The 10 Biggest Cloud Stories Of 2011

Here Comes The Cloud

In 2011 cloud computing had more story lines than a daytime soap opera (minus the step-brother back from the dead to exact revenge over a shady business deal). There were ups and downs, new innovations and a lot less lip service than in prior years. In 2011, the cloud truly took shape and the value became evident. Here, we take a look at the top cloud computing stories of 2011.

10. OpenStack Evolves

While it launched in July 2010, the Rackspace- and NASA-led OpenStack open-source cloud initiative gained real traction in 2011. OpenStack is now in its fourth release, called Diablo. The project has now drawn more than 120 participating companies, including Cisco, Citrix, Dell and others into the OpenStack community. Recently, HP has vowed its commitment to OpenStack. The OpenStack project also has roughly 300 active developers and has experienced more than 50,000 downloads from its code repository, which doesn't take into account downloads from other sources. In 2011, Rackspace also launched Rackspace Cloud: Private Edition, which offers a reference architecture around OpenStack clouds and puts OpenStack cloud deployment capabilities in the hands of select systems integrators. In 2012, Rackspace expects to launch the OpenStack Foundation, which will handle the project governance and trademark and copyright ownership for the OpenStack cloud.

9. All Eyes On Government

As the federal government continued with its "cloud-first" push to cut government IT spending and spur innovation, cloud vendors trained their sights on government contracts in 2011. From achieving FISMA certifications, which sparked a contentious war of words between Microsoft and Google to the launch of government-focused cloud offerings a la Amazon's AWS GovCloud, cloud computing companies clamored lucrative government contracts. The race to the government cloud comes as one survey revealed that roughly two-thirds of federal agencies have identified application to move to the cloud.

8. The Cloud Funding Boom

Queue the ca-ching of cash registers that mark the intro of Pink Floyd's 1973 mega-hit "Money." In 2011, myriad cloud upstarts and startups fattened their bankrolls with help from VCs and investment firms. A host of multimillion dollar cloud investments helped get startups off the ground. Cloud storage player's investments swelled to $162 million. Boundary came out of stealth with $4 million. Intacct brought in more than $12 million and a host of others reaped the benefits of the cloud boom.

7. iCloud Is Born

Apple got serious about its cloud strategy in 2011, and nowhere is that more evident than in iCloud. Apple's iCloud cloud storage and syncing play lets users store music, photos, apps, calendars, documents and more in the cloud and automatically wirelessly pushes that content to up to 10 devices. Unveiled by late Apple CEO Steve Jobs at WWDC 2011, iCloud also contains popular Apple apps including Calendar, Mail and Contacts. While iCloud's reviews have been mixed, Apple getting behind cloud computing is a major step and validates that the market has arrived.

6. Cloud Through Acquisition

It wasn't just the carriers that were plunking down top dollar to acquire companies in a bid to bulk up their cloud portfolios. Cloud acquisitions and mergers took top billing in 2011. Among the most high-profile was global integrator Dimension Data's buyout of cloud infrastructure player OpSource. Other massive mergers include HP's $10.3 billion buyout of Autonomy, which has become a major player in the market for cloud-based data management services. CA also continued its cloud computing acquisition spree in 2011, adding WatchMouse, a cloud and mobile app monitoring player. Even cloud VARs got in on the action, with cloud provider Appirio scooping up three companies this year alone, and top Google partner Cloud Sherpas making a trio of acquisitions to extend the reach of its Google story to new territories.

5. VARs Taking On ISV Role

No one has disputed that to capture the cloud's candescence, solution providers have to change their tune. Cloud computing requires a new business model. Cash flow is king as they transition from up-front payments to an annuity-based recurring revenue stream. And in many cases, VARs are taking on some of the traits traditionally reserved for ISVs. They're building custom apps and repeatable software offerings to get their feet into new clients and gain traction in the app infrastructure while also offering cloud services on top of that. In many cases, the apps are the value of the cloud and being able to deliver that value earned big business in 2011 for VARs willing to make the change to what some solution providers have dubbed "channel 2.0."

4. Carriers Catch Cloud Fever

Verizon kicked off the year in January with the $1.4 billion acquisition of cloud provider Terremark, sparking an avalanche of cloud acquisitions from traditional telecoms, carriers and service providers looking to make their marks in the cloud. What followed was a stampede by the carrier industry to get themselves into cloud computing. From acquisitions, like Time Warner Cable scooping up NaviSite for $220 million to CenturyLink nabbing Savvis in a multibillion dollar deal, to carriers like AT&T pledging big dollar investments in the cloud, the cloud was the new battleground in telecom in 2011.

3. It's All Social

Leave it to CEO Marc Benioff to take a cloud market he helped build and turn it on its ear. With Benioff's and's vision of the social enterprise and the pending social revolution, the course of the cloud has changed for good. The confluence of mobile, social and open cloud solutions that acts as the cornerstone of the social enterprise is set to make businesses more agile, collaboration simpler and work easier. For Salesforce, it stemmed from Benioff's love of Facebook and his dream of seeing Facebook-style collaboration in business. And it isn't just banging the social drum. Google and others came out of the woodwork this year to tie social components into typical workflows. A recent survey conducted by cloud provider Bluewolf shows that 61 percent companies think social media is a high priority and solution providers can reap the benefits.

2. The Cloud Gets Up And Goes

Blame it on the tablet revolution. Or, point the finger at the iPhone. Whatever the scapegoat, the cloud went mobile in 2011 in ways that were never before imagined. Driven by the app revolution, mobile cloud services dominated. Having access to apps stored elsewhere from a device carried anywhere became a value proposition for the cloud that offers immeasurable productivity gains and solution providers are now charged to not only provide cloud services, but to make sure they're available on customers' favorite devices. Cloud solution provider Model Metrics, which was recently acquired by, conducted a survey earlier in the year and found that 80 percent of its customers now include smartphone and tablet adoption plans within their cloud deployment initiatives. All told, Model Metrics' mobile projects have tripled this year.

1. Cloud Outages Abound

Since its inception, the cloud has suffered outages. It was to be expected. And while it was a nuisance, the fallout was minimal. That all changed in April 2011 when Amazon suffered a catastrophic cloud outage that took some of its top cloud customers offline for several days. What followed was radio silence from the massive provider that finally broke its silence after several days and blamed the downtime on a re-mirroring storm and offered customers an apology and a credit. After Amazon, a host of other cloud providers suffered similar outages. Microsoft's BPOS and Office 365 suites of cloud apps suffered several bouts of downtime; some Google cloud services crumbled, including Gmail, Google App Engine and Google Docs; and many others like Intuit, Jive and Yahoo all battled failures. Amazon even suffered another couple before the year closed. But it was Amazon's first major stumble in April that set the town and called into question whether cloud computing is a reliable IT strategy on which to hang your hat.