Opinion: Cloud Computing - not just a fad

Don’t listen to those who stir up fear, uncertainty and doubt around Cloud Computing. Technology’s latest disruptive wave has history on its side, argues Liquid Accounts managing director Matt Holmes.

“It’s too limited!” “It doesn’t work the same!” “I don’t understand it!” “It’s not safe!”

You may think that I’m talking about the “new and scary” Cloud Computing or software as a service (SaaS), but whilst these are some of the things that people are saying about the new online technologies, I’m actually talking about some of the things that were said about steam trains when they were the latest technology.

My point being, that whenever a new disruptive technology comes along that’s destined to revolutionise the way we do things and render old technology obsolete, this is people’s first reaction.  In some cases, it’s a fear of the unknown, but in a lot of cases it’s scaremongering on behalf of the people who rely on the existing technology and can see their livelihoods slipping away from them.

And I don’t blame them, change is always scary. Going back to my train analogy, if we look back at how things played out, we can see that the online technological revolution is already a significant way down the same path, and there can only be one conclusion.

Steam trains didn’t just arrive on the scene in the 19th Century out of thin air.  They were a product of their time.  Many people had come up with the same sorts of ideas to improve transportation by drawing together several different existing ideas and trends. Just as the waterway network, track technology and steam engines paved the way for the rail network, Cloud Computing has been born out of the convergence of broadband provision and more flexible working practices. Online business software is just one more web-based phenomena alongside Twitter, YouTube, Facebook, Flickr, iTunes, Wikipedia and Google.

The first steam trains ran on a circular track, like a giant train set – think of beta testing software or early applications that worked online but didn’t do very much.  Initially, people were convinced that they could die from travelling so fast and that there wouldn’t be a mass market for trains because there wasn’t a network of tracks to run them on.  At this stage trains were an unproven technology – slow, expensive and unreliable and many couldn’t see the need for trains when they already had canals.

But then pioneers started to build railways and make use of steam trains in industries built around moving large quantities of heavy goods such as coal and people started to recognise their potential.  Most customers started out by using a combination of steam trains and traditional horse-drawn trains, but steam engines began to prevail because they could haul bigger loads at higher speeds. For a while steam trains and canals continued to coexist with trains mainly carrying passengers and light goods and canals bulk items.

Then, as people began to see other advantages to railways - package holidays, newspapers and post, commuting, and even the standardisation of time - they started to build railways everywhere, mainly financed by industries that wanted faster delivery, bigger quantities, reduced costs, and access to bigger markets.

This is process we’ve seen over the past four years at Liquid Accounts. Our early customers were mainly people who had a specific need that wasn’t being addressed by offline software, others wanted to try it alongside their existing software in order to compare them.  Now, however, people are using online apps for all sorts of things and every coffee shop, train station and airport has Wi-Fi. While online software is gathering momentum, it is still seen as just an alternative to offline software.

We’re seeing more and more companies coming into the online market place, lured by exactly the same benefits as the railway companies 150 years ago – faster delivery, bigger quantities, reduced costs and access to bigger markets.