Cloud Costs

We're still very early in defining computing clouds, and the landscape is changing rapidly. So, it would be impossible to make any mature statement about the economics of the cloud, especially considering that any such statement would have to address economics across a wide range of needs.

However, this post by Phil Wainewright is interesting. It reminded me of a study I read about long ago (and have been unable to find since) that asserted that mass switching to a new technology did not occur until it was a 10x improvement over the current technology. The basic point was that switching costs (capital, process changes, personnel training/re-orientation, organizational changes, etc.) are far higher than most people intuitively would believe.

If the numbers Phil cites are representative, cloud-based architectures may emerge and mature far faster than most of us would have guessed. This is the sort of hard data that may eventually justify the hype associated with SOA, Web 2.0, etc.