Cloud Consolidation Nation

Consolidation is the name of the game.

secure cloud
Credit: Secure Cloud Computing by FutUndBeidl (cc by 2.0)

I titled this post "Cloud Consolidation Nation," but it actually would have been more accurate to call it "Cloud Consolidation World." But that didn't sound as snazzy.

If the 1990s and 2000s were marked by the global expansion of the Internet, one might say the 2010s may be marked by the global consolidation of content into a few large cloud providers.

Cloud consolidation in two areas

Cloud consolidation on the Internet is taking place in two ways:

  1. Content is increasingly being consolidated and centralized into cloud providers.
  2. Cloud providers themselves are increasingly consolidating.

Let's look at each of these briefly and consider some implications.

Content consolidation

First, content is moving into the could in almost all areas of computing. Your email is in the cloud. Your files are stored in the cloud. The instant you snap a picture or record a video on your phone, to the cloud it goes.

And not only is this move of data to the cloud happening with personal content, but more and more companies and governments at all levels are opting to host their applications - both public-facing and internal - in the cloud instead of on their own servers in their own data centers. Your company's HR portal is likely hosted by a third party. Your corporate email likely sits somewhere "out there" rather than on a server in the closet down the hall from your office.

Cloud provider consolidation

Not only is the content being consolidated into the cloud, but cloud providers themselves are consolidating. This has not come as a surprise, as many have predicted the trend.

So the trend is this: more and more data is moving to the cloud, and there are fewer and fewer cloud providers to host all this data.

Why does it matter? What does it mean for the future of the enterprise?

I'm not about to make any earth-shattering statements here, but here are three key implications of this trend for the enterprise:

  1. Your applications and data may change hands if your provider gets acquired. This, of course, means potential changes in terms of service, SLAs, etc. If you are seeking stability for your company, my advice when selecting a cloud provider is to stick with the big players.
  2. As cloud providers consolidate, they become bigger, juicier targets for the bad guys. Thus, security becomes even more paramount than ever. Carefully evaluate the security profile of the providers you are considering. For data storage, consider a provider that encrypts the stored data with a security key that you, the customer, hold. Be careful, though - YOU are now responsible for the secure storage of this key, and if it is lost, so is your data (by design, the provider does not keep a backup copy of the key).
  3. Loss of control. If you move your company's applications to the cloud, you lose a measure of control. Many companies are OK with this loss of control, or are even eager to outsource it and get out of the IT business altogether. But many are not prepared and are shocked when the provider experiences down time. And many become frustrated with the length of time it takes to implement a change order.

Chances are your organization has already moved to the cloud in one way or another. As data is being consolidated, so too is the cloud industry. Be prepared, educate yourself, train your staff, and you will be set for the future.

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