Cisco Canada Blog

Cloud computing, coming to an Oil and Gas company near you, Part 2

December 5, 2014

In my previous blog I discussed the evolution of cloud computing in the Oil and Gas industry. Here I will discuss how cloud computing will likely evolve in the next 5 years.

In just a short time cloud computing has been revolutionary for business. This new paradigm has transformed how we work, giving us the power and information we need to be productive almost anywhere, while at the same time helping to reign-in ballooning IT costs. Much the same way cloud computing has redefined business technology, it will fundamentally change the way the Oil and Gas sector operates as it is accepted and implemented throughout the industry.

Brad - Cloud in Oil - Part 2

Reduce IT costs

The previous IT models of high up-front hardware and software investments were unsustainable. Not only was it costly, it limited users by handcuffing them to software suites or custom applications, delaying adoption of new tools and creating a disadvantage whereby more nimble companies could overtake. By unhitching Oil and Gas companies from the cost and burden of managing large data/compute infrastructure they will be able to have greater focus on their core competency: finding and producing hydrocarbons.

Level the playing field

Software delivered through the cloud is often called software-as-a-service (SaaS), and generally these programs are characterized by universal access from any device, sometimes through a browser, and are licensed through monthly subscriptions. The result is a level playing field for small, medium, and large businesses alike. All operators have access to the same technologies at a price in line with their budgets.

Increase Innovation Velocity

As adoption increases, it will a mean significant increase in innovation velocity as developers, and users alike, from large corporations to individual consultants, can all use the same infrastructure and reallocate capital freed up from IT investments into business activities.

Connect the unconnected

Regardless of the size of an organization, the oil and gas industry relies on partners, service organizations, and individuals all outside the companies firewall. The industry is becoming more dependent on partners, suppliers and service companies as a necessity to share the increasing costs, risk and access the limited industry expertise. Cloud-based systems naturally allow for much broader collaboration as stakeholders are no longer bound to internal fixed assets and sites.

Furthermore, as oil and gas assets are developed in increasingly remote parts of the world, the industry has to become more “globally mobile.” These industry imperatives mean seamless access to data, technology, and expertise must be mobile and platform agnostic, all of which are fundamental components of modern cloud-based applications.

Securing the cloud

One of the short-term challenges the Oil and Gas industry must overcome is understanding the inherent security of the cloud. Most notably, the belief still exists that data security can’t be guaranteed in the cloud. As cloud technology becomes pervasive the challenge may solve itself, but Oil and Gas has the same security concerns as many other industries and organizations who have already begun adopting could services. As confidence grows around hosting IT in the cloud, Oil and Gas companies will undoubtedly take advantage of the benefits.

Economies of scale for everyone  

In the near term, as the cost-of-entry to cloud-based computing is low, small operators, independent software developers, and consultants not able to make the significant investments necessary for traditional IT environments will be the first to adopt the cloud. They have the most to gain and are more willing to accept technology risk. Large companies will continue to leverage existing legacy IT investments and will be selective on what is migrated to the cloud, moving on an application-by-application basis. At Cisco we enable this transition and can become a trusted advisor by working with our customers and cloud partners to tailor cloud solutions for each unique client situation.

The oil and gas industry exists today because of innovation and technology. From seismic to fracking, technology is at the forefront. And soon, cloud computing will be at the forefront of how end users consume information technology.

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