The next iteration in cloud

When the cloud industry first started, it was all about computing infrastructure. The value proposition was - Why buy datacenters when you can rent them on demand. It allowed AWS to open up an entire industry and it continues to dominate it a decade later. This first phase is generally referred to as the “Infrastructure Cloud”.

Then came Microsoft. It was already established with large enterprises with its software applications. These included amongst other things database applications (MS SQL server), ERP applications (Microsoft Dynamics), and of course, its Email and office applications (MS Office). It started offering these applications on its Azure cloud. The value proposition was - Why buy an application license when you can subscribe to it on demand. This phase of cloud computing is called the “Application Cloud”

Each successive iteration provided more and more horizontal solutions as a service. For example, there is the “Platform Cloud”, the “Software Cloud”, the “Security cloud” and so on.

So what next?

I believe the next iteration is not another horizontal offering but a vertical offering. Some people call it the “Industry cloud”. In this phase it is about understanding industry specific needs and packaging an offering suited to that industry. The focus is on the seamless integration with other components and reducing operational overheads to maintain it. It aligns much better with the C-level business executives whose priorities are speed, resilience and efficiency in their journey towards digital transformation.