Why the Cloud Computing paradigm will enter Enterprise faster than you think?

The discussion of adoption of the cloud computing paradigm in the Enterprise generally shifts towards outsourcing of infrastructure and the associated security concerns for an Enterprise. While the outsourcing part is an important part of the story that will have significant effects on the low end of the market (Small to medium business), my take is that it will not have a big impact on the Fortune 200 Enterprise clients.

What will probably happen to the Enterprise Clients is that they will end up building their own grids for internal consumption. You will start seeing vendor offerings like Sun sell -Project Caroline, that will probably be the key differentiators for the big iron vendors. (although Project caroline will potentially be the Sun Grid offering to the Small and midsize business’s - I can very easily see a situation where Sun Sales force goes to a client like Morgan Stanley and makes a sales pitch for Solaris and its hardware based on its Project Caroline based capabilities)

So going back to my original point about why do I think a case like above will come to the Enterprise faster than you think.

Most of the Large Enterprises typically have an infrastructure group that manages its data centers. This is how the provisioning of new hardware typically works in an enterprise

Applications VP - I need to unarchive some 300 GB of data and then use it for some analytics that I need to perform at least once every month.

Infrastructure Guy - 1GB costs about X $ and 1 LPAR with 2 CPUS is about Y$ per year. You need to multiply this by 5 years to get the ROI calculation for your project.

Applications VP - Wow ! Why is the cost 1.7 times Frys.

Infrastructure Guy- Well it is all the overheads; The Company needs to pay guys like us who ensure that additional storage is installed correctly and that your group adheres to all the norms we have established

Applications VP- OK (whatever! Since I do not have any options!) , when can I get it.

Infrastructure Guy- it will take 2-4 weeks after the purchase order is approved and quote submitted.

This is how it will work when you have a Computing Cloud running internally in a large Enterprise.

Applications VP - I need to unarchive some 300 GB of data and then use it for some analytics that I need to perform at least once every month.

Infrastructure Guy - Here you go , call this API for Adding Storage and launching an instance. You will be charged by the hour

Applications VP- Cool , I am charged ½ of what you guys charged me earlier and I have the ability to turn off my meter when I do not need to computing power.

Infrastructure Guy - Yes , They have cut down on group and all my buddies who did not have scripting skills and just PowerPoint skills have been asked to go. I guess our overhead is now 1.1 X as compared to 1.7X .Besides if you consider the savings you get by switching your computing off when not needing it , we are probably cheaper than frys.

So to sum it up- the fine grained transactions between the apps group and the infrastructure group will become coarse grained via development of API's and when that happens the labour costs will go down like anything.