Non clouded judgement from the GigaOm Structure Conference

Last week I attended the GigaOM Structure Conference in San Francisco, which is a key event in the calendar for companies in all areas of internet infrastructure and cloud computing, bringing together thought leaders from America and beyond to discuss the future of internet infrastructure
Some fascinating highlights and trends have come out of the conference:

API Wars

An entertaining panel involved Chris Kemp from Nebula (for Openstack), Sameer Dholakia (for Citrix) and Marten Mickos (for Eucalyptus) debating API standardisation vs innovation etc.

To summarise,  Citrix and Eucalyptus both came over open-minded about supporting multiple APIs, either now or in the future (Eucalyptus is based on the AWS API, Citrix supports both their own and AWS), whereas Chris Kemp from Nebula came over as rather narrow minded, in that Nebula will only ever support their own API and that has enough groundswell to become the new standard.  Lew Moorman for Rackspace (supporting Openstack) also presented previously at the conference presenting a similar stance.
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Recognising the ‘One True Cloud’ (and exposing the pretenders)

If you have ever attended one of the many conferences on cloud, you’ll have noticed that at least one presentation will start with a definition of what cloud is. If the presenter is unlucky enough to have a feisty audience and little other content to his presentation, there will inevitably follow a long debate as to whether this definition is or is not correct, closely followed by whether the vendor is or is not really providing a cloud service at all. In general these debates are pointless. Cloud is not a religion, and pontificating on whether someone else’s shipping product qualifies to be a member of the ‘faith of the one true cloud’ is normally a sign that the speaker should spend more time doing and less time talking.

However, another trend you’ll have found hard to miss is the notion that simply sticking the word ‘cloud’ in your product name will transform it from a run-of-the-mill undifferentiated overpriced and somewhat tired service into something novel and sparkling that no customer can do without. Doubtless there must be a little truth in this or no one would do it – hype works on occasion. But that is to miss the reason behind that hype. My concern is not the existence of ‘cloud washing’ – snake oil is a common commodity in the technology sector – but rather the fact some of the people selling products labelled as cloud appear not to have realised the fact that the driver behind the hype is economics, and without a product that takes advantage of this economics, their business will suffer in the long term whatever name their product carries.
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Where’s the smart money heading? Service Providers of course!

I just read a fascinating financial analyst report on cloud computing from Nomura Research, titled “Sky’s the limit for Cloud Computing”. The detailed report  is aimed at board members such as CEOs, CFOs and M & A.

It  positioned really well exactly what a major impact cloud computing is going to have on corporate IT over the next five years.

Interestingly enough, the authors of the study use the early days of electricity generation, pre-national grids, as direct comparison with what is expected to happen with the way computing is delivered as a service over the next decade.

Here are my key takeaways from the report:

  • This is a big shift from mainframe computing to PC client/server.
  • Widespread adoption of cloud computing will result in a shift away from on-premise internal IT to external cloud service providers.
  • Internal IT will initially resist adoption, citing security and lock-in concerns, but this will be a short-lived battle as the business value of cloud services becomes compelling.
  • Cloud service providers will be able to demonstrate considerable operational improvements to CEOs around cost, flexibility and agility.
  • Cloud computing is expected to reduce the risk and therefore cost of IT to enterprises.
  • Only 15% of companies today use an external service provider.

This report demonstrates how the benefits of cloud computing are being articulated across the corporate, financial and business channels, but most importantly – that this shift in IT delivery is going to go mainstream.

The service provider is and will play an ever increasing role and I guess that’s why the value and smart money is being focused on service providers, not Internal IT.


Service Providers and the decline and fall of the IT empire – Part 2

In part 1 of ‘Service Providers and the decline and fall of the IT empire’, I discussed how cloud computing is often categorised as a disruptive technology and discussed how centralising IT resource and offering it at scale and on an agile basis will make cloud technology to be purchased as a utility, pushing down cost of service.

Now I’d like to focus on what this all means for service providers…

First, let’s consider aggregate demand. The availability of more agile IT resources is going to increase demand from the CIO’s own internal customers. And the fact that IT requirements can increasingly be met using homogeneous service building blocks will increase the likelihood of these being outsourced. So the good news is that this means a huge increase in the demand for cloud services. No wonder Tier 1 Group forecast 68% compound annual growth in this multi-billion dollar market. The bad news is that there will be attrition of non-cloud revenue, as more cost effective cloud services replace non-cloud services. Whilst much cloud take up initially will be new revenue, and legacy services will be protected for a period by sunk costs and migration difficulties, we are already seeing service providers without cloud products losing existing business, as well as new customers.
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Launch of Extility Foundation Edition

With the release of Extility 1.5, we have for the first split Extility into two seperate editions: Foundation Edition and Service Provider Edition. This increases the choice available to our customers, and makes it easier for companies wanting to take their first steps into the cloud.

Why did we build it?

Foundation Edition has been specially designed to enable customers to get going in the cloud as quickly and easily as possible, with all the key functionality they need. You can download Foundation Edition to a DVD, and install it yourself in under an hour. Find out more about this in our One Hour Quickstart guide. For larger customers, or those with more specialised requirements, Service Provider Edition is available.

What does it deliver?

Foundation Edition delivers a fully functional Infrastructure as a Service (IaaS) Cloud Computing Platform, including virtual and physical machine, network & storage management, customer management and control, and an end-user self service interface. In short, everything you need to get going. It is the first IaaS platform that can deliver a complete solution at the touch of a button.

Who is it for?

Foundation Edition is ideally suited for smaller service providers and corporates wanting to take their first steps into the cloud.

When can I get started?

You can get started right now! Foundation Edition is now available as a free trial you can download. More details on how to get it up and running are available in our One hour kickstart guide.