Cloud computing has become a familiar cliché today. The topic is increasingly discussed in technology forums, but the definition is still fuzzy. Some experts say that it is just old wine in new bottle – a new name given to the old concept of ‘utility computing’. Others argue that anything you consume outside the firewall is from the cloud, including normal outsourcing.

Cloud computing has gained acceptability as a means to increase infrastructure capacity ‘on demand’ without investing or licensing fresh software. Precisely it is about a pay-per-use service that enhances the existing capabilities for users. The concept is at an early stage of adoption with a vast spectrum of service providers – small to medium to large – delivering various kinds of services.

Here’s some food for thought. Merrill Lynch recently released a research note titled ‘The Cloud Wars: $100+ billion at stake’ noting that by 2011 the cloud computing market would amount to $US160 billion, including $95bn in business and productivity apps (email, office, CRM, etc.) and $65bn in online advertising. A 2010 ‘Cloud Development Survey’ conducted with over 500 developers by Evans Data Corp reported that 61 percent of the developers believe that a portion of their IT resources will move to the public cloud within the next year. Three quarters are planning to migrate at least some of their IT resources to the public cloud in the next 12 months; 17 percent expect to migrate half their IT resources to the cloud.

It is clear that cloud computing represents a paradigm shift that will redefine the relationship between buyers and sellers of IT-related products and services. According to Gartner, cloud computing is a product of the convergence of three major trends – service orientation, virtualisation, and standardisation of computing through the Internet. Users need to understand the available options in the cloud ecosystem.

Types of clouds by visibility
Public Cloud: Public cloud (external cloud) describes cloud computing in the traditional sense, whereby resources are dynamically provisioned on a self-service basis over the Internet, via web applications, from an off-site third-party provider who bills the clients.

Private cloud: Private cloud (internal cloud) is an offering that emulates cloud computing on private networks. These type of clouds claim to deliver some benefits of computing without the pitfalls, capitalising on data security, corporate governance, and reliability concerns. Private clouds don’t benefit much in terms of up-front capital costs because they still require investment and management.

Hybrid cloud: A hybrid cloud environment is a mix of both public and private clouds consisting of multiple internal and external providers. This will be typical for most enterprises.

While it is predicted that private cloud networks would be the future of corporate IT, there is some contention as to whether they are a reality. Analysts also say that within the next few years a large percentage of SME users will get most of their computing resources from public cloud providers, as they would like to save on capital expenditure and make IT affordable.

What are the basic types of services that users can avail on the cloud? The notion of “Everything- as-a-Service” encompasses the cloud computing distributed entity model in which there are three popular types of cloud platforms.

Infrastructure as a Service (IaaS): This provides virtualised servers, networks, storage and software designed to augment or replace the functions of a data centre. The most appropriate examples of IaaS offering is Amazon's Elastic Compute Cloud and Simple Storage Service. Other IT solution providers like Oracle, IBM, etc. also offer similar services.

Software as a Service (SaaS): This is the most widely known and used form of cloud computing. Also, it is one of the fastest growing segments of the IT industry because it provides a cost-effective alternative for enterprises to achieve their business objectives. Salesforce.com, Google's Gmail and Apps and VoIP from Skype are examples.

Platform as a Service (PaaS): It is a paradigm for delivering operating systems and associated services over the Internet without the need for downloads or installation. It is also called cloudware because it moves resources from privately owned computers into the Internet cloud. Interestingly, PaaS is an outgrowth of SaaS. Microsoft's Azure and Salesforce's Force.com are two very popular models of PaaS currently being evaluated by users.

Pros and cons
Commercial offerings generally meet the quality of service (QoS) requirements of the users and typically offer stringent SLAs, but opinion is divided as to whether cloud computing is a better option when compared to in-house data centres.

On the cloud mode, users can assure a quick deployment and add capacity or applications almost without notice. These services are charged on the basis of their usage, which translates into more cautious and prudent IT spending. Cloud services don’t require much capital investment. Also, users have to incur little or no maintenance cost if they use cloud services.

But there is a flip side to the cloud as well. Despite tall claims made by various vendors, the management of cloud remains a big concern. There are not many standard monitoring and maintenance tools yet, and this limits the visibility into the cloud. The standards have not yet matured to the acceptable level. The Cloud Security Alliance, Open Cloud Consortium and a few more independent organisations are in the middle of developing standards for interoperability, data migration, security, etc. Most cloud service providers make a lot of assurances about privacy, but with management tools still in their infancy, a customer's ability to know who's looking at what data is limited.

In just one year, the move to the cloud by many businesses has been phenomenal. No matter what your organisational requirements are today, you might find cloud services making sense for your organisation in the near future. Even if it is not a complete switch to cloud services, possibly a partial hybrid switch might work for you until the security and management issues are fully resolved.