Innovation & Community Clouds--Part 2: Benefits of community clouds

So far, we've discussed what a community cloud looks like at a high level. In this post, we'll see a few of the benefits and take a look at a real-life example.

A community cloud, like any communal resource, is shared among stakeholders that have something in common such as regulatory requirements. This means that the cost of standing up a communal cloud versus individual private clouds can be significantly cheaper due to the division of costs among all participants. Think of it this way:

• If organizations A, B, and C each implement their own cloud computing environment to meet regulatory requirements, and assuming that these costs are roughly the same, we have $A + $B + $C = 3x the cost.
• However, if these organizations represent a community with common interests, then they can deploy a single cloud computing environment that meets all of their needs at some reduced cost; thus $(A, B, C) = 2x the cost of individual cloud environments (instead of 3x).

For this to work, the community needs to have some interest in its success, some skin in the game, so to speak. Joint ventures are a good example of such an arrangement. Each participant in the community contributes some consideration such as resources, funds, other assets, or some combination thereof, and ideally in equal proportions.

Another acceptable arrangement could be to outsource the management of the community cloud to a cloud provider. The advantage here is that the provider would be an impartial third party that is bound by contract and that has no preference to any of the customers involved other than what is contractually mandated.

Yet another arrangement would be for one of the participants to provide the cloud based services to its peers as a service provider. We already mentioned that the New York Stock Exchange (NYSE) is doing just that and will begin billing in a utility based billing model sometime in the near future.

One last thing that bears mention in this posting is the fact that community clouds can foster innovation. Typically, we think of community clouds as being horizontal in nature and encompassing similar organizations such as hospitals or government, for example. In fact, community clouds are not limited to horizontal integration, they can be vertically integrated like supply chains.

For example, a manufacturer produces a widget that is transported to a warehouse and distributed to retailers who then sell it to consumers. Tools residing in the community cloud can be used to leverage the information stored to serve customers and the supply chain, such as return tracking and just-in-time production and distribution. It is at this intersection of big data and tools that community clouds can really contribute to innovation.