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Pump the brakes on cloud adoption, except SaaS

Cloud adoption is going strong, but could never live up to the hype around it -- except when it comes to SaaS.

At times it seems like there is no one in the IT world -- analyst or journalist, PR flack or marketer -- that is not talking about cloud applications. But that does not mean businesses are buying into cloud adoption.

About 39% of respondents to the 2012 TechTarget CloudPulse survey said that they do not use any cloud services or applications and 45.2% added that they do not expect to use any cloud services or applications in the foreseeable future. Those that are in the cloud are using Software as a Service (SaaS) as their primary cloud vehicle.

"It isn't surprising that 45.2% of the respondents have no plans to adopt cloud strategies and solutions in the 'foreseeable future' given all of the confusion and uncertainty which still surrounds the cloud concept," said Jeff Kaplan, managing director of Wellesley, Mass.-based consultancy THINKstrategies. "I think this percentage will drop quickly as more customer success stories become available which make the benefits and use cases clearer."

Paul Burns, president of Fort Collins, Colo.-based Neovise, was surprised by how high the numbers were, especially given the widespread popularity of things like Web-based email. But, he did believe that there is a contingent of people who are against cloud in all circumstances.

"There are definitely a lot of people out there who are against cloud, period," he said. "They are worried about job loss, that sort of thing. They don't want things to change so much."

While some are clinging to the past, those that are investing in the future are doing it in one key area -- SaaS. Of the 352 respondents engaged in public cloud, nearly two-thirds were using SaaS applications. Within six months, 37.6% of all respondents said more than half of their applications will use the SaaS model.

"Most organizations adopt SaaS solutions as the first step in moving down the cloud path," Kaplan said. "They start by experimenting with front office and end-user-oriented SaaS applications, such as CRM and collaboration. They then explore back-office SaaS apps, such as financial management and ERP."

Burns believes the number is high because of the large investment startups have made in SaaS applications over more expensive on-premises setups.

"That strikes me as a little high. SaaS spending and adoption is higher than something like IaaS, but that seems a little bit high," he said. "[At] enterprise-level [companies] that would be shocking, but smaller companies saying that I wouldn't be surprised. I'm probably that way, half or more."

More apps, more problems

Moving more business applications into the cloud has solved some problems but created news ones. Respondents were happy with SaaS applications' low costs (21.3%), faster implementation (22.8%) and ease of use (19.3%), but said that they need help dealing with application integration (34.2%), data integration (26.2%) and customization (34.2%).

"Integrating multiple SaaS applications with legacy systems and data sources can be a big challenge," Kaplan said. "Fortunately, there are a growing number of APIs, integration tool providers and system integration firms which can help organizations overcome these challenges."

Kaplan references Informatica, Pervasive Software, Dell Boomi, IBM/CastIron and SnapLogic as cloud integration tools that are being used by some to fix integration problems. He also notes that some enterprises can kill two birds with one stone -- fixing integration and customization problems with Platform as a Service (PaaS).

"Today's Platform-as-a-Service development tools are also making it easier to build and customize SaaS apps," he said. "'s, Google [App] Engine and Microsoft Azure are the major PaaS players. Cordys, TrackVia and LongJump are leading independent players."

Burns believes people investing in SaaS need to accept the realities that they can't have everything both ways when it comes to convenience and customization.

"I definitely hear that complaint -- it's a two-edged sword," he said. "You can save time and money on SaaS, but then it varies by offering how much you can configure from there. Some people have a lot of need or in some cases are just used to configuring [their applications]."

Adam Riglian is a news writer with Follow him on Twitter @AdamRiglian.

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