TECH: Can India tackle the cloud challenge?

Cloud computing offers huge opportunities to the government and SMEs. But adoption challenges must be addressed. 

ONKAR PANDEY | New Delhi
Tags : CLOUD COMPUTING |

It is a rage globally and in India too, cloud computing is fast gaining popularity, thanks to its cost-effectiveness and efficient delivery models, resulting in major shift of information and communications technology (ICT) spending towards cloud-based services. The continuing global economic gloom is acting as a catalyst for its adoption as consumers and businesses keep a close eye on expenditures by adopting innovative and cost-effective technology solutions like the cloud.

Cloud computing refers to a pay-per-use model of computing where applications and software are accessed over the Internet and not owned by users. It helps IT companies to save on huge costs as they do not have to invest heavily in IT infrastructure. And normally, it has three broad categories of public cloud, private cloud (for specific enterprises) and a mix of two. Leading technology giants like Microsoft, Google, Amazon, Oracle, IBM, Dell as well as telecom players are pushing for an early and rapid adoption of cloud services by businesses and consumers.

Slowly, cloud computing is changing the way IT delivers economic value to countries, cities, industries and businesses. IDC estimates that in 2011 alone, IT cloud services helped businesses around the world generate more than $ 600 billion in revenue and create 1.5 million new jobs. The global cloud computing market will grow from roughly $ 40 billion in 2011 to more than $ 240 billion by 2020, according to a Forrester Research report, with a majority of the investments being made in the fields of software (SaaS), platform (PaaS), Infrastructure-as-a-service (IaaS) as well as payment and e-commerce services like the IRCTC portal for online ticket booking.

In India, cloud is rapidly being deployed as the preferred technology. Business Software Alliance (BSA), a global non-profit IT alliance, ranks India 19th among 24 in its preparedness for cloud computing implementation. With an overall score of 50, India is ahead of BRIC nations, China (47.5) and Brazil (35.1), while it is ranked well below advanced economies like Japan (83.3), Australia (79.2) and the US (78.6). These 24 countries together account for 80 per cent of the global ICT market.

Already, Indian IT companies are competing with each other for a slice in the cloud computing market. The total cloud market in India, currently at $ 400 million, will grow ten-fold to reach a market value of $ 4.5 billion by 2015, according to a report by Zinnov Management Consulting. Of this, private cloud adoption will dominate and account for $ 3.5 billion in revenues, growing at over 60 per cent. The study also estimates that the segment will create one lakh jobs by 2015 from 10,000 today. Infosys CEO and MD, SD Shibulal, reveals that the amount of integration the cloud can deliver shows its immense functionality and opportunities for all stakeholders. "It is an opportunity for both the government and small and medium enterprises (SMEs) – which are the true drivers of our economy – to improve productivity, economies of scale, cut costs and boost employment," he adds. Also, SMEs can gain from the opportunity to use critical softwares like Tally and ERP which have eluded them so far due to high costs.

Many companies have already charted plans to tap this SME base. So we have BSNL, which will be deploying 'Bharat' (its cloud offering) in 10 cities. Oracle has over 100 different Oracle applications on the cloud, including ERP, HCM, Talent Management, Sales and Marketing and Customer Experience. Microsoft CEO Steve Ballmer recently said, "India will not only see a surge in cloud computing services but companies all over the world will look to India to support their transition to cloud computing." Roughly 30 per cent or $ 7 billion of global cloud computing work is to be offshored, says a Zinnov study.

However, there are critical adoption challenges to be considered. Union Communications and IT Minister Kapil Sibal, while addressing an industry body event on cloud computing recently, said that the government was evolving a policy framework for cloud computing to address concerns. Sibal suggested that the focus should be on SMEs and the starting point could be clusters, which have commonality of purpose and vision. Stressing on the need to build confidence among users, he highlighted the imperative of outlining technical and other parameters for cloud providers, standardisation of contracts, privacy and security conditions. Experts say concerns of privacy, security, compliance and vigilance with regard to cloud are due to the absence of physical infrastructure at the user-end. Some suggest an alliance on the lines of the US-based Cloud Security Alliance be set up in India. Bhaskar Pramanik, chairman of Microsoft India, adds a thriving ecosystem of applications is a must.

Besides, cloud is a transformational concept and will face stumbling blocks if a proper ecosystem is not developed. Power, connectivity and bandwidth, real estate, technology enablers, awareness and local language support make the base of the cloud computing pyramid. Also, a consensus must be reached among all states, the centre and other institutions to ensure standardisation, leading to lower costs, improved efficiencies and higher growth. If the government and corporates work together to build this ecosystem, SMEs will certainly benefit from the opportunity for low cost and efficient IT adoption.

{It's one of my own articles written for Planman Media, while I was working as a technology journalist there.

Original Link:  http://www.thesundayindian.com/en/story/can-india-tackle-the--cloud-challenge/19/39557/  
 Issue Dated: September 2, 2012}