December 23, 2015  2:18 PM

Industry cloud boon for IT, bane for unwary tech vendors

Jason Sparapani Jason Sparapani Profile: Jason Sparapani
cloud, IDC, IT departments, IT organization, Vertical markets

Industry clouds will be the next big cloud thing, predicts research shop IDC, and they present a huge opportunity for IT. Technology vendors that don’t pay attention, though, may see business slip through their fingers.

Industry clouds are joint ventures among organizations in a vertical market that give members access to industry-specific cloud services — and in many cases they’re forums for sharing information to solve problems (see “2016 forecast: Industry clouds on horizon? IDC thinks so“).

“This is probably one of the greatest opportunities the IT department has seen in a long time,” said IDC analyst Eric Newmark. Today, a lot of IT purchases are not made by IT — they’re made by marketing, finance and other business departments that want a quicker route to the latest technology.

Industry cloud a new hope for IT

“When I look at what keeps CIOs up at night, I think it’s more about, ‘How do IT organizations reposition themselves and their companies as being something that helps to generate top-line revenue rather than being viewed as just sort of a cost center?'” Newmark said.

One way for IT to change that view is by helping the organization identify opportunities for creating or being a part of an industry cloud, he said. First, IT should call out any special expertise or value it can offer up to other organizations in the industry — for a profit. For example, an organization may have custom-developed a technology that addresses issues that a particular industry needs to address, like compliance. Can it offer that as a service in the cloud?

Second, IT should factor in the concept of industry clouds in the traditional “build vs. buy” approach to new technology, Newmark said.

“As companies consider buying particular software applications or particular capabilities, you’ll start to have the option of ‘Do we want to buy a software package for this? Or do we want to consume this as a service in an industry cloud?” Newmark said.

For tech vendors, a dark side

While industry clouds can be a powerful new tool for IT, they may be a looming danger for technology vendors — that is, if they don’t keep a watchful eye on their markets.

When organizations come together with a tech vendor on an industry cloud to provide certain technological and operational capabilities, that vendor very quickly takes on a lot of business indefinitely. Other vendors that sell the same wares will essentially be shut out of the circle.

“It’s very important that technology vendors out there pay close attention to this market because they’re going to have new competitors popping up left and right,” Newmark said.

Let us know what you think of this post; email Jason Sparapani, features writer, or find him on Twitter @jmsparapani.

December 23, 2015  2:12 PM

2016 forecast: Industry clouds on horizon? IDC thinks so

Jason Sparapani Jason Sparapani Profile: Jason Sparapani
cloud, cloud collaboration, Healthcare, IDC, Vertical markets

Coming in at No. 8 in market research outfit IDC’s tech predictions for 2016 and beyond, was this: “industry clouds.” In a webcast, analyst Frank Gens said companies like John Deere and UnitedHealthcare are turning industry cloud platforms into “epicenters of innovation, growth and disruption” — and he said half of U.S. organizations will either create or partner with one to distribute or source their innovations by 2018.

The predictions highlighted developing technologies like the Internet of Things — 22 billion devices are forecast to be hooked into to it by 2018 — and familiar ones that nonetheless are growing madly, like cloud computing. But industry clouds was a new one on me, so I turned to Eric Newmark, an IDC analyst who helps life-sciences organizations make technology decisions. He also leads the company’s industry cloud platform service.

“Industry cloud is at its essence about buyers becoming suppliers,” Newmark said, referring to buyers and suppliers of cloud computing services. It’s a sort of joint cloud venture for vertical markets: An organization in a specific industry creates a cloud platform for other organizations in that industry — for example, a hospital offering cloud services to other hospitals — or organizations come together on a customized cloud platform to work toward a common goal.

“So it’s more of a many to many not just a one to one,” Newmark said.

Industry clouds a ‘win-win’

There are three models for development of industry clouds, he said. In one, an organization offers up a particular expertise in the cloud for others, who pay for it on a subscription basis. In another, a vendor creates a cloud platform specifically for an industry. And a third is a partnership of user organizations in a specific industry and one or more technology vendors. It’s the most popular model today. For everyone involved, Newmark said, the models are a “win-win.” (See “Industry cloud boon for IT, bane for unwary tech vendors.”)

“The end-user company creating the industry cloud gets to create a new revenue opportunity for themselves,” he said. “All the other entities on the other side of the coin that decide to consume this as a service win as well because they don’t have to re-create the wheel for themselves.”

An example of the partnership model began at Mercy, a healthcare operator in the Midwest. It created a data center as a service for itself as a cloud backup service. It was so successful, Newmark said, “they realized that ‘Wow, this is something that other hospitals could use.'”

So Mercy partnered with several technology vendors to create Mercy Technology Services, which first started offering its cloud backup service. As more hospitals signed on, Mercy offered more services, like application management and telemedicine, and now aggregates data from constituent hospitals to provide data analytics services and insights on how to improve medical care.

Collaboration leads the pack

Healthcare is the forefront of the industry cloud market today, Newmark said. He credited the changes introduced by the Affordable Care Act as a catalyst for entry.

“I think that people have been trying to solve a lot of the different challenges and problems in the healthcare space — tackling things collaboratively has made a lot of sense,” he said.

Life sciences is another area where the collaborative nature of industry clouds is a boon. Sharing R&D may shorten the path to a disease cure, for example — and collaborative partnerships of this sort in the industry have existed for decades, Newmark said. Oil and gas and other utilities companies are slower to come together on the platforms. They’re highly competitive, and “there’s less of a history of working together.”

There are between 100 and 150 industry clouds today, Newmark said. But he expects there will be around 500 by 2018 and 1,000 by 2020. In revenue, hundreds of millions of dollars today will balloon to tens of billions in just three to five years.

Let us know what you think of this post; email Jason Sparapani, features writer, or find him on Twitter @jmsparapani.

December 22, 2015  5:47 PM

The CIO-CTO shuffle

Nicole Laskowski Nicole Laskowski Profile: Nicole Laskowski

In late October, The New York Times Co. pulled the trigger on a decision that reflects how digitization is disrupting more than business models: It named Nick Rockwell its new CTO.

That Rockwell was named to the role makes sense. For more than a decade now, he’s racked up a blend of digital technology and digital media experience as a CTO or a vice president at the likes of Conde Nast, and MTV Networks. What stands out about the decision is this: Rockwell is the replacement for the former CIO, Marc Frons, who left the company in June. Digital transformation, in other words, is upending the corporate structure itself — and in more ways than introducing new roles to the C-suite.

“If you’re a CIO right now, and if you’re not adapting and evolving, you risk being marginalized. It’s tough,” said Shawn Banerji, managing director at Russell Reynolds Associates, an executive search firm in New York.

It’s too early to call the CIO-CTO shuffle a trend, but it’s safe to say The New York Times isn’t alone in its decision. “As more and more companies, irrespective of their industries … are looking at data information assets and how they productize and monetize those assets, they need an individual, whether it’s the CIO or the CTO, that can do so,” Banerji said. “And many are opting for the CTO title, so we’re starting to see the emergence of that.”

Earlier in October, Starbucks announced that it was appointing Gerri Martin-Flickinger as its first-ever CTO, a replacement for former CIO Curt Garner. And last year, Brook Colangelo, who was originally hired as Houghton Mifflin Harcourt’s CIO, convinced the company to nix the CIO title in favor of CTO. “The killing of the IT title was a rebranding of who we are as an organization and how we’re delivering,” he said in an interview with SearchCIO a few months back.

Colangelo has retained his CIO responsibilities despite the title change. But by becoming a CTO, he has positioned himself as more of a front-office entity where he can serve Houghton Mifflin Harcourt customers directly, he said.

The CIOs in this story are examples of how digitization is disrupting the role of senior IT leader, but they are also examples of how CIOs are evolving with the times. Frons, for example, shed the CIO title — for now; he currently serves as senior vice president and global head of mobile platforms and deputy head of technology at News Corp, which publishes The Wall Street Journal and The New York Post. Garner, former CIO at Starbucks, is currently serving as Chipotle’s first CIO. And even Martin-Flickinger provides a CIO adaptation story: She’s performed the CIO-CTO shuffle, having served as the CIO at Adobe before joining Starbucks.

December 18, 2015  1:32 PM

EmTech 2015: Everyone should get free digital security

Fran Sales Fran Sales Profile: Fran Sales
CIO, Data privacy, Data-security, digital, MIT, Surveillance

“Our telecommunications networks were not wired for privacy. They were not designed for digital security.”

That’s how Christopher Soghoian, principal technologist at the American Civil Liberties Union, opened his session at EmTech 2015, the MIT Technology Review‘s annual conference.

When the telecommunications industry began to shift away from analog phones in the 1990s and telephone companies started building the networks to accommodate them, they didn’t have privacy in mind. In fact, these networks were built with the intent of giving law enforcement and the intelligence community the ability to access any communication at any time, said Soghoian.

Christopher Soghoian, ACLU, Principal Technologist, image, emtech

Christopher Soghoian, ACLU Principal Technologist (left)

As anyone with a cell phone can attest, Silicon Valley companies have disrupted the business models of traditional telecommunications companies. (The text message is a good example: What once cost customers 20 to 30 cents per text — a huge source of revenue for phone companies — became free when Apple rolled out iMessage in 2012, no user opt-in required. Soon after, other companies developed free alternatives to text messaging, such as WhatsApp, Viber and Facebook Messenger.)

Granting government access to telecommunication networks, however, persists for many providers, including Silicon Valley disruptors. The exception is Apple. The result is what Soghoian describes as two-tiered consumer privacy: full protection from government prying for those people who can afford Apple products — and something less for everybody else.

Last year, Apple CEO Tim Cook announced that his company would now be in the business of protecting customers’ digital privacy and provide “end to end” encryption on iPhones: Devices running the most recent versions of iOS can no longer be unlocked by the company even if it were faced with a warrant from authorities. Only these phones’ users have access to data on their Apple device.

“Apple’s customers got security without having to do any work, without having to think about security, without having to research anything, without having to go into any configuration options, which none of us ever do. Apple’s customers got security for free,” he said.

This end-to-end encryption, which is turned on in Apple’s devices by default, is a major step in the right direction. But it’s not enough, Soghoian said.

The other major mobile device OS, Google’s Android, is a different beast. Google doesn’t manufacture its smartphones — OEMs do. And they are not as keen on keeping up with the speed of encryption technology. If you walk into a store today and buy an Android phone, it’s unlikely to have data encryption turned on by default.

That’s why Android smartphone manufacturers have been able to keep its prices so low, at $50 to $100 a pop. Apple’s devices are sold for about $600 or $700 each, on average.

The resulting “digital security divide” is a problem, Soghoian said.

“What does it mean when the phone used by the rich is encrypted by default and cannot be surveilled? And the phones used by those in the global South, and the poor and the disadvantaged in America, cannot protect themselves from surveillance?” he asked the audience.

Soghoian’s bottom line? It’s promising that Apple has taken the lead in building devices that are encrypted by default, and in some cases even “frustrate” law enforcement surveillance. But these devices should not just reach the higher tiers of our society — the rest of Silicon Valley should follow Apple’s suit.

“Everyone should be free of surveillance,” Soghoian said.

Email Francesca Sales, site editor, or find her on Twitter @Fran_S_TT.

December 15, 2015  1:48 PM

CIO role in terror fight plausible — but not yet likely

Jason Sparapani Jason Sparapani Profile: Jason Sparapani
CIO, cybersecurity, IT executives, Whistleblower

Last week, I asked cybersecurity experts about their reactions to calls from President Barack Obama, Congress and Democratic presidential candidate Hillary Clinton on Silicon Valley tech giants to use their technological wizardry to help foil terrorism.

Khalid Kark, a director in Deloitte’s CIO research program, said the government, technology companies and non-tech companies need to share information and work together to crack thorny issues like how to curb terrorism recruitment online and sniff out traces of attacks on the Web before the happen in the real world.

Gartner analyst Avivah Litan said hyperawareness on the part of everyone — the government, technology companies, retailers, libraries, shopkeepers — is needed to thwart terrorists. Using Israel as an example of a place where security is woven into the fabric of everyday life, she suggested an approach along the lines of the “If you see something, say something” public-service initiatives in the months and years following the terrorist attacks of Sept. 11, 2001 — on a massive scale.

“If everybody was hyperaware, that’s the best intelligence,” Litan said.

CIO role in sharing information

The interlocking benefits of sharing and awareness aren’t lost on CIOs. They see the implications in their own organizations: the fewer the silos, the broader extent of knowledge throughout the organization, the better the business decisions. In a national security initiative based on sharing and hyperawareness, the fewer the silos, the broader extent of knowledge throughout the government and corporate America, the better the security decisions. The CIO role could be key in keeping companies — and the country — safer.

But we may be years from it. For meaningful collaboration between the government and the private sector, Kark said, the government would need to convince companies that their customer data is not compromised. In the wake of attacks in Paris and San Bernardino, Calif., there is a renewed debate in Washington about whether government agencies should be granted “backdoor” access into encryption codes on popular apps to better monitor criminals and terrorists.

“That’s definitely a no-go zone for many of the tech companies,” Kark said. “If you want to engage them you have to ensure and you have to respect their ability to ensure privacy for their customer data.”

Hyperawareness in CIO role

For CIOs to be effective in any grand national security program, Litan said, they need to hyperaware to all signals in their organizations. That means everything from making sure cybersecurity is airtight to determining whether there are potential terrorists working alongside other employees.

But to keep any kind of threat from spreading, CIOs need a “safe harbor,” or whistleblower, policy that lets them bypass legal departments — and ensures the CEO won’t sack them.

Litan gave the high-profile, hypothetical example of the self-proclaimed Islamic State trying to take down NBC Studios by installing malware on its computers. If IT detected the malware, it couldn’t report that to the government so they could alert other companies to the threat.

“There’s a bunch of lawyers at NBC Studios that would stop the IT department from sharing that level of information,” she said. “All they could say is, ‘We see signs of suspicious activity.'”

A bill working its way through Congress, the Cybersecurity Information Sharing Act, would give companies some legal immunity for sharing data with the government. But the legislation has drawn criticism from tech companies like Apple to groups like the American Library Association, which say it doesn’t adequately safeguard Americans’ privacy. As is, the bill allows the Department of Homeland Security to share information — including personal customer data — with the FBI or National Security Agency.

Let us know what you think of this story; email Jason Sparapani, features writer, or find him on Twitter @jmsparapani.

December 9, 2015  12:36 PM

The current state of the chief data officer

Nicole Laskowski Nicole Laskowski Profile: Nicole Laskowski

Are chief data officers having a moment or is all the CDO talk hype? According to Google Trends and Google Analytics, it’s likely a little bit of both.

Richard Wendell, Chief Data Officer Summit
Richard Wendell at the Chief Data Officer Summit.

That was the gist of an analysis of the CDO role presented by Richard Wendell, founding board member of the MIT-affiliated International Society of Chief Data Officers (ISCDO), at the recent Chief Data Officer Summit in New York City. Here is what he cited for the chief data officer audience.

  • Google searches for CDOs are trending, “but happiness is a low base,” Wendell said.CDO searches are experiencing a 100% compound annual growth rate (CAGR), but that still only amounts to 36,000 searches a year. “Where does that place us? That places us a little bit above African swallows and slightly below silver birch trees,” he said.
  • Most CDO searches are coming from the United States, “but this seems to be changing,” Wendell said. He pointed to statistics from CDO Club founder David Mathison, who found that in 2014, the number of CDOs in Europe grew to 23%, up from 7% in 2013. Wendell also pointed to recent CDO events happening in Asia and Africa. “I don’t see this as a U.S. phenomenon,” Wendell said. “Potentially, we could see a lot of expansion here, but it’s still early days.”
  • Top keywords associated with the CDO searches include data science, analytics and CIO responsibilities. “Why are people searching for chief data officer while they’re searching for CIO responsibilities? Is it because we’re trying to figure out what the difference is between our job and what the CIO’s job is? Maybe a little bit,” Wendell said. But a more promising read of the data suggests the CIO and the CDO are two natural collaborators. “One of the big questions I’d posit that all of us chief data officers in the room need to be asking is how can we be better partners for our chief information officers, with our chief information officers,” he said.
  • CDO vs. CAO searches. The term chief data officer is searched five times more often than the term chief analytics officer (CAO). “And, if you look at the CAGR, chief data officers are at 100% versus more or less a flat line for chief analytics officers,” Wendell said.
  • CDO vs. CIO searches. Searches for the term chief information officers are down 20% incompound growth year over year, with just 35% of searches happening now compared to 10 years ago. “That’s a big drop in searches,” Wendell said. He speculated CIOs or those researching the position may not have as many questions about role responsibilities compared to CDOs or that the CDO role is hyped well beyond the CIO role, amounting to more searches.

No doubt, there are more scientific studies on the topic, but the data provides some perspective on the current state of the chief data officer.

Question for readers: Does your company have a chief data officer? Or is it planning to hire one in 2016?

December 9, 2015  12:19 PM

Oracle’s top 10 CIO challenges in 2015: Were they yours?

Nicole Laskowski Nicole Laskowski Profile: Nicole Laskowski

Oracle published a list back in February of the top 10 CIO challenges in 2015. Last week, Richard Wendell, founding board member of the MIT-affiliated International Society of Chief Data Officers, referred to the list as he called on the chief data officers in the room to build stronger partnerships with CIOs.

“This, by the way, isn’t the answer,” Wendell said at the Chief Data Officer Summit in New York City, pointing to Oracle’s 10 CIO challenges projected onto a screen. “But I thought it was interesting food for thought.” Answer or not, each of the CIO challenges was something CDOs “can help with,” Wendell said, urging CDOs to get on it.

Wendell not only used the list of CIO challenges to make  his case for CDOs partnering with CIOs, he also used it to illustrate the organizational transformation businesses are undergoing right now as data and analytics become ever more central to business success — at least at some businesses.

“I think that the opportunity for data, analytics, insight, transformation that we can all bring from revenue is incredibly powerful, and I think it’s often underplayed for a variety of reasons,” he said. Together, CIOs and CDOs can play a powerful role in the enterprise: They can own data strategy.

How did Oracle’s list stack up? You be the judge

The aforementioned list of CIO challenges was written by Bob Evans, senior vice president and chief communications officer at Oracle. Given that the year is almost done, I thought it might be interesting food for thought, to quote Mr. Wendell, to have our readers consider how accurate — or out-of-touch — the observations were.

Here’s the list, in full. The quotes and observations are all from Evans.

  1. Be the digital disruptor. “Who’s better positioned than the CIO to drive these disruptions?”
  2. Be the chief acceleration officer. “CIOs are in an ideal position to make speed a virtue across the enterprise.”
  3. Forge relationships with the CMO, CFO and beyond. “The business-centric CIO of 2015 will not just ‘support’ these relationships but will also initiate them, enrich them, and extend them.”
  4. Harness big data and analytics across the enterprise, with a specific focus on customer engagement. Data and analytics will provide competitive differentiation.
  5. Unlock insights and capabilities that enable every employee to build customer loyalty. Think multichannel.
  6. Exploit cloud computing to help achieve each item on this list. This is the year when CIOs use the cloud in more sophisticated ways to free up funds for innovation and “enhance core business processes.”
  7. Reimagine your security strategy as globalization and mobility redefine privacy and risk. “CIOs need to be frontline enablers of powerful new digital capabilities while also somehow finding a way to ensure that security continues getting better and better.”
  8. Be the evangelist for turning social into an enterprise-wide strategy. CIOs should be on the forefront of answering questions such as: What are the best tools to quantify the impact of your company’s social programs? And how do you correlate those programs to sales?
  9. Embrace new HR solutions and tools to make your department — and your entire company — a destination for world-class talent. Talent is scarce. CIOs should partner with HR to “win the talent wars,” and not just for the IT department, but for the organization as a whole.
  10. Transform the IT organization and reputation from no to yes, from SLAs to revenue growth, from obstacle to accelerator, from passive to opportunistic. “Be a positive partner,” be “joyful” and “enthusiastic enablers” who can juggle traditional responsibilities with new duties that range from helping HR find and recruit strong talent to growing revenue and customer loyalty.

What say you CIOs: How close did Evans come to describing the top 10 CIO challenges in 2015? And, be honest, how well did you meet these challenges?

December 7, 2015  5:09 PM

Big companies cozy up to startups to drive innovation

Linda Tucci Linda Tucci Profile: Linda Tucci

How does a big company that is not exactly at a loss for new product ideas drive innovation?

When a PepsiCo division focused on “breakthrough innovations” was looking for a second opinion on a slew of new product ideas, it didn’t turn to consultants or muster up a traditional focus group.

“We brought in entrepreneurs from the MassChallenge team and basically [did] what I would call a Shark Tank on speed,” said Perry Witmer, senior manager, Innovation & Emerging Brands, at PepsiCo. MassChallenge, the world’s biggest startup accelerator, according to its website, helps promising early-stage entrepreneurs “launch and succeed immediately.”

With one day and “no budget pretty much,” Witmer showed the MassChallenge entrepreneurs her innovation team’s ideas, first getting their feedback as consumers and then asking them to exercise their business savvy.

“We then had them each pick their favorite idea and pitch it to a panel of consumers,” Witmer told the audience at the FutureM marketing technology conference, where she was a featured speaker. The consumers, in turn, were asked to invest in what they believed was the winning pitch.

“The upshot was that we were able to sit down with the consumers again and understand what drove their decision making,” she said. Her team got real-time insight into how entrepreneurs think about products — and how they pitch a product, she said. The PepsiCo innovation team also gleaned valuable information about what might drive and hold back their new products.

Constant Contact, an online marketing firm focused on helping small businesses, created its own accelerator program, said Andy Miller, chief innovation architect. The Waltham, Mass. firm brings in two classes of startups, two times a year to drive innovation.

“They stay for four to six months,” said Miller, who also spoke at FutureM.  The applicant class now numbers around 70 for the sessions, he said. The applications give Constant Contact tremendous exposure to “what’s happening in the small business space.” About 10% of the company’s employee base now works with startups during their allotted 10% “free time.”

Accenture: Large companies want to hook up with startups to drive innovation

PepsiCo and Constant Contact are hardly alone in their cultivation of startups to drive innovation — and identify potential threats to their core businesses.

A new report from Accenture, “Harnessing the Power of Entrepreneurs to Open Innovation,” found that most large companies feel they have a lot to learn from entrepreneurs. The study, based on interviews with more than 1000 entrepreneurs and 1000  large companies from the G20 countries, showed the following:

  • 82% of large companies say they can learn from startups/entrepreneurs about how to become a digital business.
  • 50% of large companies feel they need to work with entrepreneurs to be sufficiently innovative.
  • Large companies expect the proportion of their revenues generated by collaboration with entrepreneurs to more than double over the next five years, from an average of 9% today to 20%.
  • 78% of large companies say that working with entrepreneurs is important or critical to their own growth and to drive innovation.

The feeling is not mutual

Here’s what’s interesting: Entrepreneurs don’t feel the same about their bigger brethren. The report also found that:

  • Only 67% of entrepreneurs agree with the above sentiments.
  • Entrepreneurs are four times more likely than large companies to say their counterparts lack commitment to working together (29% versus 7%).
  • While 75% of large companies say they are entrepreneurial, 75% of entrepreneurs who previously worked at large companies left because they felt that was not the case

Accenture’s viewpoint is that the disconnect between the big guys and startups is puts about $1.5 trillion in global growth at risk ($433 billion in the United States).

We’re curious to know whether your company is working with startups to drive innovation and speed their routes to digital business.

Meantime, to learn more about the challenges facing innovation leaders in their quests to institutionalize and drive innovation, go to my SearchCIO report on the FutureM panel, “Enterprise innovation teams struggle to show what makes them special.”

How to drive innovation at big companies: Panel.

Innovation panel at FutureM (from left to right): Adam Cutler, IBM; Andy Miller, Constant Contact; Richard Smyers, Fidelity Investments; Perry Witmer, PepsiCo.

Email Linda Tucci, executive editor, or find her on Twitter @ltucci.

December 7, 2015  12:33 PM

Forrester: ‘Irrational fear’ holds down cloud desktop use

Jason Sparapani Jason Sparapani Profile: Jason Sparapani

Got desktop as a service? Probably not. A recent report from Forrester Research says most organizations aren’t lining up for the PC-sized version of cloud computing — at least not yet — citing configuration and security concerns.

And though the market is strong for internal private clouds, organizations aren’t seeing the business value they set out for — and soon interest will veer off toward the public-private cloud neutral zone known as hybrid cloud.

The report, part of Forrester’s TechRadar series — research that makes 10-year-plus predictions about how a range of technologies will fare, said the larger cloud market is booming, with demand for speed, flexibility and cost savings causing segments like the public cloud to rapidly expand their reach.

But while niche “as a service” services — integration as a service and storage as a service, for example — begin their rise into the stratosphere, others are finding trouble getting much lift, the report said. Desktop as a service (DaaS) takes the operations of a desktop operating system, puts it in a virtual infrastructure — so it runs on a centralized server along with others — and hands it all over to a cloud provider.

There are many benefits, said Glenn O’Donnell, a Forrester analyst and co-author of the report — it can save companies time and money spent on maintaining computers for their workforces.

“Maintaining desktops, PCs, is a real pain in the butt,” he said. “If we can manage all those desktop environments in sort of a centralized place — that has a lot of operational benefit. Simplicity pays off extremely well there.”

The problem is an old one: IT organizations are worried about their data. Though more folks are coming to trust the public cloud — because of the powerful defense big providers like Amazon have in place — ceding control of the personal information and intellectual property, which are created and stored on desktop computers, puts a lot of IT managers into a panic.

“It’s largely irrational, but every irrational fear is based on some dose of reality, and the dose of reality at the heart of all of this is, ‘My stuff is somewhere else; therefore I can’t touch it, I can’t control it and therefore it’s got to be at risk,'” O’Donnell said.

DaaS also doesn’t always integrate well with other corporate systems, including information security systems, according to the report. Make it more easily configurable for more organizations, and more may want to sign on.

Check out part two of this interview with Forrester Research analyst Glenn O’Donnell to find out about another struggling product area of cloud computing, internal private cloud.

Let us know what you think of this post; email Jason Sparapani, features writer, or find him on Twitter @jmsparapani.

December 7, 2015  12:32 PM

Private cloud fading, hybrid cloud ascending, Forrester says

Jason Sparapani Jason Sparapani Profile: Jason Sparapani

Part one of this two-part interview with Forrester Research analyst Glenn O’Donnell focuses on desktop as a service, a cloud computing category the research outfit said is having trouble making it mainstream. Part two highlights another area of concern, internal private clouds.

Internal private cloud is the only form of cloud computing in Forrester Research’s recent report on the constellation of cloud computing products that’s seeing “minimal success.”

Internal private cloud is an infrastructure-as-a-service platform implemented on hardware owned and operated by a corporate data center — as opposed to hosted private cloud, which is essentially space in a cloud provider’s data center dedicated to a particular customer.

“There has been some notable successes in private cloud, but most people who are attempting it are either failing or they are building something that isn’t true cloud,” said Forrester analyst and co-author of the report Glenn O’Donnell. “They’re basically VMware customers who are using core VMware technologies — and because they have the ability to quickly provision new environments, based on that they say, ‘Oh, this is our internal cloud.'”

Such environments are not “true cloud,” he said, because they lack chargeback and showback — policies that tie cloud usage and associated costs — and other “classic cloud characteristics” like self-service provisioning, which allows end users to launch applications without directly involving the service provider.

Internal private clouds were also faulted in the report for being both expensive to buy — around $1 million just for the software, O’Donnell said — and difficult to deploy, requiring significant modifications to meet the needs of a specific organization.

“You’ve got to build a pretty humongous environment and get significant operational benefits out of it if you’re going to recoup that investment,” O’Donnell said. “And for a lot of companies, they just haven’t done that.”

The paradox is, internal private clouds are still a popular cloud computing approach. That’s because having the value propositions of the public cloud on-premises is attractive to a lot of organizations. “The promise has not gone away,” O’Donnell said.

What will go away someday, he said, are internal private clouds themselves — at least strictly speaking. Most organizations won’t be exclusively public or private cloud — they’ll have hybrid cloud environments, a blend of on-premises IT and public cloud deployments. The model offers companies both the flexibility and scalability of the cloud and the peace of mind of keeping certain sensitive information in their own data centers.

“The hybrid cloud is really the big story,” O’Donnell said. “It doesn’t mean people are giving up cloud, but they’re giving up this pure private cloud notion and going down the path of hybrid.”

Let us know what you think of this post; email Jason Sparapani, features writer, or find him on Twitter @jmsparapani.

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