Cloud Computing: Changing the Balance of IT Power

Michael Vizard

Every time there is a major inflexion point in terms of IT, there is usually a corresponding change in competitive edge.

With the arrival of cloud computing as a new type of IT platform, some folks are starting to wonder if we're about the see a significant narrowing of the IT competitive edge gap between companies that will especially benefit companies in developing countries.

In much the same way people point to rise of mobile phone technology in Asia as an example of how one part of the world took advantage of emerging technology to leapfrog other countries, the same potential now exists with the rise of cloud computing.

For example, while cloud computing adoption is expected to grow significantly, companies in established markets where large IT investments have already been made appear to be thinking about cloud computing more tactically in terms of using a specific software-as-a-service application or outsourcing backup and recovery. Companies in developing markets appear to be thinking about more strategic approaches to cloud computing in order to narrow competitive enterprise IT edges with global rivals. 3Tera, for example, delivers a comprehensive platform that companies can deploy to create a cloud computing platform. The company has noticed that shortly after it added IPv6 support for its platform, the number of companies adding support for the platform using IPv6 shifted significantly towards Asia.

Of course, this may have something to do with the availability of IP addresses in that part of the world. But the point remains that cloud computing makes it easier for IT organizations to deploy a world-class enterprise computing platform. To the extent that U.S. companies have relied on IT to maintain a competitive edge over global rivals, the potential ease with which rival organizations can close that gap by shifting to cloud computing creates a serious theoretical challenge in terms of leveraging cloud computing to achieve higher levels of business agility. The potential advantages of cloud computing have not been lost on smaller companies, either, as more of them appear to be moving to embrace cloud computing at a faster rate.

Naturally, there is a lot more to enterprise IT than just the platform. But the fact remains that IT infrastructure until recently was a significant barrier to the cost of entry, and that might not be so relevant anymore.

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Oct 5, 2009 8:44 AM JMW JMW  says:


Great points and the White House agrees that cloud computing is the "next generation of IT" with their recent launch of Apps.Gov; the Federal government's version of the App Store to make the buying process easier for government agencies to transition to more affordable and transparent solutions.

Oct 11, 2009 4:40 AM Gail La Grouw Gail La Grouw  says:

I don't think the gap is only between developed and developing countries. Cloud also closes the gap between large companies with large IT budgets and small-medium sized businesses. The added advantage to SMB's is that not only do they now have access to enterprise class IT, but they have the agility and flexibility often lacking in larger companies - hence the impact is leveraged even further in their advantage. During economic periods such as the one we are now passing through is always an ideal time for smaller, more agile businesses to gain advantage over incumbent competition - cloud adds to that advantage. It's going to be interesting to watch!

Gail La Grouw

Author: The Logical Organization

Oct 27, 2009 6:28 AM Raj Raj  says:

Mike, there is a problem with your core thesis: the fact that technology is equally accessible by emerging markets is NOT the reason to lose competitive differentiation; the fact that in a globalized world, there are no more unique technology infrastructures is.

Irrespective of the nature of the business, it will be the business process that imparts any level of differentiation. Giving that up (via packaged apps ,"any flavor is OK as long as its Vanilla") and looking erroneously in the technology layer of the stack will be a setback.

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