An Open Letter to Ireland Inc. on the Cloud Computing opportunity

This is the (mildly edited) text of a letter I wrote to Jennifer Condon, head of Software and Services for Enterprise Ireland, in August 2009. Jennifer was kind enough to take some time to discuss the contents of the letter with me, but I think the Cloud Computing opportunity needs a much broader involvement than any single state body.

Ireland Inc. (Enterprise Ireland, IDA, Irish Software Association, IBEC, Irish Computer Society, Irish Internet Association) are not doing enough for the country to take advantage of this enormous opportunity and position Ireland as THE location for Cloud Services – both for foreign companies locating and investing here, and for indigenous and start-up Irish businesses exporting Cloud Services.

In a recent talk I attended, Enterprise Ireland highlighted the projected value of both the Cloud Computing and SaaS markets – being $150bn and $17bn respectively. A question from the audience asked why the focus of EI’s presentation was on the SaaS market rather than the Cloud Computing area, given the relative size of the opportunities, and was answered that this was because the SaaS opportunity was ‘more immediate’. I do not believe that this is entirely accurate, to reach even 50% of the estimated market size of Cloud Computing, explosive growth will, and is, happening, and the opportunity is for Ireland to be a first-mover here. There is no company in Ireland or indeed globally that will not evaluate Cloud Services in the next couple of years. This is a massive market!

I am concerned at the level of understanding Ireland as a economy – both the public and private sector – has of the emerging Cloud Computing sector. The term is becoming a ‘bandwagon’ and on a weekly basis, press releases are being published with companies claiming to have launched a Cloud Computing service. It is my opinion that a key role that industry bodies should play is in providing a clear definition to what the term ‘Cloud Computing’ actually covers, and educate the business and public sector leaders  as to what this is.

The accepted industry definition of Cloud Computing, is that it provides Computing, Storage and Network Transit resources (the service) in an On-Demand (Pay-As-You-Go) and Scalable manner (the business and billing model). Below are two relevant URL’s to more information around this definition:

I believe Ireland has the opportunity to take a number of steps that will greatly further our potential to grow our economy on the back of the growth and opportunity in Cloud Computing. In my opinion, some of these steps include:

  • Create the legal framework to encourage consumers of Cloud Computing to use services delivered from Ireland. The legalities around hosting business applications and data ‘in the Cloud’ are complex and creating a forum for understanding these, and addressing them through Public Policy, would both present Ireland as an ideal location for Cloud Computing Centres, as well as encouraging innovation and enterprise development.
  • Agree and promote a definition of Cloud Computing – this simple first step is essential if we are to capitalise on the sector, as it is widely misunderstood, and misused, at present. A working group including the relevant representative organisations could create this definition and cause their membership to adopt it.
  • Assist start-ups with IT infrastructure. Infrastructure is very expensive. In partnership with infrastructure hardware and data centre providers, create a Cloud Computing Platform and provide access to this for early stage start-ups, so they can focus on innovation,  without the normally associated large capital expenditure. Very few people are innovating on the hardware-platform of Cloud Computing, because the cost of entry is high.
  • Setup a Cloud Standards body, or engage with existing standards authorities in Ireland. Create a working group from existing suppliers, new entrants, large IT suppliers and consumers, legal professionals and relevant public authorities. The goal of this group would be to create a standard to which suppliers and start-ups of Cloud Computing resources could become certified. This done right could dramatically push Ireland as a government-supported, progressive location to build Cloud Computing Centres and foster innovation.
  • Get the Government using Cloud Computing – demand fosters innovation, and one area where a lot of money can be saved is in Public Sector IT – the premise of Cloud Computing is that it is inherently far cheaper than purchasing and maintaining dedicated equipment which goes under-utilised.

Cloud Computing is estimated to be a $150 billion market in just 4 years. This is from a market that today is worth a single digit percentage of this figure. That is truly explosive growth, and because the market is in it’s infancy, no dominant corporate force or geographic location has emerged – Ireland has an opportunity here to capitalise on this, and position ourselves as a hub of innovation and excellence in service delivery – in the Cloud Computing space.

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1 Response to “An Open Letter to Ireland Inc. on the Cloud Computing opportunity”


  1. 1 Paul Browne (EI BestConnected) April 15, 2010 at 3:53 pm

    Thanks for the comments Ed, lot of changes for both of us since we met at the first Barcamp Dublin!

    For info (and it covers both Cloud and Saas), a large chunk of the public work that EI has been doing is online at http://www.BestConnected.ie – in particular; http://www.bestconnected.ie/tag/saas/ What this *cannot* cover is the behind the scenes one-to-one work.

    Does this meet the vision that you describe? I’m not sure.

    For the software companies that I deal with , the focus is often on the smaller Saas opportunites. This is mainly because of their size and need for a more immediate return on investment.

    Paul


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