Does Cloud computing scares you?

Does it matter that there is a difference between cloud computing and hosted applications? Should it matter?

• Marketing people use cloud computing, cloud, and hosted apps (not the term, the concept or else this question would not exist) interchangeably. It destroys the value of cloud computing to infer that it can only do hosted apps (I won't even start on the concept of private cloud - that will be another question) The most blatant example I can think of right now is 's campaign "to the cloud".  Of course, if you are in you can come up with 2 dozen examples without thinking -- marketing is that heavy. Does it matter to enterprise applications buyers, architects, and / or CIO/CTOs? Should it matter? Should the real-life distinction be moved to Marketing? (BTW, if you need to review the classic definition of what cloud computing is, Wikipedia is probably best - http://en.wikipedia.org/wiki/Cloud_computing) Thoughts?

• Answer:

  Philosopher Ken Wilber has this concept of "useful distinctions". This means two things. The first is that distinctions that are not useful are a waste of time. The second is that utility depends on the person using the distinctions. In general, "cloud computing" tend to have connotations related to elastic computing (that is, computing resources that can be scaled up or down on demand) whereas hosted applications means ownership, management, and control of software tend to be outsourced to a third party. Hosted applications today are generally, but not always, built on top of an elastic computing infrastructure. These are great terms to introduce people to the concept that computing environments we have now are no longer tied 1-to-1 to a physical object. However, these terms are not precise enough for the decision makers and the technical people. The terms, IaaS (infrastructure as a service), PaaS (platform as a service), and SaaS (software as a service) are more precise and gives the decision-maker a better idea on how much control and management is traded-off for flexibility. Amazon AWS and Rackspace Cloud Servers are examples of IaaS. Heroku, Google App Engine, RightScale and OpsCode Platform are examples of PaaS. http://Salesforce.com, 37Signals product line, Pivotal Tracker, and Google Apps for Business are examples of SaaS. For example, a company might consider deploying their proprietary technology on a IaaS if the combination of their technology and the elastic resources gives them a significant advantage over their competitors. Some of these advantages include iterating faster and staying ahead of the competition, or being able to quickly establish a presence in a new market without risking a larger investment in equipment. Many web and mobile startups today take advantage of IaaS and some PaaS in order to get their products out to the market faster rather than waiting the weeks it takes to provision physical computing hardware. On the other hand, SaaS is more appropriate if there are no unique competitive advantage at stake. AMD uses Salesforce for their CRM, but a high-end, boutique, custom-tailored clothier might not. Ultimately, the distinction between "cloud computing" and "hosted applications" matters only within the context of a clear strategy. If you already know the kind of advantages you want to acquire, then the distinctions among IaaS, PaaS, and SaaS matters a great deal. Otherwise, using fuzzier terms like "cloud computing" and "hosted applications" are good enough. Given the marketing climate for cloud computing, knowing and using more precise terms may well become a competitive advantage in its own right. End Notes: (1) 48% of IT workers don't know what "cloud computing" means - http://www.informationweek.com/news/smb/services/showArticle.jhtml?articleID=229000142