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Cloud Enablement & Operations

5 Cloud Predictions for 2014

By John Dixon, LogicsOne

Here are my 5 Cloud Predictions for 2014. As always, leave a comment below and let me know what you think!

1. IaaS prices will drop by at least 20%

Amazon has continued to reduce its pricing since it first launched its cloud services back in 2006. In February of last year, Amazon dropped its price for the 25th time. By April prices dropped for the 30th time and by the summer it was up to 37 times. Furthermore, there was a 37% drop in hourly costs for dedicated on-demand instances. Microsoft announced that they will follow AWS’s lead with regard to price cuts. I expect this trend to continue in 2014 and likely 2015. I highlight some of these price changes and the impact it will have on the market as more organizations embrace the public cloud in more detail in my eBook.

2. We’ll see signs of the shift to PaaS

Amazon is already starting to look more like a PaaS provider than an IaaS provider. Just consider pre-packaged, pre-engineered features like Auto Scaling, CloudWatch, SQS, RDS among other services. An application hosted with AWS that uses all of these features looks more like an AWS application and less like a cloud application. Using proprietary features is very convenient, but don’t forget how application portability is impacted. I expect continued innovation in the PaaS market with new providers and technology, while downward price pressures in the IaaS market remain high. Could AWS (focusing on PaaS innovation) one day source its underlying infrastructure to a pure IaaS provider? This is my prediction for the long term — large telecoms like AT&T, Verizon, BT, et al. will eventually own the IaaS market, Amazon, Google, Microsoft will focus on PaaS innovation, and use infrastructure provided by those telecoms. This of course leaves room for startup, niche PaaS providers to build something innovative and leverage quality infrastructure delivered from the telecoms. This is already happening with smaller PaaS providers. Look for signs of this continuing in 2014.

3. “The cloud” will not be regulated

Recently, there have been rumblings of regulating “the cloud” especially in Europe, and that European clouds are safer than American clouds. If we stick with the concept that cloud computing is just another way of running IT (I call it the supply chain for IT service delivery), then the same old data classification and security rules apply. Only now, if you use cloud computing concepts, the need to classify and secure your data appropriately becomes more important. An attempt to regulate cloud computing would certainly have far reaching economic impacts. This is one to watch, but I don’t expect any legislative action to happen here in 2014.

4. More organizations will look to cloud as enabling DevOps

It’s relatively easy for developers to head out to the cloud, procure needed infrastructure, and get to work quickly. When developers behave like this, they not only write code and test new products, but they become the administrators of the platforms they own (all the way from underlying code to patching the OS) — development and operations come together. This becomes a bit stickier as things move to production, but the same concept can work (see prediction #5).

5. More organizations will be increasingly interested in governance as they build a DevOps culture

As developers can quickly bypass traditional procurement processes and controls, new governance concepts will be needed. Notice how I wrote “concepts” and not “controls.” Part of the new role of the IT department is to stay a step ahead of these movements, and offer developers new ways to govern their own platforms. For example, a real time chart showing used vs. budgeted resources will influence a department’s behavior much more effectively than a cold process that ends with “You’re over budget, you need to get approval from an SVP (expected wait time: 2-8 weeks).”

DevOps CIO Dashboard

 Service Owner Dashboard

The numbers pictured are fictitious. With the concept of Service Owners, the owner of collaboration services can get a view of the applications and systems that provide the service. The owner can then see how VoIP spending is a little above the others, and drill down to see where resources are being spent (on people, processes, or technology). Different ITBM applications display these charts differently, but the premise is the same – real time visibility into spend. With cloud usage in general gaining steam, it is now possible to adjust the resources allocated to these services. With this type of information available to developers, it is possible to take proactive steps to avoid compromising the budget allocated to a particular application or service. On the same token, opportunities to make informed investments in certain areas will become exposed with this information.

So there you have it, my 2014 cloud predictions. What other predictions do you have?

To hear more from John, download his eBook “The Evolution of Your Corporate IT Department” or his Whitepaper “Cloud Management, Now