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How the Slow Adoption of the Cloud Has Impacted 3 Industries

"It's in the cloud" has become a phrase we don't think twice about, but less than a decade ago, you might have received some awkward looks using this kind of talk in the boardroom.

Cloud-based software applications are heralding the fourth industrial revolution that will eventually lead to the industrial internet of things (IIOT). The reasons for this are because:

  • Clear, cloud solutions are more accessible for a mobile workforce.
  • They offer a uniform solution to customers who work in regulated fields.
  • They handle large amounts of data exceptionally well across large geographical expanses.

It's quite possible that in the future, you'll need to specify when an application is in fact local, and not cloud-based. The solution is very effective to fit the needs of the growing software-as-a-service model.

However, the cloud solution isn't perfect. Making the transition from in-house to cloud-based solutions presents challenges that are more pronounced in some fields than others. Let's take a look at examples of industries that are feeling a little more weighed down than their cloud-bound compatriots:

1. Finance & Banking

At first, you might think the folks at the teller stand are in fact using a cloud-based system. The fact is, though, most of the banks and financial institutions in the world still rely on relatively antiquated local systems.

Probably the most compelling reason the finance industry has chosen to remain "on the ground" is security. Robbing banks has come a long way since 1886, and there's no reason to expect it will go out of style in the era of technology.

People are warming up to the idea of placing their contact information in the cloud, but with cyber attacks increasing in frequency every year, it's not surprising the banking industry is waiting for a comprehensive solution before moving to the cloud.

2. Government

This one may not surprise you, either. After all, government industries aren't known for being early adopters. The mobile access offered by industrial computers means that cloud solutions are often the solution to managing infrastructure projects, powering municipalities, and communicating within the military, which gives a compelling case for government entities to migrate.

Still, techniques to take existing bodies of "big data" and migrate them to the cloud are not yet perfect. This presents a challenge for the Government where any hiccup in systems will have a very noticeable impact on public users. Worse yet, flaws in migrated data could cause all sorts of unplanned-for situations.

Anyone who's worked in IT will attest that once a business has their system in place and working, they'll often times stretch it to the bleeding edge of its lifespan before making the upgrade to the latest and greatest. For bureaucrats running antiquated government systems, the idea that support cost can consume as much as 70-85% of total costs makes the transition to the cloud a proverbial root-canal.

3. Legal/Consultative

Is moving to the cloud a loss for the legal industry? Well, no, but the draw isn't there the way it is in places like healthcare and education. Legal teams tend to be small in size, so they don't need a cloud solution to be consistent, even when mobile. There are also fewer visual assets involved, which can un-sell the cloud idea.

But neither of these factors are deal-breakers. The real reason why cloud computing doesn't appeal in these types of businesses is that they can afford and make use of private cloud solutions. Similar in execution to public ones, but with increased security and consistency features, you can expect to see private cloud arrangements winning businesses that are small but can afford costly solutions.

Business Forecast

Make no mistake, movement to the cloud is all but unavoidable for successful businesses. What we're looking at today is a first-generation system that's already able to offer huge advantages in crucial industries like real-estate, tech, healthcare and education. The weaknesses that make cloud solutions questionable for certain fields are holding back business, which is why they will be overcome.

The coders and engineers who built some of the earliest cloud-based applications proved what an effective business tool the cloud can be. New generations of businesspeople and developers, inspired by that success, will seek out the solutions to bring new industries into the cloud era.

The need for better security in all areas of network technology will strongly motivate the development of solutions that can stop attacks on cloud servers. Not only that, but the service costs that are so high today will come down as both cloud systems and cloud IT skills become more prevalent.

The use of private cloud solutions may never completely die, but the proficiency of public cloud solutions will offer serious competition.

In these ways, the cloud-based applications we already recognize as revolutionary will evolve to comprise the vast majority of software we use, and the industries that today might face challenges in adopting the cloud will almost certainly end up relying on it, too.

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VINTON CERF
Co-designer of the TCP/IP Protocols & the Architecture of the Internet

Comments

I'd present a counter-argument: "the cloud" today By Todd Knarr  –  Oct 07, 2016 8:35 pm PDT

I'd present a counter-argument: "the cloud" today is essentially a new iteration of the mainframe service bureau of old, offering instances (either bare and ready for loading a customer's software on, or preconfigured for a specific job) running in virtual machines with the service bureau owning the physical hardware and expanding/upgrading it as needed to handle additional customers and workloads, all accessed remotely from workstations whose capabilities closely mirrored those of today's browsers (you'd be amazed what you could do with 3270 forms and field macros). And as with the mainframe service bureau, there will be a move away from the cloud driven by the same things that motivated the move away from the MSB and to individual PCs and customer-owned-and-operated superminis and supermicros. One of those motivations will be the ability for individuals and departments to customize solutions to meet their specific needs without interference from corporate IT and without impacting anyone else. Another will be the ability to keep operating when competitors are down because your data center isn't affected by outages at the cloud data centers your competitors are using.

We're already seeing the first phases of that cycle in web applications, with a shift from server-centered processing with the client handling display to applications that're primarily Javascript running on the client with the server used primarily as a data source. Ie., a shift from thin clients with the application running on the mainframe to a traditional thick-client desktop application accessing remote data stores.

Great insight Todd! By Megan Wild  –  Oct 13, 2016 1:15 pm PDT

Thank you for commenting - it's great to hear another perspective! I agree, I don't see "the cloud" being the end-of-all-means for company storage. At the rate that technology (especially in IT) is advancing, I can definitely see customized solutions playing a big part in the future of data storage.

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