The Integrated Clouds

Cloud Computing continues to grow at an unprecedented pace; MSFT's Azure is live and gaining momentum, SAP is taking it seriously, vmforce is coming this fall, AWS has a region in Singapore and even some of the larger banks in the world have the cloud on their radar.

Ubiquitous and affordable broadband along with the evolution of social networks, real time and mobile technologies emphasize the importance and value of the Cloud. While the skeptics continue to focus on the missing pieces, it is very hard to ignore the ways in which the Cloud is shaping the way we live.

Yet, in spite of this progress, somehow today's Clouds remind me of the pre ERP days when companies would have separate systems for different functions: accounting, customer service, manufacturing, etc. While Clouds tend to be more open and easier to integrate than pre ERP enterprise applications, the reality is that Cloud integration is still in its infancy. Yes there are many interesting mashups coming along but most of them just collate information from different sources in the browser and rarely engage in significant business processes.

To reach its full potential the Cloud will need to become more open and more integrated, loosely coupled, integrated on demand and with a specific purpose. It is nice for business users to be able to combine data from different web services in a Google document but the integrations that I have in mind would happen at the application level, where salesfoce.com exchanges information with Parature which then kicks off a process in Netsuite which then triggers a payroll in Intuit which then updates a dashboard in Tableau and publishes the results to Twitter. All automated and coordinated to solve a particular problem. Once that process is automated, the next step would be to make that process smarter, that would be the era of the intelligent Cloud and a great topic for a future post.

Cloud Computing Lessons Learned

The beginning of a new year has brought along a large number of predictions regarding the impact adoption of disruptive technologies like Cloud Computing. The art of the possible is certainly exciting, it drives innovation and shapes the future.

While I believe that innovation can't be stopped, I recognize that expectations and change management are largely responsible for the ultimate adoption of a promising technologies. As such, I thought it would be appropriate to share a few lessons learned around some of the challenges and opportunities surrounding Cloud Computing.

Challenge: Privacy and Security

Lesson Learned: Mainstream technology and reasonable precautions are enough to satisfy the requirements of a majority of organizations.

Observations: Privacy and Security remain an unsolved and a delicate issue and its severity and complexity vary by industry. Nevertheless, the leading cloud providers (e.g. salesforce.com, AMZN, GOOG) have in place controls, technology and procedures to properly secure data and applications.

Challenge: Vendor Lock-In

Lesson Learned: The Cloud continues to be more open than legacy technology and vendors like GOOG have initiatives in place to keep it that way.

Observations: Migrating from one cloud provider to another with ease is a key criteria in many practitioners' checklist. The ultimate goal for some is the ability to switch cloud providers quickly, easily and cheaply. I'm not sure how feasible this goal is. I think it is inevitable that most solutions will be optimized for a particular cloud provider (SaaS, PaaS, IaaS, or other). Commodity services will get easier and easier to change but other services will always require work. Either way, the tendency towards more openness does not appear to slow down.

Challenge: Hype

Lesson Learned: Buyers are well informed and proceed with caution

Observations: There is a lot of hype around Cloud Computing but the early adopters are focused and well informed. I have seen technology buyers fall in 3 categories: 1) Focused on a particular solution 2) Skeptical but doing thorough due diligence 3) Skeptical and not adopting. What I find notorious is the absence of a 4th group that is rushing towards towards cloud computing with unrealistic expectations. Don't get me wrong, I'm sure they are out there but there aren't that many. It feels a little different from the late 1990s.

Opportunity: Innovation

Lesson Learned: There is an explosion of services, many of them truly valuable

Observations: When thinking about Cloud Computing, a majority of my acquaintances think about cutting costs and saving money. I like to focus on finding value. I have come across a large number of applications that I find incredibly useful and more importantly worth paying money for. These are innovative services that solve specific problems (e.g. collaboration, version control, project management, communication, etc.) efficiently and profitably. All the necessary signs of sustainable economics.

Opportunity: Globalization

Lesson Learned: The world is flat but the cloud makes it flatter

Observations: Call me naive but I must confess that I have been truly surprised by the global reach of Cloud Computing. I have worked with customers in 4 continents with remarkable ease. Somehow, the Cloud's always-on nature enables a familiar (standard?) and relatively efficient marketplace; almost like a new lingua-franca. Like I said, call me naive.

Decision Management and the Cloud

Last week Predictive Analytics World brought together a fantastic collection of minds to share case studies and expertise. A theme echoed in multiple sessions and conversations was that analytics are a necessary but not sufficient ingredient for success. To succeed it is critical to have a strong alignment and integration of technology, processes and corporate strategy. Not an easy task but the ROI tends to be irresistible and mastering this act is at the core of Decision Management.

What does Cloud Computing have to do with effective Decision Management? Well, one of the most obvious aspects is better analytics. Cloud computing offers more storage and more processing power at lower costs. More computing power and more data for less money seems quite attractive. Furthermore, these characteristics make predictive analytics accessible to many more organizations and applications. I like to think about it as the democratization of predictive analytics made possible by Cloud computing.

But that is just one part of the story. Predictive Analytics on the cloud will succeed because of the Cloud's standards and open platforms. Operationalizing analytics behind the firewall of a large corporation can require the custom integration several layers of expensive software and in-house applications, e.g.: point of sales systems, call centers, databases, rule/workflow engines, analytic engines/models, etc. The cost and complexity of these projects can easily challenge the most optimistic ROI models.

Fortunately the Cloud is being designed precisely to simplify these scenarios. For example, let's consider Salesforce.com, one of the leading Cloud platforms available today (along with Netsuite and Intuit among others). Salesforce simplifies integration because it has a rich API based on open standards. Salesforce has a powerful workflow engine to automate business processes a flexible data repository and native support of email, social and mobile channels. All of this functionality is available on demand on a pay as you go basis. Similar functionality is becoming more and more popular among cloud platforms but getting it on-premises is far more complicated.

The Cloud can deliver more powerful analytics and also help make them actionable. Now we just need alignment with the Corporate Strategy but we'll leave that for a future post.

Doing more with less

Christopher Musico wrote a well timed piece for DestinationCRM describing how some companies are leveraging predictive analytics to become more competitive. It comes as no surprise that during challenging economic times companies try to be more efficient by making better use of their assets. And what better asset than their internal databases?

I think it is safe to say that by now most companies (large and small) have deployed relational databases and reporting software of varying sophistication. This reporting tools have been asked to answer questions about historical events. Questions about 'what happened', about 'the impact (how much, how many, how often)' and even more specific questions that require drilling down to granular levels of information to understand where exactly the event took place (place, product, point in time). Some more advanced companies have even deployed alerting systems to be notified as soon as certain conditions occur. The natural next step to develop competitive advantages is to deploy analytic solutions that can predict and optimize future events.

This conclusion might seem obvious to many. Christopher's article includes the results of a survey where more than 50% of the respondents intend to deploy predictive analytics in the next 6 months. Predictive Analytics can bring many benefits but effective deployment is no easy task. The software cost, skills shortage and infrastructure complexity can be significant barriers to entry. Not to mention the necessary changes in culture and business processes.

Traditionally, the successful deployment of predictive analytical solutions has been reserved to a handful of large companies with vast resources. It is nice to see organizations like USTA succeeding with these projects. I believe this is a sign of things to come. I think the intersection of Cloud Computing and predictive analytics will create new possibilities for powerful and accessible insight.

What if the Cloud never makes it to the enterprise?

David Linthicum wrote an interesting piece about the cloud reality setting in. The enterprise is cautious and a bit skeptical about the Cloud; as it should. Frederic Paul at bmighty.com writes about the Forrester report that asks "Why not run with the Cloud". There seems to be a general agreement that when it comes to the Cloud the question is not IF but rather WHEN and HOW.

But what if the answer for the enterprise is never. What would happen if the enterprise never adopts the Cloud (at least the cloud as I like to think about it). What are the risks of inaction? How competitive would those enterprises be?

I believe history would repeat itself. No matter how large or mighty, those corporations would collapse unable to compete against more efficient and more innovative competitors. Just like Chrysler, GM or the print media industry. I echo David's opinion: 'there are pros and cons, let's understand both' (paraphrasing) and I would like to add that companies need to go one step farther and start focusing on the HOW. The ones that do will deliver more value to customers and shareholders for a longer period of time.

Gartner and the Cloud

Back in may there was some controversy with the estimates by Gartner of the Cloud Computing market size. Earlier this month Gartner announced the results of a survey of SaaS users where findings did not exactly provide a ringing endorsement of SaaS. Needless to say these results also caused controversy and a very articulate response from Jeff Kaplan from THINKstrategies.

Gartner's press release of the SaaS survey mentions that TCO, ease of integration and technical requirements are challenges faced by SaaS solutions. No surprise. And that is why when I look at the most successful SaaS company in the planet I can understand that success is never a coincidence. Salesforce.com's is a true role model for Cloud Computing and SaaS startups. Ten years ago they understood the importance of technology integrity, innovation and excellent customer service.

When it comes to the future, I prefer to focus on the ones that are shaping it and not just talking about it.

BI and the Cloud

Wayne Eckerson from The Data Warehouse Institute has an interesting post about Implementing BI in the Cloud. He mentions that BI in the Cloud faces four constraints:

1) Customization or application fit

2) Ongoing cost of transferring data to the Cloud

3) Data Security

4) Vendor viability

Wayne wraps up his post with the following conclusion:

BI for SaaS offers a lot of promise to reduce costs and speed deployment but only for companies whose requirements are suitable to cloud-based computing. Today, these are companies that have limited or no available IT resources, little capital to spend on building compute-based or software capabilities inhouse, and whose BI applications don’t require significant, continuous transfers of data from source systems to the cloud.

I tend to agree with the following high level thoughts:

1) BI on the Cloud is not for everybody (yet)

2) Due diligence is necessary to reduce risks on data security and vendor viability

But Wayne's post raised several questions in my mind:

Integration. There are several ways to customize an application. For example, a multi-tenant architecture like Salesforce.com offers endless possibilities to customize and extend every single instance. Are these customizations unprofitable? No they are not, they are part of the application and they do not require changes to the underlying code. Can the same level of customization apply to BI? Absolutely. Wayne mentions briefly Platform as a Service but his focus is towards custom application development (although his chart shows "DW as a Service"). An intriguing approach to offer a BI platform as a service would be to setup something like MicroStrategy and configure it in a multi-tenant fashion. The underlying layer of IaaS would support the data repository while the top layer of SaaS could support ad-hoc reporting, vertical applications or full customizations on top of their API. Would this be unprofitable? Not at all. Wayne makes another good point regarding integration:

So, unless the SaaS vendor supports a broad range of integrated functional applications, it’s hard to justify purchasing any SaaS application.

But from my experience, successful enterprise wide deployments need to focus on integrating subject areas at the data level. This is an architecture and design challenge. A well integrated data repository will support integrated functional applications seamlessly. It is about the underlying data not only the application.

Ongoing Data Transfers Costs. Is this really a significant constraint? How much data does the typical Data Warehouse has to incorporate on a daily basis? The cost to transfer data to Google's App Engine is $0.10 per GB. Moving a TB a day would cost around $3,000 per month (I'm not suggesting using BigTable as a DWH repository yet). As Data Warehouse costs go, this does not seem unreasonable. Amazon is running a promotion right now that would bring that cost down to $1,000; hardly a deal braker. Latency and complexity can complicate this data transfer. This is to be expected because 99% of them were not designed with the Cloud in mind. Which brings me to my final point.

I mentioned using MicroStrategy as a BI platform on the cloud as an example to make a point. I believe that successful Cloud applications need to do more than just cloning their on-premise counterparts. They need to leverage the Cloud inherent qualities, for example elastic computing power. The nature of the Cloud can enable ongoing ETL: receive a copy of the transaction on the fly via a web hook, cleanse, transform and aggregate in real time or a few times a day at least. How about Map Reduce? I think this technique will allow to create more powerful analysis over more data, faster and easier.

Rigid applications built with yesterday's patterns will struggle to survive, in the Cloud or elsewhere. The Cloud is an open environment by definition, its openness will facilitate the integration of multiple data sources from inside and outside the corporate firewall. This integration will support a next generation of cross-functional applications. Bandwidth and storage costs continue to drop very rapidly and will cease to be a major consideration in the near future. New design principles (e.g. scale out vs. scale up) will enable more sophisticated analysis over ever larger datasets (Google analyzes over a PetaByte of data every day). With over $1B in sales Salesforce.com is the most successful SaaS provider. They host more than 55k customers, well over 1M users and every day execute more than 30M lines of customer code. If they can do it, I'm convinced the next BI leader in the Cloud will do it as well. That is how I see it.

Federated Applications

Intuit recently launched a new ambitious program to deliver Federated Applications on their platform. These applications will be available to Intuit customers via a "marketplace" (my term not Intuit's). Intuit has a number of SDKs to use their Cloud platform (Flex seems to be a strategic platform for them) but Federated Applications will not be constrained to a specific technology because they will be able to use a REST API. From the distance this program looks similar to Salesforce's successful AppExchange--approaching 1,000 published applications rapidly--but after a closer look it is important to highlight two intriguing differences:

1) Intuit takes care of the billing. It collects the monthly fees, pays the application developer and keeps a %. To many developers this is a nice service, they just know that every month money will be deposited in their bank accounts and they don't have to worry about paying Intuit. Intuit gets paid right away.

2) Federated applications have the ability to read data from Intuit applications but ALSO from any other Federated application in use by the current user. To make this happen Intuit requires that all applications meet certain integration requirements. While this is an extra step for most application developers the amount of work does not appear to be excessive (i.e. weeks not months). These requirements help to deliver a more consistent user experience and they make it easier for customers to try new applications. Another interesting consequence is the potential Network effect among applications. Federated applications are expected to publish their data objects to an open and shared environment. This means that application A can read/write data from Intuit applications but also from federated application B. This data exchange can increase the value of individual applications significantly (the more connected the more valuable). Of course, each application would need to know what type of objects to expect and what to do with them but given a common framework it should not be too difficult.

Compared to other Cloud providers (e.g. Salesforce) Intuit would seem to be off to a slow start but I find their vision intriguing and ambitious. More importantly if Intuit succeeds in recruiting useful applications this strategy could become very profitable for all involved.

The Cloud is Crossing the Chasm

Cloud Computing is crossing the chasm. Every other week you hear about the deployment of Cloud Computing applications to thousands of users by leading corporations and governments. These deployments go hand in hand with the announcement of new Cloud offerings by leading technology vendors and service providers. You can still find disagreements about the size of the market or the actual definition but there is no doubt that Cloud Computing is having a great year and the best is yet to come. These are some of the many news/announcements that caught my eye:

1) This is a couple of months old but I have to mention Oracle's acquisition of Sun. It was interesting to see Oracle make the move after all the talk about IBM buying Sun. But the implications to the industry are far more intriguing. How is this acquisition going to impact HP? Will IBM see any impact from Oracle 'owning' Java? Will ORCL be able to manage Hardware and Software effectively? Oracle has been a bit slow to announce a compelling Cloud strategy. Sun made a late announcement about their software strategy and more recently another one about consulting services for the Cloud. This is an intriguing combination, it might seem like the odds are against them but you should never underestimate Oracle.

2) TIBCO launches TIBCO Silver an application development platform for AMZN's AWS. I'm intrigued by this announcement. Although some have labeled it "Amazon for Dummies" I'm curious to see if TIBCO will be able to leverage some of its sophisticated analytical technology for intelligent scaling and SLAs.

3) In close partnership with RedHat (RHT) Verizon (VZ) launched a new service offering called Computing as a Service (CaaS) "With CaaS, you have access to bandwidth, servers, storage, and firewalls with dynamic real-time control over what, when, and how those resources are deployed". This service will put pressure on traditional/smaller hosting providers looking to transition to the Cloud. It will also help enterprise customers feel more comfortable about embracing the Cloud.

4) The brilliant Ray Ozzie elaborates on Microsoft's view of the Cloud. You know it is serious when Microsoft gets serious about it. It is hard not to imagine a future with public and private clouds, unless of course, networking technology evolves to a point where the difference is irrelevant. Given MSFT's impressive footprint in the enterprise (Exchange, Sharepoint, SQL Server, etc.) they seem to be in a perfect position to dominate that hybrid world with Azure. If you can offer greater scalability, lower costs and greater flexibility leveraging the same skills and the technology you already have then you have a winning recipe. The question is "Will they be able to execute?"

5) CSC to offer cloud services. Now if it wasn't enough that Microsoft is dead serious about Cloud Computing, CSC one of the largest and most successful government contractors will leverage its security and strategy expertise to offer cloud services. I'm expecting Lockheed, EDS and others to follow with similar offerings. These services will certainly lower the risk for CIOs in the public sector.

6) More fuzzy math, this time courtesy of Gartner in one of their estimates for the size of the Cloud Computing industry. Inconsistent estimates are the consequence of inconsistent market definitions, I can see that. I just hope that there are no hidden agendas.

7) Google Apps is profitable and growing. Although not a direct replacement of MS Office, Google Apps continues to capture market share one enterprise customer at a time. Although mostly driven by cost savings in Email you can expect the adoption of Google Docs to increase as new and improved versions continue to roll out over the next year (including of course my favorites: App Engine and SDC).

With so much activity it is hard to believe that the best is yet to come but trust me, it is. Hang on tight.

HTML5

Today Google dominated the spotlight with with the announcement of Google Wave. The idea and implementation appear superb while the approach to open a lot of its code is very intriguing. However what I found just as important was HTML5 and how much Google is embracing it.

Google has an impressive portfolio of APIs and products for developers. They have created and embraced a large number of open standards and are working hard to bring everything together as a comprehensive platform. A platform that depends heavily on the support by "Modern Open Source Browsers" of HTML5 and Javascript.

Microsoft has a dominant footprint in the enterprise and Silverlight continues to gain popularity. Adobe's Flash is as ubiquitous as HTML and Flex is also gaining momentum. But I when I look at the power and simplicity of Google's App Engine, along with the dozens of open APIs (from visualization to online analytics to documents scripting) it is hard to believe that the status quou will resist this powerful 'wave' of innovation. 

Booz Allen Comments on McKinsey's Cloud Report

Booz Allen makes several interesting remarks about McKinsey's Cloud Report. The following two jumped at me. First:

They state that cloud offerings “are most attractive” to small and medium sized business, and “there are significant hurdles to the adoption of cloud services by large enterprises.” That would come as quite a shock to Target, Eli Lily, the New York Stock Exchange, the American Stock Exchange, NSADAQ, Toyota, E*Trade, Computer Associates, and a host other large enterprises that have been in the cloud for a couple of years.

Second:

Where this example appears to break down is that, for the data center, they are calculating the cost per core, while for Amazon they are calculating the cost of a Large EC2 instance, which is four cores. On a single-core basis, an EC2 Small instance is only $72 month, running non-stop. Assuming the same 10% utilization used in other examples, the comparison should be $48/month for the data center and $7.20 month for EC2.

McKinsey and the Cloud

McKinsey&Company just released an interesting document on Cloud Computing: Clearing the air on cloud computing. Very interesting thoughts. I agree with the idea that over hyping Cloud Computing (and any other new technology) is risky and when done on purpose, irresponsible. I also liked their Cloud definition, it seemed pragmatic, down to earth.

I was surprised by their conclusion that AWS would not be cost effective for large corporations. I know AMZN has some large customers and I'm sure they will have some follow up commentary. In terms of the cost analysis, I think the author is missing two points. First, I think that the effort to initiate or further deploy virtualization in the corporate data center has a not zero cost. Starting from training and support. It obviously does not happen overnight either. Secondly and more important in my opinion is the opportunity cost. I believe that the financial rewards offered by the Cloud's speed to market far outweigh the potential incremental cost (assuming they are correct and it is more expensive for large corporations--I have my doubts). 

For example, let's take a hypothetical example of a multi-billion dollar media company, that would be a large corporation in my mind. They need to analyze 4 to 6 TB of clickstream data every month to fine tune their advertising efforts. The ability to execute on their strategy could easily bring additional revenues in the 8 digit range. They have two options: 1) go with their current data center 2) deploy MapReduce/Hadoop at AWS. Option 1 would easily take 6 to 8 months to complete. Option 2 could be up and running in days at most. To me that speed to market is priceless. In the short and long term.

SDC is what really matters

Two days ago Google announced several enhancements to the AppEngine. The support for Java grabbed most of the headlines. It was the number one feature request from developers and it certainly opens new possibilities for JRuby, Scala and others. Personally, I prefer non strongly typed languages like Python but I digress. 

During this announcement Google also introduced the Secure Data Connector (SDC) to access data behind the firewall. This, I think is more significant and will have a bigger impact on the Cloud Computing landscape. Establishing a secure yet simple to setup link between the Cloud and corporate data assets will prove to be a game changer. Microsoft knows this and it has been developing its Cloud platform to interconnect public and private clouds as well. It seems that many companies are going to be publishing connectors in the near future, among them Oracle.

One step at a time the Cloud continues to evolve and mature. Each evolution delivers new capabilities and removes obstacles. The future is exciting; without a doubt.

AMZN AWSome

Well, Amazon strikes again. MapReduce (Hadoop) on demand. Although AMZN already offered some Hadoop pre-configured AMIs, the simplicity of this new packaging makes it much easier. Furthermore, it is synergistic with EC2 and S3.

I have been using Amazon Web Services for close to a year now and they continue to surpass my expectations. I wouldn't be surprised if AMZN spun off AWS and filed for an IPO sometime next year. It is not easy to isolate AWS's revenues from AMZN financial statements but with customers in 96 countries and a super scalable business model I have to believe this is a cash machine for them. These folks are brilliant. 

Many people often relate the Cloud to pure storage and CPUs as in pure hosting. AMZN goes up one level and provides application services. SimpleDB and SQS are good examples, now Elastic Map Reduce is another one. These are higher level application services on demand, industrial strength and world class.

A quote from Spiderman comes to mind: "... with great power comes great responsibility". What would you do with all this power?

Cloud Manifesto

The Open Cloud Manifesto was published earlier this week. I have been following this the development of this Manifesto along with the activity in the Cloud Interoperability Forum for several weeks now. Inevitably I have mixed feelings about a lot of the concepts being discussed.

What does it really mean to have an Open Cloud and why does that matter?

Advocates of Cloud Interoperability would like to be able to switch from one Cloud provider to another quickly and easily if their business requires so. They would also like  to see a common API for provisioning of services and applications. For instance, something like "ODBC" for Cloud repositories. Efforts of standardization and industry cooperation always remind me of the development of GSM for wireless communication in Europe. One school of thought believes that it is better to let individual companies create their own standards and allow for open competition to select the best one. The other school of thought sees too much friction in that model and believes that cooperation by market leaders can ultimately produce a better solution faster.

In the history of technology innovation, standards have always followed the establishment of a dominant design. For the cloud, this is way too early. There are just too many viable offerings with clearly distinct functionality. First with ODBC, then with J2EE I have heard many people claim that standards reduce their risk because they could "easily" change providers (i.e. database or application servers). But was this ever the case? In spite of supporting a common connectivity layer each RDBMS offers so many unique features that porting applications is can be completely unpractical. The same with application servers, I believe. Vanilla functionality can be migrated from WebLogic to WebSphere relatively easily. But the best performing, mission critical, strategic applications are most often optimized for a specific platform.

The Cloud seems pretty open already. It is very accessible, easy to get started, well documented and it is already based on industry standards (http, XML, REST, SOAP). I can see how a number of vendors could expand their product's markets if they did not have to re-write them for each Cloud provider, but are we trying to boil the ocean?

It seems the Cloud is doing quite well and although it needs to continue to mature, why fix it if it ain't broken?

Seybold and the Cloud

Andrew Seybold wrote an interesting piece on Cloud Computing: Cloud Computing -- a new version of an old idea. He identifies a few similarities between the centralized nature of cloud computing and the mainframes from many decades ago. Andrew's comments are centered mostly around centralizing data and making it available to a variety of clients. One of Andrew's biggest concerns is that he might not have network access ALL the time.

Network access is a valid concern and while wifi and broadband coverage continues to grow every day it is still not EVERYWHERE. Google has made offline versions of several of its products, most recently GMail. However, I think Andrew's mainframe comparison is not quite right. The Cloud is much more web based email and web based document storage. Openness and Accessibility are the Cloud's key disruptive drivers. 

Openness: the programmable Web lists over 1200 APIs available for any software developer. Most of them are free or free to get started. These are 1200 intelligent services that can be mashed up together to create new applications. They are open to anyone in the world without the need of any high end equipment. Technologies like HTTP, XML, SOAP, REST, and JavaScript are making this possible.

Accessibility: The programmable Web is open to anyone with the right skills but you don't need to be a rocket scientist to benefit from it. Kids in high school are building mashups to share pictures and communicate with each other but so is the Federal government. This is unprecedented. Sure there is a digital divide but the gap can't be compared to the mainframe days. Furthermore, anyone from their home computer can have access to Google's massive computing infrastructure for free. And once they go beyond their free quota, they can still serve an application with more than 5M page views a day for less than $50 a month. These conditions will power unprecedented innovation over the next 5 years.

Andrew says that the Cloud is not being pushed by IT professionals. I don't completely agree. I see a lot of CIOs looking at Cloud based solutions where possible to reduce operating costs. But in my experience the real people pushing the Cloud are actual business users that are exposed to the innovation delivered by consumer services like Facebook and wonder why can't they have the same type of tools at work.

The Cloud is successful because it represents the ultimate democratization of technology: driven by end users and open to all.

SAS, analytics and the cloud

SAS got a lot of press coverage when it announced it would invest $70M in a new data center. There is no doubt SAS is a world class company, clear market leader. In a 2008 survey by Rexer Analytics, 45% of respondents reported they use SAS. Almost 1 in 2 data miners? not bad.

I did not know SAS had a hosting service. As they said, their hosting business has grown with almost no advertising but late last year I heard they were pitching to one of the top media companies. I was surprised at first but it really makes a lot of sense and their recent announcement confirms the solid traction that business is getting.

After thinking about it a little more I'm very curious to see how their SaaS offering will play out. I believe the Analytics market is prime for a big disruption. The market is dominated by a handful of companies with relatively closed technology (at least in one direction) and significant profit margins. Open Source projects like R have shaken the game a bit but nothing earth shattering yet. I believe the Cloud -with its limitless storage and cpu power- will bring a more disruptive wave.  Will SAS take the lead? Can they embrace the power of Hadoop and in-memory databases to take their business to the next level? Or will they play conservatively, milking their current cash cow and using their market dominance to crush their smaller competitors? 

This will be a fascinating race.

Force.com thoughts, 2nd part

This is a short follow up to a previous post about Salesforce.com (SFDC) development platform. The more I work with this platform the more impressed I become: SFDC is fantastic. I have talked about their documentation and support in the past. Well, their technology is quite impressive as well.

The force.com platform has been built on a very consistent and predictable multi-tenant architecture. A highly efficient one by the way. Reports indicate that all of SFDC runs on 1000 mirrored servers, that is a total of only 500! This is quite remarkable.

Their development environment has all the features an enterprise developer can ask from a cloud provider. SFDC uses Visualforce Pages to render GUIs. These pages use a proprietary markup language that is quite similar to other frameworks like Django. By using this framework they enable/enforce a mainstream and efficient Model View Controller design pattern.

In addition to the Visualforce pages, SFDC recently added APEX, a Java based scripting language for data manipulation operations such as triggers or traditional stored procedures in relational databases. Java developers should feel right at home with APEX, it is strongly typed and the syntax appears identical to Java. APEX supports inheritance, unit testing and access to web services. Some other operations are restricted for security reasons; very similar to Google's approach with the AppEngine and Python's libraries.

Finally, the integration and customization features of SFDC are very useful and easy to use. Objects can be extended with new attributes, users can have different security profiles that apply specific privileges to different applications, custom applications can be packaged, managed and published with just a few clicks and their security requirements should put any corporation at ease. A winner all in all. What I find most impressive is how easy it is to see how all of these features are really customer driven.

Salesforce.com is definitely a role model for any other aspiring Cloud company.

Cloudera

Cloudera has created quite a buzz with its recent launch: great talent and great backers without a doubt. Business plan? I'm just not as excited as everybody else. I like Hadoop and what I have read about Cloudera makes it look like a solid business. Game changer? I find it hard to believe. This launch and press coverage reminds me of another startup from many years ago: e-pinions.com -and I'm sure there must be dozens of other examples. Great talent, tons of press, overblown expectations. I hope Cloudera has a better future.

Success story

Here is a short success story about how Appirio runs its entire business on the cloud.