Over the last 6 months, we have started to slide down the hype curve, into what Garter calls the “trough of disillusionment”, with too many small local vendors, developing poor quality, ‘cloud’ computing systems, which are relatively expensive and limited in terms of functionality. At the end of June however, we saw what I believe will be the first signs of the upward “slope of enlightenment”, when Microsoft officially launched the long-awaited Office 365, bringing together the Cloud versions of the most well-known Microsoft Products, including Exchange, Lync and SharePoint, along with the latest version of Microsoft Office.

Compared to the recent efforts of local providers to supply ‘cloud’ services, this new offering from Microsoft is cheaper, (both to set up and on an on-going basis), more flexible, has more features, and offers products that have been custom-built for the cloud environment. With several other IT powerhouses, such as Google, Oracle and Amazon also pumping billions into developing cloud services, the day of reckoning has now well and truly arrived.

Specifically, Office 365 now provides access to enterprise level technology for as little as £6.50 per user, per month. Compare this to ‘cloud hosted desktops’, remote services using off-the-shelf Microsoft Office that providers in the Channel Islands have been offering for £100 per month, and it is clear that some vendors are not going to survive this new era of cloud development.

With Office 365 there is no capital investment required to buy infrastructure, like servers, or the need to factor in the cost of support, such as additional staff or power. And the ability to add or remove users instantly, also means you only pay for what you are actually using, making Office 365 suitable for large and small businesses alike.

While there has been some debate about how cloud computing will work legally in terms of client data jurisdiction, (for example for local Trust companies), we are now finding at C5 Alliance that for many clients, many elements of Office 365 are still incredibly useful and cost effective, and hybrid solutions that still isolate client data locally can easily be put in place. I believe that as products like Office 365 develop, hybrid solutions will become more common, and the meaningful question businesses will ask themselves is not, “should we use the cloud?”, (the answer will be “yes”), but more importantly, “do we keep our client data in-house on our own server, or outsource to a locally based storage provider?”

Effectively, as I discussed in my last paper, the developments being brought forward by the big players, like Microsoft, are going to make computing the New Utility. Until now, our IT provision has been the equivalent of having individual electricity generators in each building, and everyone owning private water tanks. In the future, we will pay for our computing in the same way we pay our utility bills, and cloud services will legitimately be able to claim their spot on the Monopoly board.

Yes there are incredible savings to be made by harnessing the pooled resources of the true cloud. But much of the cloud offering remains very hazy.

Advances in computing are never as definitive as people like to make out, and immature services invariably arrive on a wind of hype, mistruth and trouble. The cloud has all this in spades, yet every IT vendor is still clamouring to stick the word ‘cloud’ next to their product.

The Channel Islands aren’t immune to the noise. In fact they suffer worse than most. A surprising number of local ‘cloud’ services have sprung up to exploit the buzz. But let’s not beat around the bush here the wrong choice could seriously harm your business.

One of the worst aspects of excessive hype is that the real benefits of the cloud get lost
in the noise. A sensible look at the technology shows that the cloud has plenty to offer.

Essential Characteristics of the Cloud (Source: NIST.gov)

Paper: The Cloud cutting through the hype.

I have put together a paper around this subject, it is intended to stimulate debate about the sort of cloud services that should be being offered to local companies.