while industry groups and major vendors are vigorously promoting the transition to Cloud-based services, the platform can involve significant disadvantages. "Subscription services may not be financially beneficial in the long term," the report cited.

One of the cited disadvantages was that ongoing access to content may depend on continuing to pay the subscription fee, and on the ongoing existence of the provider.

“Should a customer cease paying, or should its operator decide to cease providing the service, access to content could be affected,” the report cited.

The Committee also heard evidence that Cloud services can serve to increase a consumer’s dependence on a given ecosystem or service, which can also affect pricing as well as increasing a vendor’s or publisher’s control, according to the report.

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Tags CloudIT pricingParliamentary Committee

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