Doing business the hard way

The era of cloud may be upon us, but not everyone in the channel is convinced that hardware has had its day

If you listened to the deafening cloud hype, you may be forgiven for thinking that hardware is a thing of the past - or at least it will be within the next decade.

PCs, printers and server boxes will all be confined to history's technological dumping ground along with car phones, floppy discs and cassette tapes, or so cloud enthusiasts would have you believe.

There is no doubt that the market for cloud is growing, with figures from Alcatel predicting the industry's worth to soar to about $177bn (£114bn) by 2015. But does this anticipated growth signal the death knell for hardware?

For all the cloud benefits cited by its proponents, cloud services simply cannot be delivered without reliance upon a hardware device, whether it is a desktop, laptop, tablet or smartphone.

And for every vendor or reseller extolling the virtues of cloud, others remain convinced that there is a future for hardware.

Shaune Parsons, managing director of Computerworld Wales, believes hardware is fundamental to any future cloud developments, regardless of people's enthusiasm.

He said: "Of course hardware is important; you cannot do anything without hardware. You still need it in order to get to the cloud or nothing is going to happen.

"Whether you are a small or large company, you still need front-end hardware and internal infrastructure before you can even get to the cloud.

"It is hardware that is running the cloud, and there is no getting around that.

"Anyway, cloud is just a general term for things stored off site. We have a ‘cloud' and it is just a datacentre in Canary Wharf."

The stampede to the cloud has arguably left the traditional on-premise model looking tired and old fashioned, leading to concerns about the future of VARs who focus their business primarily on this model.

According to Paul Sweeney (pictured), managing director of ANS, vendors will continue to lean on their resellers to take their cloud propositions to market.

He said: "The customer will care less about hardware; there is a big shift yet to happen and big vendors have to adjust to that. Resellers are the biggest customers and we will be the powerhouse.

"VARs are the people in the middle and we have to procure hardware and make it into a service for end users. Over the past six months, we have seen that 75 per cent of opportunities in our pipeline are now cloud related," he added.

But Sam Routledge, solutions director at VAR Softcat, said the demand for traditional hardware is not going away any time soon.

"Hardware is still enormously important for the channel. There are a lot of companies, Softcat included, that are still selling hardware, and for all the cloud hype, customers are still buying hardware too," he said.

"Some organisations are very gung ho, and if they could never touch a piece of hardware again, they wouldn't. But if you are an organisation that just sells servers off the page or from a catalogue, that business is not going to go away overnight.

"At Softcat, we are biding our time. We are certainly not ignoring cloud and burying our heads in the sand and thinking it will all go away.

"The overall idea is that there will be a gradual progression to cloud instead of a big bang."

Cloud sceptics also point to concerns that the on-premise model offers a greater level of security and reliability. Customers may be more likely to stick to more traditional models which are seen to be a comparatively smaller risk, particularly in a recession.

Brett Edgecombe, sales director at VAR 101 Data Solutions, said: "Tier-one vendors are releasing smaller entry-point hardware - it is lower-cost hardware that is massively scalable.

"We have been offering affordable storage solutions in this way over the past 12 months," he added.

According to Alcatel Lucent's recent figures, only 18 per cent of UK companies strongly agree that having cloud is a strategic advantage, with performance, data security, ease of use and cost all cited as factors that turn off users.

Data security has been a constant thorn in the side of cloud services, with the recent compromising of up to 150 million LinkedIn users' passwords acting as a prime example of the susceptibility of online databases to security breaches.

Andy Trish, director of systems integrator NCI technologies, agreed that security concerns are holding back cloud adoption.

He said: "Security is still a big issue in the cloud. The situation with LinkedIn recently is a prime example that even the big boys get hit. If you have all your data in the cloud, you are putting your company at risk. I am not saying it is more secure on hardware devices, but you are in control of it that way.

"At NCI, we rarely sell cloud - I just do not believe in it. Don't get me wrong, there is good uptake for cloud, but there is still demand for a combination of cloud and on-premise solutions," he added.

Trust issues
Security is a key consideration for companies looking to migrate the cloud. Of the 3,886 IT decision makers quizzed in a recent Alcatel Lucent poll, 15 per cent cited data security as the single area which needed the most improvement.

Kevin Drew, owner of VAR DU360, said: "Data security is really the only point of conflict with cloud, especially when it is stored on something that is outsourced to a third party.

"Companies do not want their secrets in the hands of someone else.

"For obvious reasons, the most secure way of keeping data will always be for you to own it; it can never be 100 per cent secure when it goes to third parties.

"Really, there is just an emotional connection to your data, and if you can get over this and look at it factually, then you know your concerns are untrue," he added.

Parsons (pictured) at Computerworld Wales believes it is not just the technical side of cloud data security that lets it down, and that psychologically, people are still reluctant to trust it.

He said: "With hardware, a lot of time and effort goes into stopping people getting in and out.

"With the cloud, I am sure an awful lot of time and effort goes into security too, but the cloud is still an unknown entity and people are less likely to trust it."