Introduction

Technology overview
What is cloud Computing
Cloud computing is the ability to store, access data and programs over the Internet instead of
from a computer's hard drive. There are three distinct characteristics that define a cloud service; it is
sold on demand usually by the hour or minute, it is elastic meaning that the user can determine how
much service they want at a given time and it is fully managed by the provider. Examples include
Google Drive, Apple iCloud, Amazon Cloud Drive and Amazon Web Services. The services are divided
into three categories, Infrastructure-as-a-Service (IaaS), Platform-as-a-Service (PaaS) and Software-asa-Service (SaaS).
Infrastructure-as-a-Service (IaaS)
Provide businesses with the option to purchase infrastructure from providers as virtual resources.
Components include servers, memory, firewalls and more. Components include dynamic scaling,
internet connectivity, automation of administrative tasks and desktop virtualization
(SearchCloudComputing, 2010). IaaS providers include Amazon EC2, Rackspace, and Google Compute
Engine (pcmag, 2013).
Platform-as-a-Service (PaaS)
Allows businesses a platform on which they can create and deploy custom apps, databases and
business services integrated into one platform. PaaS in the cloud is defined as a set of software and
product development tools hosted on the provider's infrastructure. Developers create applications on the
provider's platform over the Internet. PaaS providers may use APIs, website portals or gateway software
installed on the customer's computer (SearchCloudComputing, 2010). Some benefits are lower costs

and operating systems features can be changed and upgraded more frequently. Examples of PaaS
include Windows Azure and Google App Engine (pcmag, 2013).
Software-as-a-Service (SaaS)
SaaS provides a way of delivering software and technical services that would otherwise be costprohibitive and difficult to manage as on-premise, local solutions (pcmag, 2013). The vendor supplies
the hardware infrastructure, the software product and interacts with the user through a front-end portal.
The end user is free to use the service from anywhere. Benefits include compatibility for all users,
global access, easier collaboration, automatic updates and patch management. Examples include webbased email, database processing and inventory control.

Cloud Computing vs. Application Service Provider (ASP)

ASP is a business that provides computer based services to a customer over a network. This is
sometimes called on-demand software. ASP does not allow customers to pick, configure and deploy the
system without their software engineers intervention, slower implementation timelines and slow
response to changes. ASP has higher set up costs, low-speed networks, not very strong interfaces and
poor ability to granulize billing. Cloud computing on the other hand, allows for total input from the
client in scaling from increased traffic, customization, shorter implementation timelines and availability
of new features and upgrades.
Emerging Technology
According to BusinessDitionary.com (2014), emerging technologies are:

New technologies currently developing or will be developed over the next five to ten
years, and which will substantially alter the business and social environment. These
include information technology, wireless data communication, man-machine
communication, on-demand printing, bio-technologies, and advanced robotics.
Ask.com (2014) states that emerging technology is a field that advances new territories in a significant
way. Further, these are technical innovations which represent progressive developments within a field
for competitive advancement. New technological fields may be as a result of technological convergence
of different systems moving towards similar goals.
Finally, according to the World Economic Forum Global Agenda Council Emerging
Technologies meeting Nov 2010, Emerging Technology is (matterforall.org, Retrieved 2014):

technologies which arise from new knowledge, or the innovative application of

existing knowledge;

leading to the rapid development of new capabilities;

are projected to have significant systemic and long-lasting economic, social and political
impacts;

create new opportunities for and challenges to addressing global issues;

have the potential to disrupt or create entire industries.

Customer and Market Definition Porter Model

a. Describe the target customer and market

Porters Five Forces are:
1. The threat of substitute products
This technology is fairly new and the substitute product is on its way out (IT
Outsourcing). Organizations usually choose to do their IT work themselves or outsource
to another suitable organization based on business case. This new product is one where,
the ties to the ITO are no longer binding and companies do not need technical support
from the vendor. Everything is managed and administered by the client.
2. The threat of new entrants
Since this is a new service where many companies are still researching adoption, there
will be many companies entering to offer various types of these services. There are those
who are offering private cloud services. The one that survive are they that are able to
meet the needs of the various groups that they market to.
3. The bargaining power of suppliers
Supplier in this industry bargaining is great as contractual terms can be changed, little or
no service level penalties and there are no liquidated damages (as per small/individual
consumers). On the other hand, large companies may weaken this power based on their
cash strength.
4. The bargaining power of buyers
Large buyers will user their power to determine to get from the suppliers what the small
consumers are not able to based on their spending power.
5. The intensity of industry rivalry

It is believed that the new cloud and IT Outsourcing model will merge. It has already
started happening where SaaS is being offered as a dedicated on-premise private cloud
solution. (Wilkinson, 2012)

Threat of new entrants There is likely to be a large number of new

entrants from SMEs, that will raise the level of competition. The reasons
that there is likely to be a large number of new entrants are low fixed
costs, low cost of switching to this new technology, and relative lack of
government restrictions.
Bargaining power of suppliers Unfortunately, the bargaining power of
suppliers is high, and this is reflected in the way the terms and
conditions (T&C) are drafted, many much more in the suppliers
favour in the buyer-supplier relationship. The reasons for the bargaining
power of suppliers being so high is that there are many potential
customers amongst SMEs and few dominant suppliers (such as Google
and Amazon), and the suppliers integrate in positioning themselves in
the marketplace.
Bargaining powers of buyers The bargaining power for SME clients can
potentially improve, if the cloud computing products become
standardized (and a large driver for this could be regulatory compliance
with the law), and there are more emerging suppliers of cloud
computing (although it has to be conceded that Google, Microsoft and
Amazon have achieved a healthy dominance in the market due to their
innovation rather than abuse of competition).

Threat of substitutes The main competition of cloud computing is open

source computing, and SME clients might consider adopting cloud
computing in preference to open source computing, as the switching
costs are not prohibitive, SME directors might find the business case for
switching attractive, and, not least, because cloud computing is cheaper.
However, factors in favour of sticking to open source computing might
be brand loyalty and current trends.
Competitive rivalry The question of whether the market is truly
competitive is an area of controversy. Analysis of this depends on
whether any particular provider is dominant in the market (all the main
providers, such as Google, Amazon and Microsoft, have all been called
main providers at some point), and whether there is true differentiation
between the products being offered by the cloud computing providers.
For example, Google Apps strategy is a mix of differentiation and cost
leadership. It seeks to distinguish itself from the market as bringing a
purely online collaboration model, where companies would need to give
up traditional desktop based document software like MS Office.

http://lms.ctl.cyut.edu.tw/sysdata/81/33281/doc/01918f578f160703/attach/1910871.pdf

b. What are the potential benefits to the customer, what business problem does it solve or what
business opportunity does it present?
o Advantages
o Benefits
o Opportunities

 Opportunities
SMEs can now exploit high-end applications such as business
analytics that were hitherto unavailable to them. While it can be
argued that some of the more involved features of such applications
might not be available on their cloud-based counterparts, such
omissions will matter very little for their intended customers
(Tucker 2009a) .
Threats
Several concerns have centreed on the lack of standards. The cloud
has been described as a trap by GNU creator foundation founder
Richard Stallman one where companies like Google will force
customers into locked, proprietary systems that will gradually cost
more and more over time.

o Disadvantage
c. Assess the current and future markets
According to Rahman (2010), The US expert analysts Gartner estimate that, over the course
of the next five years, enterprises will spend $112 billion cumulatively on cloud computing.
The US share of the worldwide cloud services market was 60 percent in 2009 and will be 58
percent in 2010. By 2014, this will be diluted to 50% as other countries and regions begin to
adopt cloud services in more-significant volumes.
http://shibleyrahman.com/business-administration/the-business-of-cloud-computing

How would you introduce this into a company? What would you do to sell it to Management?
http://www.eweek.com/c/a/Cloud-Computing/Cloud-Computing-Is-the-Future-of-IT-How-to-ConvinceYour-Boss-831828/
Cloud to Management pdf

Conclusion will this technology succeed and why?

Summary of benefits
Potential for growth
Opportunites
http://searchdatacenter.techtarget.com/feature/What-do-SaaS-implementations-mean-for-IT
http://searchcloudcomputing.techtarget.com/news/2240211535/Why-Software-as-a-Servicebenefits-trump-IaaS

Other Factors to consider

http://www.cdw.com/content/solutions/small-business-cloud-computing.aspx
http://www.cio.com/article/109704/Software_as_a_Service_SaaS_Definition_and_Soluti
ons
http://www.cio.com/article/660316/SaaS_PaaS_and_IaaS_a_Security_Checklist_for_Clo
ud_Models?page=2&taxonomyId=3089

Citation
o http://searchcloudcomputing.techtarget.com/definition/cloud-computing

o http://www.pcmag.com/article2/0,2817,2361500,00.asp
o http://www.pcmag.com/article2/0,2817,2372163,00.asp

http://searchcloudcomputing.techtarget.com/definition/SPI-model

http://searchcloudcomputing.techtarget.com/definition/Infrastructure-as-a-Service-IaaS

http://searchcloudcomputing.techtarget.com/definition/Platform-as-a-Service-PaaS

http://www.technologyevaluation.com/research/article/Ask-the-Experts-Whats-theDifference-between-ASP-and-SaaS.html

http://www.oulixeus.com/2011/02/two-acid-tests-for-real-cloud-computing/
http://www.oulixeus.com/2011/02/two-acid-tests-for-real-cloud-computing/

o http://www.businessdictionary.com/definition/emerging-technologies.html
o http://www.ask.com/web?
am=broad&q=what+is+emerging+technology&an=google_s&askid=6261db2a-1e8b43f2-a473-622f13fd533a-0us_gsb&kv=sdb&gc=0&dqi=what+is+an+emerging+technology&qsrc=999&ad=semD
&o=11705&l=dir&af=&_=1
o http://www.matterforall.org/projects/emerging-technology-goverance/2/
http://wilkipedias.wordpress.com/2012/10/30/michael-porters-five-forces-and-the-futureof-the-cloud/
http://shibleyrahman.com/business-administration/the-business-of-cloud-computing