Everyone seems to be growing aware of cloud computing. Why does it matter – especially to hedge funds and asset managers and the marketing that they do?
Cloud computing is the delivery of a computing service as a utility (like the electricity grid) over a network (typically the Internet). Like the electricity grid, you get charged for what you use and the amount you use is not an issue….within reason.
“In the next few years your operational strategy (or part of it) will be moved to the cloud…and the migration may have already started,” Paul Allen, Microsoft
This quote sums up what is happening with cloud computing and awareness is certainly growing. But does it, and should it, matter to hedge fund and asset managers in respect to the marketing they do?
In a nutshell, cloud computing is the delivery of a computing service as a utility (like the electricity grid) over a network (typically the internet). Like the electricity grid, you get charged for what you use and the amount you use is not an issue….within reason. ( information from Wiki and Radius).
What is the benefit to hedge fund marketing?
Firstly, the cloud gives you the ability to avoid tying up data use or investing in any additional infrastructure or IT resource for sending out estimates, performance and fact sheets. Even sending a few attachments, such as a small fact sheet or performance information, to a reasonably small list can reduce the efficiency of your internal network by taking up megabytes or gigabytes of data and reducing the performance of your infrastructure.
The cloud extends the ability to deliver high-quality communications, with the potential of having detailed tracking information.
Secondly, as the size and content of mailings increases, there is no element of scalability issues as the cloud automatically provides the horse-power and band-width to deliver the communications.
Cloud-based systems, in general, are specialists in their chosen area and give the marketing, sales and communication teams the ability to focus on more strategic initiatives. With systems like ProFundCom the cloud will also manage:
Detailed sales reports
Investor and Prospect engagement
SPAM and black list management
Advanced analytics
This blog entry was prompted by me speaking to the good folks at Radius and the views of Marc Andreessen, co-founder of the Andreessen Horowitz venture capital firm. Marc Andreessen thinks that the clock is ticking on old-line software and infrastructure companies. His evidence: not a single one of Andreessen-Horowitz’s start-up investments uses non-cloud software, they all use cloud-based alternatives instead. Andreessen kicked off BoxWorks, the first-ever customer conference for cloud collaboration provider Box.net. His firm invested in BoxWorks, he says, partly because he found that a lot of the other start-ups they were funding already used the product.
As he put it, “Ten years ago, it was a joke: you’d raise $20 million in venture capital and write a $4 or $5 million check to Oracle, Sun, BEA, and EMC….When it started, Salesforce looked like a toy compared with Siebel. Look ahead five years later, it’s obviously better. Not a single one of our startups uses Oracle.”
Cloud computing has lowered costs so dramatically, that it’s made huge success stories like Facebook possible. “Ten years ago, Facebook wouldn’t have been viable as a company or a business. The infrastructure costs wouldn’t have worked. The checks to Oracle, Sun, BEA, and EMC would have crushed the company before it ever got off the ground.”
He also said, “I think the clock is really ticking and Oracle is the most vivid case. I have huge respect for Oracle, Larry Ellison is one of my idols — I wouldn’t quite say role model….But objectively looking where they are, they have all the old software, and they’ve cranked up the maintenance fees. That’s all well and good for customers using that model, but they have not leaped forward into this change.”
Hedge Fund IT managers would do well to take heed of what Marc Andreessen has to say.
