The Future Lies In the Cloud

By Rita Chattaraj - October 1, 2012 | Tickers: AMZN, INTC, IBM, MSFT | 0 Comments

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Information Technology is a sector which is growing at a rapid rate and in this sector Cloud Computing is the segment which is enjoying the maximum growth. With each passing day, Cloud Computing is gaining more and more importance and presently Cloud adoption is growing at a rate almost 10 times faster than traditional software. Major corporations around the world are shifting a substantial chunk of their IT budgets over to the cloud. The gradually decreasing entry barriers and lower switching costs are driving the growth of the cloud space.

Cloud has already revolutionized the business world and everyday life. Ordinary people are unknowingly using cloud services everyday while downloading their favorite music and many major business corporations around the world are enjoying the fruits of this powerful resource. According to a recent study conducted by IBM (NYSE: IBM), few organizations are presently taking the advantages of cloud capabilities. The company conducted a survey on 572 business and technology executives across the globe and study suggested that although all businesses perceive cloud to be a game-changer with the potential to transform how their business functions, majority of companies are yet to adopt cloud-enable business models.

The study also suggests that the situation is going to change in the next few years as more and more organizations shift to the cloud-based business models. Almost three-fourths of the leaders in the survey indicated their companies had piloted adopted or substantially implemented cloud in their organization and 90% expect to have done so in three years. And the number of respondents whose companies have substantially implemented cloud is expected to grow from 13% today to 41% in three years.

(Source: Study conducted by IBM)

Even Gartner recently came out with the results of its study on the cloud computing space. According to the firm’s recently published Gartner Hype Cycle for Cloud Computing, 2012, many companies are starting to subscribe to cloud based solutions primarily because of the lower costs, easy customizations and speed of deployment. According to the study, the Cloud business performance management (bpmPaaS) market will grow 25% year over year and Big Data will deliver transformational benefits to enterprises within 2 to 5 years, and by 2015, enterprises adopting this technology will outperform competitors by 20% in every available financial metric. Also, Software as a service, SaaS is rapidly gaining adoption and Gartner forecasts that more than 50% of enterprises will have some form of SaaS-based application strategy by 2015, much of this impetus coming from companies wanting to get around limitations on IT and capital spending. The following graphs highlight some of the vital points of the report.

So, it’s clear there is huge potential in cloud computing and the future lies in the cloud. Now, the obvious question is, how do we benefit from the cloud? Easy! By investing in the following companies:

IBM
International Business Machines Corp named its cloud offering SmartCloud. SmartCloud enables enterprises to confidently achieve new levels of innovation and efficiency with private cloud, IaaS, PaaS and SaaS solutions. IBM, being at the forefront of developing a holistic cloud computing solution, is looking pretty attractive for someone who wishes to invest in cloud computing technology.

Microsoft (NASDAQ: MSFT)
Microsoft’s offering will be known as Windows Azure. Windows Azure is an open and flexible cloud platform that enables a user to quickly build, deploy and manage applications across a global network of Microsoft-managed data centers. The user can build applications using any language, tool or framework. Microsoft is also looking tempting as a cloud-space investment. Almost 48% of the second quarter revenue of the company came from worldwide server shipping. Microsoft is also actively working towards building up its cloud portfolio. In July, Microsoft rolled out its new version of Windows Server, committing itself to a proprietary model of computing where the software giant makes sure all roads lead to Azure.

Intel (NASDAQ: INTC)
Intel expects to significantly expand its operations for cloud computing through its Cloud Builders program. Intel Cloud Builders is a cross-industry initiative aimed at making it easier to build, enhance, and operate cloud infrastructure. Intel Cloud Builders is relevant to enterprises, hosters, telcos, and service providers looking for transformational guidance that will yield more simplified, secure, and efficient cloud infrastructures.  The processor giant is leveraging interest in the trend to build closer ties with OEMs and others at a time when Intel's server franchise is under attack from alternative processor vendors.

Amazon (NASDAQ: AMZN)
Amazon EC2 or Elastic Compute Cloud is a popular elastic cloud computing service that has developers in mind. EC2 offers complete control over web computing resources and structures its pay-as-you-go feature as specific as a per minute usage basis. Amazon offers other web services that allow developers to easily utilize different degrees of infrastructure and SaaS needs on an as-needed basis. Amazon EC2 reduces the time required to obtain and boot new server instances to minutes, allowing the user to quickly scale capacity, both up and down, as the computing requirements change. According to many industry experts and analysts, Amazon is one of the biggest contenders in the cloud management software space.

Research shows that cloud computing can cut companies' cost by as much as 20%. Such being the case, it is obvious that global firms will gradually start accepting cloud facilities. As cloud computing moves into the main stream, these above mentioned giants stand a chance to benefit hugely from the new technology and an investment in them will surely benefit your portfolio.

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