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Presentation that I used at the IBM cloud conference in Pune.
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Will Cloud Computing erode the IT Services Business?
Anand Deshpande September 2012
10 September 2012 1
10 September 2012 2
Coming to
New Delhi, India
2016
Cloud Computing is imminent …
● It will be driven by economics ...
… about 30% reduction in costs!
– Cost of infrastructure
– Cost of management of infrastructure
3
By operating at scale, improving utilization, simplifying operations, standardizing, increasing reliability, reducing energy and cooling
• hardware costs can be reduced 33-70 percent • maintenance costs can be reduced up to 50 percent • support costs can be reduced by as much as 33
percent • floor space/facility costs can be reduced 33-50
percent
http://www-935.ibm.com/services/us/its/html/green-datacenter-svcs-landing.html February 3, 2012 4
Cloud computing will see mainstream deployments in the second half of 2013.
● Cloud leaders (pre-2010) … Amazon, Salesforce.com
● Major cloud strategy announcements in 2012 from
– Microsoft, IBM, HP, Dell, EMC/Cisco
– Vmware
– Oracle, SAP
10 September 2012 5
February 3, 2012 6
Cloud is about simplicity!
Mobile devices are the de-facto consumption device
● BYOD is the hottest disruption in the enterprise.
● Mobility is not just small screen. There is more.
– Presence
– Location
– HTML5
– Task specific apps
● Build for Mobile device first!
10 September 2012 7
Cloud and Mobility will grow in tandem. They are interdependent!
10 September 2012 8
Cloud computing will create jobs in India!
10 September 2012 9
Really? If every CIO saves 30% from their budget … world’s software business is significantly down!
10
𝑥𝑖 > (𝑥𝑖 − 𝜕𝑖)
ADM business will bear the brunt
11
0%
20%
40%
60%
80%
100%
120%
Pre Cloud Post Cloud
Business Apps
ADM
Packaged Software
Infrastructure
30% reduction in cost!
Buying Decisions are moving from the CIO to C-Suite and the Line of Business Heads
12
As the CIO’s budgets shrink, Line of Business (LOB) Execs are making technology buying decisions
● LOBs build projects like “products” rather than IT Services
– Incremental, agile,
● Will consider new set of vendors … opportunity for different set of vendors.
10 September 2012 13
The cost of product development has gone down significantly!
14
Team Size
Time Period
Traditional Ways
On the Cloud
If it costs less to build a product …
● Different kind of products will be built.
● Different kinds of people will invest to build products
● If product development costs are not significant, do I need to go offshore at all?
10 September 2012 15
Data on the cloud is enabling new data-centric business models.
February 3, 2012 16
We live in a world of apps. Apps, apps everywhere!
February 3, 2012 17
Enterprise Value is Shifting to Data
18
Mainframe
Operating Systems
ERP
Apps
Data
2013 2006
Database
1995 1985 1975 10 September 2012
There will be a hierarchy of apps with different price points; all available on a pay-per-use business model.
Business Process Specific Apps
Task/Device Specific Apps
Traditional Applications will
be commoditized on the cloud.
Aggregate Data
Enterprise Data Public Data
February 3, 2012
19
India: the source
and the market
for innovation 20 February 3, 2012
Cloud computing is an excellent
opportunity for Indian
Industries to collaborate and
disrupt
21
Healthcare Tourism Education
Retail Logistics Research
