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Published by Bhavin V Rayka

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Published by: Bhavin V Rayka on Aug 17, 2011
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08/17/2011

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IIPM
Desk ProjectOn
Impact of the developing Cloud computing technologies onSMEs
Subject:
Information Technology
 
Submitted
To:
Submitted
By:
Ms.Poonam Gurbaxani
Bhavin.V.RaykaIIPM,Ahemedabad. FW/9-11/ISBE/FIN
 
AB
STR 
A
CT
Cloud computing has been a major focus of some businesses andgovernment agencies in developing economies. Regarding the potential and impactof cloud computing in the developing world, findings and conclusions drawn fromsurveys, studies and experiences of companies are inconsistent. We reviewdiffusion of cloud computing in developing economies and examine somedeveloping country-based firms in the supply side of the cloud to present aframework for evaluating the attractiveness of this technology in the contexts of evolving needs, capabilities, and competitive positions of developing countries.We examine how various determinants related to development and structure of related industries, externality mechanisms, and institutional legitimacy affect cloudrelated performances and impacts to the local economy.
CLOUD COMPUTING IN INDI
A
 
Gartner estimated that SaaS market in India was US$27 million in 2007.According to a study by Springboard Research, the Indian SaaS market wouldexperience a CAGR (compound annual growth rate) of 77% during 2006-2010 andwill reach US$165 million in 2010 (IANS 2008). According to a study by India¶s National Association of Software and Services Companies (NASSCOM) andMckinsey, remote infrastructure management will be a US$15 billion industry inIndia by 2013. In September 2008, IBM opened a cloud center in Bangalore,which targets mid-market vendors, universities, government bodies andmicrofinance and telecommunications companies (Channelworld 2008). Indianuniversities are banking on the cloud to develop innovative research and educationactivities. The Indian Institute of Technology (IIT), Kanpur and other academicinstitutions use the cloud (MacMillan 2009; Raghu 2008). In November 2009,Microsoft India announced commercial availability of cloud services such as e-mail, collaboration, conferencing and productivity starting US$2 per user per 
 
month (HT 2009). These services are mainly targeted to SMEs. India also has anumber of local cloud providers (Table 2). In July 2009, VMware opened a cloudcenter in Pune (eeherald.com 2009). Likewise, the U.S. Company, Parallelsannounced a plan to establish cloud operations in India . The SaaS vendor,Salesforce.com, which started its operations in 2005, is focusing on cities such asBangalore, Gurgaon and Mumbai and is taking measures to create cloudawareness. Salesforce.com¶s clients include big companies such as Bharti AXAGeneral Insurance, eBay India, Sify Technologies, Polaris Software Labs, LodhaGroup, Servion, Maytas Properties, HCL, Sasken Communication Technologies,Ocimum Biosolutions, and state owned National Research DevelopmentCorporation (NRDC) (Srikanth 2009). The Indian offshoring industry is probablythe prime example of an industry that is likely to feel the impact of cloudcomputing. The demand for cloud related services is especially high in theoffshoring industry and technology hubs such as Bangalore and Delhi (EconomicTimes 2009).
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Operational efficiency is related to the costs of accomplishing corporatefunctions. Anecdotal evidence from developing countries such as China, India andSouth Africa indicates that adoption of the cloud may lead to productivity andefficiency gains. As noted earlier, cloud has enabled some South African callcenters to increase productivity by 20% (Firth 2009). The Indian cloud Provider, Netmagic reported that the company¶s cloud services helped its clients cut costs by25-30% (Abrar 2009). Microsoft claimed that its cloud services offered in Indiawould help reduce IT costs by 10 -50% . Likewise, the cloud-based model hashelped Chinese software start-ups access to infrastructures and data centers and

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