Tuesday, November 20, 2012

Musings on the Cloud

I recently attended the Cloud Channel Summit in Silicon Valley.  The attendees represented leading software, hardware, systems and cloud hosting providers, as well as their channel—distributors, value-added resellers, systems integrators. Billed as a networking event to help build strategic alliances for a #cloud offering, it was apparent that the “cloud” and its ecosystem are still very much in a developmental stage.

Leading software and hardware providers, as well as companies that have successfully transitioned to a cloud-only strategy (such as Salesforce.com) all spoke of their “journey” to the cloud.  Issues such as delivery, support, pricing, channels to market—it’s all still in the development stage for a lot of companies.  The good part is that there’s movement in the market, so the cost per user, the experience, and the software delivered, will only get better, cheaper, and easier to procure over time.  The interesting part will be, how long will it take?

The majority of companies attending were not from the industrial automation space—I’d say, less than 5% represented our industry.  But the challenges and issues they have overall on creating, pricing, and deploying  cloud offerings definitely affect the industrial automation sector, and we can learn from their activities.  Many cited the Gartner Technology Adoption Curve (their Hype Cycle), which looks like this:

Most believe we are passing through the “Trough of Disillusionment” since the industry is now just starting to mature, with off the shelf, commercialized product offerings for the “cloud.” The real issue for us, the manufacturing/industrial sector, is how to evolve, in a cost effective, productive manner, existing solutions to take advantage of what the cloud can offer us: lower total cost of ownership, release from hardware & software restrictions, reliance on IT departments, and access to information from a variety of devices, including PCs, smart phones, tablets, etc.

That being said, I expect that over the next 12 to 18 months, you’ll see most industrial automation providers offer some cloud-based solution, whether it’s for maintenance (like Rockwell) or more pure-play software reporting & analysis (like Invensys).  It’s gone from a “technology trigger” to “slope of enlightenment” and for our industry, it’s a way of making software easier to acquire, less expensive implement, and use.  We are seeing crossover from the BPM (Business Process Management) and ERP (Enterprise Resource Planning) segments that have made the cloud a defacto delivery mechanism.  As others have written, the farther from the process equipment, the more sense the cloud makes.  And we are seeing that play out.

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