‘Go to’ clouds of the future, parts 2 and 1

Dois posts interessantes sobre Cloud Computing publicados por James Urquhart no blog http://news.cnet.com!
Primeiramente a parte 2 e logo abaixo a parte 1!
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January 6, 2011 4:00 AM PST

Go to’ clouds of the future, part 2

by James Urquhart

Read more: http://news.cnet.com/8301-19413_3-20027380-240.html#ixzz1AGELO5HQ

In part 1 of this two-part series, I highlighted my thoughts on why the long-term future of the cloud, at least for consumer and small business, belongs to integrated “one-stop” cloud suites, and why Microsoft and Google are the two companies best positioned for this opportunity. However, I was also clear that success in this space for both companies is far from guaranteed.

The truth is that several potential competitors could overtake either–or both–companies, if they should fail to execute successfully. Here are some of my favorites, and a few that should be contenders but really aren’t, at this point:

Salesforce.com
With a series of moves in the last year or two, Salesforce.com has moved from simply being a customer relationship management software-as-a-service vendor to being a true cloud platform contender. With the broadening of its Force.com platform as a service environment to add Java (via VMforce, a partnership with VMware) and Ruby (via the acquisition of Heroku), Salesforce has made itself a very interesting option for developers.

However, given its SaaS roots, I’m convinced that CEO Mark Benioff has more up his sleeve than that. Already, Salesforce has built up an impressive ecosystem with its App Exchange marketplace, but the real sign that it intends to be a broad business platform is the investment in Chatter, its enterprise social network and collaboration tool.

With a few more acquisitions and/or product offerings to expand its business applications suite (perhaps adding e-mail, a productivity suite, or even accounting applications), Salesforce will begin to look like a true “one-stop” leader. Frankly, with respect to the company, I’m already on the fence about whether the top two should become the top three.

VMware
First, it should be noted that VMware is not trying to be a cloud provider itself but rather an arms dealer to those that are. The question is, will it help these providers be “one-stop shops,” if they so choose?

There is no doubt that VMware has made significant progress in moving up the stack from virtual server infrastructure to cloud computing and even to development platforms. The aforementioned PaaS offering with Salesforce.com, VMforce, is one example, but there have been many announcements around cloud application development and operations capabilities–and all signs point to there being much more to come.

The reason VMware is mentioned here, however, is its acquisition early in 2010 of Zimbra, the open-source online e-mail platform. To me, that was a sign that VMware was looking at building a complete suite of cloud services, including IaaS, PaaS, and SaaS capabilities. However, as far as I can tell, the SaaS-related investments have either gone underground or dried up completely.

Giving VMware the benefit of the doubt, I’ll assume that it is still working its way up to the SaaS applications necessary to supply one-stop cloud services. With the capabilities it has been working on over the last few years, being a contender in this space is not out of the question–or perhaps its ecosystem of partners will do it for the company. However, it just doesn’t have enough SaaS to be one today.

Amazon Web Services
Amazon Web Services is, and will likely remain, the flagship cloud infrastructure company. It is also underrated as a PaaS offering, in that most people don’t understand how much its services are geared toward the developer.

However, it is completely focused on selling basic services to enable people to develop, deploy, and operate applications at scale on its infrastructure. It does not appear to be interested today in adding SaaS services to serve small businesses.

That said, there are two things that may make AWS a major part of the one-stop ecosystem. The first is, if a start-up or existing SaaS provider chooses to build and operate its one-stop suite on top of AWS services. That is actually a very likely scenario.

The other would be if Amazon.com CEO Jeff Bezos sees an integrated suite of small-business applications as a perfect offering for the Amazon retail business. This would probably be the resale of other companies’ software, but it would make AWS a one-stop shop worth paying attention to.

IBM and HP
IBM and Hewlett-Packard are companies that can integrate a wide variety of infrastructure, platform, and professional-services products, so you can never count them out of a major IT market opportunity. However, they seem to have shifted away from business software suites, with a focus more on IT operations and data management/analytics.

While IBM and HP will no doubt be players in enterprise IaaS and PaaS, I don’t see them making the investments in building, acquiring, or partnering for the basic IT software services required to meet the one-stop vision. Again, perhaps their ecosystems get them there, but they are not promoting that vision themselves.

Hosting-turned-cloud companies
Companies such as Rackspace, Terremark, and other hosting companies that have embraced the cloud for IaaS services are important players in the overall cloud model, but I don’t believe that they are ready to contend, when it comes to integrated cloud suites, at this time. Their focus right now is on how to generate as much revenue as possible per square foot of data center space, and their skill sets fit IaaS perfectly. However, if VMware or another cloud infrastructure software provider builds a suite of services that they can simply deploy and operate, that may change quickly. They just are not contenders based on today’s business models.

Telecommunications and cable companies
One possible industry segment that may surprise us with respect to one-stop cloud services would be companies such as AT&T, Verizon Communications, Comcast, and BT–the major telecommunications providers. They own the connectivity to the data center, the campus, mobile devices, and so on, and they have data center infrastructures perfect for a heavily distributed market like the small-business market (where each small business may be local, but the market itself exists in every town and city).

The problem is the same as it has been for decades: business models and regulatory requirements of these companies make it difficult for them to address software services effectively. These companies have traditionally been late to new software market opportunities (with the possible exception of the mobile market). You don’t see AT&T, for instance, competing with others in bidding for a platform-as-a-service opportunity. So until they show signs of understanding how to monitize business applications, they are not in the running.

My dark horse: Oracle
“Really? Not with Larry Ellison at the helm,” some of you are probably thinking. However, you have to admit that when it comes to business software suites, Oracle certainly has the ammunition. It has dabbled in SaaS already, and with the Sun acquisition, it has rounded out its possible offerings with OpenOffice.org and Java.

Oracle’s biggest problem is its business model, as well as its love of license and maintenance revenue. If it can figure out how to generate revenue from SaaS that meets or exceeds its existing model, I think that it’ll move quickly to establish itself as a major player in the space and will quickly rise towards the top of the heap. In fact, the recent announcement of Oracle Cloud Office might be a sign that it has already started.

Today Oracle does not seem to be focused on being a cloud provider. It killed Sun’s IaaS offering–which always confused me–and has only introduced PaaS for private-cloud deployments. To date, it seems that it can’t pull itself away from equating an enterprise sale with an on-premise, up-front licensing sale.

I am watching Oracle’s moves in the cloud with great interest, for that reason.

If I am right–if one-stop cloud services are what many small and midsize businesses turn to in order to avoid building an IT data center infrastructure of their own; if integration is the key differentiator for cloud services across SaaS, PaaS and IaaS–then I’m pretty comfortable with the observations I’ve made in this series.

If I am wrong, then integration of disparate cloud services will be a huge market opportunity. What it will come down to is what is easier to consume by small and medium-size businesses. For that reason, I’ll place my bet on the one-stop model. What about you?

James Urquhart is a field technologist with almost 20 years of experience in distributed-systems development and deployment, focusing on service-oriented architectures, cloud computing, and virtualization. James is a market strategist for cloud computing at Cisco Systems and an adviser to EnStratus, though the opinions expressed here are strictly his own. He is a member of the CNET Blog Network and is not an employee of CNET.

Read more: http://news.cnet.com/8301-19413_3-20027380-240.html#ixzz1AGE7aThY

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January 3, 2011 2:19 PM PST

‘Go to’ clouds of the future, part 1

by James Urquhart

Read more: http://news.cnet.com/8301-19413_3-20026878-240.html#ixzz1AGDA3m92

I am often asked which companies I think will be the most dominant names in IT 10 years from now, thanks to cloud computing. My answer often surprises those who ask; not because the two companies I believe will be the most recongnized names in cloud-based IT services aren’t considered players today, but rather because of why I believe they will be so recongized.

In this, the first of two posts exploring the companies that can best exploit the cloud model, I’ll identify those two companies and explain why they best fit the needs of a large percentage of IT service customers. Then, in the second part of this series, I will explore several companies that will challenge those two leaders, possibly taking a leadership spot for theirselves.

But before I get into who these leaders are, I have to explain why success in cloud computing will be different in 10 years than it is today.

Why today’s clouds don’t represent tomorrow’s biggest opportunity
Think about what cloud computing promises. Imagine being a company that relies on technology to deliver its business capability, but does not sell computing technology or services itself. Picture being able to deliver a complete IT capability to support your business, whatever it is, without needing to own a data center–or at least any more data center than absolutely necessary.

Imagine there being a widely available ecosystem to support that model. Every general purpose IT system (such as printing, file sharing or e-mail) has a wide variety of competing services to choose from. Common business applications, such as accounting/finance, collaboration/communications and human resources, have several options to choose from. Even industry specific systems, such as electronic health records exchanges and law enforcement data warehouses, have one or more mature options to choose from.

Need to write code to differentiate your information systems? There will be several options to choose from there, as well. Most new applications will be developed on platform as a service options, I believe, with vendors meeting a wide variety of potential markets, from Web applications to “big data” and business intelligence to business process automation. However, if you want (or need) to innovate the entire software stack, infrastructure services will also be readily available.

With such a rich environment to choose from, what becomes your biggest problem? I would argue that’s an easy question to answer: integration. Your biggest problem by far is integrating all of those IT systems into a cohesive whole.

In fact, we see that today. Most cloud projects, even incredibly successful ones like Netflix’s move to Amazon Web Services, focus efforts within one cloud provider or cloud ecosystem, and usually include applications and services that were developed to work together from the ground up. While there have been attempts to move and integrate disparate IT systems across multiple clouds, none of them stand out as big successes today.

While some may argue that’s a sign of the nascent nature of cloud, I would argue that its also a sign that integrating systems across cloud services is just plain hard.

Why integrated services will drive the most revenue
Now imagine you are founding a small business like a consultancy or a new retail store. You need IT, you need it to “just work” with minimal effort and/or expertise, and you need it to be cost effective. What are you going to be looking for from “the cloud?”

There, again, I would argue the answer is easy: start-ups and small businesses will be seeking integrated services, either from one vendor, or a highly integrated vendor ecosystem. The ideal would be to sign up for one online account that provided pre-integrated financials, collaboration, communications, customer relationship management, human resources management, and so on.

In other words, “keep it simple, stupid.” The cloud will someday deliver this for new businesses. But there are very few companies out there today that can achieve broad IT systems integration. I would argue the two most capable are Microsoft and Google.

“What?!?,” you might be saying. “Both of those companies have been tagged as fading dinosaurs by the technorati in the last year. Why would anyone want to lock themselves into one vendor for IT services when the cloud offers such a broad marketplace–especially those two?”

To answer that, we need to look a little more closely at each vendor’s current offerings, and stated vision.

Microsoft: it’s all about the portfolio, baby!
Microsoft stands out for its breadth of offerings. While its infrastructure as a service and platform as a service offerings (both part of Azure) are central to its business model, it’s the applications that will ultimately win them great market share.

Already, offerings such as Office 365 provide cloud-based versions of key collaboration and communications capabilities for a variety of business markets. However, Microsoft CEO, Steve Balmer, has also made it clear that every Microsoft product group is looking at how to either deliver their products in the cloud, or leverage the cloud to increase the utility of their products.

As every product group within Microsoft pushes to “cloudify” their offerings, I am betting similar effort will be put in to making sure the entire portfolio is integrated.

Combine the Dynamics portfolio with Sharepoint and Lync and add “Oslo”-based tools to integrate across system or organizational boundaries, and you’ve got a heck of an IT platform to get started with. Add in Azure, and you have the development platform services to allow you to customize, extend, or innovate beyond the base capabilities of Microsoft’s services.

Google: Bringing consumer success to business
What impresses me most about Google’s move towards the cloud has been its pure focus on the application. Google doesn’t put forth offerings targeted at providing raw infrastructure. Even Google App Engine, one of the poster children of the platform as a service model, is built with making a certain class of applications–perhaps not surprisingly, Web applications–as easy to develop as possible. Most of the integration of the underlying platform elements has been done for the developer already.

However, it’s when you look at its consumer application portfolio, and how it’s modifying those applications for business, that you can see its real strength. Google takes chances on new Web applications all the time, and those who succeed–either by building a large user base, or by actually generating revenue–draw additional investment aimed at increasing the application’s appeal to a broader marketplace. Google Mail is the most mature of these options, but Google Apps is not far behind.

What appears to be happeninging now, however, is a concerted effort by Google to build an ecosystem around its core application offerings. The Google Apps Marketplace is a great example of the company trying to build a suite of applications that integrate with or extend its base Google Apps and mail offerings.

Add the company’s nascent suite of communications and collaboration tools, such as Google Voice and Buzz, and signs of integration among all of their offerings, and you can see the basis of a new form of IT platform that will especially appeal to small businesses and ad hoc work efforts.

There are no guarantees in cloud
As you can see, Microsoft and Google have the basic tools and expertise to deliver on the one-stop shop IT services model, and both have proven to me that they have the desire as well. However, neither company is a shoe-in for success in this space. There are two reasons for this, the most important of which is neither company has what I would call a spotless execution record. In fact, both have struggled mightily to impose change on their core business models.

Both companies will have to align their various efforts to see this vision through, even as it disrupts current markets. Each has plenty of applications that show great promise, but both are also a long way away from proving they can deliver on a one-stop shop vision.

The other reason is that there are a variety of worthy competitors vying for the “one-stop” throne. You may have been asking by now about Amazon, Salesforce.com, VMware, or the hosting companies, and telecoms. In the second post of the series, I’ll outline my favorites to displace the two leaders, including one that may surprise you.

In the meantime, I think cloud services targeting developers will still get most of the press for the next several years. Achieving an integrated IT platform that serves multiple business markets is extremely difficult, and will take a true commitment and concerted effort by the company or companies that ultimately achieve that vision.

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