A Walk In The Cloud
Though Cloud Computing is one of the most discussed topics in the current IT implementations scenario, adoption levels are low globally and especially in India. While organizations across the country, such as Bharti, Ashok Leyland, Asian Paints, Infosys, Maruti, and Tata Elxsi, are tuning in to the cloud computing station, certain concerns prevent them from buying the basket of services that the cloud has to offer.

An organization in the country could essentially opt for any of the services provided by global cloud vendors such as Google, Amazon, Microsoft, Salesforce, IBM, Cisco, EMC, and others. However, due to certain challenges, the quality of these services within India are debatable. Also, it is only recently that companies such as Netmagic, CSC, and Wipro have looked at offering such services from within India.

There are customers in the country who have adopted cloud services by either global or local cloud providers, but very few are pro-actively talking about it. This nascent level of adoption coupled with the ‘emerging’ image of cloud services has made it difficult to gauge an addressable market in India, the success or failure of these services here, and the associated challenges.

Cloud: Value For Money?
The cost at which the vendor offers these services needs to justify the level of service that will be provided. If the cost of having data and applications on the cloud over a period of time surpasses the cost of having it on premise, it would not really make sense for a customer to adopt a cloud-based solution. Instead it would make better business sense to deploy the necessary infrastructure on the company’s premises and bear the additional investment costs.

“The decision process in most enterprises for cloud computing will start with the economics: Are the total costs likely to be lower than current costs? Total costs will include the raw cost of hardware, storage, and bandwidth, plus usage charges (especially network usage), and software licensing and any systems integration, migration, and service support costs,” says K Ananth Krishnan, VP and CTO, Tata Consultancy Services.

Satish Joshi, Executive Vice President and Global Technology Head, Patni, shares this view. He believes that the primary challenge lies in understanding the real implications of the commercial models offered by cloud providers.

“The primary reason for contemplating a move to the cloud environment is cost savings. There is no point in moving the computing load to the cloud unless what one pays per month to use the cloud is significantly less than the expenses incurred (including cost of capital) of running the same applications in-house,” says Joshi.

Joshi further explains that quantifying this benefit is easier said than done partly because there are no accepted “standard” charging mechanisms and there are no “standard” definitions of what is meant by “computing capacity,” except perhaps in the case of storage and network bandwidth, and there are no “standard” definitions of service levels. This makes it very difficult to compare the “real” benefits of moving to a cloud versus computing in-house and to choose between the competing offers of different cloud providers.

Anand Ramkrishnan, Head, Cloud Computing business, Wipro Infotech, observes that in India, client organizations have native software/solutions to suit their current requirements. The value of such software will depreciate in the future. Hence, such organizations will not be able to build a business case for the cloud.

 
“Client organizations need to define the features required by their business such as high availability, enhanced service levels for their business, increased features, building flexibility in the solution and so on, and then compare the cost of acquisition of such a solution vis-à-vis a cloud offering, and then build a business case,” says Ramkrishnan.