The journey to the Cloud

Faced with intensifying competition and consumer demands for faster, better service, CXOs need to be certain that IT operations are ready for the upcoming challenges. That no longer means investing in surplus capacity to cope with any predictable or unpredictable changes in demand or business growth. The advent of cloud computing, where capacity is available flexibly, and on demand, from a service provider, means an organisation can right-size IT and build out in line with actual use.

Cloud computing gives CXOs the opportunity to embrace new business applications that improve the user experience, including higher levels of collaboration and mobility. The emphasis on business benefit highlights the fact that moving to cloud is a strategic and financial decision, not just a technology decision, with implications for organisational, people and process changes. AT&T, as an experienced business partner, can help CXOs  identify cloud opportunities and assess the potential impact on the organisation.

The increasing interest in cloud is driven by many factors, including the growth of web applications, virtualisation of infrastructure, and demand from business customers and consumers for access anywhere, anytime on any device access. All of these factors are putting intense pressure on internal IT resources and, as a result, many CXOs face the frustration of trying to respond rapidly to business opportunities and challenges with limited flexibility.

To avoid this type of problem, the traditional approach was to invest valuable capital in spare capacity which sat idle for most of the time. With cloud computing, organisations can scale up almost immediately in line with business demands and only pay for the additional resources when they need them. Cloud services provide the essential business agility to meet those changing demands, giving access to IT and networking resources at service provider scale without the cost or complexity of managing a large-scale IT infrastructure

Cloud also offers important financial benefits. Many enterprises are concerned about the cost of IT services and resources and want to move from a fixed to a variable cost consumption-based model. Cloud computing offers a pay-as-you-go model, giving the flexibility to scale up or down in line with business needs. Payment is based on usage not fixed assets and administration overheads, making an important contribution to overall cost reduction through the use of shared infrastructure, elimination of CAPEX and lower provisioning costs.

The key to cost comparison is to take into account the usage-based pricing paradigm of cloud services. Even if cloud services cost more when they are used, they cost nothing when they are not used. In contrast, owned resources continue to incur costs whether they are used or not.

For an expanding business, the pay-as-you-go model matches revenue with expenses incurred in growing the business. For example, a company launching a new application that will drive additional revenue could utilise cloud infrastructure and network resources to quickly put the service into the market, scaling up the resources in line with demand. There are no build out costs to create the additional resources and both capital and assets can be moved off the balance sheet, purchasing capacity as services.

Equally important is the ability to tap into the scale and reach of a service provider's networked resources. A company moving into international markets could tap into AT&T's global resources to deliver a service to customers anywhere in the world without incurring start-up costs.

The business benefits of cloud are clear - the challenge is how and when to begin the transition. There are many different routes to cloud computing and these should be driven by your business needs. It's therefore important to work with a partner who is committed to cloud, and who has the experience and understanding of enterprise issues and concerns. At AT&T, we have demonstrated our own confidence in cloud by reengineering and aligning our business around cloud and, as part of our $1 billion investment plan for 2010, we will scale our delivery of cloud services for global customers. 

From a technology perspective, AT&T believes that organisations should not move everything to cloud straight away, but adopt a policy of  integrating cloud with existing internal processes and IT services. There is no need to throw away an existing environment -  as leases expire workload can be moved to the cloud as part of a flexible hybrid solution.

AT&T recognises that organisations are at different stages of cloud readiness and have different priorities. We believe that it is important to offer a continuum based on a wide portfolio that includes cloud as well as traditional hosting and utility services. If an organisation is not yet ready for full cloud adoption, AT&T can offer customised hybrid solutions that are fully integrated with our long-term strategy which covers deployment of the three main cloud categories - Infrastructure as a Service (IaaS), Platform as a Service (PaaS) and Software as a Service (SaaS).

This comprehensive portfolio and the continuum means that an organisation can join the journey to cloud at any stage and continue seamless migration along a clear roadmap. This level of flexibility allows an organisation to move towards cloud solutions at its own pace, as it develops trust in each stage.

It's important to recognise that cloud computing is not just a technology solution. Successful deployment, financial and business benefit depend on taking a holistic approach across business strategy, architectural decisions, people and processes. Embarking on an architecture design without first detailing the strategic objectives and assessing Return on Investment (ROI) and Total Cost of Operations (TCO) may result in a project that fails to deliver measurable business benefit.  AT&T can help establish key metrics and performance indicators to evaluate ROI and the operational changes needed to benefit. AT&T experts help CXOs identify the strategy that will accelerate time to revenue, with proposals for both quick wins and longer-term gains.

This approach will help CXOs to identify and assess the changing business opportunities arising from the new capabilities and flexibility that cloud offers, using the information to plan a strategic roadmap and identify the quick wins.

You can draw on AT&T's long heritage as an established provider of enterprise infrastructure services.

Download the full copy of the AT&T and Gartner Newsletter - The Journey to the Cloud - and find out if your business is ready for cloud computing.