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FEATURE

Cloud Providers Combine to Boost Asian Market

02/21/2011

Some of the biggest players in technology have come together to form a group that aims to boost the use of cloud architectures in Asia, where adoption lags behind the U.S. and Europe.

The effort provides a window on some of the continuing issues affecting the evolution of cloud computing. And it shows some surprising barriers. Among them: Data sovereignty laws locking information inside a country's borders and a lack of definitions of quality that makes it difficult for marketers to advertise their specialties. 

Eleven companies, primarily from the U.S. and western Europe,  announced they were forming the Asia Cloud Computing Association to address regional issues and challenges to the adoption of cloud computing in Asia.

Bernie Trudel, cloud CTO for Cisco in Asia, who is currently vice chairman of the association, said in an interview: "The idea is to help define and catalyze the market and make sure we can remove any barriers to adoption."  He said that interest in moving to the cloud in Asia "is really hot," but the infrastructure isn't ready yet. He said Asia is probably about three years behind North America and 18 months behind Europe in adopting cloud methodologies.

"The idea is to help define and catalyze the market and make sure we can remove any barriers to adoption."

— Bernie Trudel, cloud CTO for Cisco in Asia

Asia's fragmented regulatory framework presents one big challenge to growth of the market. For instance, some countries -- even tiny island nations -- require that citizens' personal information remain inside their national borders.  That means that cloud storage providers can't maximize efficiency by providing regional cloud centers. And Sa s providers can't run applications remotely if they need to download data in order to analyze or change it.  Indeed it could even hamper recovery in emergencies, because back-up data centers might be affected by the same weather or terrorism issues that shut down the main site.

Moreover, those regulations are "preventing some of the benefits of economies of scale," Trudel says. "We're trying to work with regulators and identify how they might loosen up some of their regulations in order to allow clouds to proliferate and local companies to benefit from cloud."

Trudel says that one of the Association's most important functions is to connect with international bodies like the Cloud Security Alliance. With the huge community of offshore IT service providers in India, the Philippines and elsewhere in Asia, "we want to make sure Asian concerns are in their minds when they're writing their standards," he says.

The immature state of the cloud market is reflected in the lack of standard definitions for cloud features. Trudel said that a working group in the association has been in touch with the international-standards body, NIST,  about developing a cloud taxonomy. One thing Trudel would like to see is a definition of "a gold standard level for cloud." He notes that telecommunications companies define "carrier grade" as "five-nines availability," or 99.999% up time. Having a similar standard for cloud computing would give engineers something to shoot for and marketers something specific to promote.

Asia Cloud chairman Sundi Balu, who is chief information officer of satellite-and-undersea-cable operator Reach, said: "Cloud adoption in the Asia Pacific region has yet to reach its full potential. The regulatory landscape and varying market maturity levels have fragmented the adoption of cloud computing in the region."

Some of the world's largest technology companies, including Microsoft Corp., Cisco Systems Inc., and Verizon Communications Inc. joined to form the group.  Asian companies in the group include Philippine Long Distance Telephone Company, known as Smart, as well as Hong Kong-based Reach.

There's no doubt that the Asia market for cloud will be huge. Telegeography Research estimates that global broadband Internet subscribers will climb to more than 700 million by 2013, with more than 300 million from Asia, compared to about 100 million in North America, and nearly 200 million in Europe.  Broadband availability is closely linked to cloud computing because it makes it easy for users to store and access video, audio and applications in the cloud rather than running them on their own PCs.

The global market for cloud computing is growing at a compound annual rate of 28 percent, from $47 billion U.S. in 2008 to $126 billion U.S. dollars by 2012, according to industry estimates.   The research firm IDC estimates cloud computing in Asia, outside of Japan, will expand 40 percent every year until 2014, from $1.3 billion U.S. dollars in 2010. Japan, currently the 2nd largest IT market globally, is expected to grow to $29.2 billion in 2015 according to Japan's Internal Affairs and Communications Ministry.

Suppliers are rushing to fulfill demand. In January, International Business Machines Corp. announced plans to build Asia's largest cloud computing center on the outskirts of Beijing. The multi-building campus will cover 6.2 million square feet.

Trudel said that the Association has big aspirations too. By the end of the year, he said. he hopes membership will double. In four years, he adds, it could be 400.

IBM estimate of worldwide cloud growth: http://www.ibm.com/news/ch/de/2010/07/21/b829272f44836g02.html

Related Tags: Technologies , Data Center , Standards , Virtualization , Vertical Markets , Telecommunications/Service Providers , Region , Asia Pacific

 
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