By Colin Barker, 11 December 2008 08:36
NEWS
Top HP software executives said on Tuesday that they believe in the ideas behind cloud computing but don't like the name of the approach or the "hype" surrounding it.
Talking at the HP Software Universe show and conference in Vienna, Tom Hogan, senior vice president for software at HP, said the company had taken time to weigh up the promise of cloud computing, which provides web-based access to remote enterprise applications and storage.
Hogan said: "Rather than jump in to the hype [around cloud computing] out of the gate - you can't pick up a newspaper or a technology magazine today without reading about the cloud - we have been very deliberate over the past nine months, assessing where we think the cloud can help us".
The result of that period of assessment, Hogan told silicon.com sister site ZDNet UK, was the conclusion that "just like a lot of things in technology, the cloud will not be a panacea".
Several major technology companies have announced cloud computing moves recently. These include Microsoft, which launched Azure, a cloud extension to its Windows franchise, Salesforce.com, Amazon and Google.
Hogan said there will be a place for the cloud. Customers will be able to have a channel strategy for services, somewhat like the channel strategy they have for sales and marketing, he said.
According to Hogan, that means there will be three operations approaches open to enterprises: traditional in-house; outsourced; and in the cloud. "You have a host of applications that you will want to run on-premise in the traditional manner; there will be services for outsourcing (for which we have EDS); and there will be an emerging new paradigm that will aim to capitalise on the cloud," he said.
Within that context, the cloud is important, and HP has the tools to exploit it, Hogan said. "We think that HP has more capability in fulfilling the promise for the enterprise cloud, which is a heritage strength for HP," he said.
HP is especially well-equipped to do this, as its EDS business group can provide the processes needed for the cloud model, Hogan said. The company acquired EDS for $13.9bn in May, adding EDS's computer-services expertise to its portfolio.
Hogan's scepticism about the hype was echoed by other executives at the conference. Andy Isherwood, HP's vice president for software services in Europe, said: "A lot of people are jumping on the bandwagon of cloud but I have not heard two people say the same thing about it. There are multiple definitions out there of 'the cloud'."
According to Isherwood, HP prefers to talk about the software as a service (SaaS) model. Isherwood told ZDNet UK: "Customers say: 'We want solutions from you that we can buy and implement quickly. And we want to do that without investing a lot of our capital in people, equipment and software. We buy SaaS and, if it works: great. We will keep it.'"
HP has become the 10th largest company in the global SaaS market, according to Isherwood.
Comments
There are 5 comments. Join the discussion
1. Chris Lindsay, GM, BT Business Applications
In response, despite the “hype” surrounding cloud computing, it is clear that businesses of all sizes can benefit from Software as a Service. The worries and fears created during this time of economic downturn perhaps only highlight the advantages of SaaS and the growing need for such applications, particularly for smaller companies.
SaaS removes the need for upfront capital investment as well as upgrade costs. It also means small businesses no longer need to manage and support critical business applications in-house, therefore reducing cost and increasing flexibility. As a result, UK SMEs can benefit from services previously only available to larger companies – an important factor in today’s current market.
2. Guy Reynolds
I would like to respond to Chris' comments. Whilst my example is not with SaaS it is analogus, and by the was I work for an SME.
We recently needed to upgrade our PBX and were looking for a system that would support VOIP over the internet for our remote workers as well as servicing our internal phones. The two solutions on offer were a remotely hosted service equivalent to SaaS and the outright purchase of a PBX.
As with SaaS, the remote service was sold on the grounds of limited inital capital expenditure and always having the most up to date equipment without the need for upgrade investment. However we made the decision to buy, simply on the grounds that with the remote service we had nothing, and that if the service provider went under, they decided to put their costs up or the relationship simply broke down, we would be in the position of having no telephones, which are critical to our business.
This investment was done earlier in the year before the deepening of the current crisis. If the investment was done now putting crtical functions in the hands of third parties would be even less likely given the size and prior reputation of some of the businesses now going under.
If anything we are now investing in retrenchment, bringing as much of our operation inhouse where we can control it rather than risking it to others who could cripple us or even take us down should they get into difficulty.
3. Chris Lindsay, GM, BT Business Applications
At times like these you need to be working with brands you can trust that will provide stability and longevity. On that basis you get the best of all worlds, low capital, swiftly deployed and flexible solutions with the security of knowing you're in safe hands.
4. Karl Deacon
A personal view on the article:
HP's response to Cloud in this article demonstrates to me that it's absolutely a new capability (Cloud Hosting/Computing) that is worth pursuing. Because it feels like that defensive stance comes from a new, emerging HP, that is now considering how to take value out of the massive expenditure of acquiring a very large traditional outsourcing capability. Whatever happened to the innovative entrepreneural spirit that gave birth to that great company?
Obviously it's not a panacea, but it's also not something companies will want to, or can afford to ignore.
The Cynic in me can't help wondering if this reaction stems from a fear that the market may move more quickly to cloud than their ability to establish services that make profit, in the cloud, can be achieved - sounds reminiscent of the canal boat owners at the introduction of Railways in 1840's!
5. Drew Stephenson
I'm leaning towards Guy's position on this, for two main reasons:
firstly, with all the outsourcing deals i've seen to date (and we have a lot) the true cost of the deal is never shown up front, people in the purchasing company end up picking up activity that is never costed and just gets added onto their job in order for things to work. Inevitably you either end up paying high-rates to well qualified people to do menial tasks or, worse, you end up with unqualified people filling in the gap.
Secondly, and this is primarily directed at Chris' second post, how big a brand does a company have to be to trust? Most large companies are so complex in their structures that it is almost impossible to understand how secure they are until after the disaster has occured.