how cloud computing will change the nature of competition for many businesses now and in the future STRATEGIC FOCUSCOMPETITION TO SELL CLOUD COMPUTING RESOURCESTECHNOLOGYCloud computing refers to firms that sell computer processing,storage and software application access on demand via acomputer network, in particular over the internet. The 'cloud'is actually a large server that holds data. It includes applicationsoftware such as word processing, spreadsheets, databasemanagement and email. The traditional model of computingwhere software and data are fully contained on a user'scomputer is differentiated from cloud computing, where theuser's computer may contain very little software or data and aminimal operating system or web browser. Through this minimalsoftware, the client uses the focal computer as a display terminalfor accessing applications, data and storage in a distant location.Certainly this is the way mobile smartphones access email andother data sources located on a server elsewhere. Web-basedemail such as Gmail, Hotmail and Yahoo! allow services to beprovided on local devices through the internet, making themprime examples of cloud computing. As such, cloud computinginvolves pooling of many remote computers in the cloud' tomanage tasks, warehouse large storage of data, manage andsynchronise multiple documents online, and computationallyprocess intense amounts of data and provide application services.Large firms and start-ups are seeking to use the power ofcloud computing. Amazon played a key role in the emergenceof cloud computing. When it modernised its data centres, theywere using as little as 10 per cent of their capacity at one time.As their internal efficiency improved, Amazon initiated a servicedevelopment effort by providing computing power to externalcustomers by launching Amazon Web Services (AWS). NowAmazon has thousands of corporate customers who use theirWork the way you wantDrotoA number of companies focused on online storage, like Dropbox, aregaining users' attention, with new investment driving a boom in thisniche business.Source: Shutterstock.com/Rawpixel.comand reduce costs throughout their intra-corporate networks.For example, in 2010 Oracle bought Sun Microsystems, ahardware server manufacturer, even though Oracle's focushas traditionally been on producing software that facilitatesdatabase management and providing software services to largercorporations. Their intent with the Sun acquisition is to pursuecombination hardware and software systems to establish aplatform on which to run the various products that are needed inthe cloud and establish a standard that client firms can dependcloud computing services, including Pfizer, Netflix and manysmall start-ups. Suchtheir efficiency and change computing to an expense ratherthan a large capital investment. Furthermore, these servicesallow small firms access to powerful computational resourceson for running their large networks.allow largeto improveaimed to have a leading role in cloudcomputer information technology. HP has adopted a hybridapproach, offering intra-company systems plus public cloudsLikewise,to sell computational resources to small and medium-sizedthat they can purchase rather inexpensively compared withthe capital investment that might otherwise be required. Forsmall firms in emerging economies, these services facilitateeasier entry into markets in developed countries relative to theirprevious capabilities if they had to spend significant investmentdollars to gain up-to-date information technology resources.Another aspect of the business is focused on intra-companycloud computing, or private clouds. Large hardware and softwareproducers such as Oracle, HP, IBM and Dell are all seeking toenterprises, thereby offering a portfolio of cloud services,from private infrastructure to public platform services. Toaccomplish this, it will need to acquire more software, especiallyapplications. For instance, it acquired Palm's web0S mobileoperating system. It hopes to sell 100 million devices installedwith web0S, allowing mobile devices to access its client's intra-company or HP's public cloud offerings. An example of howthese devices might work is the iPad tablet computer by Apple.sell private cloud computer systems to corporations so thattheir clients can consolidate their computing power centrallyOne can examine files on the iPad generated by Microsoft 0fficeapplications and Adobe's portable document format (PDF) files,despite the lack of a USB computer bus on the iPad. To readcontinued16? continuedthese documents, the iPad uses a file transferred from theand by late 2015 it had over 200 million users globally. DropboxiTunes computer program, which is accessed through remotecloud computing services, sending the file to the iPad as anelectronic mail message attachment.The competition for private intra-company services to shiftlarge data-intensive firms to cloud computing is intense, withplayers including HP, IBM, Oracle and SAP. This competitionwill be fast-changing and uncertain, given the disruptive costreduction incentive for firms to move their data crunching tolets its customers 'store digital files, including photos, personaldocuments and digital music files, in an electronic locker thatthe owner can access or share on nearly any net-connecteddevice'. In other words, Dropbox is a file backup service as wellas a source to provide access from any net-connected device atan increasingly affordable price.As you can see, this disruptive concept, cloud computing, islikely to change the way that we use and access our computerservices, especially as we move further and further into mobilecomputing devices such as smartphones and tablets. This willnot only change the nature of competition but will also increaseit in different ways for existing companies.lower-cost opportunities in the cloud, as well as the lack ofstandards. Likewise, the competition will be just as intense anduncertain in the battle to sell public cloud services to small andmedium-sized firms that will seek to have access to increasedcomputing power at a cheaper cost.Salesforce.com is an example of a specific business functionmoving to the cloud and selling its services to individual companiesas a way to increase the efficiency of sales operations. Salesforce.com sells its web-based software to large and small firms' salesdepartments. It has created a US$1.4 billion-a-year businessby tracking leads, giving detailed histories of who bought whatand when, and advising on how to reach particular consumers.Although Salesforce.com is focused on one particular function ofcloud computing, its software has developed 170000 applicationswritten by other firms running on its technology. However,Salesforce.com may have difficulty breaking into other functionson the cloud, given its single focus on sales.Dropbox is another example of cloud computing focused onindividual consumers. It is 'cloud computing for the rest of usSources: Google, 2015, How many people use Dropbox, https://www.google.com.au/webhp?sourceid%-chrome-instant&ion=1&espv-2&ie%3DUTF-8#q=how+many+people+use+dropbox, 12 0ctober; V. Barret, 2011, Larry's long reach,Forbes, 14 March, 18-19; T. Claburn, 2011, Google turns office into Googleapps client, InformationWeek, 14 March, 16; J. P. Mangalindan, 2011, Cloudcomputing for the rest of us, Fortune, 21 March, 50; S. Marston, Z. Li, S.Bandyopadhyay, J. Zhang & A. Ghalsasi, 2011, Cloud computing: The businessperspective, Decision Support Systems, 51(1): 176-89; A. Ricadela, 2011,Apotheker seeks to save HP's 'lost soul' with software growth, BloombergBusinessweek, http://www.businessweek.com, 10 March; C. Saran & W.Ashford, 2011, HP aims to be leader of the pack but will new strategy reachthe cloud?, Computer Weekly, 22 March, 8; C. Tuna, 2011, Tech giants lookforward to cloudy days, Wall Street Journal, 30 March, B1; B. Worthen, 2011,Boss talk: Michael Dell looks beyond PC business, Wall Street Journal, 25April, B1; B. Worthen & I. Sherr, 2011, Corporate news: H-P CEO takes thestage, Wall Street Journal, 15 March, B3; V. Barret, 2010, The web's bigupstart, Forbes, 6 December, 72-80.

Cloud computing refers to the delivery of computing services, including storage, processing power,…

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how cloud computing will change the nature of competition for many businesses now and in the future

Database System Concepts

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ISBN:9780078022159

Author:Abraham Silberschatz Professor, Henry F. Korth, S. Sudarshan

Publisher:Abraham Silberschatz Professor, Henry F. Korth, S. Sudarshan

Chapter1: Introduction

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