Virtualization and the Private Cloud Over the Outsourced Cloud?

I caught up with a former colleague from CRM magazine yesterday who is now an analyst with Datamonitor covering customer interaction solutions. We had quite a lengthy discussion about everything that’s CRM for an upcoming report he’s publishing on North American and European contact centers.

Among other topics, we talked about the fallout that current economic conditions are having on both enterprise and SMB adoption of CRM and other call center-related technologies, and I was pleasantly surprised to find that Datamonitor is finding similar results.

As we discussed, cloud computing is clearly a marketing triumph, and for SMBs, the financial benefits and “hands-off” attitude is clearly a win-win situation. But for enterprises, the benefits still aren’t as clear cut for outsourcing your cloud.

Customers are becoming much more price sensitive, and are no longer looking to make major investments with huge projects, but continue to think of their call center/CRM deployments on a much more modular level. I think cloud computing will experience similar approaches from businesses.

In many aspects, the industry as a whole has over-assumed the financial benefits of outsourced cloud computing (just like the industry has done with nearly every technological innovation for the past 10+ years).

The key is choice. One size never has, nor never will, fit all, not all software will eventually move to a cloud or SaaS model and companies will continue to find that the virtualization of data centers will drive adoption of equally cost-effective, internally hosted, private clouds. And within the context of a cloud deployment model, both public and private clouds – with multiple variations of both – will be the driver of value, innovation and cost savings moving forward.