1. What Is Cloud Computing?—The Journey to Cloud

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This chapter begins with a definition of cloud computing before providing an in-depth look at the following topics:

• Cloud Service Models

• Cloud Deployment Models

In this chapter, we also compare IT and application delivery processes to manufacturing supply chains. The introduction of Michael Porter’s concept of the value chain will be helpful in understanding the IT cost center. Both the supply chain analogy and the value chain concept are used in future chapters to establish a baseline for cost analysis for IT deliverables. Understanding the IT supply chain will in turn simplify the process of cost justification for cloud-computing adoption.

It is often joked that if you ask five people to define cloud computing, you will get ten different definitions. Generally speaking, we seem to want to overcomplicate cloud computing and what the cloud means in real life. While in some cases, there can be complex technologies involved behind the scenes, there is nothing inherently complex about cloud computing.

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In fact, the technology behind cloud computing is by and large the easy part. Frankly, the hardest part of cloud computing is the people. The politics of migrating from legacy platforms to the cloud is inherently complicated because the adoption of cloud computing affects the way many people—not just IT professionals—do their jobs. Over time, cloud computing might drastically change some roles so that they are no longer recognizable from their current form, or even potentially eliminate some jobs entirely. Thus, the human-economic implications of adopting and migrating to cloud computing platforms and processes should not be taken lightly.

There are also, of course, countless benefits stemming from the adoption of cloud computing, both in the short term and the longer term. Many benefits of cloud computing in the corporate arena are purely financial, while other network externalities relating to cloud computing will have much broader positive effects. The ubiquity of free or inexpensive computing accessed through the cloud is already impacting both communications in First World and established economies, and research and development, agriculture, and banking in Third World and emerging economies.

Therefore, it is important for decision makers to understand the impact of cloud computing both from a financial and from a sociological standpoint. This understanding begins with a clear definition of cloud computing.