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So here's a question: Which IT sector accounts for fully 25% of the industry's year-over-year growth and, if the same growth trajectories continue, will generate about one-third of the IT industry's net new growth by 2013? The answer is Cloud Services, according to research firm IDC. Cloud computing is garnering its fair share of industry buzz as well. Its promise of revolutionary cost savings and agile, just-in-time capacity has driven IT organizations at enterprises of all sizes to build cloud deployment strategies into their plans.

The Benefits of the Cloud

Cloud computing is immensely popular with companies and government agencies in search of revolutionary cost savings and operational flexibility. According to industry research firm IDC, cloud computing's growth trajectory is, at 27% CAGR, more than five times the growth rate of the traditional, on-premise IT delivery/consumption model.

Cloud computing practitioners cite numerous benefits, but most often point to two fundamental benefits:

  • Adaptability: An enterprise can get computing resources implemented in record time, for a fraction of the cost of an on-premise solution, and then shut them off just as easily. IT departments are free to scale capacity up and down as usage demands at will, with no up-front network, hardware or storage investment required. Users can access information wherever they are, rather than having to remain at their desks.

  • Cost Reduction: Cloud computing follows a model in which service costs are based on consumption and make use of highly shared infrastructure. Companies pay for only what they use and providers can spread their costs across multiple customers. In addition to deferring additional infrastructure investment, IT can scale its budget spend up and down just as flexibly. This leads to an order of magnitude cost savings that wasn't possible with 100% proprietary infrastructure.

Other benefits of the cloud include collaboration, scaling and availability, but revolutionary cost savings and the almost "instant gratification" offered by the agility of the cloud will be the key contributors to adoption of the cloud.

What is the Cloud?

So much has been written, advertised and discussed about cloud computing, it is appropriate to define the term for common understanding. Cloud computing generally describes a method to supplement, consume and deliver IT services over the Internet. Web-based network resources, software and data services are shared under multi-tenancy and provided on-demand to customers. It is this central tenet of sharing - and the standardization it implies - that is the enabler of cloud computing's core benefits. Cloud computing providers can amortize their costs across many clients and pass these savings on to them. This paradigm shift in computing infrastructure was a logical byproduct and consequence of the ease-of-access to remote and virtual computing sites provided by the Internet.


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