SaaS is Shaping Up

While 2009 has been an overall difficult year, software as a service (SaaS) is one industry that I think is developing very well, especially from my perspective as a promoter and firm believer in the benefits of SaaS and all components of cloud computing.

One example of the positive developments in SaaS this year is a recent blog post, “Four Factors Changing the SaaS Landscape,” by InformationWeek Editor Chris Murphy. The post is based on insights from a “future of software” panel of IT experts at the InformationWeek 500 conference.

From Chris Murphy’s post, the four factors changing the SaaS landscape are:

1. Board of directors support: even the board is on board with SaaS, according to panel experts working in enterprise IT. That’s a rather important consideration when presenting IT projects to the board for funding.
2. New product categories: SaaS vendors can quickly develop niche products that are not on the product roadmaps of large on-premises vendors.
3. Attitudes about “on premises” are changing to a point where on-premises systems will be considered legacy systems, like mainframes are today.
4. The recession helped SaaS because of lower initial capital requirements, quick implementation, and often less training.

One of the concerns expressed about point two above was integration of the various niche SaaS products and legacy systems; however, there are several integration companies, such as Pervasive Software, which provides standards-based bidirectional interfaces between any application, data source or technology.

Examples of niche SaaS products delivering business value include Mimiran, which focuses on pricing optimization, an important consideration for sales; and BranchIt, which provides a solution for enterprise relationship management: helping sales and other departments to leverage the business relationships within their companies.

In another post, “SaaS for Your Business in the Cloud,” Phil Wainewright documents the positive mood of sales professionals who moved from on-premises to SaaS companies.

Technology continually changes and improves; with SaaS, we’re now experiencing another example of change and improvement in software delivery, cost optimization, and business value.

Are the above points similar to the views about SaaS at your organization?

The Death and Resurrection of Business Intelligence

We’re seeing the death and resurrection of many big entities these days: the global economy, banks, financial service, insurance, and automotive companies. Now, we can even add business intelligence (BI) to the list.

Business Intelligence is definitely “in play.” It topped the wish list of 2,500 CIOs surveyed by IBM this year, was high on the priority list of InformationWeek 500 companies with more than $250 million in revenue, and large vendors such as IBM are introducing new products for midsize companies, the fastest growing segment of the BI market.

With all of this focus on BI, it appears that BI is alive and well. Not so, according to Dan Woods’ article, “The Death of Business Intelligence,” published on Forbes.com. In the article, Woods points out that there are technologies available that can provide multi-touch-screen access to real-time reports about virtually any question. He cites CNN coverage of the presidential election as an example.  Gone are the days of deciding in advance which questions need to be answered, and then waiting to receive the reports. Real-time operational intelligence will eventually replace business intelligence, according to Woods.

InformationWeek also recently published a cover-story article by Doug Henschen about next-generation BI, and the four technologies that are re-shaping it: predictive analytics, real-time performance monitoring, in-memory BI for faster analysis, and software as a service.

Between the extremes of traditional, costly, and time-consuming on-premises business intelligence systems, and the BI utopia that Dan Woods wrote about, software-as-a-service (SaaS) BI provides a current, practical solution to making business intelligence available to more users, quickly and cost effectively. Furthermore, enterprise mashup dashboards provide a way to visualize data from any web-facing source within minutes. SaaS BI and enterprise mashup dashboards provide affordable, current alternatives to real-time operational intelligence and multi-touch-screen interfaces that only large enterprises can currently afford.

To learn more about the “death” of on-premises BI, its “resurrection” in the cloud, and some points to consider while evaluating and implementing SaaS BI solutions, see William Laurent’s article, “Business Intelligence in the Cloud,” published on Dashboard Insight.

Does your organization plan to implement any of the new BI technologies such as SaaS BI, predictive analytics, real-time performance monitoring, or in-memory BI?

Enterprise IT Trends in 2010

On New Year’s Day 2009 I proposed a toast to endurance in 2009 and better times in 2010. Unfortunately, 2009 did not really stand a chance of being considered an overall good year from day one, largely due to the recession that many think could have been prevented with better business insight and decision-making. The recession and the resulting business goals of improving decision-making, efficiency, and cost optimization are among the reasons that business intelligence and analytics, enterprise mashups, and cloud computing ranked highly in this year’s enterprise IT surveys such as the 2009 IBM Global CIO Study and the InformationWeek 500 report.

Now that autumn 2009 has begun and Q4 2009 begins next week, it’s time to predict and look forward to 2010. Burton Group, an IT research and advisory firm, did just that and today released its projection of five enterprise IT trends for 2010:

• Externalization, Consumerization and Globalization – Increasing use of external IT providers; more individual choices for devices and applications; increasing use of social networks
• Cloud Computing – Increasing use of cloud computing for competitive advantage, and maturity of cloud-computing solutions due to enterprise demand
• Data Center Transformation – Increasing use of virtualization and hybrids of internal and external IT providers to deliver business services
• Social Computing – Empowering worker interactions through social networking to create business value
• Wireless Everything – Increasing use of wireless networking and employee-owned wireless devices

According to Chris Howard, Burton Group executive analyst, “IT professionals find themselves at a critical junction in the decade beginning in 2010. Choosing one path, they have the opportunity to become proactive strategic partners within their businesses. Choosing another, they persist as a reactive organization that is gradually being eroded by the availability of commodity IT.” Howard also said, “If this plays out as Burton Group anticipates, enterprise IT will regain its proper place as a part of the business—not a separate entity that must somehow be aligned. True integration—beyond alignment—is achieved when the artificial distinction between ‘the business and ‘IT’ is eliminated altogether.”

Here are my five predictions for enterprise IT trends in 2010:

• Cloud computing will top the list of delivery preferences for IT business services, due to flexibility, rapid time to market, and optimal cost.
• Business intelligence (BI) and analytics will continue to be high-priority strategic initiatives for improved decision-making and business performance.
• Use of mashups to combine and visualize data from multiple web-facing sources will increase.
• Use of SaaS solutions for sales-enablement purposes such as pricie optimization and enterprise relationship management will increase.
• Concerns about integration, compliance, security, and privacy of cloud-computing solutions will be addressed and will decrease.

What are your five predictions for enterprise IT trends in 2010?

Life is a Mashup; So Are Enterprise Applications

Last weekend I attended a Samurai exhibition at the Asian Art Museum of San Francisco; the Autumn Moon Festival in San Francisco’s Chinatown; and I watched a film about painter Georgia O’Keeffe and her husband, photographer and art promoter Alfred Stieglitz. Although I did not watch sports, I saw and heard many sports fans cheering their teams on televisions in packed bars. Add the Internet, newspapers, magazines, books, music, people, relationships, family, work, and daily events to the mix, and I think it’s clear that life is a mashup, because we are continually exposed to so much diverse information virtually everywhere.

Enterprise mashups, also called composite applications, are beginning to extend what has already been happening throughout history: we continually have more access to more information from more sources more quickly. Rather than displaying information from one application, mashups combine and display information from several applications to facilitate business intelligence, performance and decision-making.

Several reports and articles confirm enterprise adoption and implementation of mashups. Last month, research firm Business Insights published a report, “The Future of Enterprise Mashups: Demand, Challenges and Vendor Opportunities.” The report forecasts the enterprise mashup market to grow from $161 million in 2008 to $1.74 billion by 2013. Nearly one-third of organizations surveyed already use enterprise mashups. I learned of the report from a search engine company, Reportlinker, which provides access to more than 1 million reports from more than 200,000 organizations. Reportlinker provides yet another example of easy access to information.

In the InformationWeek 500 report, published last week, 42 percent of surveyed enterprises with more than $250 million in revenue reported that their organizations are implementing mashups. In this interview with Government Technology, Federal CIO Vivek Kundra expressed interest in creating mashups of government data.

The future looks good for enterprise mashup companies such asmashmatrix, which enables rapid creation of mashups from any web-facing data source.

Mashups will help enterprises make better business decisions more quickly, and I think the proliferation of information should continue helping us as we participate in the great mashup of life.

How is your organization using, or planning to use, mashups?

Government in the Cloud

Some may think that government “has its head in the clouds.”

Actually, it does, according to President Obama and his federal CIO, Vivek Kundra. Regardless of political opinions or persuasions, it’s true that the U.S. government is one of the foremost early adopters and advocates of cloud computing.

USAspending.gov

A case in point is the federal government’s IT Dashboard, launched on June 30 and part of the USAspending.gov portal.  The IT Dashboard provides visibility into the IT funding and projects of 28 federal agencies.

President Bush signs transparency act while co-author Obama observes.

Then-Senator Obama, in 2006, actually introduced the bill for transparency of the federal budget (the Obama-Coburn 2006 Federal Funding Accountability and Transparency Act). USASpending.gov and the IT Dashboard are products of that bill.

Apps.gov

On September 15, Federal CIO Vivek Kundra and the General Services Administration released Apps.Gov, a storefront for quick procurement of government-approved cloud-computing solutions. In this interview with InformationWeek, General Services Administration CIO Casey Coleman discusses more ways the GSA is paving the way to cloud computing for government.

Data.gov

Earlier this year, on May 15, the federal government launched Data.gov, a site that offers complete federal datasets to the public. On May 9, the National Institute of Standards and Technology published its working definition of cloud computing.

In this interview with Government Technology, Federal CIO Vivek Kundra discusses the IT Dashboard, Data.gov, and future plans of using dashboards for state and local government, and “every aspect of government operations, not just technology projects, but also health care, energy and education. Once that data is made available to the public, you can do interesting mashups, create applications and innovate in spaces where innovation is needed at a time when the only way we can lead is through innovation in a global economy.”

It will be interesting to see the U.S. government’s cloud-computing initiatives unfold over the coming years.

Washington: “What is cloud computing, and is it revolutionary?”

Jefferson: “The NIST published a working definition here.”

Roosevelt: “I am concerned about security, privacy, and compliance.”

Lincoln: “Those concerns will be resolved peacefully.”

What do you see happening in government adoption and promotion of cloud computing over the next several years?

Salesforce Switches to SaaS

As I read articles daily about cloud computing, I continually learn that security, privacy, compliance, and integration with existing systems top the list of concerns for enterprise customers who are considering implementing cloud-computing solutions. A recent poll by Unisys is one example of the many polls, surveys and articles that highlight these concerns.

However, I read as many, if not more, articles indicating that enterprise companies list cloud computing among their top initiatives to help improve efficiency, reduce costs, and align IT with business objectives. The InformationWeek 500 report, published this week, is an excellent and high-profile example of the many articles, reports and surveys that clearly confirm enterprise adoption of cloud computing and that we are beginning a major transition in IT service delivery.

While I have read many articles for and against cloud computing, and many articles defining it, I have not read many case studies of enterprises using and switching to cloud-computing solutions. This may be because it is too early to report on the results of new enterprise cloud-computing initiatives, and many large companies are also unwilling or unable to provide the required information about their IT operations for a case study.

That’s why I was happy to see an excellent case study, written by Mary Hayes Weier, of an enterprise switching to cloud-computing solutions as part of the InformationWeek 500 report. It is none other than Salesforce.com, the leading SaaS company, that is switching to SaaS business applications for internal use.

It makes sense for Salesforce to lead the way and promote its switch to SaaS business applications; it is also very interesting to see how Salesforce is doing it, because it provides some insight into how an IT organization may change as it moves to cloud computing.

The changes that struck me the most were the switch to the agile software development method, and the use of Scrum teams that include business and IT professionals. The result has been rapid development of enterprise applications that meet business needs.

It’s a good read, and I look forward to reading, and eventually writing, more case studies of enterprises switching to SaaS business software.

What are some examples and results of switching to SaaS at your organization?

Les Paul, Cloud Computing, and IT Innovation in the Great Recession

Les Paul and one of his innovations, the Gibson Les Paul guitar

Video: Les Paul performs "Over the Rainbow"

As a guitarist, I was especially saddened by the recent death of Les Paul, one of the greatest innovators in music. Les Paul invented the solid-body electric guitar, which sustains sound longer than hollow-body guitars; multi-track recording, which allows individual parts of a composition to be recorded separately and then mixed together to produce the final recording; and delay effects, which many musicians use to enhance their sound.  The Gibson Les Paul guitar is an iconic instrument that is played in countless recordings and concerts, and one of the best-selling guitars of all time. A Gibson Les Paul was my first excellent electric guitar. Les Paul’s inspiration and influence will live on through guitarists, electronic music, recording technology, and through everyone who listens to and enjoys recorded and live music today.

Just as the loss of an innovator does not stop his influence, the stagnating economy does not stop innovation. This is shown in the just-published InformationWeek 500 report, InformationWeek’s annual ranking of the nation’s business technology leaders.

This year, more than any year since 1983, IT needed to innovate with fewer resources. The top priorities of InformationWeek 500 companies to innovate with technology include making business processes more efficient (60 percent); lowering IT or business costs (47 percent); and getting better business intelligence to more employees, more quickly (37 percent). Other innovation initiatives noted in the report include improving customer service and experience, and creating a new business model or revenue stream. Web technologies that will help InformationWeek 500 companies meet their goals for innovation include software as a service (SaaS, 61 percent); and mashups (42 percent).

This is good news for cloud computing, because cloud-computing solutions help companies deliver on initiatives such as making business processes more efficient, lowering IT or business costs, getting better business intelligence to more employees, more quickly, and creating new revenue streams. It’s especially good news because InformationWeek’s top 500 IT innovators recognize the value of cloud computing and are planning to implement cloud computing technologies such as SaaS and mashups to achieve their goals. Even better, the InformationWeek 500 report only profiles companies with more than $250 million in annual revenue, which validates enterprise adoption of cloud-computing solutions.

Independent software vendors that can help the InformationWeek 500 innovations succeed include mashmatrix, a provider of enterprise mashup software; Birst, a SaaS business intelligence solution; and BranchIt, SaaS business software for enterprise relationship management, which helps companies uncover relationships that can lead to new revenue streams and improved interaction with customers, suppliers, and other business partners.

Cloud computing itself is an innovation that is developing at the right time to help innovative companies succeed with increased efficiency, lower costs, better business intelligence, improved customer service and new revenue streams. It is an innovation that will change information technology forever, just as Les Paul did with musical technology.

What are some examples of IT innovation at your organization?

The Change from On-Premises Software to Software as a Service

While watching President Obama’s speech about health care reform last week, it was clear that there is no stopping the dynamic of change that permeates everything today, from economic turmoil to international conflicts to bankruptcies of storied companies, and now health care. While most agree that health care reform is necessary, the road to reform will likely be long and difficult.

Change is also clearly in play in enterprise computing, as the industry shifts from on-premises software to software as a service (SaaS). In a white paper published last week, “A Software-as-a-Service Primer for Independent Software Vendors,” Jeff Kaplan of THINKstrategies made it clear that the path from developing and selling on-premises software to SaaS also requires many steps.

According to Jeff Kaplan, an on-premises software company moving to SaaS must re-architect and re-package applications for the Web; restructure revenue recognition to comply with accounting standards for selling services rather than products; and re-orient R&D, sales and support staff to sell and deliver SaaS solutions that quickly meet customer expectations and keep pace with increasing competition. He further segmented these large initiatives into 15 elements of a SaaS strategy.

While on-premises software vendors work on producing SaaS products, SaaS independent software vendors creating native SaaS applications face other challenges, including the ability to survive in a market with low barriers to entry and in difficult economic times. Most SaaS companies simply cannot afford a sales force large and experienced enough for effective direct sales to enterprise customers.

Enterprise customers are also experiencing great changes. They are caught between initiatives to streamline operations and cut costs, and concerns over compliance, security, the viability of SaaS providers, and the time it will take for established on-premises software vendors to re-engineer their applications and operations to support SaaS.

The roads to economic recovery, health care reform and enterprise cloud computing will all take time and effort. How do you think the change from on-premises software to cloud-computing solutions will play out in your organization?

IBM Study: Business Intelligence and Analytics are Top Priorities for CIOs

An IBM global study of 2,500 CIOs released yesterday indicates that business intelligence and analytics top the list of their priorities. Eighty-three percent of CIOs surveyed will use analytics to gain competitive advantage and improve business decision-making.

Other high priorities include data reliability, security, risk management, compliance, reducing energy costs, building a strongly centralized infrastructure, and implementing completely standardized, low-cost business processes. Technologies that the CIOs listed to help them achieve these goals include virtualization, service-oriented architecture (SOA), and cloud computing.

The study also documents that CIOs are playing an increasingly strategic role as visionary leaders and as drivers of innovation and financial growth, and spending less time on infrastructure and operations management.

“Clearly the role of the CIO is changing dramatically,” said Pat Toole, IBM’s CIO. “On the one hand they are trying to standardize routine processes and simplify their existing IT infrastructure to reduce costs, hence their growing interest in technologies such as cloud computing. On the other hand, given the central role that today’s CIO performs in driving new business models, whether it’s a smart grid system, an intelligent transport system, or a transparent food supply chain, it’s not surprising that the amount of time they are now spending on driving new kinds of growth for their companies is growing considerably.”

Two of the quickest ways to satisfy current CIO needs for driving revenue growth and profitability, and improving business insight and performanceare through SaaS business intelligence (BI) and data visualization. SaaS BI companies such as Birst can provide actionable insights into large amounts of data within days rather than months or years with traditional on-premises BI solutions. Similarly, dashboard mashup products such as mashmatrix can draw and display data from any web-facing source, and can be used to create personalized dashboards for data visualization within minutes. SaaS BI and data visualization solutions are also a fraction of the cost of on-premises solutions.

The survey underscores the transitional time we live in: the roles and priorities of CIOs have changed, while inexpensive and flexible cloud-computing solutions are supporting their business needs with new technology.

Do the survey results reflect the current priorities of your organization?

Salesforce.com Announces Service Cloud 2

Salesforce.com today announced Service Cloud 2, a new version of its Service Cloud product for customer service. Service Cloud 2 includes three new modules: Salesforce Knowledge, a knowledge base for cloud computing; Salesforce Answers, a service for creating user discussion forums for crowd-sourced knowledge; and Salesforce for Twitter, which allows companies to monitor and join customer-service conversations on Twitter. With the new modules, Service Cloud 2 allows customer-service agents to combine their knowledge and information with user conversations happening throughout the cloud.

Salesforce Knowledge will be priced at $50 per agent, per month for salesforce.com customers and is currently scheduled to be available in the fourth quarter of fiscal year 2010. Salesforce Answers is currently in pilot and is currently scheduled to be available in the first quarter of fiscal year 2011. Salesforce for Twitter is available today at no additional charge on the Force.com AppExchange for Professional, Enterprise and Unlimited Edition customers.

“With Service Cloud 2, salesforce.com is doing for customer service what we did for sales: proving that the cloud is a better way. The customer service market is being held back by traditional technology. With two-thirds of customer service interactions moving to the cloud and the popularity of social networks, it is high time for a change. I am excited by the momentum we are seeing in the customer service market and believe it is the next billion-dollar opportunity for salesforce.com,” said Marc Benioff, chairman and CEO of salesforce.com.

Leveraging Enterprise Relationships to Drive Sales

Are your enterprise relationships also closed?

On Labor Day weekend the San Francisco-Oakland Bay Bridge was closed for repairs, leaving drivers of the approximately 260,000 vehicles it services every day to choose other options. The bridge closure and those who left the Bay Area for the holiday weekend reduced the number of people in San Francisco and got me thinking about the need for bridges to facilitate relationships. Also, in a recent call about the economics of software as a service (SaaS), an industry analyst stated that “you can’t commoditize relationships.”

It is true that relationships matter most in conducting business; it is usually easier to reach a business goal, such as getting an appointment or making a sale, with someone who knows, likes, and successfully worked with you than with a new contact. However, business is also about continually building new relationships, and one of the easiest and most effective ways to build new relationships is through existing relationships. That is one of the reasons LinkedIn is so popular.

Every company is filled with opportunities to build new relationships based on employee business contacts. Wouldn’t it be great to leverage the relationships your colleagues have to further the business goals of your company? The only drawback is that some colleagues may prefer not to participate; they may not want to expose or risk their relationships to further every business initiative, and they may want to avoid the pressure of participation every time they are asked.

One of the keys to successfully unlocking and leveraging internal business relationships is anonymity. If there were a way to indicate that colleagues have relationships within a prospective company, without initially specifying the exact contact or the colleague who has the relationship, it would provide an opportunity to build a new relationship while providing your colleague the comfort level he or she needs to evaluate the opportunity and make a clear decision with no pressure to participate.

BranchIt is one product that helps organizations accomplish both objectives of leveraging relationships colleagues have while keeping the relationships and the colleagues anonymous until the colleague decides to help with an introduction. It supports the above analyst statement that you can’t commoditize relationships while providing organizations a better opportunity than they would normally have to build new relationships at the discretion of those who hold the relationships.

What are some of the ways your company uses enterprise relationship management and social networking to achieve business goals?

Mashups Have Grown up for the Enterprise

Many of us are familiar with the dashboards available at portals such as Yahoo! and Google; we can get services and information such as news, weather, stock quotes, email, entertainment and travel tickets, maps and directions all from one screen.

Dashboards caught on for enterprise use, and in recent years many independent software vendors (ISVs) began offering dashboards to display information from several functions in a single view. For example, in salesforce.com, users can create a personalized dashboard to view information such as contact management, orders placed, projected orders and revenue for each customer.

One of the limitations of ISV dashboards was that they were able to display information only from a single application, not from several applications or data sources.  This meant, for example, that a VP of sales would need to log in to several applications or dashboards to get complete customer information such as order and shipping history, contact management, revenue projections, accounts receivable, product support history, contract information, revenue and purchasing comparisons with other customers.

While IT professionals could develop customized dashboards that could pull and display data from various sources, this requires significant time, human and financial resources, and scheduling consideration in the context of competing and shifting priorities.

It is now easy to create personalized dashboards from any web-facing application or data source. The availability of web services and web-based applications have ushered in a “grown up” version of enterprise dashboards that would enable the VP of sales mentioned above to view all desired customer information on one screen. Below is a screen shot of a personalized dashboard mashing data from disparate sources such as salesforce.com, Google, Twitter, and an enterprise-resource-planning (ERP) application such as SAP.

An enterprise mashup dashboard displaying data from disparate sources

A personalized dashboard displaying other information from other applications for another user, such as a call-center representative, could be created in minutes using mashup and visualization software such asmashmatrix. mashmatrix provides a drag-and-drop environment for rapidly creating dashboards that “mash up” data from disparate sources in a single view. Mashups are applications such as dashboards that access and allow users to interact with several applications and data sources to complete their work.

The ability to rapidly mash up and display in a single dashboard the information that professionals need to efficiently perform their work is one example of how mashups have “grown up” from consumer portals to enterprise use.

What other enterprise mashup software have you used or learned about and what enterprise dashboards have you seen or used?

Advantages and Next Stages of Enterprise SaaS Business Intelligence

In an excellent article in InformationWeek, Doug Henschen wrote about the four technologies that are reshaping business intelligence (BI):

• Predictive analytics enables users to forecast results such as future revenue, number of items sold, etc.
• Real-time monitoring provides immediate information about current transactions, call volume, etc.
• In-memory processing allows data sets to be stored in RAM for quick queries and results.
• Software as a service (SaaS) provides on-demand access to business intelligence applications via web services.

The benefits of SaaS business intelligence include rapid and flexible deployment, and lower cost as compared to on-premises business intelligence systems. With SaaS BI, end users can be up and running within days, making queries that provide insight for decisions, forecasts, and reporting. The web interface of SaaS also provides extended availability over installed software, and the ability to make business-intelligence applications available to a greater number of users due to low maintenance requirements and cost. SaaS BI also avoids the expensive and time-consuming requirement of building a data warehouse, where data is copied from production databases for queries.

While SaaS BI has advantages over costly, time-consuming and less flexible on-premises systems, there is no single SaaS BI vendor that provides the entire BI stack, as illustrated in the below diagram from Forrester Research. There are also many companies entering the SaaS BI market due to the low cost of developing, delivering and maintaining SaaS software. Furthermore, the recent demise of LucidEra, a leading SaaS BI provider with excellent products and customers, increased concerns about the viability of SaaS vendors in general.

Enterprises need help in identifying, selecting, vetting and integrating the various SaaS BI products to create a SaaS BI solution that addresses their business needs for flexibility, availability, cost containment, and, most importantly, business insight.  The next steps for enterprise adoption of SaaS BI include the SaaS market intelligence they need to make informed choices for SaaS BI solutions.

What are your views about the advantages and next stages of enterprise SaaS business intelligence?

Is Cloud Computing for Dummies?

Video: The Incredible Crash Test Dummies


A sure sign that a new technology or methodology has arrived is a “for Dummies” book on the topic. Industry analyst Judith Hurwitz recently completed “Cloud Computing for Dummies,” and posted the 10 things she learned while writing the book with her colleagues. Judith’s post includes great points about the current state of cloud computing and where it is headed:

1. Cloud computing is both old and new. It is an evolution of pre-existing technologies and services such as timesharing, internet services, application service providers, hosting, and managed services.

2. There are many shades of gray with segmentation between infrastructure as a service, platform as a service, software as a service, and other buckets such as business process as a service.

3. Large companies such as IBM, HP, EMC, VMware, Microsoft, and others are entering the cloud-computing market with enterprise offerings to challenge established cloud vendors such as Amazon and Google.

4. The economic decisions to switch to cloud computing are complicated because it is not always practical to shut down existing on-premises systems that already include significant investments in hardware, software, personnel, and facilities.

5. The private cloud is real and is used to safely procure infrastructure, platform and software services in a self-service manner, by organizations that are unwilling or unable to entrust data to a third party.

6. The hybrid cloud is the future. Most companies will have a combination of private, traditional data centers, hosting, and public clouds.

7. Managing the cloud is complicated. Enterprise customers need to monitor service levels, and ensure compliance, security and privacy across the services they use.

8. Security is king in the cloud. Enterprise customers are concerned about the security implications of putting their valuable data into a public cloud. There are also legal issues with data crossing country borders, and concerns about the stability of cloud vendors.

9. Interoperability between clouds is the next frontier. Enterprise customers will want to be able to move their data and their code from one environment to another.

10. There is a trend toward packaging in the form of appliance-based environments or combining cloud offerings with hardware.

What are your observations about the current state and future technical and economic developments of cloud computing?