Friday, June 5, 2009

How Cloud Computing Will Change Business

How Cloud Computing Will Change Business

IBM, Qualcomm, Nokia, and other majors, along with startups, are preparing to cash in on new technology. Not that it will be easy

(Source Business Week)
In 1990, in a keynote speech at the Comdex computer conference, Microsoft's (MSFT) then-chief executive, Bill Gates, bolstered his bona fides as a tech visionary when he declared the PC industry would produce advances within a few years that would put information at people's fingertips. To get there, Gates said, the world needed three things: a more "personal" personal computer, more powerful communications networks, and easy access to a broad range of information. Sometimes visionaries are right on the vision but off on the timing.

Only now is Gates' grand vision finally becoming a reality for businesses. While pieces of what he had in mind have been available for years, they typically were expensive and difficult to set up and use. Now that more personal PC is here in the form of smartphones and mini-laptops, and broadband wireless networks make it possible for people to be connected almost anytime and anywhere. At the same time, we're seeing the rise of cloud computing, the vast array of interconnected machines managing the data and software that used to run on PCs. This combination of mobile and cloud technologies is shaping up to be one of most significant advances in the computing universe in decades. "The big vision: We're finally getting there," says Donagh Herlihy, chief information officer of Avon Products (AVP). "Today, wherever you are, you can connect to all the information you need."

Avon is embarking on a massive, multiyear overhaul of the way it manages its nearly 6 million sales representatives around the world. In the past, "sales leaders," who help manage reps but are not employees of the company, mainly checked in with the salespeople through face-to-face meetings and phone conversations. But next month, Avon will begin to equip 150,000 sales leaders with a cloud-based computing system accessible via smartphones and PCs. The technology will keep them much more up-to-date on the sales of each rep, and it will alert them when reps haven't placed orders recently or when they have payments overdue to the company. The idea is to increase the sales and efficiency of Avon's distribution system.

Avon's strategy shows how the relationship between individuals and their computers is undergoing a radical change. Up till now, people have used a variety of computing devices in their professional lives, including desktops, laptops, handhelds, and smartphones. Each device was essentially an island of capabilities—applications, communications, and content. Cloud computing means that information is not stranded on individual machines; it is combined into one digital "cloud" available at the touch of a finger from many different devices. "We're shifting to more of a people- and information-centric world," says Paul Maritz, CEO of software maker VMware (VMW).

For the $3.4 trillion global tech industry, this shift offers a path out of the economic doldrums. In fact, it may be the largest growth opportunity since the Internet boom. While market researcher Gartner (IT) expects the global tech market to shrink by 3.8% this year, forecasters have high hopes for portables, wireless networks, and cloud computing over the next few years. Gartner predicts the market for cloud products and services will vault from $46.4 billion last year to $150.1 billion in 2013.
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