Channel's Head Stuck in The Cloud

On its face, cloud computing seems like one of those can't-miss opportunities for the channel. Despite the growing opportunity for profit, channel partners should recognize the misgivings some customers have.

On its face, cloud computing seems like one of those can't-miss opportunities for the channel. The notion that a business or consumer will benefit by simply using a Web browser to easily access important documents, emails and other applications from anywhere at any time "through the cloud" rather than a laptop seems like a no-brainer. Indeed, plenty of VARs and other channel partners are eagerly embracing this latest trend, citing its unparalleled convenience as well as its ability to make businesses more efficient.

They've got lots of partners with which to align. Salesforce.com's platform, Force.com, offers an integrated development environment, as well an exchange for third-party applications. Salesforce believes its model heralds the end of packaged software apps; it stores all the customer data and handles updates online. Amazon's S3 cloud operation is one of its fastest growing businesses. Google offers its own collection of cloud-based storage and app services. Sun, IBM and EMC, all big channel players, are heavily into the cloud business. Yahoo, in its latest reorganization, suggests it will form a "cloud computing" unit; it already hosts consumer email and other services online. Even Microsoft, the granddaddy of expensive packaged software, has skin in the game.

All well and good, but maybe the channel shouldn't rush to put all its eggs in the cloud basket. Cloud computing seems like a cool notion, but it isn't inevitable. First there is that classic IT bugaboo, the control issue. As a consumer, do you really want to place all your applications in the Internet cloud, or would you prefer to maybe own them on your desktop and access them in places (like an airplane, a hotel room or your outside patio) when Internet access can be a little dicey?

If you are operating a business, the dilemma is greater. CEOs are rightfully uneasy about having all that important corporate data had out of the building and sit in the Internet cloud where unscrupulous competitors and hackers lurk. Do you really trust those third parties to secure all that data? Of course, the cloud supporters argue that's a better alternative than scattering the data among hundreds or thousands of laptops, desktop and smart devices that are easily stolen.

There is also the question of reliability. Will the cloud support the bandwidth needed to transfer all those large corporate files on a regular basis? Will outages bring down the cloud, and what happens then? (Amazon, Google and Microsoft have given consumers a taste of this with intermittent, unexplained mail outages. Just imagine if all your apps and data were sitting in that email account you couldn't access.)

Another impediment for the enterprise is losing the strategic ability to analyze the information you are collecting on both customers and suppliers, which limits the ability to suggest improvements in business processes on either end.

Finally, there's the issue of which vendors are in this new market for the long haul.  As competition in the cloud continues to grow, will some players drop out, especially if the service become a commodity and prices drop?

Cloud computing certainly presents a real profit-making opportunity for the channel. But it's also important to keep your customer in mind and appreciate the issues this new trend presents. A little less hype might benefit everyone over the long haul.

(Al Senia is managing editor of ITChannelPlanet.com.)

TAGS: Google,services,Microsoft,IBM,Salesforce.com

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