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The great cloud bait and switch: Agility instead of cost

Remember when cloud's major selling point was the bottom-line benefits? It's only recently that the vendor's buzzword has been curiously changed from "cost" to "agility."

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As enterprise cloud adoption steadily mounts, for both public cloud services and the private cloud paradigm, it's becoming clear that vendors are trying to change their tune to better suit their ambitions. The new byword is "agility"; the sell-siders would fain have you forget about that earlier golden calf, "operating expenses (opex) versus capital expenses (capex)."

Enterprises are looking at a long-term, fundamental shift in how they do IT.

At Interop last week, there was a two-day Enterprise Cloud Summit that trotted out every cloud computing trope and moldy old straw man from the last three years…except that one. Based on the vendor panels, which these days at least have company names you've heard of instead of flavor-of-the-week startups, the magic bottom-line benefits aren't the rallying cry anymore. And Microsoft, at Interop and again this week at TechEd, put cloud in practically every tag line but accompanied it with "agility, agility, agility."

"Use Azure to be more agile, use Hyper-V to be more agile," and so on. The only time Microsoft mentioned cloud's vaunted economies of scale and promised hyper-efficiency was to tell us all about its new Chicago data center, which will host 700,000 servers and give Microsoft "unprecedented" levels of efficiency and running costs. Of course, they're not lowering prices anywhere that I could see, so that was an unsubtle way to tell your customers that they'll be bent over a barrel like never before. Did Larry Ellison start giving Redmond PR tips?

The good ol' days of cloud
Remember when "the cloud" was all about dumping those pesky capital investment dollars for slimmer, trimmer opex costs? It was the banner under which rode hosts of cloud providers, startups and independent software vendors. IT shops were supposed to drop everything and flock to the idea of never owning infrastructure again, or turning their crummy old data centers into sparkly new systems without rebuilding everything from scratch.

That was, of course, because cloud turned out to be a viable business model for a serious business enterprise (Amazon), and half the IT world got whiplash watching it happen. The whole point was that you could take cheap, basic stuff (white box servers and hard drives) and cook up a working, scalable IT infrastructure that delivered what companies like CA and IBM were promising for umpteen jillions of dollars. "Cheap and it works like crazy" is a very compelling argument.

The magic bottom-line benefits aren't the rallying cry anymore.

Even today, Amazon Web Services' margins could probably make Croesus weep. However, like all marketing, there's some truth to the fact that agility -- which we'll describe as the ability to deliver, change and improve IT services faster than otherwise -- is as important to enterprises as the operational efficiency to be gained from running a cloud computing model. By and large, users I talk to aren't terribly confused: Cloud computing gives them the ability to do more, with the same amount of budget, than they could before. That's why it's popular. But that's pure poison to the sales and marketing departments at the likes of IBM, Microsoft, and so on. They'll end up selling you the same amount of stuff and you'll do 5 times what you used to, or worse, you'll buy less stuff.

It's becoming increasingly clear that to properly take advantage of cloud computing -- inside, outside and in between -- enterprises are looking at a long-term, fundamental shift in how they do IT. Amazon did it basically for free (open source software, brain sweat and amortized commodity hardware). Is that what got you interested in cloud, or was it the prospect of opening your wallet even wider to Microsoft, IBM, CA, BMC and all the rest?

There are zero viable, attractive, salutary examples of cloud computing or enterprises using cloud computing that cannot be done the same way and realize the same astounding economies; most IT shops will pick a vendor because it's easier and more reliable than doing it themselves. But when the vendors are trying to downplay the cost benefit, it's a sign of trouble. Watch out for "agile."

Carl Brooks is the Senior Technology Writer for Contact him at

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