Friday, August 5, 2011

Cloud Computing - Where is the revenue?

In this excellent article John Foley asked the question about cloud computing: Where is the revenue? There are some pretty big surprises when you look at the real reported numbers. Amazon bundles AWS revenue into a category they call "other" and it is nothing like the $25 billion number that gets bandied about.

The same is true for all of the big players. If this is the "next big thing" then why aren't we hearing anything about revenue? My question is this: When was the last time you heard of a company hiding success? Cloud computing revenue numbers are like real sales figures for every table not named iPad: dirty little secrets that are kept quiet. This can't be good.

There are so many IT buzzwords that have come and gone, and I fear that this is another one. Remember push? That was the next big thing. How about thin clients? Time and time again the buzzwords get all the press, but what keeps selling is desktop pc's, servers, and software...



Anonymous said...

While there is a point here about knowing the revenue of a company it is not the whole story. I could give you 3 different balance sheets from the same company and cheat the numbers to make one look good and the others bad and you would not know the difference. So while knowing the revenue may be a good thing, if you base a decision on it you are misleading the reader. Another point is I know many companies that offer SaaS software that charge more for their products than others. But the ones that charge less are more profitable. How can that be? Several reasons - the smaller companies might be more lean, they may be producing better software so they don't need 50 programmers and 100 support technicians to fix the fires, etc. So there are too many variables that go into that one magic "revenue" number to use as a tool for validation. Should you know it? Yes. Should you bet the farm on it - Absolutely not.

renewingmind said...

I agree with you. Keep in mind, this is not a comment on SAAS or non SAAS. But for all of the noise about the cloud, the revenue numbers are really, really low. Puzzling.