Energy efficiency drives the cloud

If Eskom gets its proposed 45% year-on-year tariff increase, SA will have the most expensive electricity in the world. For this reason businesses are turning to virtualisation technologies such as cloud computing.

This is the view of Annalise Olivier, senior manager of KPMG, who outlined the market trends and drivers for cloud computing in SA, during the ITWeb Cloud Computing conference, held in Bryanston, yesterday.

“One of the major reasons for moving to cloud computing, especially in tough economic times, is the reduction in costs associated with delivering IT services. These cost savings include reduction in capital and operating costs,” said Olivier.

According to IBM, administration costs of servers in data centres have increased 400% since 1996. Olivier noted that cloud computing enables companies to move away from expensive and risky capital expenditure of data centres, to a predictable monthly fixed-cost of operating expenditure.

Cloud computing boosts business agility, as companies are able to adapt quickly to change and the growing demands of data, while giving them access to their data and analytics in real-time.

“There's an exponential growth in data volumes,” said Olivier. “It's predicted that by 2010, the world's information will double every 11 hours. And managing these volumes is going to be a huge challenge going forward.”

She explained that the Texas electricity utility could no longer supply IBM's research and development data centre with more electricity, and as a result the computing giant was forced to implement a virtualisation strategy to slash its energy usage.

Olivier pointed out that as a company's IT environment grows and matures, it causes a change in decision-makers' behaviour. In addition, energy efficiency is being seen as a driver for cloud computing, with green compliance regulations set by government on the horizon. Olivier added that US president Barrack Obama has pledged $150 billion towards green technology over the next few years.

According to KPMG's Technology Industry Executive Survey 2009, the biggest challenges in dealing with the current economic downturn include finding new resources of revenue growth (66%), and managing and cutting costs (42%).