Blog @ Digital Bazaar

The Looming Cloud Computing Bubble

Creating Tech Industry Bubbles

The media and the IT industry have a cyclical dance that lasts about 5-7 years, depending on who you ask. The media needs stories to attract eyeballs in order to sell advertising. The IT industry needs sensational stories to convince investors and the public that there are spectacular investment opportunities on the horizon. These cycles follow something called the Gartner Hype Cycle and are what create the bubbles and the busts that we see on a fairly regular basis in the technology industry.

While all technologies go through the cycle, it is especially damaging when the media and IT darlings exaggerate the “Peak of Inflated Expectations” and then, by not fulfilling expectations that they have helped create, make the “Trough of Disillusionment” deeper than necessary. A good indicator of the start of a hype cycle is a sharp up-tick in news stories about a new buzz word, followed by confusion about what the buzz word actually means. The more vague the buzz word, the higher the ratio of snake-oil to good science.

Ask any vendor about the essence of Cloud Computing and you will get a myriad of answers in return – more than likely aligned with their business interests. Cloud Computing includes a dizzying array of technologies and is claimed to be the way of the future, but the service model that it provides is no different than the days of the mainframe computer. A highly-available, centralized service connected to by people around the world to run various jobs and store the output of those jobs for retrieval at a later date – we were doing this in the 1960s.

So, why are people excited about centralized computing again? Simply put – it’s being spun by the media in just the right way for companies that have a vested interest in selling infrastructure/platforms/software as a service. Billing your customers on a monthly basis for services that may or may not have been consumed is a fantastic business model and is the dream of most entrepreneurs and VCs that desire to make a large chunk of money with minimum investment. The term “Cloud Computing” helps to sell that business model because it sounds more exciting than “centralized computing” – it is the next bubble.

Bubbles are never helpful – they harm us as an industry…

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