How the Cloud is not "what we already do", and why Larry Ellison is wrong

Larry Ellison has stated that Cloud Computing is "everything that we already do", and In many ways, I totally agree.  The big difference is that Cloud-based technologies let us do everything much faster, smarter, and often at a greatly reduced cost.

Cloud Computing encompasses a lot of areas (and we go into more detail below), but whether you're talking about Google Apps or AWS, "the Cloud" brings some very disruptive changes. Here's the broad strokes:


How the Cloud is disruptive

What's new

Cloud Examples

Old School Examples

Why it's important


Just the same as using an ATM or kiosk at the airport, individuals can now go directly into their services (whether that service is Google Apps or a RightScale-like Cloud Server farm dashboard), and do everything they need with the push of a few buttons.

User had to buy a copy of MS Office and install it on their machine... every 2-3 years. IT folks would have to purchase a server, put it in their racks, and spend at least 2-3 days setting it up before they could use it.

Users no longer have to wait in line to get their job done.

Auto Updates

When Google Apps releases a new feature or AWS adds a new API Hook, I see it next time I log in.

Microsoft releasing OS distros or Office versions every 2-3 years. Some legacy applications that the Government and Banks use are 10-20 years old.

Users get useful features & security patches right away.

Sharing and Collaboration

I can be in Tokyo, working with someone in San Francisco, in exactly the same Google Apps Spreadsheet at the exactly the same time.

I would make my Excel edits, mail those to San Francisco. 10-15 minutes later, I'd get SF edits back and possibly have to repeat the cycle.

Working faster, smarter in real-time.

Codebase Centralization 

Zoho manages all of their useful apps on one server. GoGrid only has one codebase they need to maintain for their Cloud Server UIs.

An office with 100 people had 100 different copies of MS Office, keeping at least 2-3 IT staff busy with patches, upgrades and problem resolution.

SaaS provider saves money on maintaining codebase, App consumers no longer need internal support staff.

Auto provisioning of resources

Salesforce sets up your instance only when you become a customer. EC2 auto-scales another server only when you need it.

Business and IT management would have to coordinate, usually months in advance,  to get software & hardware configured and set up

On-demand resources result in faster moving companies, and Apps that can absorb infinite load. 
Utility-based (and often free) pricing A Rackspace Cloud Server can be had for 1.5¢ per hour. If you only use it for an hour, that's all you need to pay. Think of it like your electric bill. IT Management would plan for maximum usage, then purchase, configure, and maintain all the hardware & software to allow for that usage. Whether usage was 5% or 95%, the bill was the same. Why pay your maximum electric bill every month, even if you're on vacation and the lights are off? Companies and Divisions only pay for what they need, and they can innovate quicker since they're not locked in to long term infrastructure costs.


As you can see, Cloud-based services provide many advantages over "everything that we already do". Questions still remain over security, ownership, and migration costs, but "the Cloud" is an extremely disruptive force that is going to change everything we do.

To get perspective on the future, it often helps to look into the past. In his book, "The Big Switch", Nick Carr reminds us that it was only 100 years ago that companies stopped generating their own power and "plugged into" the newly available Electric Grid. That infrastructure change that we all now take for granted spun off decades of innovation the likes of which the world has never seen before.

We're on the verge of another very revolutionary change in infrastructure. Are you ready for it?


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Wow! Its like you understand

Wow! Its like you understand my mind! You seem to know so much about this, like you wrote the book in it or something. I think that you can do with some images to drive the content home a bit, besides that, this is helpful blog. A outstanding read. Ill definitely be back.

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