What Is Cloud Computing?
No universally accepted definition exists for cloud computing -- yet. Wikipedia offers this vague description: "Cloud computing is Internet-based computing, whereby shared resources, software and information are provided to computers and other devices on demand, like the electricity grid."
The results of BS&T's survey confirm the confusion over the definition of cloud computing: 13 percent of respondents said cloud computing is "using specific applications, like CRM or ERP, over the Internet," 8 percent said it is "using a provider's raw CPU time and storage resources to run apps we buy/develop on our own," 6 percent identified it as "using a provider's development system to create apps running on a hosted platform" and 9 percent said it's "a marketing term used haphazardly." Meanwhile, the majority of survey participants (62 percent) said it was all of the above.
"It definitely is a marketing term," ING's Boehme concurs. But, he notes, he sees a strong distinction between cloud computing and simple hosted software (generally referred to as "software as a service"). To truly be cloud, in Boehme's view, a software architecture needs to be multitenant -- in other words, an environment in which a single instance of software on a server serves multiple clients (tenants) rather than the one-to-one relationship of a software instance to a client commonly found with SaaS arrangements. "If it's multitenant and running in a virtualized environment -- servers, storage, the network and all -- it's cloud," Boehme says.
According to Andrew Greenway, global cloud computing program lead at Accenture, "Cloud is a style of computing based on the Internet that allows customers to pay for exactly the resources and infrastructure they use." Its characteristics, he says, include lack of an up-front capital requirement, shared service delivery over the Internet and pay for use.
Although the technologies underpinning cloud computing are not brand-new, two recent developments have made it more viable, according to Greenway. One is the introduction of many cloud offerings that truly let users "pay by the drink," whereas in the past, that often has not been the case, he says. The other is the trend of technology giants such as Amazon, Google and Microsoft making huge investments in cloud infrastructure that they extend to other companies.
There are three basic flavors of clouds in use at banks -- internal clouds, external clouds and hybrids. Nineteen percent of the participants in the BS&T/InformationWeek Analytics survey said they are developing or using an internal, or private, cloud network.
"An internal cloud means you've virtualized your storage, your operating environment, your servers, your network, everything -- and the whole environment is self-provisioning and self-adjusting to people's resource needs," ING's Boehme explains. Internal clouds are also multitenant, with many people, divisions or functions accessing the same resources almost simultaneously. "You really are talking about the ultimate in virtualization," Boehme says.
But Laurent Lachal, senior analyst at Ovum, argues that virtualization is not the point of a private cloud, although it is a prerequisite. "It's looking at the way IT delivers its services in a new way, moving from the traditional project management and procurement processes to something more dynamic, whereby users have access to a self-service portal they can use to select resources and then give them back to the pool when they're done," he contends. "Virtualization is relevant because it's part of the effort to allow users to use resources dynamically."