Dial a Cloud

Dial a Cloud

There is so much hype about Cloud Computing with little understanding of what its real potential is. What perhaps added to the confusion was the recently released McKinsey report that headlined there was more hype than reality in the Cloud. For the enterprise sector, perhaps, but the SME and the organizations that are already strapped for cash, they really have no option other than the Cloud.

And the 'supply creation' by hardware companies who promote equipment that has a value proposition for people to plug themselves into the internet cloud through thin clients and netbooks. Companies who used to provide simple hosting services are now expanding into the realm of Infrastructure As A Service as well as providing niche hosting services for everything from online data storage to archiving. But sure, the decision to plug a company into the cloud really has to make business sense. If the economies of scale make it sensible for them toengage in DIY solutions (Do It Yourself), then so be it.

But let's take a step back and see what Cloud Computing is actually all about, for those of you who might still consider it as an option.

Cloud computing is hosting your information on the internet. There are three models of the Cloud: Software As A Service (SAAS), Infrastructure As A Service (IAAS) and Platform As A Service (PAAS). SAAS is where you have simply plug yourself into the Cloud to store your data or manage a solution which was otherwise done on your desktop or laptop. Examples which you might recognize include Yahoo Groups or Google Docs. IAAS is when you are provided with a server and you can opt to have specific applications or software installed on your server or rack.

Simple examples of this could be when you need to have a server prepared to run specific configurations such as LAMP or WAMP or when you need to have a platform installed on your hosting service. The hosting provider will usually offer you a portfolio of such apps which can be installed through the interface provided to you. You usually find these options in the control panel of your hosting provider.

Lastly, there are companies who provide you with PAAS options which are usually geared towards developers. You can use a platform online rather than installing the components on your workstation. Examples of this would be of Windows Azure or Google Apps Engine.

People go ahead and further breakdown these categories but for the purpose of this article, we'll stick to these three categories.

Cloud for TelcosOnce you understand the power of the Cloud, you have to understand how it operates from a service standpoint. Depending on who you speak with, you will get a different perspective, however when it comes for Telecom companies, there is an interesting opportunity to optimize their already underutilized service portfolio.

Take a look at the core business of a Telco. They essentially provide a connectivity pipe to help transmit data and voice from one location to another.

They process a bit from one place to another at a cost which is charged to the consumer. And it makes sense to have the exact 'price per Kb or minute' transfer if you have only a few customers, but when you are dealing with millions of subscribers, the rate of transmission becomes insignificant. One way or another, the costs will be absorbed. However, there is a lot of 'bandwidth' and infrastructure that still sits idle. And it is this underutilized infrastructure that can actually be offered to customers.

Box manufacturers have changed their pricing model to increase affordability.

Isn't that the vision Netbooks? You can get a Netbook for $100 if you sign up for a 2-year contract. A similar approach will eventually be taken on with Telcos locally. Depending on the type of customer, they can offer different, flexible price models for each consumer.

They can, for example, charge per byte of transfer whereby their infrastructure costs will reduce. A second option is that they provide complementing services to their existing subscriber base. For example, offering an enterprise data center solution, or offering consumers security which also opens up archiving and data warehousing. For a fixed monthly cost, an existing telecom subscriber can get more out of the infrastructure, at little or no additional cost to the Telco.

Another option that is already being rolled out into the Pakistani market is when the telecom service provider provides an integrated solution and then simply charges extra for that. Examples of this can be the additional GPRS or connectivity dongles that you see with Telenor or Ufone. This might not be their core business but it provides more value to the consumer and will help to retain them.

Perhaps the only thing that keeps telecom companies from going full throttle into these options, is lack of technical know how. Traditionally, telecoms started off to be all about, well, telecommunications. But this is fast changing because of the way technology is driving it. It might be ideal for everyone to follow the announcements that AT&T has recently made, but then there are few conglomerates that are technically competent and skill of the company, who has its origins in Bell Labs. So the evolution will simply take some time.

But take a look at companies like Mobilink Infinity, Wateen or Worldcall -- they're already dabbling in all the platforms which link their customers to the Cloud directly.

The IndustryThere are different kinds of companies that make the virtual world go round. Microsoft, Oracle, VMWare are in the Cloud as the software giants who are now into SAAS. There are then services vendor such as Google, and Yahoo. Platform vendors include companies such as Amazon, who have converted from servicing their niche verticals to PAAS. There are security vendors, traditional hosting vendors, hardware vendors and then Telcos.

If Telecoms get a little more experience in serving the Cloud to its subscribers, there is no reason why these services, which are probably cheaper than what most other countries offer, cannot be offered to specific niche markets regionally. The key here, is the niche. If platforms can be opened up to developers, then there can be a greater amount of value add to the end user. Telcos can offer services to verticals and to other platforms through front end integration with Pakistani customers. Establish a successful track record and package it to an international audience.

Wrapping It UpCloud computing has a great deal of criticism as to whether it is just hype or reality. The truth of the matter is, consumers are already in the Cloud. As for enterprises, because they have issues such as security, legal issues and privacy, the shift for them will take a little longer. But one thing is for certain -- in times of an economic downturn, Cloud computing is ideal -- it will just take a while for companies to get there.

With the expanding Telecom subscriber base, recycling infrastructure for more optimal utilization, is what will drive further growth in the market.

about the author:Zia Khan is the founder of Operation Badar, a Microsoft Valuable Professional and his area of expertise includes .NET and Java. You can contact him at

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