Large business shys away from cloud computing

A new study from consulting firm McKinsey has shown that introducing cloud computing initiatives doesn't make sense for larger companies.

The "Clearing the air on cloud computing" report finds that moving to a cloud computing model for a large company would double the costs of IT operations.

"Clouds already make sense for many small and medium-size businesses, but technical, operational and financial hurdles will need to be overcome before clouds will be used extensively by large public and private enterprises," the report states.

"Rather than create unrealisable expectations for ‘internal clouds', CIOs should focus now on the immediate benefits of virtualising server storage, network operations, and other critical building blocks."

The company uses Amazon.com's operation as an example, estimating the total cost of its data centre functions would be $US366 a month in the cloud compared to $US150 a month for a normal in-house data centre.

The report suggests companies looking to save money on IT operations should look to desktop virtualisation.

• Cloud lessons learned
• Adobe offers CS6 through Creative Cloud subscription
• Do cloud prices always come down?
• Google’s Dropbox competitor to launch next week
• Dell to takeover cloud client maker Wyse

...
written by David M. Markus, April 20, 2009

This article has a lot of information packed into it but does not quite make it clear what costs are and are not included. It only seems to look at the cost of a direct exchange from local solution to cloud based on a virtual server style solution. There are many ways to use cloud technology that this does not address.

If you are contemplating using cloud based solutions in your SME environment you need to get professional advice to ensure you have the right mix of solutions. Some technology needs to be in your hands, some on the desk, some in your server room and some in the cloud. The people at www.combo.com.au can help you to know which ones belong where.