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By Jennigay Coetzer – Business Day

Cloud computing will allow an increasing number of applications and other IT functions to be accessed as a service over the internet or any internet enabled network. Kevin Mortimer, MD of Triple4 says with cloud computing IT suppliers can package services and dish them up like the mobile operators have been doing for years.

Customers will connect to the application or service without knowing how it is being delivered and pay for the quantity they use, like plugging a kettle into a socket and consuming electricity. “They no longer have to worry about servers and firewalls or how the service is delivered.”

He says the move to the cloud provides an opportunity for the smaller, nimbler entrepreneurial software developers to come up with innovative new applications and services. “But if the smaller guys do not hurry up and do this, the old software giants will have time to bring cloud solutions to market.”

He says Amazon.com and Google are both offering technology platforms that can be used by smaller developers to develop cloud-ready applications. Rudie Raath, country manager for technology consulting at HP SA, says software suppliers will have to restructure their licensing models to allow their applications to be accessed on demand and charged for on a pay-per-use basis, and they are still coming to terms with this.

Suppliers need to understand what value users put on their applications and not dictate to them, or they will buy from someone that does. “That someone might be a backyard garage operation that has a better approach to delivering cloud services to meet consumer demands,” he says.

Raath says secure cloud service delivery platforms are becoming available that will allow smaller players to enter the market without investing in technology infrastructure. For example, they could set up a self-service portal through another service provider and gather and serve up a selection of applications and services for consumers to chose from.

He says specialist cloud services portals will emerge that focus on specific industries or niche markets. Steven Cohen, MD of Softline Pastel, says 95% of applications are still installed in-house, largely due to to a lack of understanding of what the cloud is all about. “But once people grasp the concept they buy into it.”

He says there are no barriers to entry for newcomers developing cloud-based applications because the internet gives them immediate access to global markets. “You can just place a few google ads, and there is no need to woo retailers for shelf space.”

Val Moodley, regional manager for data centres and virtualisation for emerging markets at Cisco Systems says cloud computing is the next evolution of the internet, which will provide a platform for service providers to deliver applications and services to consumers and businesses. She says some companies will want to keep their core systems in-house and run non-core applications in the cloud.

One of the challenges will be how to access cloud services securely, especially if there needs to be a link between internal applications and applications that are being used on a cloud computing basis, says Moodley.  “Internal, and external systems that need to be accessed on a cloud services basis must be based on open standards so that they can talk to each other,” she says.

Chris Norton, regional director for VMware Southern Africa, says companies will set up their own internal private clouds and users will select the applications they need to use from a catalogue. The cost of the service will then be billed to the relevant business unit manager at an agreed cost.

There will also be hybrid situations whereby some applications will run in the private cloud and others will be accessed from external resources over the internet. They will be able to move non-core applications to the cloud and move them back again with no service interruption.

“We can do a lot of this today,” he says. Opportunities will also arise for companies to rent out their spare processing and storage capacity to other businesses when it is not being used. Community clouds will also emerge, for example that allow government departments to share infrastructure, applications, IT skills and other resources, says Norton.

Warren Weertman, manager of legal affairs at the Business Software Alliance (BSA) for Europe, Middle East and Africa, says when companies use software applications on a pay-per-use basis they will still need to pay a licence fee, although it will be included in the service provider’s fee. The service provider would be responsible for collecting the licence fee and paying it to the software owner.

“Service providers will enter into an agreement with the software supplier to licence applications to their customers,” says Weertman. He says companies accessing applications on the internet should ensure that the service provider warrants that it is authorised by the software supplier to provide access to these.

Jennigay Coetzer is a freelance business and technology journalist with 25 years experience, and she writes regularly for Business Day. She also runs media training and writing skills workshops, and is the author of A Perfect Press Release – or Not?, a guide to writing and distributing effective press releases, an electronic version of which can be downloaded free from her website: www.jennigay.co.za.

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