In May, Merrill Lynch predicted that the cloud computing market could reach US$160 billion by 2011. By any measure, in any industry, that’s a huge number — it’s astronomical for one that can only be described as “nascent.”
To be sure, the potential for cloud computing is immense. Still, Merrill Lynch may have jumped the gun with its attempt to size the market. Among those expressing doubts about the firm’s projection is Martin Schneider, product marketing manager for SugarCRM.
“$100 billion could be too low — or way too high,” he told CRM Buyer. “We just don’t know enough about the industry yet. It is premature to put numbers on it.”
Where’s the Math?
Many of the new players latching onto the buzzword are delivering little of substance, Schneider said, noting, “We saw the same thing unfold with the SaaS market a few years ago when it became very popular.”
More information about the concept’s downside — “you always have to give up something when you go outside of the firewall” — will be essential, as more companies consider it for their computing needs, he suggested.
That said, Schneider counts himself among the fans of the concept. “Especially given the economy right now — people realize the potential this can deliver.”
Sugar began offering cloud functionality with the release of its Data Center Edition, he said. “With DCE, users can create their own clouds.”
Merrill put together a chart that “makes very little business sense to me in terms of a competitive market analysis,” Schneider wrote in his blog post. “The Cloud Computing, for lack of a better term, market is still very nascent, and I don’t think anyone has a true grasp on what it really means to be a player in this space. And by simply adding up revenues of existing players who have had their CEO rant about ‘the Cloud’ does not make up a market segment.”
Cloud Takes a Bruising
Indeed, the events of the last few days illustrate, if nothing else, the merry-go-round of providers entering the space. In a brief announcement that has gotten a lot of play in the blogosphere and IT media, VMware’s board of directors announced President and CEO Diane Greene would be departing and that Paul Maritz would take her place, effective immediately.
Speculation about what this means for VMware’s cloud initiative is running rampant. In
“Maritz’s appointment as Greene’s successor is a bigger surprise,” wrote Wade Roush. “The 14-year Microsoft veteran founded Pi Corporation in 2003 and briefly led EMC’s cloud computing efforts. … In his role as president and general manager of the Cloud Infrastructure and Services Division, Maritz was expected to bring focus to EMC’s cloud-based offerings, which so far consist mainly of the Mozy online backup system for home and business PCs.
“It’s not clear whether Maritz’s assignment to lead VMware leaves the cloud division leaderless, or signals that some kind of closer integration of VMware into EMC’s cloud effort is in the offing,” Roush continued. “There’s some rationale for integration, since virtualization is one of the main enabling technologies behind cloud computing — the trend toward making remote computing resources available on demand, in the manner of electrical utilities. Greene had long resisted any integration between EMC and VMware’s products and business functions — in part because many VMware customers and partners, such as IBM, are direct EMC competitors.”
The market doesn’t pay enough attention to the downside of cloud computing, Schneider pointed out.
There are security issues, for example, and then there’s the matter of down time.
“Google Docs was down for approximately 45 minutes today,” wrote Nino Tasca, director of Internet Technology & Strategy for Radio Free Europe/Radio Liberty (RFE/RL) in a blog post.
“This doesn’t just hurt Google’s reputation, but puts a ding in the entire Cloud industry. It gives all of the naysayers out there ammunition when citing reasons why cloud computing won’t work in their environment,” wrote Tasca.
Down time is simply not acceptable, he insisted, no matter how stable overall the offering is. “The uptime needs to approach Six Sigma levels — which would be 3.4 down units per million — or just under two minutes per year. I know that sounds unreasonable to some — but the industry will never hit the mainstream until it can reach these type of numbers.”
Tasca’s advice to the industry: Hire some black belts from GE and Motorola.
Tips for Successful Mobile CRM
After years of false positives, there’s a growing consensus that mobile CRM is indeed upon us.
Many are back-to-basics considerations, but such a review is necessary, given the number of stops and starts this CRM niche has experienced. Take, for example, Wettre’s Tip No. 4:
“It is crucial to ensure that the system is easy to navigate in order to encourage a high adoption rate by staff. … Measure the ‘start-to-finish’ times of key tasks such as looking up a contact’s phone number, retrieving a list of today’s scheduled calls or entering a new contact.”