Cloud Computing – How Did We Get Here?

I’m not a historian. So to paraphrase Feynman: “What I am telling you is a sort of conventionalized myth-story that the consultants tell to their clients, and those clients tell to their clients, and is not necessarily related to the actual historical development, which I do not really know!”

This is the nutshell version of a much longer section:

At its core, any business has three main business processes: customer relationship management, product innovation, and infrastructure management. Business Unbundling describes the effect when these three core business processes become separated by specialized companies due to reduced interaction costs within and between companies and customers. The operational model of Web 2.0 is helping to massively reduce interaction costs, subsequently increasing market fragmentation. In order to deal with the operational model of Web 2.0 and the associated fragmentation, the ICT industry required a design framework that allows flexibility while providing operational stability. The principles of Service Oriented Architectures (SOA) from the early 90ties flourished. If Web 2.0 is an operational model, and SOA its design framework, then Cloud is the (business) model for service provisioning and exposure to external and internal parties.

There are, in fact, many Cloud business models, each with its own value proposition, key resources and activities, revenue streams and costs, but I am alluding to the fact that Cloud is merely a new way of doing IT business, and not necessarily a new technology or service. At least not initially – but we will get to that.

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This entry was posted on Friday, August 27th, 2010 at 9:19 am and is filed under Book. You can follow any comments to this entry through the RSS 2.0 feed. You can leave a comment, or trackback from your own site.

  • http://bestbrisbaneseo.com brisbane seo

    By stark contrast, those IT professionals that have been embracing Cloud Computing, however, seem to be having a very different experience that puts this …

  • Me

    “Web 2.0 accelerates business unbundling by reducing interaction costs. Its customer-centric approach, .harnessing collective intelligence and creating an environment or platform of intellectual exchange., lead to app stores and open development initiatives”This is the only paragraph I read, what a crappy collection of buzzwords with no real meaning. Get your head out of your butt and speak in practical terms if you want to have any sort of credibility.

  • http://about.me/thinkstorm Thorsten Claus

    I’m glad to hear that the microeconomics concept of  “business unbundling” is a buzz word – that’s great news!  While there seems to be a problem with your copy+paste formatting (iOS?) I regret that you would not use your name or leave a real email address so I could answer you – but I understand that using foul language in comments might not be the smartest thing to do while using a government DSL connection in Gatineau, Quebec (Canada). So I will answer here on the blog:

    The paragraph you refer to is from the 2-3 paragraph summary at the beginning of each chapter, usually a condensed version of the following 5-10 pages. Unfortunately for you (and besides my many typos :)) this is full of content, but with – I admit – a few buzz words to make it possible for readers to skip a chapter if this is old news. As this book was not written for the “Net Heads” but for the “Bell Heads” some of these concepts need explanations. But here my slightly longer-than-three-sentence-summary and a-lot-shorter-than-ten-pages explanation (which has even more practical explanations on some of the microeconomics concepts and interplay between Net Heads and Bell Heads:

    1/  The first sentence refers to the fact that Web 2.0 (generally speaking) lowered hurdles and costs to access and interact with data. HBR’s study of “interaction costs” within and between businesses shows that reducing such “costs” (time, money, effort) leads to necessary disintegration of core business processes, and Web 2.0 is doing exactly that. 

    2/  Web2.0 is “customer centric” per definition of O’Reilly – no buzz-words here.  Web2.0 creates value out of several different ideas and products – O’Reilly uses the phrase “collective intelligence” and “platform for exchange” – and I stick with people who know about it rather than using my own terminology.

    3/  Maybe “platform for immediate shared resource access” would be a better description for Web2.0, looking back.  It means that whatever resource you have – customer access, data, time, money – you can now share without mediation (though you might want to use an aggregator) immediately. This concept created anything from AJAX user interfaces (immediate access to data) to value added services (maps+traffic overlay) to app stores (sharing of customer access and OS functions and billing).   I’m not saying that Web2.0 made App Stores possible, or that Web2.0 apps became Apps, or that Web2.0 technologies are the basis of App Stores. I am saying that a shift in mindset on how to “own” resources – customer access, data, time, money, technologies., infrastructure – was *one* of the factors that made a new access paradigm possible.

  • http://about.me/thinkstorm Thorsten Claus

    … and by the way, dear anonymous angry commenter: Maybe a book format is also not the right content format for you in general, or simply summaries are not your thing… maybe Twitter is better if your attention span is too short for a book.