Purposeful View: Google CIO Ben Fried Says Cloud Tipping Point Is At Hand (by Walt Lapinsky, 2 May 2012)


In a recent blog on wsj.blogs.com, Wall Street Journal Deputy Editor Steve Rosenbush reported on remarks made by Google CIO Ben Fried at the May Bloomberg Link Enterprise Technology Summit in New York. Fried said that cloud-based computing is fast approaching a tipping point that will make it the standard for IT. “Here’s where I think it is going. The macroeconomic tides — you can’t fight them forever — will force companies to adapt. We’re probably close to that point now.”

What has caused this? Fried points to three specific things:

  1. Financial pressures that all companies are facing.
  2. The advent and rapid growth of free and simple tools such as Google Apps, Skype, Flickr and iTunes that people are using in their personal lives.
  3. The rise of enterprise-focused Cloud services like Amazon Web Services. These services are rapidly making it possible for startups and other organizations to run their businesses at significantly lower cost.

Fried indicated that the reason Google can afford to offer free, ad-supported services to literally millions of people is because Google has taken costs out of its own business. The economics of providing the Cloud has led “to a level of vertical integration never seen before.” Google owns many of the elements of its own supply chain, including building its own data centers close to low-cost power sources.

This vertical integration is not unique to Google. Many Cloud Service Providers are also grabbing control of more and more of the Cloud supply chain, including making tight partnerships with worldwide communication companies.

Our view: We agree. Join the Cloud or you are highly likely to be overtaken by your competition. Talk to your employees – they may be more Cloud savvy than your IT department. It is time to reassess what your core business truly is. Where should you be investing your capital to expand your business? If your core business is not IT, then it is time to plan your journey to the Cloud now.

Comments? Questions? Contrary views? Some event we missed?
We welcome your feedback at talk@purposefulclouds.com

Purposeful Clouds helps companies assess and plan their best options for Cloud technology adoption, with before-the-fact consideration of contingencies, ROI, and further migration strategies. To discuss how we would be able to help you make the best decisions, contact us at info@purposefulclouds.com.

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