Cloud prices heading for a fall?

Cloud computing

Remote hosting prices are set to tumble because people will soon no longer care where their services come from as everything will look the same from the outside in.

So claims Ditlev Bredahl, chief executive of hosting company OnApps, who believes this shift will occur

as the cloud market becomes more commoditised.

In the next 12-18 months, services will become more transparent and people will care less about the hardware and only concentrate on the compute power they need and service levels, Bredahl claimed.

"People will understand that it is the same sort of thing as a dedicated server with a lot of resilience and redundancy that we didn't have before," Bredahl said. "Something that is commoditised equals transparency. Suddenly, when the market is transparent, a CPU is just a CPU no matter where you buy it. No-one will care about it anymore."

The situation will be similar to the PC market where the hardware only varies in the processing power on offer and the operating system on board. This has resulted in a tremendous drop in the cost of computers and, Bredahl predicts, the same will be true when it comes to the cloud.

OnApps is one of a new breed of cloud service providers that have entered the field against fairly established platforms such as Amazon, Google and Microsoft.

Bredahl is highly critical of the terminology used by some service providers: "They ask How many RAM hours do you need?'- I've been in the business 10-15 years, I still don't know how many RAM hours I need," he said. "It's just a silly question, especially when you come to the SOHO and SME market who hardly know what RAM is."

OnApps has taken this "layer of complexity" away to suit the market and that this makes it easier to sell as a commoditised, or white-label, service, Bredahl added. An off-shoot of this is that it also makes the services easier for resellers to become involved.

"In the next phase of adoption, cloud will no longer be called the cloud it will just be the way that stuff is done," he said. "We are moving towards providing professional services rather than being a technical services business."