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Private cloud isn’t a new market

Private cloud is a touchy subject these days. Proponents say it’s inevitable, detractors say it’s all marketing. Enterprises, who are supposed to be clamoring for it, are cautious: hearing endless pitches from endless different angles will do that.

“We only have ourselves to blame,” said ParaScale CEO Sajai Krishnan. He said, month over month, more than half the people he pitches to say they’ve come to learn about cloud and cut through the hype. He said that enterprises are hearing about cloud, but what they’re hearing is, ‘do everything a different way’, and that’s not attractive.

Cloud is pitched as easy, cheap, low-investment, cures cancer and feeds the poor, etc., but the reality is that for a large organization that’s not going to use Amazon or Rackspace, private cloud means changing the way your business runs. Maybe for the better, but that’s real work.

Enterprises are told “’Here is cloud infrastructure and now you can have it in-house’ – that’s a big change from something that used to be fairly stovepiped,” said Krishnan. Private cloud enthusiasts promise efficiency, but what the enterprise hears is ‘they want to sell me more stuff to cram in there’.

Krishnan thinks this complexity slows down private cloud adoption. Unless it’s your business, a la Amazon or Rackspace, building or re-directing a data center into a self-service automated, fully virtualized compute cycle utility is weary and expensive work. A company that does that will spend years doing it and years realizing the return. It’s not the technology; you can get a cloud for free on Ubuntu now- it’s the planning, and procedural changes.

All well and good for a Web 2.0 enthusiast to start up a business on his or her laptop with Amazon; but convincing 10,000 developers they have to use a new business process is quite another. Krishnan says the other pressure is that enterprises are conservative, and what they have is working. It’s not impossible, it’s just a lot slower than many have speculated, he said.

Intuitively, this makes sense. I can’t poke any holes in Krishnan’s reasoning. The timeline for private cloud is going to look a lot more like the infrastructure lifecycle, than a booming new marketplace. So watch those private cloud startup ideas, kids. There’s less room in here than you think.

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