Cloudonomics: The Business Value of Cloud Computing, + Website

Insanity or Inevitability?

Larry Ellison, the founder and CEO of Oracle, claimed at one point that the cloud was “gibberish,” “insane,” and “idiocy.”3 It’s difficult to dismiss out of hand the perspective of the fifth richest person in the world, with a fortune recently valued at about $40 billion.4

And, after evaluating nearly 2,000 technologies, Gartner, one of the most respected IT research and analyst groups, recently singled out cloud computing as a technology at the “Peak of Inflated Expectations” using its “Hype Cycle” assessment methodology, which has been used “since 1995 to highlight the common pattern of overenthusiasm, disillusionment and eventual realism that accompanies” new technologies.5

Nicholas Carr, former executive editor of the Harvard Business Review, who, perhaps because he has claimed that IT Doesn’t Matter and thus is an easily outsourced commodity, nevertheless projected a Big Switch to ubiquitous cloud computing.6

A CIO can be forgiven for some degree of confusion, given the articulate spokespersons for opposing points of view. And there is truth to these different perspectives: Cloud may well be overhyped, but it is demonstrably creating value. Some computing may be a commodity and thus shift to the cloud, but perhaps the cloud can also be wielded strategically. Cloud computing can be a ubiquitous, democratizing commodity; a tactical necessity; a strategic differentiator; or even of existential import.

As a number of companies found out during the ...