Cloud computing is generating very big buzz, but also a lot of controversy. How can we entrust our data to people we barely know, in an age where the costs of a privacy breach can be enormous? There are two main reasons that this objection will be overcome:
- The economics of cloud computing are simply too powerful to ignore. Microsoft, Google, Amazon.com, and the other big cloud vendors can run a giant cloud datacenter far more inexpensively and efficiently than you can run your local datacenter. When the economies of scale kick in, Wall Street will punish Company A for the high capital costs of maintaining its own plant, and reward Company B for the lower operating costs of leveraging the cloud. High fixed costs and no economy of scale will lose to lower variable costs with an economy of scale every single time. Even if the latter presented slightly higher security risks, the cloud offers enough savings that the leftover money will provide enough insurance to cover the risk.
- Of course, there will be no need to buy insurance. A company is probably less safe and secure running its own datacenter than allowing one of the large cloud vendors to run it. Nay-sayers will likely be able to point to a couple of high-profile cases, but the reality will probably be much like the difference between air crashes and car crashes. Automobile accidents are much more common (like everyday IT security breaches)but airplane crashes are much higher-profile because of the additional scrutiny they get.
Demand for consultants who learn how to save clients money using cloud computing will be sky-high, especially given how powerful cloud computing is in terms of a cost-saving play. Trust me, every CFO on the planet would love to take the company's expensive datacenter, hook it up to a large semi-trailer, and dump it into the ocean, never to be seen (or invoiced) again.