1. The 2009 Cloud Consensus Report July 28, 2009 Bringing the Cloud Down to Earth Sponsored by the Merlin Federal Cloud Initiative

2. 22 Introduction President Barack Obama, Federal CIO Vivek Kundra, and others vocally support a Federal transition to cloud computing. Questions, however, remain – what exactly is cloud computing, and what are the real benefits for Federal agencies? In June 2009, MeriTalk surveyed 605 Federal and industry IT executives to identify the following: Snapshots of both government and industry cloud progress Issues stalling the Federal cloud transition Recommendations to enable agency cloud readiness “Is the cloud just the latest hype?” – IT Manager, Department of Defense

3. There are more than 20 definitions of cloud computing in circulation* In your own words, how would you define “the cloud?” “The concept of providing services, infrastructure (network connectivity, database management, etc.), and software applications in a virtual environment.” - Deputy CIO/CTO, DoD 3 Cloud Definitions *CIO, “Early Adaptors Ride Out Cloud Hype,” May 27, 2009 “The architecture supporting services offered.” - IT Manager, Federal Civilian “Internet client side is not the cloud, but when Internet traffic is submitted to the client side, the cloud is present.” - IT Director, Federal Civilian “Remote services and infrastructure available over the Internet that appear as local resources.” - IT Manager, Federal Civilian “The domain of Web-based applications.” - CIO/CTO, Federal Civilian “A pool of resources (processing and storage) that is sold as a service to various clients so that they do not have to own and maintain their own data center.” - IT Director, DoD “A vaguely defined set of computing resources that can be utilized to complete tasks.” - IT Manager, DoD Take Away: Low Visibility “Just another name for the Internet.” - IT Manager, DoD

4. 4 Cloud Status 44% 28% 42% Take Away: Cloud Confusion however Report using database cloud applications Report using document management cloud applications Report running a virtualized server environment in-house; aka – private clouds report they are currently using cloud computing Just 13% Federal IT executives report confusion over exactly what is and what is not cloud computing While few Federal IT managers say their agencies are using cloud computing, many more report using applications that rely on the cloud

5. Cloud Impact Take Away: Staying Power Federal IT managers are more likely than industry managers to hold this optimistic outlook – 61% to 51% Confident Outlook: Aggressive Timeline: 76% 61% Of Federal IT managers believe the cloud is “here to stay” Believe that in five years, the majority of large enterprises will rely on cloud computing for core applications 2.6 Average number of years that Federal IT managers believe it will take for their agency to realize the benefits of cloud computing Despite uncertainty, Federal IT managers see the cloud as more than the latest tech trend 5

6. Take Away: Opportunity for Federal Leadership Where Are We Today? "Everywhere I look, people talk about how the private sector's ahead of the Federal government and that the Federal government can't lead. I reject that idea. The Federal government can lead.“ – Federal CIO Vivek Kundra on the adoption of innovative IT* *InternetNews.com, “Obama CIO: Government Can Lead in IT,” March 12, 2009 Not discussing the cloud Implementing a plan Have cloud applications in place Unsure Learning about the technology Designing a plan Where is your organization with cloud computing? Federal government Industry On track with industry organizations, most Federal agencies are currently in cloud learning mode 6

7. 7 Take Away: Golden Ticket Cloud Benefits 57% Reduced hardware requirements 45% Reduced costs – pay-as-you go model 35% Reduced staff requirements – allows for focus on more critical tasks 33% Flexibility 24% Potential for group collaboration 22% Continuity of Operations Planning (COOP) *Federal IT managers asked to select up to three benefits While Federal and industry IT managers agree on the top three benefits of cloud computing, Federal managers are twice as likely to view COOP as a top benefit – 22% to 11% With Federal budgets shrinking, the cloud may offer an opportunity to save without sacrifice What are the most significant benefits of cloud computing for your agency?*

8. 8 Take Away: Cash In Cloud Success 90% of agencies and organizations that have implemented cloud computing say their implementation has been successful 63% of Federal agencies and industry organizations believe cloud computing is the key to reducing their IT expenses and “We have recently benchmarked our cloud implementation and have had high service levels with very low costs.” – IT Manager, Federal Civilian Across Federal agencies and industry organizations, IT departments are anticipating and achieving a high rate of cloud computing success

9. 9 Cloud Barriers Take Away: Storm Clouds Security Privacy Bandwidth Costs Performance 78% Though Federal and industry IT managers both see it as the top barrier, Federal agencies are more likely than industry organizations to experience implementation challenges with security – 73% to 48% *Federal IT managers asked to select up to three barriers However, Federal IT managers see security concerns as a major hurdle to cloud advancement What are the biggest barriers to cloud computing within your agency?*

10. 10 Take Away: Feds Value Privacy Cloud Outlook Government agencies are less likely to be open to the use of public clouds than industry organizations – 27% to 41% Both government and industry are optimistic about their future cloud use When it comes to architecture, Federal agencies are more likely to select private clouds over public clouds; may see as a way to address security and privacy concerns My organization is open to using: Clouds Today Clouds Tomorrow My organization is currently using: Federal government Industry

11. 11 Take Away: Clouds in the Distance Five-Year Forecast Looking ahead, Federal IT managers believe e-mail is the most likely cloud candidate However, close to half also anticipate moving procurement, enterprise resource planning (ERP), and customer relationship management (CRM) applications to a cloud model within the next five years Five years from now, how do you believe your agency will host the following applications?* *Federal IT managers asked to select one hosting method for each application

12. Download the Cloud Consensus Report Today at Meritalk.com: http://www.meritalk.com/2009-cloud-consensus- registration.php Steve O’Keeffe – MeriTalk sokeeffe@meritalk.com (703) 883-9000 ext. 111