The Rise of Cloud Computing

An overview of the transformation to Cloud/SaaS computing model.

www.moderro.com
© 2008
h
en was the last time you used a fax machine? A film camera? A vinyl
record? Technologies evolve, they evolve constantly, and they evolve in
spurts and spirals, often throwing out the old for the benefit of the new. The
phenomenon is also referred to as disruptive innovation (Clayton M. Christensen,
1995). Just like in the case of payphones being replaced by mobile phones, faxes by
email, mainframes by personal computers, new disruptive technologies are often
not as fast and don’t offer as
many features at the start, but
they offer a key advantage over
the existing technology –
anything from cost, to size,
mobility, or convergence with
other technology.

Personal Computer technology

was a disruptive technology
back at the time of mainframes
and expensive workstations, but
with time it has gotten very
complex, burdened by layer after layer of software designed to deal with
compatibilities, threats, legacy, or bridging the gaps between various software
platforms.

Organizations today feel this burden by having to worry about installing and
maintaining applications, supporting myriads of potential end users problems,
managing servers, managing risks, while trying to keep up with the pace of
innovation in the market. IT departments often have multi-year backlogs on things
that matter most – providing business users with the tools they need to compete in
the market.

The trend that promises to break the vicious cycle and provide a computing
platform where the benefits are clear and quick to realize, without the exorbitant
expense of maintenance and deployment is Software-as-a-Service (SaaS) model,

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where the applications are hosted (maintained) by the application vendor
themselves, allowing businesses to deploy software quickly without any artificial
barriers, and leaving IT to provide value-added services to the businesses in
recommending, evaluating, and configuring the business platforms.

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The table below illustrates some of the benefits of web-centric computing in
comparison to a standard PC software architecture across the myriad of
considerations that come into play:

** PC Computer ** ** SaaS/Cloud Computer **

Manageability Managing a PC environment
requires several levels of
management and myriad of
complex systems. Operating
Systems have to be patched
and managed, data and
application rights have to be
managed, backups have to be
managed, data stores have to
be managed, licenses have to
be managed. This all adds up to
tremendous overhead and
opportunity for errors.
Productivity Client-server applications
promote individual contribution,
with individuals working on their
individual assignments.
Collaboration using a PC is
dependent on compatibility of
the application versions and a
common broker server (such as
Sharepoint) to facilitate such
collaboration. The collaboration
are limited in scope and
participation
Supporting Traditional Client-Server PC
Infrastructure infrastructure requires a heavy
back-office investment.
Servers, server OS’s, SQL
servers, Directory Servers,
Collaboration servers, File
Servers, Intranet Servers, etc
Rate of Innovation Client-server applications
require client-side updates. The
vendors have to go through a
rigorous testing and release
processes. The end-user
organizations have to go
through testing and release
processes of their own. The
average timeline between
releases for “shrink-wrap”
software is 2-3 years.
0 1 Only application-level
permissions have be managed in
the SaaS model with appropriate
hardware.
0 1 SaaS Computing stretches far
beyond individual work, and
enables real collaboration with
multiple people working or
having visibility to same set of
documents. This collaborative
nature of web applications opens
great opportunities for furthering
productivity.
0 1 SaaS don’t require internal
server infrastructure, the server
part is handled by the application
providers.
0 1 Web Applications don’t have the
constraints that non-SaaS
software titles face, they can and
are released often. The releases
are small and quick and bring the
innovations at a much faster
rate. The end-user organizations
also do not need to get involved
in testing and release processes,
saving valuable IT resources.

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Data Portability Using the same application
[data] on several different
computers involves non-trivial
synchronization. The
synchronization often leaves
much desired and is imprecise
Compatibility PC applications facilitate several
people collaborating on a
document by hoping that all the
reviewers have the same
version of the application or by
resorting to “lowest common
denominator” format that
everyone can understand at the
expense of producing bloated
files and loosing the advanced
capabilities of the program.
Flexibility PCs have long been a
battleground between flexibility
and control. While flexibility to
install any application they like
is great for the end user, it
creates a nightmare situation
for the IT department, who want
to tighten up on security,
licensing, and software
problems.
Repair and Recycling Repairing a PC because of failed
power supply or broken hard
disk drive is a frequent
occurrence. Repair costs range
from $150 to $1,200 at $150/hr
rate
PC disposal costs range from
$85 to $136. IT organizations
have to rely on 3rd parties to
destroy the data
Viruses and Spyware Viruses and spyware install
resident software on computers
in order to tap into user’s data
and proliferate. In order to
protect from viruses and
spyware, additional software
must be installed and updated
frequently
Data Loss Data Recovery costs range from
$400 to $2,000, plus shipping.
There are no guarantees
License Management License Management is a
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0 1 There’s no need for data
synchronization with web-based
applications – all data is
persistent and belongs to the
application, and can be accessed
from any device.
o 1 File compatibility problem does
not exist in Software-as-a-Service
environment as all the
participants are working with the
same version of the application
and data is stored in the
database rather than a file.
0 1 SaaS Computing retain the
benefits of flexibility allowing
most web applications to run
within confines of the browser
platform, while preventing any
local resident application from
being installed, thus maintaining
a great level of control.
0 1 Repair and Disposal costs are
much smaller in comparison.
There’s no data to recover. Web
Computers are disposable.
0 1 Viruses and Spyware of thing of
the past for SaaS Computing
model. Using Internet
Computers like Moderro XPack
with read-only operating
systems, no unauthorized
software can be installed.
0 1 There’s no data loss with SaaS as
all the data is stored by the
application provider who takes
care of data integrity
0 1 License management with Web
5
 serious issue for the IT Computer is a non-issue as the
department with the traditional licenses are managed by the
PC infrastructure – one that application vendors directly.
requires management protocols
and lots of tracking systems. IT
is also exposed to the license
terms breach if they allow end-
user application installs.
Data Back-ups PC’s require data backup. Data 0 1 No backups required. The data is
backup is NOT trivial! stored with the application and
Incremental backups are tricky data integrity is preserved by the
and backing up laptops is application provider.
intermittent.
Data Security Traditional PC’s in a client-server 0 1 The data is stored online and is
model save data locally. This not represented by a file that can
leads to the data being hacked, be compromised or stolen.
files stolen. Alternative
solutions such as Citrix ICA help
protect the data, but require
costly infrastructure investment.
Document Versioning Versioning documents is 0 1 Versioning is automatic with
typically done by keeping copies most document authoring
around ad-hoc. Doing this solutions. Document sharing is
bodes badly for backups and is simple, with the recipient always
imprecise at best. Distributed looking at the latest version of
(shared) documents are not the document.
kept-up-to-date.

It’s easy to see from this data that SaaS/Cloudcomputing has a great future in the
business world. Businesses are able to decrease their IT costs while gaining
productivity and competitive advantages.

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SaaS Applications Profiles
Office Suite
Office applications is one category that almost no business can live without. Email,
Calendaring, Document Authoring, Spreadsheets, and Presentations have become
the quintessential productivity tools in today’s office. Luckily, web versions of
these applications have matured to the point of sophistication and feature richness
that meets or exceeds their desktop counterparts.

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Strong Players:
Zoho, Google

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Business Applications
Customer Relationships Management (CRM) systems, ERP, Billing, Databases,
Business Process Management(BPM), and Situational Software (software designed
by non-programmers) – are the types of business applications available as web-
based applications-on-demand.

Strong Players:
Salesforce.com, LongJump, Coghead

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Project Management and Collaboration
Project Management and Collaboration are particularly strong among SaaS
offerings. With choices ranging from simplest to very sophisticated, any
organization is likely to find a solution that fits its needs.

Strong Players: 37 Signals, Central Desktop, Liquid Planner, Jive, Zoho, Clarizen

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Cloud Computer (End Point)

Efficiencies gained by replacing traditional client-server (thick client) model with the
cloud computing one also open up an opportunity to significantly trim down the
complexity on the client.

Moderro XPack Internet Computer is designed specifically for running web

applicationsin the most efficient manner. Solid state, space saving design together
with an operating system built for and around web applications, and a
capable internet management back-end set this product squarely in the center of
web-computing experience.

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