Rackspace cloud chief predicts enterprise caution

Managers won't move their main applications to a cloud for several years, he believes

Most large enterprises won't move their established applications on to cloud services for years but are embracing the technology for new projects, the head of Rackspace's cloud business said on Thursday at the Structure 2010 conference in San Francisco.

"The idea of an IT department prioritizing taking their SAP and putting it in the cloud, it's just not the way IT (departments) think," said Lew Moorman, Rackspace's chief strategy officer and president, cloud. "The SAP [in their enterprise] works. I think mostly they just don't touch it," he said. The number of new projects in the cloud will far outweigh the large-scale migrations, he said.

Though mainstream productivity applications are likely to be run on a cloud eventually, it won't be done in one fell swoop, Moorman said. A company might start with the human resources component of the SAP package and see how that goes. "Piece by piece, those legacy applications will get disaggregated, and they'll end up in the cloud. ... But that's going to be a 10-year process," he said.

Enterprises are already taking advantage of cloud services for small, new projects that they can now easily buy the resources for, according to Moorman.

"There's a whole backlog of projects and ideas and innovation that exists in companies and in employees' minds that suddenly they're going to execute on, because they can do it," he said. "They can put their credit cards up, they don't have to coordinate with IT."

Rackspace is still mostly in the managed hosting business, with only about 10 percent of its revenue coming from cloud services, Moorman said. But its revenue is growing much faster in the cloud business and within a few years will probably make up about half of what the company brings in, he said.

"There is tremendous momentum behind these technologies," Moorman said.

Other observers at the conference have also noted an upswell of cloud use in individual departments as they tackle small or temporary projects.

"If you want to see what's really happening in the cloud, don't go to IT," Forrester Research analyst James Staten said during a Wednesday panel discussion. A CIO may say 5 percent of the company's computing work is being done using cloud services, not knowing about what a research and development department is doing because they haven't told top management, he said. Other panelists agreed.

Though most cloud projects are tactical today, enterprises are soon likely to target established applications that are relatively easy to migrate, said Frost and Sullivan analyst Vanessa Alvarez.

"I do think there are legacy applications that make sense to put in the cloud," Alvarez said. One possible example is e-mail, which doesn't operate in real time, she said. By contrast, CRM (customer relationship management) is more complex and holds sensitive data about customers. Both the time and the cost involved in putting a legacy CRM application in the cloud is likely to be higher.

However, though C-level executives are beginning to plan long-term cloud strategies, most enterprises won't move their first mainstream applications to a cloud service until 2011, she believes.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.

Tags cloud computinginternetrackspace

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Stephen Lawson

IDG News Service
Show Comments

Cool Tech

Toys for Boys

Family Friendly

Stocking Stuffer

SmartLens - Clip on Phone Camera Lens Set of 3

Learn more >

Christmas Gift Guide

Click for more ›

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Aysha Strobbe

Microsoft Office 365/HP Spectre x360

Microsoft Office continues to make a student’s life that little bit easier by offering reliable, easy to use, time-saving functionality, while continuing to develop new features that further enhance what is already a formidable collection of applications

Michael Hargreaves

Microsoft Office 365/Dell XPS 15 2-in-1

I’d recommend a Dell XPS 15 2-in-1 and the new Windows 10 to anyone who needs to get serious work done (before you kick back on your couch with your favourite Netflix show.)

Maryellen Rose George

Brother PT-P750W

It’s useful for office tasks as well as pragmatic labelling of equipment and storage – just don’t get too excited and label everything in sight!

Cathy Giles

Brother MFC-L8900CDW

The Brother MFC-L8900CDW is an absolute stand out. I struggle to fault it.

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Featured Content

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?