5 Things that Changed Cloud in 2011

Carol Wilson
Carol Wilson, Editor-at-large

8:25 PM -- "Cloud" has gone from hot to hype to happening in the space of two years. So the trends in the cloud arena are much more practical and much less theoretical (i.e., sexy). But they still exist.

Here are some notable shifts for cloud in 2011 that will continue to play out during the next year.

"Commodity" is no longer a dirty word. Telecom service providers launched their assault against cloud pioneers, such as Amazon Web Services Inc. and Rackspace , by touting everything they added to cloud, implying that enterprises wouldn't dare trust their applications and data to cloud services that lacked the five-nines of telecom offers. But commodity clouds continue to thrive, despite AWS outages, and telecom providers are looking to offer their own commodity cloud services -- expect more of those in 2012.

Cloud becomes part of the portfolio. Managed services existed before cloud was identified as a concept, and they aren't going away. Will cloud-based services become part of the managed service portfolio or vice-versa? Who cares? Service providers will have to be able to offer a full range of managed, hosted and on-demand cloud services that meet the needs of different businesses, different applications within the same business and different types of data within the same application. Oh, and they'll have to keep all that simple.

Network services will also be "on-demand." Telecom service providers are beefing up the bandwidth they deliver to and between data centers, in anticipation of cloud services expansion. But that bandwidth will have to be delivered more dynamically to match the on-demand nature of cloud services. That kind of thinking works against the notion that cloud becomes a driver of bandwidth that is purchased in the traditional way -- high volume at lower cost on long-term contracts -- and also could create interesting debates around SLAs. All of that will lead to the major challenge for 2012, which is:

Cloud services will put major new demands on back-office systems. OSS transformation has been largely driven in the past by the need for job cuts and cost reduction, but delivering more flexible, on-demand services at high levels of reliability will put new pressures on how service providers manage their networks and back-office systems, right up through to billing and customer service. The need for end-to-end delivery is one reason we're seeing major vendors, such as Alcatel-Lucent (NYSE: ALU) and Cisco Systems Inc. (Nasdaq: CSCO), offer cloud solutions that address many of the network service delivery and integration issues -- provided, of course, that service providers are willing to place their eggs in one vendor basket. The need for multi-vendor approaches is likely to lead to:

The development of standards around cloud. Early discussion of standards has centered on end-user needs, such as the enterprise wish not to be locked into a cloud provider, but there is also growing interest on the service provider end to begin to commoditize pieces of the cloud puzzle. That means standards development. We'll see a lot of talk about standards in 2012, but results may take longer.

— Carol Wilson, Chief Editor, Events, Light Reading

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