This is the first part of the presentation given as part of the City of Sydney’s Let’s Talk Business series of events on new business technologies.
The IT industry loves buzzwords and one of the biggest buzzwords at the moment is Cloud Computing.
Another thing the IT industry loves is overselling concepts, think of Y2K or the Dot Com Boom, so in this presentation we’ll look at what cloud computing is, whether it’s being overhyped and what it can realistically do for today’s businesses.
In 2003 Nicholas Carr wrote in the Harvard Business Review that Information Technology no longer matters. In Nick’s view, computers, the Internet and IT are all becoming a utility and we’ll take computers and the Internet for granted just as we in the Western world consider clean running water and electricity today.
That point of view is probably true and the always on nature of the Internet and cloud computing is bringing us closer to the day we’ll assume IT is always there.
In the always on, always connected society each of the nodes we see on this screen could be a customer, a supplier, an employee or even the tax man and this changes the way we do business.
But every innovation has its risks and every revolution its victims. So we’ll look at the risks as well as the opportunities in an economy where cloud computing is changing the fundamentals of our businesses.
What is the cloud?
Before we go on, let’s explain what the cloud is. The analogy of a cloud is quite appropriate, just as a rain cloud is made up of many individual water particles, the Internet is made up of millions of computers talking to each other.
In fact there are so many computers on the Internet that the Internet Protocol version 4 developed in 1980 allowed around 4 billion address and we’ve just run out of those.
The Internet Protocol 6 now being introduced allows 34 undecillion addresses. An undecillion is a trillion, trillion, trillion so 34 undecillion addresses is a big number, although in 1980 4 billion seemed to be a lot and it was unthinkable we’d use them all up in 30 years.
The Internet though was designed to survive the unthinkable. Surviving a nuclear war was the reason for the Internet’s design. The fundamental idea behind the net is redundancy, should one group of computers fail the network adapts and sends the information around the damaged area.
The same principle applies to cloud computing, the tens of thousands of computers in each data centre – the buildings that house the cloud computing companies – are duplicated many times so if one or a hundred fail then others will pick up the work and the person using the service should never notice there has been a problem.
Naturally the data centres themselves are duplicated so the failure of one centre won’t interrupt the service. When you open a document in Google Docs, the data and the program are being run on computers in Oregon, Belgium possibly even here in Sydney.
Interestingly, the computers in these data centres are cheap and basic with most of them having less power than our home or office desktop computers.
The real power lies in combining the capabilities of these modest systems, as a group they are far more powerful than most supercomputers.
For our purposes we can define cloud computing as using someone else’s computers to do the work rather than our own systems.
Cloud computing is nothing new
The idea of cloud computing isn’t new, it goes back to the earliest days of computers.
Until the arrival of the personal computer, academics and businesses had to use mainframe computers where time was allocated to them by the computing department. These were only really feasible for well resourced organisations.
The Personal computer took the data off the servers and onto the desktop. It’s notable that IT departments back then resisted introducing personal computers for almost identical reasons that they are resisting cloud and web based services along with social media tools today.
PCs and later laptops and smartphones had advantages that the old mainframes could never offer and while the old ways of centralised computing didn’t go away, most people and businesses preferred the advantages of the smaller, more flexibile systems.
With the arrival of the Internet, it was possible to link computers in the same way again and take advantage of the economies of scale of what we call client-server systems while retaining the benefits of personal and mobile computing.
This is the first of a series of four posts taken from The Networked Business presentation. Parts two, three and four are also online.