CLOUD COMPUTING IS EFFICIENT

Cloud Computing Energy Efficiency; Strategic and Tactical Assessment of Energy Savings and Carbon Emissions Reduction Opportunities for Data Centers Utilizing SaaS, IaaS, and PaaS
Bruce Daley and Clint Wheelock, 4Q 2010 (Pike Research)

"The market for cloud computing services has continued to expand despite a general decline in economic activity in most of the world…Pike Research expects the growth in cloud computing revenue…between now and 2015…[to have] a compound annual growth rate (CAGR) of 28.8%, with the market increasing from $46.0 billion in 2009 to $210.3 billion by 2015.

"…Thanks to massive investments in new data center technologies, computing clouds in general and public clouds in particular are able to achieve industry-leading rates of efficiency. Simply put, clouds are better utilized and less expensive to operate than traditional data centers…Pike Research’s analysis indicates that only the very largest of organizations – both commercial and governmental – will have the capital and expertise to achieve a similar level of efficiency at a comparable cost. As a result…[M]uch of the work done today in internal data centers will be outsourced to the cloud by 2020."

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"…[S]uppliers of servers, network equipment, disk drives, and cooling and power equipment will all increasingly design their products to suit [cloud] needs. One of the most important of these is to improve operating margins by making better use of electricity. Many of the products designed specifically to optimize clouds are only now entering the market…[T]hese products will enhance the energy efficiency of all data centers.

"…[A]s data centers become more efficient, we expect them to use less energy and produce less carbon emissions…By 2020, Pike Research forecasts that data center contributions to GHG emissions will decline from 109.7 MTCO2e in 2010 to 79.5 MTCO2e – an improvement of 27%. This level of emissions is also 38% lower in 2015 than a business as usual (BAU) scenario in which data centers maintain their current rates of energy consumption and carbon emissions output."

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"…Pike Research’s cloud computing adoption forecast scenario finds that data center energy expenditures will be $16.0 billion annually by 2015, a 62% reduction from the BAU scenario figure of $25.9 billion.

"Cloud computing can play a pivotal role in moving towards a sustainable future. For competitive reasons cloud providers are making their data centers as energy efficient as possible…A new generation of hardware, software, and business processes has the potential to leverage the enormous scale of the cloud and make computing even more energy efficient than we predict – if they become more widely adopted. Few, if any, clean technologies offer to impact GHG production with so little disruption of business."