Bringing Cloud Computing Back Down to Earth

The Find: All the hype about the future lying in cloud computing is overblown, say consultants McKinsey, concluding it's still more expensive for big business than traditional data storage.
The Source: A discussion of McKinsey's report on Silicon Valley Insider.

The Takeaway: If you believe the hype, in the future it's out with storing our information on desktop computers or the company's servers and in with the idea of having it all out there, in a Google-like cloud of data, accessible via any internet connection. The idea of infinitely portable data certainly is seductive (as anyone who has ever forgotten to bring that crucial piece of information home/ to the office/ the meeting can tell you), but is this futuristic vision of cloud computing really feasible and cost effective? For big business, at least for now, the verdict seems to be no.

Silicon Valley Insider summarizes McKinsey's 34-page report (available in its entirety for free download), noting "critically, cloud computing can actually be more expensive for big business than traditional IT solutions. In one 'disguised client example,' McKinsey reported total IT costs would rise 144 percent with a cloud computing approach." Plus, "cloud uptime guarantees lag behind what big businesses can achieve on their own," another strike against the technology.

On the up side, McKinsey did find that cloud computing can be a cost effective solution for startups and small to medium sized business.

(Image of dramatic clouds by joshme17, CC 2.0)

Jessica Stillman

Jessica lives in London where she works as a freelance writer with interests in green business and tech, management, and marketing.

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