Tourism Cloud – Enabled Business Model Innovation Jen-Yao Chung IBM T. J. Watson Research Center © 2012 IBM Corporation Agenda Introduction and Industry Trend Tourism Ecosystem What is Cloud, Why Cloud – Rethink IT / Reinvent Business Enterprise Cloud Approach Cloud Adoption Patterns - Business Cloud Services Innovative Business Model for Cloud Summary 2 © 2012 IBM Corporation The World Wide Tourist Market WTTC’s latest Economic Impact Research shows that world Travel & Tourism continues to grow in spite of continuing economic challenges. – Despite progressive downgrades to growth forecasts through 2011, the industry grew by 3% over the course of the year (in terms of Travel & Tourism’s contribution to GDP). – Tourism’s direct contribution to GDP in 2011 was US$2 trillion and the industry generated 98 million jobs. – Taking account of its direct, indirect and induced impacts, Travel & Tourism’s total contribution in 2011 was US$6.3 trillion in GDP, 255 million jobs, US$743 billion in investment and US$1.2 trillion in exports. This contribution represented 9% of GDP, 1 in 12 jobs, 5% of investment and 5% of exports. – Growth forecasts for 2012, although lower than anticipated a year ago, are still positive at 2.8% in terms of the industry’s contribution to GDP. – Longer-term prospects are even more positive with annual growth forecast to be 4.2% over the ten years to 2022. Source: World Travel & Tourism Council (WTTC) http://www.wttc.org/research/economic-impact-research/ 3 © 2012 IBM Corporation Tourist Industry Trend Internet continues impact on tourism Strong efforts in standardization and interoperability Increasing importance of mobile devices and geographical information systems – Always on – Integrated circuits (RFID) enter tourism industry Market segmentation will become more sophisticated and specific – Individualization/personalization as an ongoing trend – Travel agents reinvent themselves for personalized service – Promote customer centricity – Personalize with precision – Demographic changes and consequences Elderly people is increasing rapidly Further decrease in the average number of persons per household – Extend the experience the experience doesn’t begin at departure or end upon completion (e.g. virtual experience) Sustainable tourism – Global catastrophes as facts of daily life 4 © 2012 IBM Corporation Barriers to e-business adoption The small size of the company Costs of e-business technologies Complexity of e-business technologies Lacking compatibility of technologies Security risks and concerns about privacy issues Perceived unsolved legal issues The difficulty to find reliable IT suppliers. 5 © 2012 IBM Corporation Agenda Introduction and Industry Trend Tourism Ecosystem What is Cloud, Why Cloud – Rethink IT / Reinvent Business Enterprise Cloud Approach Cloud Adoption Patterns - Business Cloud Services Innovative Business Model for Cloud Summary 6 © 2012 IBM Corporation The Travel Ecosystem Providers Air Hotel Car Other Global Dist Systems Traditional Other Distributors TA/OTA Other Travelers 7 © 2012 IBM Corporation Evolution of travel distributions “Push” Travel Providers “Swarm” “Pull” Social Networks Traveler Travel Provider s Distribution Networks Brick & Mortar Agencies Traveler 8 Multiple Intermediaries Media & Advertisin g Traveler Online Forums Intermediaries On/offline Agencies Distribution Networks Travel Providers Shifting paradigms in travel distribution… Suppliers once controlled data and used this to their advantage, but as customers gained access to the same data they became adept at meeting their own needs The continued flood of information is too complex and is adding to customer dissatisfaction with travel distribution © 2012 IBM Corporation Hot Issues and Key Questions to Focus Hot issues in travel technology: – exponential transaction growth / look to book ratios – explosive distribution channel growth – single view of customer / systems integration – cloud computing – mobile – green compliance / sustainability strategy – social networking / social media – dynamic packaging – descriptive/rich visual content 9 For the tourism industry service providers, these are the key questions to focus: – Which distribution channels are most / least effective? – How does your travel distribution website compare to best-in-class websites? – How do customers view travel distribution and fulfillment? – Do current segmentation schemes match current and future needs? – How can partner data be used to formulate a more robust view of customers? – What capability gaps can partners fulfill more effectively? © 2012 IBM Corporation To enable seamless travel: information aggregation and partner coordination must become top priorities in the travel industry The journey toward seamless travel Will travelers be willing to pay for this service? Does the necessary data exist? 10 Will the resulting analysis prove useful? Can customers interact with the information? Can the data be shared? Can the data be analyzed for travelers? Can it be delivered efficiently? Has it been stored for reuse? Can it be integrated with other data? Can the analysis be packaged? © 2012 IBM Corporation Agenda Introduction and Industry Trend Tourism Ecosystem What is Cloud, Why Cloud – Rethink IT / Reinvent Business Enterprise Cloud Approach Cloud Adoption Patterns - Business Cloud Services Innovative Business Model for Cloud Summary 11 © 2012 IBM Corporation Cloud Computing – A Business Value Cloud computing is a model for enabling cost effective business outcomes through the use of shared application and computing services. The value …. if possible …. is better economics in the execution of business processes. Cloud computing is a new consumption and delivery model inspired by consumer internet services. Key characteristics: On-demand self-service Ubiquitous network access Location independent resource pooling Rapid elasticity Flexible pricing models 12 Usage Tracking Web 2.0 SOA End User Focused Virtualization Service Automation © 2012 IBM Corporation Cloud: A Model for Shared Services Cloud Computing is a model of shared network-delivered services, both public and private, in which the user sees only the service, and need not worry about the implementation or infrastructure People Services Business Services Standard Internet technologies Important roles for both public and private clouds. Application Services Flexible pricing Consumable webdelivered services requiring no installation, minimal setup Rapid provisioning Service layers separated by clean APIs, enabling composition. Platform Services Infrastructure Services 13 Built on radically scalable, manageable, virtualized IT resources Elastic scaling Advanced virtualization © 2012 IBM Corporation Clouds will be used at each layer, and stacked to easily create new solutions Cloud technologies offer operational expense reductions at all layers Agents Support Community End Users People Services Crowdsourcing Retail Banking Trade & SC Finance Single Euro Payments Mobile Banking Front Office Optimization Business Services Customer Care Int. Risk Mgmt. Industry Frameworks & Information Foundation Experience Management. CiC Design Space User Manager Mashup Server Service/Software Catalogs Open SOA Foundation (WS Framework, Service Bus) Assurance Fulfillment Billing Service Cloud Business & Operations Support Dynamic Provisioning Process & Policy Mgmt. Problem & Change Mgmt. B2B Partnerships Application Services Platform Services Payments Distributed Cloud Computing Services Infrastructure Services 14 Data Mgmt. Virtualization Provisioning Workload Mgmt SLA & Capacity Security Monitoring © 2012 IBM Corporation Business and IT are attracted to cloud for different reasons Rethink IT 60% of CIOs plan to use cloud (up from 33% 2 years ago) 55% of business executives believe cloud enables business transformation and leaner, faster, more agile processes • Initiate new revenue streams • Faster time to market for new services • Focus on differentiated processes • Meet changing customer expectations Transformation Efficiency • Rapidly deliver services • Integrate services across cloud environments • Increase efficiency Reinvent Business Economics of Computing are Changing 15 © 2012 IBM Corporation Businesses are seeing significant results Reduce IT labor cost by 50% in configuration, operations, management and monitoring. Improve capital utilization by 75%, significantly reducing license costs. Reduce provisioning from weeks to minutes and improve cycle times Eliminate 30% of software defects and improve quality. Reduce IT support costs by up to 40% for end users. 16 © 2012 IBM Corporation Cloud perception is evolving Enabling • Things are possible which were not possible before • Create new business models • Triggers competitive advantage Disruptive Speeding • Speed of transformation • Lower barriers to Transformational Optimizing • Cost Savings • Time to market • CapEx to OpEx • Reduced TCO Efficient o 2006 17 innovate • Reduce risks • Increase productivity o o o o o o o APIs New services Applications built for Cloud Brokering Private Clouds Cloud Management Further Automation IaaS 2007 2008 2009 2010 2011 2012 © 2012 IBM Corporation Agenda Introduction and Industry Trend Tourism Ecosystem What is Cloud, Why Cloud – Rethink IT / Reinvent Business Enterprise Cloud Approach Cloud Adoption Patterns - Business Cloud Services Innovative Business Model for Cloud Summary 18 © 2012 IBM Corporation Enterprise Cloud Approach …workload optimization – Development and Test; Desktop; Collaboration; Analytics; Compute – Rapid return-on-investment and productivity gain …deployment choices – Public, private, hybrid …integrated service management – Service delivery, service request, service monitoring – Lowers operational costs, drives efficiency, enhances security 19 © 2012 IBM Corporation Key Consideration 1: What workloads to move to cloud and what application delivery model is best for that workload? Traditional On-Premises Infrastructure as a Service Platform as a Service Software as a Service Applications Applications Applications Applications Data Data Data Data Runtime Runtime Runtime Runtime Middleware Middleware Middleware Middleware O/S O/S O/S O/S Virtualization Virtualization Virtualization Virtualization Servers Servers Servers Servers Storage Storage Storage Storage Networking Networking Networking Networking Standardization; OPEX savings; faster time to value Vendor Manages in Cloud 20 *Capex: Capital Expenses, *Opex: Operating Expenses Client Manages © 2012 IBM Corporation Workloads Matter: Cloud adoption is driven by workloads Ready for Cloud New Industry workloads Collaborative Care Analytics Infrastructure Storage Information intensive Sensitive Data Medical Imaging Industry Applications Isolated workloads Highly customized Collaboration Mature workloads Not yet virtualized 3rd party SW May not yet be ready for Cloud … 21 Financial Risk Complex processes & transactions Energy Management Workplace, Desktop & Devices Business Processes Preproduction systems Regulation sensitive Development & Test Batch processing Infrastructure Compute © 2012 IBM Corporation Key Consideration 2: What deployment model is best for a given workload? Private Cloud Enterprise Data Center Managed Private Cloud Hosted Private Cloud Enterprise Data Center Enterprise Third-party operated Third-party hosted and operated Shared Cloud Services Enterprises Public IT capabilities are provided “as a service,” over an intranet, within the enterprise and behind the firewall 22 Users Free Register Credit Card Click to contract Private Hybrid Public Cloud Services IT activities / functions are provided “as a service,” over the Internet Internal and external service delivery methods are integrated 60% of CIOs plan to use cloud up from 33% two years ago …the majority being hybrid clouds © 2012 IBM Corporation An evolutionary transformation to cloud is typical for enterprises and provides unique challenges In the enterprise cloud is an evolution, revolution and game changer Enterprise Cloud adoption presents unique challenges Integration of cloud and traditional IT Cloud Shared Resources Automate Migration over time Security and compliance issues Global business process transformation Standardize Virtualize Traditional IT 23 © 2012 IBM Corporation Transforming application development – end to end - for the cloud IBM Testing Services System Stability/Completeness Metric Expected Severity over Time, All Valid Defects Actual High severity defects and total defect volumes decreasing over time Defect volumes are decreasing High severity defects and total defect volumes decreasing over time Sev1s = 6% overall but decreasing Sev1’s <= 3% Sev2s = 52% but decreasing Sev2’s <= 35% Application Virtualization Requirements Cloud Deployment Topology & Security Modeling Requirements Analysis Sev2s = 53% but decreasing Sev2’s <= 40% ALM Tools Project Initiation Defect Analysis Defect volumes are decreasing Sev1s = 9% overall, no obvious trend Sev1’s <= 6% Severity over Time, Code Defects Only Development Integration : Cloud-to-Cloud ; Cloud-to-Enterprise Simplest issues and total defect volumes decreasing over time Defect volume trend is decreasing over time. Function defects have not surfaced for several periods. Algorithm, Assignment, and Checking defects continue to surface throughout UAT. System Completeness: Qualifier over Time (Code Defects Only) Missing decreasing over time & overall E2E proportions 25-35% Missing is increasing over time and overall proportions are significantly higher than desirable at 41% Missing percentage during UAT should be 10% - 15% Overall Rating Percentage of “missing” is very high compared to the benchmark, and the trend is increasing. Overall volumes are decreasing, but higher severities and simpler defects continue to surface. Insufficient 25 Services Optimizations Cloud Brokering / Deployment Design System Code Stability: Artifact Type over Time (Code Defects Only) IBM Confidential © 2008 IBM Corporation Image/ & Services Mgnt/Monitoring Billing & Metering Deployment Production Test xCloud Testing Data Security Maintain Code Analysis & Reporting. 24 Performance Testing Services Website & Mobile Application Performance © 2012 IBM Corporation Agenda Introduction and Industry Trend Tourism Ecosystem What is Cloud, Why Cloud – Rethink IT / Reinvent Business Enterprise Cloud Approach Cloud Adoption Patterns - Business Cloud Services Innovative Business Model for Cloud Summary 25 © 2012 IBM Corporation Questions to ask the Cloud Service Provider at every layer All clouds will not be the same … Does your people cloud use knowledge-enablement and social computing to create increased value? Does your business cloud have deep industry capability that lets me benefit from the increasing returns of sharing (e.g., information)? Can your application cloud easily function as a component in my application? Service Cloud Layers ‘People’ Services Business Services Do you have platform and management technologies to overcome the potential complexities/downsides of multiple clouds. Application Services Platform Services Can your cloud technologies to help solve “out-ofspace, out-of-power” and lower costs? Quality of service? Infrastructure Services Static, dedicated, outsourced 26 2000 2006 Network-delivered, off-premises 2012 Shared, automated, dynamic © 2012 IBM Corporation New Cloud Computing Architecture and delivery models are already changing the application and business services ecosystem DESKTOP AND DEVICES Storing files and applications remotely and pushing them to clients in real time. ANALYTICS Turning data into insight to anticipate business conditions, avoid risks and capture new opportunities. STORAGE Putting rapidly increasing volumes of data in a location that is scalable and accessible from anywhere. 27 Key Future technologies: • Extreme Automation • Highly differentiated platform as a service • Fine grained cloud security • Seamless secure operations across private and public cloud COLLABORATION Simplifying and improving daily business interactions with customers, partners and colleagues. DEVELOPMENT AND TEST Deploying virtual environments for the construction of software applications. © 2012 IBM Corporation Cloud services Business Desktop Development and Test Applications and data PCs Systems (AD, DHCP, DNS) Thin clients VPN or dedicated circuit Virtual machines Connection Broker • Access a security-rich, standardized test and development environment • Reduce operational costs and large amounts of capital outlays, • Improve cycle times for faster time-to-market • Improve collaboration and quality • Reduce the cost of desktop hardware and management • Safeguard data and applications • Increase business flexibility • Reduce complexity and energy consumption Managed Backup Cloud Real-Time Collaboration • Work beyond the boundaries of an organization • Share information more easily with customers, suppliers and Business Partners • Lower upfront investment and operating costs • Reduce/eliminate IT staff for implementation • Acquire services extremely easily • Provide work-ready integrated business applications • Provide remote data protection with a managed, offsite data backup and recovery solution that is automatic, secure and reliable • Reduce backup windows with automated, deduplicated technologies. • Shift to a pay-as-you-use pricing model that enables predictable monthly costs and requires no up-front capital investment. Remote Recovery Site Customer Location(s) Web conferencing Collaboration Messaging Server and PC Data 28 Wide Area Network (WAN) Offsite Data Protection Remote Data Protection Service Platforms © 2012 IBM Corporation Software as a service coupled with deep industry insights, business process skills and analytics E-Commerce on Cloud Cloud Solutions Software and Business Process as a Service Business Process as a Service Software as a Service Business Analytics and Optimization Social Business Commerce Smarter Cities Helping companies transform how they buy, market, sell and service goods and services with customers and suppliers Social Business on Cloud Helping companies accelerate their ability to turn information into insights Business Analytics & Optimization on Cloud Integrate the collective knowledge of peoplecentric networks to accelerate decision-making, strengthen business processes, and increase innovation Smarter Cities on Cloud 29 Helping cities of all sizes leverage information, anticipate problems and coordinate resources to deliver exceptional service to their citizens © 2012 IBM Corporation Agenda Introduction and Industry Trend Tourism Ecosystem What is Cloud, Why Cloud – Rethink IT / Reinvent Business Enterprise Cloud Approach Cloud Adoption Patterns - Business Cloud Services Innovative Business Model for Cloud Summary 30 © 2012 IBM Corporation Major Technology Trends driving Business Change Mobile revolution – Connectivity, access and participation are growing rapidly – Smart devices are becoming the primary route to get connected – Devices are getting smarter as they are increasingly enriched by mobile apps Social media explosion – Social media is quickly becoming the primary communication and collaboration format – “digital natives” use of technology and social media platforms is accelerating adoption – Enterprises are adopting social media but are struggling to realize the value and manage risk Hyper digitization – Digital content is produced and accessed more quickly than ever before – Internet traffic is growing globally driven by consumer use of video, mobile data, interconnectedness – An increasing number of connected devices and sensors is further driving growth The power of analytics – New capabilities for real time analysis, predictive analytics and micro-segmentation are emerging – Top performing companies use analytics to drive action and business value – Analytics are making information “consumable” and is transforming all parts of the organization, from customer intimacy to supply chain management 31 © 2012 IBM Corporation “Game Changing” Cloud Business Enablers 2 1 Cost Flexibility Shifts fixed to variable cost Pay as and when needed 6 Business Scalability Provides limitless, costeffective computing capacity to support growth Ecosystem Connectivity New value nets Potential new businesses 3 Faster time to market Supports experimentation 4 5 Context-driven Variability Market Adaptability Masked Complexity Expands product sophistication Simpler for customers/users User defined experiences Increases relevance Source: IBV Analysis 32 © 2012 IBM Corporation Cloud enables businesses to reduce fixed IT costs and shift to a more variable, “pay-as-you-go” cost structure 1 Cost Flexibility Characteristics Shifts CapEx to OpEx, when and as needed Shifts cost from fixed to variable Generates faster payback and higher ROI Example: An online marketplace company An online marketplace company provides service to buy and sell travel-related goods. In addition to bringing buyers and sellers together, the marketplace offers product recommendations based on analysis of buyer preferences. The marketplace company uses cloud based analytics capabilities for its targeted marketing approach by renting hundreds of computers every night to analyze data from a billion views of its website. Cost flexibility of the cloud allows the marketplace company access to tools and compute power that only large retailers could afford. The cloud frees up capital by significantly reducing the need for IT investment 33 © 2012 IBM Corporation Cloud enables businesses to grow efficiently, expanding the range of business options 2 Business Scalability Characteristics Rapid / elastic provisioning of resources No scale limitations Benefit from scale economics without achieving large volumes on your own Example: An internet media company An internet media company streams movies ondemand with large surges of capacity required at peak times. The company can use cloud to rapidly scale up its business without having to buy, support and operate infrastructure and resources to meet its growth requirements. Cloud’s ubiquitous and nearly unlimited computing power drives scale economics and enables self-provisioning and peak/non-peak responsiveness 34 © 2012 IBM Corporation Cloud enables businesses to rapidly adjust processes, products and services to meet the changing needs of the market 3 Market Adaptability Characteristics Facilitates prototyping Speeds time to market Supports rapid prototyping and innovation Example: An open application platform for TV An open application platform for TV allows content providers and distributors to react immediately to changing consumer demands and deliver what the consumers want. Cable, IP and Satellite TV providers can create and deliver interactive, on-demand content dynamically to consumers on any device. Content providers, TV programmers and web content developers can create or change an application – for entertainment, commerce, advertising, social media, gaming or news and sports – and deploy it all-at-once for all end-users. Cloud-enabled services can be tuned for market dynamics and demand and then rapidly updated, revamped and deployed via web services 35 © 2012 IBM Corporation Cloud enables businesses to attract a broader range of consumers with elegantly simple solutions 4 Masked Complexity Characteristics Expands feasible range of sophistication in products and services Minimizes requirements of user to understand how product works or how to maintain it Example: the Mobile Print platform The Mobile Print platform uses tools via a cloud to convert and process print requests from any mobile device (e.g. tablet, smart phone) to a printer. It can remove complexity for users – no need to understand / install / maintain printer device drivers for their mobile devices or targeted printers. It will reduce cost and management of supporting diverse end-user mobile devices, content-producing applications, network configurations and printer types. Cloud-enabled services leave the complexity to the experts, delivering only outcomes to the end-user 36 © 2012 IBM Corporation Cloud enables businesses to create personal experiences that adapt to subtle changes in user-defined context 5 Context-driven Variability Characteristics Supports context-driven, usercentric experiences (preferences, movements, behaviors) Example: A cloud-based, natural language assistant This is to support user defined preferences. Cloud can be used to store information about user preferences and enable the customization of product or service which is being delivered. A cloud-based, natural language “intelligent personal assistant and knowledge navigator” that relies on context to create a more personal, intimate interaction. Leveraging the computing capabilities and capacity of the cloud, the application “understands a wide variety of ways to ask a question, grasps the context and returns useful information in a friendly way, either audibly or by displaying results. The computing power and capacity of cloud enables individualized, context-relevant customer experiences 37 © 2012 IBM Corporation Facilitating engagement, alignment and innovation, cloud enables external collaboration with partners and customers 6 Ecosystem Connectivity Characteristics Facilitates new value nets of partners, customers and other external players Example: tourism value chain New value nets can be created including subject matter experts (SMEs), shared infrastructure and services from cloud service providers. Productivity can be enhanced through customer and partner interactions. In tourism value chain, cloud based platforms can support sharing of resources, processes and workforce between companies, hence it can also enable joint marketing and collaboration. The ecosystem connectivity enables efficiencies required in an emerging market to deliver quality tourism at low cost. More and more, companies are relying on collaborative ecosystems to provide the input for innovation that will drive their growth 38 © 2012 IBM Corporation Using cloud’s business enablers to optimize, innovate and disrupt business models Cloud offers six “game changing” business enablers … …that are fuelling innovations across enterprise value chains and customer value propositions… …empowering organizations to optimize, innovate or disrupt business models 6 Ecosystem Connectivity 4 5 Context-driven Variability Market Adaptability Cloud Enablement Framework Masked Complexity Customer Value Proposition Transform 3 Value Chain Cost Flexibility Improve 1 Business Scalability Value Chain 2 Disruptors Create Cloud’s Business Enablers Innovators Optimizers Enhance Extend Invent Customer Value Proposition Organizations need to assess themselves using the Cloud Enablement Framework and examine the potential to innovate by leveraging the cloud’s business enablers 39 © 2012 IBM Corporation Agenda Introduction and Industry Trend Tourism Ecosystem What is Cloud, Why Cloud – Rethink IT / Reinvent Business Enterprise Cloud Approach Cloud Adoption Patterns - Business Cloud Services Innovative Business Model for Cloud Summary 40 © 2012 IBM Corporation Six Steps to Getting Started with Cloud 1 2 Develop the Strategic Direction Analyze Workloads Determine Delivery Models IT Provider Relationship Profile High Enabler Benefit 3 Provider researches, recommends and implements technology to enable quantum leap in business capability Partner Utility Provider works with others to develop a service and provide resources/skills necessary to support the service E-Mail, Collaboration Software Development Test and PreProduction Data Intensive Processing Enterprise Trad Private IT Provider of a quality service at a cost equal to or lower than the competition Public Hybrid Database Provider of an adequate service at a cost lower than the competition Cost High 4 Platform Infrastructure Service Catalog Cloud Platform Service Publishing Tools Service Fulfillment & Config Tools 41 OSS Service Reporting & Analytics Enterprise Architecture Service Definition Tools BSS Operational Console Implement the Roadmap Service Planning Software Role Based Access Build the Business Case Master Data Management Cloud Services 6 5 Define the Architectural Model End Users, Operators ERP Information Integration Commodity Business Architecture Alignment Information Systems Architecture Metadata Data Model Information Transformation Information Placement & Structure Phase 1 Phase 1 Document business directions and IT’s alignment with them, across the enterprise Provide a baseline of agreement by educating all stakeholders on the fundamentals of Enterprise Architecture Assess the existing IS Architecture for a selected set of LOBs Develop and execute an IS Architecture roadmap across the enterprise Pilot Metadata integration with key tools and applications Develop metadata technical strategy Establish a cross-functional Information Architecture (Data Administration) team Define the information integration architecture Develop and implement enterprise-wide business architecture initiatives Develop an overall IS enterprise architecture framework to guide the enterprise Establish data entity naming standards Extend the information integration architecture across the organization & technologies Extend the Information Integration Architecture for placement & structure optimization Phase 2 Phase 2 Document business glossary into metadata repository for some LOBs Define and document common semantics (business glossary) across LOBs for some subject areas Integrate information transformation with common metadata and data cleansing services Optimize data & content placement and structure across all LOBs & technology silos Integrate data placement with the Information Lifecycle Management implementation Phase 3 Phase 3 Phase 4 Phase 4 © 2012 IBM Corporation Business Cloud Summary Cloud Computing is a model of shared network-delivered services, both public and private, in which the user sees only the service, and need not worry about the implementation or infrastructure The Cloud has 5 distinct layers and value propositions. Very significant opportunities exist above the infrastructure level, where much of the cloud discussion has been focused previously. The Cloud model can be truly disruptive if it can reduce the IT operational expenses of enterprises: development, management, integration, and energy consumption. By reducing expenses and increasing efficiency and flexibility, the Cloud model of services can improve the way we manage travel, transport, airline, finance, mobile information, and more. In the long run, development of an enterprise will depend on composable web-delivered services on flexible infrastructure: that is, the Cloud. Moving to higher value business services with focus on “data”, “analytics” and “people”. 42 © 2012 IBM Corporation Summary Travel industry was expected to be among the greatest beneficiaries of new, low-cost, information-rich distribution opportunities. More than a decade later, however, online channels have mostly focus on price. Now the new internet and cloud computing technologies and business models can offer the potential for online differentiation and the provision of value-added services and features for which tourists will pay for the services. To capitalize on these developments, enhance the tourists travel experience and create opportunities for improved financial performance, – the tourism ecosystem must learn to use the new cloud computing to “play well” with all the others in the ecosystem. 43 © 2012 IBM Corporation