Cloud Computing and the Irish Economy: A clouded issue?
By Ian Bergin, Digital Mines, Ireland
Apr 8, 2011 - 3:35 AM

Printer-friendly page from Finfacts Ireland Business News - Click for the News Main Page - A service of the Finfacts Ireland Business and Finance Portal

Cloud Computing and the Irish Economy: In recent years, clouds have represented three distinct things to the Irish - the start of yet another freakish and severe weather front, the dark thing that hangs over our nation’s economic issues, and now the latest buzzword in IT - ‘Cloud Computing’.
Strangely enough, this third point has been heavily influenced by those aforementioned fiscal issues, and has proved prominent in the story of the cloud in Ireland, right up to its recently becoming a ‘Global Cloud Computing Centre of Excellence’.

The Irish cloud
To put some perspective on where the cloud in Ireland currently stands in comparison with the US, a recent report on cloud adoption demonstrated that Infrastructure as a Service (IaaS) adoption was far higher in the USA than in Ireland, while Software as a Service (SaaS) actually had a better adoption rate in Ireland than in the USA.

To date, the cloud in Ireland has never really been driven by big business demands or the major global players in the same way it has in the US. The cloud’s adoption in Ireland has been led by the development community, who, through its early use of Amazon’s web services, demanded cloud services in Ireland. The Irish hosting companies, who were either running out of space, available power and/or access to land to build data centres (as the cost of land in Ireland went out of control) saw the potential for small-scale virtual private servers, and slowly started answering the call.

Since this realisation, the market has spawned a new breed of cloud-centric service providers who provide ‘cloud-only’ services, supplying best-in-class clouds without the noose of aged legacy infrastructures and services to support. Dublin-based Digital Mines is one such company. Founded in 2010, this Irish start-up recently shot into the news after closing €750,000 in first round funding via Enterprise Ireland and Delta Partners, a venture capital fund.

Considering the difficulty Irish businesses have continued to express over the last three years since the global economy imploded, this kind of investment not only shows the strength of the cloud for economic hope in Ireland, but also that experienced Irish cloud professionals are leading the way, getting their message heard and more importantly, playing their part in the cloud fulfilling its potential and economic role in the Irish and European markets.

Digital Mines, as an example, set out on the path of innovating beyond the traditional euro-spend-sink of buying hardware and building its own data centre; instead leveraging off existing world-class leading infrastructure from Amazon’s AWS.
Continuing issues
But while awareness of the cloud is gaining momentum in Ireland thanks to companies like Digital Mines, the actual understanding of how to apply it within a business is not. As a result, most businesses have not taken advantage of cloud services to date. Obviously this is a huge opportunity with awareness and appetite being very high, but expertise and understanding are lacking.

For example, IaaS cloud providers in the Irish market have in recent years tended to take a very hands-off, business unfriendly ‘we-provide-infrastructure-only-with-service-level-agreements’ approach. This has proven to be one of those barriers to adoption of cloud in Ireland, and indeed an example of bad experiences some early cloud-adopters faced, which has in fact turned some of them off the cloud, and back into traditional frameworks such as colocation or shared hosting. Cloud, where it was supposed to be a solution, suddenly became a problem for some of these users.

One of the biggest complaints (and indeed criticisms) levelled at Irish cloud service providers is their inability actually make the services easy to access, in the same way Apple makes its technology intuitive and accessible - customers want it easy to use, with a user-friendly interface. They don’t care how it works, or why it works, and rightfully so. They don’t need to. It should ‘just work’ right out of the well-packaged and marketed box, as promised.

It’s not a uniquely Irish problem, but one that is at the forefront of the Irish cloud space.Too often a start-up (usually the most common adopter in Ireland of cloud services) approaches a cloud service provider for a solution, only to be told the solution they want is a problem, as opposed to the provider having the solution to the prospect’s problems. Often the prospective cloud customer must rejig their needs to fit into the provider’s expensive monthly template.

Despite these issues, the cloud in Ireland has had a large number of successes, which those in the industry know exist, but won’t discuss, or are afraid to share. As a result, success stories in the cloud in Ireland to date have been given minimum coverage, despite the current hype.

A brighter future?
If the cloud in Ireland is to grow in line with that hype, genuine use cases and more cloud-based businesses must be encouraged, which innovate and ultimately lead to the ‘smart economy’ Ireland’s politicians have waxed so lyrically about.

While the recent Microsoft and IDA study (that led to Ireland's declaration as a Global Cloud Computing Centre of Excellence) rightly indicated the level of hype for cloud in Ireland, and the many job possibilities, it really failed to highlight what the opportunities were, or indeed explain the Cloud in any detail to help drive the point home and to encourage innovation and entrepreneurship, which has driven the cloud in Ireland.

Yes, it has garnered further awareness and excitement, as well as help ignite sparks of hope for jobs in the smart economy, which is a good thing. However, the example of Ireland’s fervour for ‘hype and excitement’ in property in the early part of this decade did it no favours. The fervour for this must have follow-through. It must be purposeful, and not turn into the same level of emptiness that the property boom did in Ireland. Cloud in Ireland, or anywhere else must be about working smarter to gain better results as we face into an uncertain set of economic circumstances that our previous ideas about IT enabling business had alluded to.

The cloud and its strategy in Ireland now needs the Irish Government, arm in arm with its global commercial links and partners, to work together to ensure nurture its cloud movements adequately and appropriately, and continue to actively encourage Ireland’s native cloud industry  in the future. It is with this impetus that it can contribute to the economic recovery in Ireland, and across Europe, with an excitement and energy that we all need. One that is found in abundance within those same cloud companies daily.

Ian Bergin is a veteran of the Cloud and managed services industries in Ireland, specialising in cloud strategies & account management for Government, Multi-national Corporations & Irish technology & service Start-ups. He has previously worked for AOL, eircom, Hosting365, & SunGard, recently joining Digital Mines as their Cloud Sales Consultant. He also currently writes his own blog dedicated to discussing Cloud adaptation for Irish SME’s:

To learn more about Cloud Computing and what it means for your organisation register for the Cloud Computing World Forum for free at .

IBM's strategy for making money off cloud computing, with CNBC's Jon Fortt and Steve Mills, IBM sr. vp. Mills discusses Big Blue's "smart cloud," which he believes wlll generate $7bn in revenue by 2015:

Singtel and VMware have launched an on-demand enterprise hybrid cloud solution. Paul Maritz, CEO & president of VMware, discusses the firm's new venture:

© Copyright 2011 by