The IT industry is overpromoting the benefits of cloud computing, warns John Tate.

I live near a railway line and when my children were young I used to take them to see the trains.

Watching from a bridge, we first became aware of an approaching train by crackles and creaking noises on the line. Seconds later you could see the train approaching in the distance. Getting closer and closer, it looked like it was going to come right on top of us and smash the bridge to pieces. We all stood in terror and then enjoyed the relief as the train passed safely below.

Full throttle

The IT industry hype-machine has similarities with this spectacle. Right now, the phenomenon of ‘the cloud’ is at full throttle. For those not familiar with this term, the cloud is all about running your applications and storing your data online.

There are a cast of many that make up the train. The IT suppliers are the drivers; the media and blogging community provide the fuel; while the end-users are the customers who experience what is really happening.

But the IT hype-machine is no ordinary train. It charges along at breakneck speed, often on the wrong side of the track, with no standard wheel gauge. There are countless accidents, with injured customers littering the track.

In recent weeks we have seen many of these cloud-related accidents. LinkedIn reported that millions of their users’ login credentials had been downloaded by an unauthorised source; Dropbox announced that customer information had been obtained via a security breach; Google Talk – the text, voice and video-chat service – suffered an outage in July; and so it goes on.

Microsoft’s prediction that the cloud will ‘fundamentally change how businesses operate and compete’ is correct, but not perhaps in the way they meant it. HP’s view that ‘through the cloud, everything will be delivered as a service, from computing power, to business processes, to personal interactions’ is deeply worrying. Call me stupid, but shouldn’t personal interactions be personal?

Not only are there accidents, but the lack of standards within cloud IT systems makes it incredibly difficult to integrate different applications. For example, it is very tempting to add a cloud service to your CRM (contact management) system, to engage in online fundraising or to sell new products and services. But how do you link this to your current systems?

New contacts can be added, and details changed, within a cloud product but most core CRM systems do not offer the facility to automate the integration of this data. Similarly, if you have a number of different cloud solutions on top of your core CRM system, how do you get one view of what is going on with your contacts? Each solution will hold the data in a different format and it is a huge challenge to pull all this together.

Civil war

Customers want standards and interoperability, but the IT industry is apparently engaged in a civil war that makes this look very unlikely to happen.

There has been a tidal wave of patent litigation involving the likes of Oracle, Apple, Microsoft, RIM (creator of the BlackBerry), Facebook and Yahoo. Longstanding partnerships are being broken and former allies are now in competition.

A good example of this was Microsoft’s announcement of the launch of their own tablet device, which puts them in direct competition with their major partners such as Dell, Acer and HP.

For those who remember the original launch of the graphical user interface (including the Windows operating system), the rise of social media, and outsourcing, this hype is all too familiar.

So if you are going to adopt some cloud technology please do the blindingly obvious. Check very carefully that the product works before you buy it, worry a lot about security, and then develop an IT plan to manage data integration as well as you can.

Finally, make sure you get a really quick ROI on your expenditure, so there is a chance your money will be well spent.

If you want to check out a different sort of train, you might like to visit the bridge I mentioned. The postcode is TW9 1UY.

John Tate is a business consultant, IT adviser to CFG and a visiting lecturer at Cass Business School