Secrets From Cloud Computing’s First Stage: An Action Agenda for Government and Industry

New computing architectures come in waves.12 The mainframe dominated in the 1960s and 1970s, the PC in the 1980s, client-server in the 1990s, the Internet in the 2000s, and cloud computing took off in 2010 and is now gaining scale. [...] One of the most powerful ideas in economics is specialization and division of labor.22 The cloud takes specialization and division of labor to a new level in IT, wherein the cloud provider specializes in the IT infrastructure so users doesn’t have to. [...] The EU is driving the GAIA- X project and the European Cloud Initiative, in which it expects to invest €2 billion.46 Figure 6: Cloud provider market share and growth rate, Q1 2021 (IaaS, PaaS, and hosted private cloud)47 The Cloud Is a Platform With a Partner Innovation Ecosystem AWS, Microsoft, Google, Alibaba, Tencent, and others enable thousands of competitors and tens- of-thousands of partners. [...] From an industry value chain perspective, we expect cloud to accelerate the shift in revenue and profits from hardware and components to the cloud, and from legacy software to the cloud. [...] Notice the specialization and division of labor: The cloud automates the underlying IT so that businesses and governments can devote resources and focus to applications and business processes that help customers and improve outcomes.