The economics of cloud computing are driving down the cost structure of business so far and so fast that it’s scary, Google CIO Ben Fried says. He says, CIOs are finally beginning to use cloud computing as a strategic tool. The ability to rent computing and storage capacity as needs arise, as well as applications that can be used to manage sales accounts, deploy field technicians, or just about any other function, gives CIOs the ability to help their organizations seize new market opportunities without making huge up-front investments. The systems are intended to lower costs while putting the company in the position to move quickly when the opportunity presents itself.
Cloud based applications have become extremely popular. Workers frequently using free and simple tools such as Google Apps, Skype, Flickr and iTunes for their personal affairs, now wanted to use those cloud-based software tools at work. And CIOs and other technology executives were beginning to let them experiment themselves with those services.
Cloud-based applications that utilize cloud computing technology don’t offer every feature and can’t be customized as much as software installed on corporate-owned servers. But as Google CIO Ben Fried said at a Bloomberg technology conference Thursday, “as a CIO, you have to figure out what is really important to you.” Cloud-based computing is fast approaching a tipping point that will make it the standard for IT. The macroeconomic tides will force companies to adapt it soon.
Google will offer free ad-supported services to millions of people because it cut down the coat of its own business. Google has now built its own data centers, locating them to take advantage of the lowest-cost source of power. You don’t go the cloud just because you can, you right source it and must manage it accordingly and then you can spend your budget with the greatest gain.
The cloud is measuring what their core business is, and where they want to invest their capital. “We don’t offer a special version of gmail for financial services firms”, Fried said. You have to figure out what is really important to you and give up that control with consumer technologies. Cloud computing has been mostly about the distribution of applications and the later will enable sharing of the environment to run those applications.