Appirio’s Consultants Weigh In: Predictions for Twenty-Eleven

January 21, 2011 Appirio

by Mark Koenig and Ryan Nichols

Last week we published a review of our 2010 predictions. All things considered we did pretty well, with six of ten on target, three of ten moving in the right direction, and one still on the horizon. Still, as we read through the avalanche of year-end predictions and posturing by the pundits, we found ourselves asking how we could avoid being “just another year-end blog post.” So once again, we decided to canvas our team of over 250 cloud practitioners, on the ground as we speak, accelerating the adoption of cloud computing at hundreds of real-life customers.

This time, we compiled 30 IT analyst predictions about cloud computing in 2011 from leading IT industry analysts and industry leaders and loaded them into Google Moderator, abridging the predictions to conform to Moderator’s 255-character limit, and veiling the identity of the prognosticator. Then we invited all of Appirio to vote the ideas up or down. Our colleagues cast 1388 votes over a one-week period.

Here’s how the results played out (with sources identified). And, since we are compiling the results – and because we can’t resist – we took the liberty of providing some color commentary as well.

Prediction 1 (87% Up / 13% Down): “Vendors that provide cloud integration tools and professional services will be key acquisition targets because they represent a critical component in pulling the various cloud piece-parts together.” (Source: THINKStrategies)

Commentary: Not surprisingly, Appirians voted up the one prediction that focuses on our sweet spot: cloud-to-cloud integration. We too think this is going to be a big focus in 2011. Gartner predicts that this type of “cloud brokerage” represents the single largest opportunity in cloud computing. Some companies in this space will become acquisition targets– others like us are hoping to emerge as the next-generation IBM (with all the hardware in the cloud, of course). Our own offering in the space, CloudWorks, was introduced in September of 2010, and is already in use by industry leaders in the telecommunications and manufacturing industries. Oh – and used by Appirio too – ask any one of our team members to show it to you.

Prediction 2 (81% Up / 19% Down): “2011 will be the year when industry giants from across the spectrum — including major financial institutions, pharmaceuticals and retailers — will migrate major internal and external IT systems to the cloud.” (Source: CRN)

Commentary: Some would argue that the reason this prediction ranks so highly is that Appirians are already convinced that cloud has a seat at the table alongside other mainstream technologies. But there is a good reason – we are the ones who have been doing the work at these industry giants – household names such as the City of Los Angeles, DeVry, Dolby, Dunkin’ Brands, Motorola, Qualcomm and Starbucks – and we are the ones talking to them about where they want to go next in the cloud.

Prediction 3 (77% Up / 23% Down): “The Cloud Computing market will grow more rapidly than analyst firms forecast as organizations move from asking ‘what is cloud and why is it important?’ to ‘where and how can I capitalize on the cloud today!?!’” (Source: THINKStrategies)

Commentary: There is no question that the tenor and the content of the cloud conversation has changed. This prediction sums up the shift. Now that cloud has moved from the kid’s table to the grown-up’s table, executives are actively looking for opportunities to bring it into the conversation. This is especially true among companies such as our customers who have already started on the path of adopting cloud applications. We recently conducted a survey of 150+ mid-sized companies that have adopted one or more cloud applications and found that this group plans to more than double their cloud footprint within the next three years (full results here).

Prediction 4 (73% Up / 27% Down): “Mobile devices become the primary means of accessing enterprise cloud applications, just as they’ve become the primary means of accessing the internet. This has huge implications for how applications are built and how business gets done.” (Source: CRN/Appirio)

Commentary: Aw shucks. This is the one prediction that we did end up publishing this year, when asked by CRN Magazine for a contribution, and we’re pleased as punch to see it ranked so highly. Modesty aside, mobility and the cloud is one of the most high-demand areas of focus for our consulting teams. This combination has the power to change businesses and entire industries, as we’ve found in our work with RehabCare, a leading provider of rehabilitation services who is arming their 18,000 therapists with iPads!

Prediction 5 (70% Up / 30% Down): “Social networking will become a required component of enterprise applications, driven by the success of salesforce.com’s Chatter.” (Source: THINKStrategies)

Commentary: There’s no doubt that enterprise applications need to get more “social”– with 500M people on Facebook, our expectations of how we communicate and collaborate are completely different than they used to be. But bringing social features to the enterprise is harder than it looks (much more than just cloning Facebook), and there’s no reason to re-invent the social feature-set application by application. That makes 2011 the year of the social platform – that’s exactly why Salesforce is re-architecting their platform to enable Chatter for custom applications built on Force.com. This is a big idea, one where they’re sure to have plenty of competition!

Prediction 6 (69% Up / 31% Down): “2011 will see an unprecedented escalation of the cloud wars, with vendors on all sides pushing their proprietary cloud stacks. Channel partners should be on guard to avoid lock-in…” (Source: CRN)

Commentary: Unless you want to be relegated to the lowest common denominator of cloud computing, you’re going to have to manage some degree of lock-in… that’s always been a reality of adopting innovative new technology. The rate of innovation in cloud computing is so great that we’ve yet to see true portability standards emerge. That being said, we’ve seen more and more adoption of open standards by “proprietary” cloud stacks to overcome this concern – Salesforce’s embrace of Java (through VMforce) and Ruby (through Heroku) is a case in point.

Prediction 7 (69% Up / 31% Down): “Corporate decision makers shift their focus from reliability, security and integration concerns to strategic and tactical governance issues: planning, selection, deployment, monitoring and evaluation, optimization and monetization of cloud initiatives.” (Source: THINKStrategies)

Commentary: Just as fear of flying is most prevalent in those who have never flown, fear about cloud security is most prevalent among those who have never used a cloud solution. Companies who actually use cloud solutions named security concerns the #1 misconception about cloud computing. Once you get over those concerns and take your first, second, and third steps towards the cloud, your main concern quickly becomes how you’re going to manage and govern this once-in-a-generation shift in IT architecture.

Prediction 8 (65% Up / 35% Down): “Rate of cloud company failures and M&A activities will escalate. Many startups are unable to keep pace with rising customer expectations and intensifying competition. Established players accelerate their development efforts via acquisitions.” (Source: THINKStrategies)

Commentary: Consolidation is inevitable among the thousands of self-described “cloud” solution vendors. Vendors who have “cloud-washed” their hosted or on-premise offerings are going to have a tough time competing with the superior economics of multi-tenancy in 2011, as are sub-scale vendors who aren’t taking advantage of IaaS and PaaS to level the playing field. That being said, we’re a little disappointed in our team for voting this one into the top ten. It seems to be a perennial and generic – i.e.: not very interesting – prediction (compare it to the next prediction on the list).

What do you think of these predictions? Are these ranked in the right order? Did we leave anything out? We’d love to hear your thoughts in the comments below. Or better yet, use your Google account to log-in to our Google Moderator series for this blog post and revise them all – and keep on voting!

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