The impact of cloud computing could be sky high - eventually

July 26th, 2010 | Scot Petersen

There’s no debate that cloud computing is a hot topic, but it’s still in the middle of its “hype cycle,” as The 451 Group’s Dan Kusnetzky pointed out recently.

According to’s annual IT Priorities Survey, cloud computing ranks below server virtualization, disaster recovery, business continuity and data protection projects. CIOs are dipping their toes into cloud computing waters, to be sure, though the applications vary wildly.

Lincoln Property Co., for instance, has moved many of its mission-critical applications to Software as a Service and cloud providers, and also is migrating its user base to Gmail and Google Apps. Sun National is using cloud services to deploy a mobile banking service to customers. But Boston Scientific, which considered cloud-based email services, decided that privacy and security concerns for the medical device maker were too significant.

No one who has talked with, however, has exhibited the kind of enthusiasm shown this month by Vivek Kundra, President Obama’s federal CIO.

“We can’t even imagine today the potential of cloud computing as we look forward,” he said at The Brookings Institution on April 7. “But the intersection of higher processing power, cheaper cost and the ubiquitous access to broadband networks that for the first time are able to deliver content in ways that we couldn’t imagine before … transformation that’s going to fundamentally change the way we live our lives.”

Kundra’s viewpoint is not surprising, considering that the government has been an early adopter of technology, but it is surprising in contrast to the conventional wisdom of many CIOs, who right now are mostly valuing tactical over strategic cloud implementations.

What may have a bigger impact besides technology, especially over the long term, is how cloud computing is changing the way IT organizations work alongside business units.

At the very least, cloud computing is forcing IT professionals to innovate like never before in the attempt to marry a potential technological revolution with true business value. As Kelly Services Inc. CIO Joe Drouin puts it:

“I’ve actually used cloud computing as a rallying point to demonstrate to the company that IT was thinking differently, was willing to challenge itself and to challenge conventional thinking and be a little more daring, with the hope that there was a real value proposition.”

This is an encouraging point of view. Creating new ways of servicing their organizations through technology should be the mission of all CIOs. And those who are already deploying cloud computing services will be better prepared to take advantage of cloud services when the reality does finally catch up with the hype.

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