Bill Gates once semi-famously commented that the effects of technology shifts are overrated in the short term, and underrated in the long term. This is very true — particularly when it comes to cloud computing.
The hype cycle is well documented. A technology comes to public attention, lots of people instantly grasp its potential consequences, and our lemming-like instincts cause a big bubble of hype, usually right at the time when the technology is only reaching awkward pre-adolescence. When the technology doesn’t immediately live up to the hype, we are equally lemming-like in rejecting it as useless. Meanwhile, the technology’s kinks work themselves out slowly, and in the long run, it turns out to be even more powerful than we first anticipated.
Consider how this cycle played out with cloud computing.
The cloud was supposed to drive the “consumerization of enterprise.” Because enterprise software could be delivered seamlessly through the cloud, individual workers, and not IT departments, would decide what kind of software people would use for work. This would be a big deal because software designed and sold to be accepted by IT departments is not software designed and sold to meet the needs of end users, but rather of IT departments. This explains the strange paradox whereby the software you use at home gets better and more user friendly every day, while the software you use for work still looks like something from 1997.
Has the original hyped prediction about the “consumerization of the enterprise” come true? Sort of.
Cloud computing has indeed led to a new breed of companies pushing better enterprise software that has been adopted in part from the bottom up in companies. But that “in part” is key: It turns out that “consumerization” is, thus far, less of a revolution than a marketing strategy. It’s not that you build, say, a great file storage system (like BOX.net, a “Dropbox for the enterprise” Silicon Valley darling that recently went public) and that people magically adopt it from the bottom up, and presto, it becomes the new thing. It’s more that you build a great file storage system, some people adopt it from the bottom up, that gets you a meeting with the head of IT, and then you sell him the designed-for-the-IT-department (and more expensive!) version.
This reality has created lots of shareholder value for Silicon Valley venture capitalists, and probably caused a real, albeit limited, improvement in the overall quality of enterprise software than would have happened otherwise. But it looks very much more like evolution than revolution.
And don’t forget, this only takes us past the first peak of the hype cycle. As Amazon CEO Jeff Bezos — who knows a thing or two about cloud computing — pointed out in one of his excellent shareholder letters, the main virtue of the internet is not so much this or that service, but that its lack of gatekeepers enables permission-less innovation. And permission-less innovation can be transformative, because the best ideas are often the ones that sound crazy to gatekeepers.