So you’ve decided you don’t want to run your software solution in-house, and it’s time to move to the cloud? But it’s important to recognise that not all applications provided over the Internet are equal, and that some "cloud” choices aren’t cloud solutions at all. Many on-premise vendors are in the process of "cloudwashing” their solutions and customers by offering hosted versions of their existing software.So what’s the difference between a solution that is designed to run in the cloud and a product that was designed to run on-premise but is now being offered as a hosted solution? And why should it factor into your decision making?Gartner and other respected analyst firms have confirmed that hosted services are not the same as cloud computing.Two core elements of true cloud are multi-tenancy and self-service, which result in the provision of instant upgrades, APIs to customise core applications and connections to other cloud services in a secure environment. A self-service capability is an essential element of cloud, allowing users to make all customisations without relying on additional IT resources and independent of the vendor.According to IDC, Software-as-a-Service (SaaS) solutions are set to grow six times faster than all software, at a compound annual growth rate of 26% through to 2014. With cloud computing growing so rapidly, many vendors are trying to position themselves as cloud providers. Much relabelling of traditional application outsourcing approaches is occurring. Several components will simply be rebranded versions of on-premise software, and in some cases have less functionality.So CIOs should be very aware of "cloudwashing”, particularly from vendors with long-standing investments and deep histories in legacy, on-premise software. Hosting poses many risks related to upgrades, cost, customisations and economies of scale.Gartner recently outlined the issue: "It is important to differentiate SaaS from hosting or application management or application outsourcing. Because SaaS and cloud are hot concepts in the market, many suppliers are rebranding their hosting or application management or application outsourcing capabilities as SaaS or are claiming their solutions are available ‘in the cloud’.Much relabeling of more traditional application outsourcing approaches is occurring. Suppliers run the risk of confusing and antagonising buyers if they persist in this approach. Enterprises run the risk of getting nasty shocks when the thing they thought they were buying turns out to be something altogether different. Hosting and application management are not synonymous with SaaS, nor do they necessarily comply with the definition of cloud computing.”Customers need to be able to recognise a true cloud solution as one that was designed from a web-based, multi-tenant, self-service perspective. If they are not clear about the pedigree of what they are buying they could end up being committed to technology purchases or long term licences which don’t match their expectations or needs.In a fake cloud, software which was designed to run on-premise in a LAN environment is typically hosted by a value-added reseller (VAR) or other service provider in a manner similar to the application service providers (ASPs) of the late 1990s. In addition to being unintegrated, a hosted offering may have problems related to upgrades, process integration, and business viability of the VAR or service provider and customisation tools.Customers should be careful to examine the business viability of the VAR. If the strategy is to move to cloud then CIOs must be confident that the application and its means of delivery will be around for the long haul.Cloud solution providers run integrated R&D and data center operations in a multi-tenant environment so that customers are always running on the latest version of the software. When new functionality is announced or users introduce their own customisations they are upgraded reliably and automatically. There’s no waiting for releases or a VAR to schedule the upgrade.A cloud vendor can achieve substantially better economies of scale by undertaking shared improvements rather than repeating the same effort on separate stacks, as in a hosted solution, and releasing resources to security, data management and uptime in its data centers.The cloud platform provides a full customisation layer that enables changes to migrate reliably and automatically with each upgrade. It supports managed customisations such as custom reports, workflows, schema changes and integration. Compare this to the VAR that must migrate customisations of every single application instance to a new release.The cloud vendor can optimise the application based on usage across its customers, identify any performance bottlenecks, and clearly see where to make user experience improvements to the product. Web-services, SOA-based solutions allow easy interoperability with other cloud-based software applications, in addition to integrating with on-premise investments.Secure and easy access over the Internet is one of the key benefits of cloud computing. Employees can work from anywhere at any time using just a web browser.Myths abound in the Cloud vs Hosting arena. Ask each provider if the promised flexibility, security and reliability, can be delivered. Do the speed of deployment, integration capabilities, application optimisation and self-service meet your business needs? Ensure that you can choose the pace of upgrade and migration.Legacy software designed back in the 1990s and now running in a hosted environment is not cloud computing. Solutions designed for the cloud deliver superior value, that hosted simply can’t achieve