Editors' Cuts

Coalescing in the Clouds

Bill Kenealy
Insurance Experts' Forum, July 14, 2010

Considering the miasma of hype and confusion surrounding it, the term “cloud computing” seems an apt appellation.

Yet emerging from the vapors, changes that will significantly alter the enterprise software landscape are coming into focus. One such clearing occurred in Washington D.C. Monday at Microsoft's Worldwide Partner Conference. While the company’s intention to position its Azure platform as a general purpose cloud development standard are not exactly a secret, several significant announcements reinforced how intent the company is on making this a reality. Indeed, the addition of services giants Hewlett-Packard Co. and Dell Services (which acquired Perot Systems Corp. last year) underscore this point in a big way by introducing the platform to HP and Dell’s existing client base.

“By adopting the Windows Azure platform appliance, customers will have a clear path to adopt a proven cloud platform that integrates with their existing investments and expertise,” Bob Muglia, president of the Server and Tools Business at Microsoft. “The Windows Azure platform appliance will provide customers with a turnkey solution to address new business scenarios that require rapid scaling of applications and deliver services that are predictable, immediately consumable and more cost-effective.”

The promise of the cloud to make fixed costs variable and eventually redefine the nature of how information technology is configured and managed were central themes when Insurance Networking News sat down with Microsoft CFO Peter Klein in March."[Cloud computing] will empower IT, which is focused on innovation anyway,” Klein said. “This is just the latest innovation. They may need to figure out how to evolve to that, but IT will simply move up the value chain."

Microsoft is hardly alone in this vision of cloud computing someday altering the role of data centers. IBM, Google and Amazon Web Services have all articulated their visions for cloud computing. On Tuesday, Amazon unveiled its Cluster Compute offering, which pairs the company’s standard EC2 service with more processing power and faster network connections in order to offer high-performance computing on demand.

One intriguing detail in the raft of Microsoft announcements was that Azure would now be available for customers to install in their own data centers. Previously, Microsoft only permitted Azure systems to run in its own data centers. This reconciles with perception that many large data-intensive companies such as insurers, are more apt to develop internal, hybrid, cloud functionality rather than send data outside their walls.

To be sure, IT departments and risk and compliance officers harbor legitimate data security concerns about the technology. While not even the most rabid proponents of cloud computing seem to envision large companies jettisoning their data centers in order to move everything over to the cloud, given the tectonic shifts possible, insurers way well need to keep an eye out when today’s hype becomes tomorrow’s competitive reality.

Bill Kenealy is a senior editor with Insurance Networking News.

Readers are encouraged to respond to Bill by using the “Add Your Comments” box below. He can also be reached at william.kenealy@sourcemedia.com.

This blog was exclusively written for Insurance Networking News. It may not be reposted or reused without permission from Insurance Networking News.

The opinions of bloggers on www.insurancenetworking.com do not necessarily reflect those of Insurance Networking News.

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