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'Cloudburst' Expected in United States Could Save Both Cash and Carbon
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November 09, 2011

'Cloudburst' Expected in United States Could Save Both Cash and Carbon

By Cheryl Kaften
TMCnet Contributor

The future of U.S. computing is under a cloud — and that’s a good thing. A new report predicts that American companies will increase their adoption of cloud computing over the next decade from 10 percent to 70 percent of their information technology spend. The anticipated sky-high leap in cloud usage will be good for the planet, as well as bottom-line profitability, making it a win-win for environmentalists and economists alike.

In fact, by 2020, cloud adoption could save 85.7 million tons of carbon, equivalent to the annual emissions from 16.8 million passenger vehicles, anda 50 percent CO2 reduction versus no cloud at all. What’s more, the energy savings would total more than $12 billion annually for the 2,653 global firms with annual revenues in the United States above $1 billion.

The study, “Cloud Computing: The IT Solution for the 21st Century,” was conducted on behalf of the Carbon Disclosure Project(CDP) by the independent, London-based research firm Verdantix and sponsored by Dallas-based communications giant (and cloud provider) AT&T. The Carbon Disclosure Projectis an independent, nonprofit organization with headquarters in London that has amassed the largest database of primary corporate climate change information in the world.

What exactly is cloud computing? According to the  National Institute of Standards and Technology (NIST), “Cloud computing is a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (e.g.,  networks, servers, storage, applications, and services).”

In addition to energy savings, cloud computing represents a way to:

  • Help users to avoid costly up-front capital investments in infrastructure;
  • Improve time-to-market, because a new server can be created or brought online in minutes;
  • Provide greater flexibility, by paying for excess capacity only when they need it;
  • Avoid continual maintenance of excess capacity to handle spikes; and
  • Drive process efficiencies.

Paul Stemmler from Citigroup commented: “Carbon reduction is one driver, but … the primary driver is time to market. Developers used to take 45 days to get new servers, but in the internal cloud infrastructure that we operate in our own private network, it takes just a couple of minutes.”

The study results make a powerful case for businesses to continue to explore and adopt secure and flexible cloud computing solutions,” said John Potter, vice president, As-a-Service Solutions, AT&T (News - Alert).

The study makes the following recommendations to help companies maximize their cloud computing investments:

  • Develop an enterprise-wide strategy: Firms that have demonstrated the greatest success in moving to a cloud-based model have integrated cloud computing into their overall IT strategy. By taking a holistic approach rather than establishing an uncoordinated mix of various cloud- and non-cloud-based solutions, targeted solutions can be deployed to increase the efficiency of the business.
  • Understand the IT estate. Creating a business case for cloud computing demands an understanding of the costs of supporting the different elements of the existing IT model. In looking at an IT application, the license fee may be highly transparent; but the cost of the supporting infrastructure and the number of full-time employees involved in the maintenance of the application may be less obvious, as well as the electricity cost of powering this application.
  • Investigate business processes. One of the characteristics and benefits of cloud computing is its flexibility, which allows for the rapid provisioning or de-provisioning of services. Many firms have particularly high computing demands at month-end, quarter-end, or year -end. Adopting a cloud model enables these firms to rapidly scale up and down as required, rather than spending money maintaining servers year-round to accommodate occasional spikes.
  • Identify non-business-critical applications. Firms repeatedly indicate that they would not consider a public cloud software solution where business-critical data would be stored. At the same time, they confirm that a public cloud solution would be feasible for less-critical applications. Firms should determine which applications are non-business-critical and investigate a public cloud solution.
  • Harmonize use of tools. Developers have traditionally used their own tools to develop new IT applications, which is not conducive to using a cloud-based development platform. Firms should try to harmonize use of tools, thus facilitating a move to a cloud based platform

Verdantix conducted in-depth interviews with multi-national firms in diverse sectors including Aviva, Boeing, Citigroup, and Juniper Networks (News - Alert). All study participants had adopted cloud services for at least two years. Many of the firms interviewed reported cost savings as a primary motivator, with anticipated cost reductions as high as 40 percent to 50 percent.

For a full copy of the report, visit the Carbon Disclosure Project website.

Cheryl Kaften is an accomplished communicator who has written for consumer and corporate audiences. She has worked extensively for MasterCard (News - Alert) Worldwide, Philip Morris USA (Altria), and KPMG, and has consulted for Estee Lauder and the Philadelphia Inquirer Newspapers. To read more of her articles, please visit her columnist page.

Edited by Rich Steeves

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