The cloud is no longer a pie-in-the-sky idea

Posted by Ron Miller on Jan 18, 2016 11:48:22 AM

cloud computingThere was a time when the cloud was a fairly radical idea. You were asking IT to give up control of its hardware resources and software and hand it off to a third party to manage. In the 2008-2010 timeframe, only early adopters were willing to go that route. Today as the cloud has matured, it's a mainstream idea.

Consider that Salesforce, the grandfather of cloud computing, has been around since 1997. That's 17 years, folks, and it has more than 16,000 employees. Last November, the company announced its third quarter fiscal 2016 numbers, and they were impressive by any measure.

They earned $1.71 billion in revenue for the quarter, up 24 percent year over year. The total for fiscal 2015 was $5.37 billion, up 32 percent year over year. The projection for 2016 revenue is now between $6.64 billion to $6.65 billion. Consider that a cloud software company is now close to a $7 billion a year operation. (We'll learn the actual results next month.)

Meanwhile, the  Salesforce AppExchange turned 10 last week, and you could credit that concept with helping drive the growth we're seeing now. That's because Salesforce decided to make a platform play, something just about every cloud software company out there wants to mimic now. By providing access to Salesforce's platform as a service, it created new companies, let others fill in missing pieces on the platform, and simply grew the brand. The numbers show it's been a tremendously successful strategy.

AWS also turns 10 this year

Salesforce is just one high profile example, though. Consider that the premiere Infrastructure-as-a-Service  vendor, Amazon Web Services, also turns 10 this year. Amazon came up with a novel idea 10 years ago. It was running enormous data centers to fuel its online retail business. It decided it could rent out some of its excess capacity to others as a small side business.

That side business has turned into a rapidly growing $7 billion cloud juggernaut that is becoming increasingly difficult for competitors to catch (even though there are certainly a litany of worthy competitors, including Microsoft, Google, IBM, and others, out there trying).

Ten years ago, there weren't many CIOs or IT leaders who were willing to rent out servers in another company's data center, but today  it's a mainstream concept with large organizations like Netflix, Juniper Networks, and Symantec fully committed to using AWS.

GE has previously said it plans to close 90 percent of its data centers worldwide, also fully committing to almost a total cloud approach to computing (although not necessarily with any single vendor).

All of this goes to show how far the cloud has come. What once was considered an extreme edge case for computing is now firmly embedded in the mainstream with vendors showing cloud companies can be huge endeavors and large customers fully committed to the idea.

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Photo Credit: (c) Can Stock Photo

Topics: Cloud Trends

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