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The Cloud in 2013 … and beyond

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Next year we will see the first major Cloud failure, says JJ MILNER of Global Micro, as he shares the major trends that he forecasts in the Cloud market in 2013 and beyond.

As we come to the end of 2012 and reflect on the year, there are numerous lessons to be learned. Cloud has proven itself worthy and although many businesses are still slow to transition, there is no doubt that as legacy SLA’s (Service Level Agreements) are upgraded, more businesses will venture into the cloud in order to reap the benefits that comes with it. There is also a level of maturity from the cloud that some companies were waiting for before they made the transition.

2013 will see the introduction of more cloud based services and as we see an increase in the uptake, we will also start seeing the first of the major cloud failures. It is a very competitive market out there, as virtually anyone with an Internet connected PC can run a cloud-reseller business. This makes the market very price conscious as companies are pushed to deliver more for less.

Although we have seen some outages from the likes of Amazon and Go Daddy, these failures were merely seen as embarrassing. As we venture further into the cloud and become more dependent on storing data and running services directly from the Internet, the impact of an outage could affect millions more, becoming a much larger problem than a similar outage would have been in the last two years. Let us also not forget the additional strain on data centres with the advent of a user base that grows exponentially.

The first major outage will take some of the shine off the notion that the cloud solves all of your IT problems, but it will give prominence to the SLA in the channel and show its practicality in the cloud. Furthermore, the Enterprise is going to notice the value chain involved in consuming a cloud service. So rather than consuming a cloud service from a number of entities, it will become critical for companies to have a single-point-of-failure support and service agreement.

Another perception that will certainly change in 2013 is the assumption that every cloud service has to be cheaper than an on-premise solution. While there are numerous unique cloud offerings currently available in the cloud, they still pretty much do the same thing. The detail in these offerings will start to matter and customers will realise that it is worth paying a small premium to have a tailored solution that fits service level requirements better. The lesson to be learned here: Manage your supply chain more closely. Tying your network and connectivity to the cloud is going to be one of the most important aspects of ensuring constant access and 100% uptime.

We will also start to see a wider acceptance of electronic contracting in 2013. The globalisation of services within the cloud means that the practicality of sending original documents is going to show its limitations. In the past, customers simply signed a contract by clicking through the software agreements to sign up with a cloud service. Although this is fine for consumers and small businesses, enterprise customers have more stringent requirements around contract agreements such as biometric verification or multi-factor authentication by the parties entering into the contract. Electronic contracting will need to be managed efficiently by mid-market enterprise customers if they wish to keep up with the transition of business to the cloud.

The final big trend I foresee for 2013 is data sovereignty and confidentiality of data, as well as the protection of intellectual property. There are millions of people that store their data on the cloud. Most the time it is unencrypted or if it is encrypted the decryption keys are held by the service provider itself. I expect we will see more service providers being tested in court when access to information stored on their servers is subpoenaed. Whether it is one party suing another or a law enforcement agency running an investigation, the service provider will always be caught in the middle.

According to the Google Transparency Report, www.google.com/transparencyreport, Google regularly receives requests from government agencies and courts around the world to hand over user data. From January to June this year the number of requests reached 20,938. I recommend that you always keep your own encryption keys so as to ensure you know who has access to your data at any time.

Looking beyond 2013, cloud integration is a problem that many people do not realise has to be solved. If you use cloud services from multiple providers, how do you make sure that those services can talk to each other, given that they come from various service providers using different networks or standards? Over the next few years I see the rise of a cloud integration platform, which securely links one API to another. This will help bridge the digital divide, but the first uptake has to happen at the development layer. This capability will give us the ability to hook into as many cloud services as possible without having to build links to a variety of services. We will also see more meaningful data recovery functionality from the cloud and feature rich capabilities, rather than merely hosting your data offsite like most people currently do.

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In summary, JJ Milner wraps up key trends in the Cloud as follows:

· As we witness an increase in the uptake of more cloud based services, the market is certain to see some major cloud failures. Prominence will be given to the Service Level Agreement (SLA) in the channel and show its practicality in relation to the cloud. It will be critical for companies to have a single-point-of- support and SLA for their cloud service provision.

· The perception that will certainly change in 2013 is the assumption that every cloud service has to be cheaper than an on-premise solution РCustomers will realise that it is worth paying a small premium to have a tailored solution that fits service level requirements better.

· Supply chains will need to be managed more closely РTying the network and connectivity to the cloud is going to be one of the most important aspects of ensuring constant access and 100% uptime.

· We will see a wider acceptance of electronic contracting in 2013 РElectronic contracting will need to be managed efficiently by mid-market enterprise customers if they wish to keep up with the transition of business to the cloud.

· Data sovereignty and confidentiality of data, as well as the protection of intellectual property. Global Micro recommends that you always keep your own encryption keys so as to ensure you know who has access to your data at any time.

· Over the next few years, we will see the rise of a cloud integration platform, which securely links one API to another.

· We will also see more meaningful data recovery functionality from the cloud and feature rich capabilities beyond just the hosting of data offsite.

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