The Economic Potential from Cloud Computing

Posted on September 20, 2010


The EU Digital Agenda mentions Cloud Computing ONCE (Clause 2.5.1), but anyone familiar with the concept will not be fooled in to believing that it is a bit player.  I would expect that Cloud Computing will become a demanding factor in all that the Digital Agenda embraces. 

Cloud Computing is a marketing term. A very appropriate marketing moniker, the cloud metaphor is as amorphous and indistinct as it is clear. Cloud Computing like its meteorological simile means different things to different people. A characteristic that reflect its flexibility and adaptability but does little to help provide any definitive clarity.  

Coming at it from a high level – “Cloud Computing” is a new service orientated paradigm culminating from economic and technological confluences that are causing a disruptive change to more than just I.T., changes that will alter the operational chemistry of companies as we know them today and change the face of the ICT landscape to its core, faster than many are prepared to acknowledge.

As such “Cloud Computing” is not a tangible solution but a conceptual label for marketing guru’s to commoditise the metamorphosis of the technological and non-technological dimensions of this new IT service orientated paradigm. A model of IT consumption for business providing unquestionable value to organisations of all sizes, none more so than the SME’s through economies of scale delivered by experts at a price point with guaranteed Service Levels that no business could afford to deliver in-house. 

The challenge is not a technical one – In fact the concepts and ideas around cloud, platforms, the economics, the barriers to adoption and how to engage the opportunities echo back to the VT Terminals of the ’70s. After all mainframes have been using virtualisation for years; the unique nature and transformation of the mainframe virtualisation into cheap PC virtualisation technologies forming one of the key catalysts of Cloud Computing’s coming of age. The recession being the sober economic energiser focusing the mind of big and small business alike.


The challenges are those of:

          I.            Awareness – educating business to the opportunities

        II.            Preparedness – underpinning the educational messages with qualified research

      III.            Execution – a service environment that can demonstrate its credibility and security through Trustmark’s that business can rely on.

Where the rubber really hits the road is what Cloud Computing has the potential of delivering for Europe:

        I.            business creation = 300-400 hundred thousand new SMEs

      II.            substantial impact on employment

a.      @ a million new jobs

b.      reduced unemployment rates

    III.            and increased GDP growth

Quote “The Economic Impact of Cloud Computing on the EU Economy” – Prof. Federico Etro University of Milan.

Posted in: Cloud Computing