Monitoring the "cloud" ...

At E-Tech (March 2007), I talked about :-

• The commoditisation of IT.
• The need for competitive utility computing markets.
• The "potential" green benefits of large scale computing providers.
• Why open source was essential for SaaS.
• The need for open hardware.
• The change of consumer from a passive to active participant.
• Why patent length needs to be variable and set to the likely time of independent discovery.

All of these themes were connected to the underlying process of commoditisation.

I continuously keep tabs on how different business activities are affected by this process as this enables me to help my clients determine a better strategic choice for their activities. There are numerous stages in an activity's lifecycle, each with its own methodologies and strategies.

Now whatever the "cloud" is, it is certainly about the commoditisation of IT. It's therefore about the creation of a competitive utility computing market for which there are a number of requirements.

One of these is a high degree of substitutability between services (what I jokingly called Fungitility and Patration and James called Software Fluidity). Substitutability between services in the Software as a Service or Cloud Computing or whatever term is in vogue, means:-

The freedom to move from one service provider (including internally) to another without hindrance (including excessive cost, time or effort), without boundaries and predicated on the existence of an equivalent service or services.

This term really is about the portability of data, applications and frameworks (see my talk from OSCON) between providers but that terms is used by the DataPortability group to mean something equivalent to "access to data". It's all a bit messy but it's the concepts that matter not the actual terms. They will all get cleaned up at some later point along with aaS wars when there is less buzz.

All you need to know is that IT is moving from a product to a service based economy (hence all the different aaS terms), and in a service based economy the freedom to move from one service provider to another without hindrance is critical. This of course means there must be more than one service provider.

Oscon, July 2007

Substitutability between service providers will require the portability of any necessary data, applications and frameworks from one to another services that are interoperable. For this, and for reasons of strategic control, the services will need to be based upon open sourced standards. This is starting to slowly happen for example with the open SDK of GAE and Eucalyptus. Another requirement is compliance and assurance services. It seems like we have a first step being made along this path with CloudStatus.

Back in July '07, I said: "Six years from now, you'll be seeing job adverts for computer resource brokers."

The speed at which things are moving, it could be even sooner.

Look what I've found hiding in the shadows ...

For over ten years I've been going on and on and on about commoditisation as a force both in IT and manufacturing. From utility computing to 3D printing with a healthy dose of open source, network effects and the interaction of digital / physical along the way.

Many times it has felt like a lonely journey and I have become very used to people mocking these ideas. Of course I've seen the transition from mocking to accepted wisdom as heavyweights get involved in these subjects. When Carr published his first HBR article and Sterling published his book, it was a joyous moment for me as I knew my likelihood of being mad was decreasing.

A lot of the poor souls at Fotango were continuously exposed to my mutterings and Tom Insam (now at Dopplr) once said that "I had the annoying habit of being right about the future". Well, the truth is I don't predict the future. All I ever do is take old ideas and repeat them in a modern context.

I happen to agree with Tim O'Reilly that the future is already here, it's just not evenly distributed. However, I would also extend his idea to the future is already here, we've just forgotten where we've put it. There is an incredible sense of pleasure in discovering that little bit of the future which has been brushed underneath the carpet or left cowering in some dusty corner of a library.

On that note, it is good to see that the old ideas (pre 1980's) on commoditisation of IT are so mainstream now. Also I'm glad that finally we have a heavyweight, Greg Papadopoulos, advocate "a free market [in the cloud] in which all interfaces and formats are based on open standards". This will take more than open standards, as open APIs and data formats won't provide portability (including interoperability) alone, however the discussion about competitive markets between providers is excellent. This is what should be expected to happen from the old ideas of second sourcing (pre 1970's).

I did note with interest that Gartner is reported to have said that :-

“By 2012, software as a service (SaaS) will surpass open source as the IT cost-cutting method of choice.”

You really shouldn't think of it as SaaS vs Open Source. The really powerful combination is SaaS and Open Source. SaaS will become huge once it is based upon open source and competitive markets form.

As for me, well everyone who knows me also knows that I've become somewhat tired of web 2.0, enterprise 2.0 and the "cloud". I still blog and talk about these subjects, but I'm slowly moving on to something new - books. In other words I'm playing with ordinary objects that do extraordinary things.

Here comes the Borg ...

Many, many years ago, Fotango introduced a system called the "Borg".

The idea of the system was that we could deploy any of our web applications to a mass of blades and spin up new application servers as we needed them. A lot of this went into production but many of our advanced plans for automatic creation and destruction of virtual servers and applications according to estimation of future load were never completed in production. But then again, this was 2004.

What we were trying to create was an environment where we just added more hardware, as it was needed, and the environment decided how it was best used. The plan was that the environment would automatically balance the use of hardware according to the variable demand of all the various web applications that existed within it. The decision process would be left to the "Borg Queen". What we ended up with was most of this, the ability to spin up virtual machines, deploy and configure applications with a single command, scale up applications and recreate virtual machines on fail.

Of course, Borg raised an interesting question that you wouldn't know on what hardware your application existed on at any one moment in time.

I joked about this subject when Rich Miller and Greg Ness posted about portable VMs. However James Urquhart has explored the concept of portable environments in the cloud and brought up a whole host of legal issues. James really is a smart cookie, but then all the Jameses I know are smart - odd that.

If you are interested in the "cloud" and you don't follow James and Rich, you really should. Actually Greg is really interesting too.

-- update June 2014

Came across this system from Google - apparently called Borg as well. The scale is obviously different, probably some of the ambitions are the same.

Fotango's more limited version was built by a team led by Artur Bergman.

Gang up now before the *aaS cloud gets you.

I've just been invited to speak at London Cloud Camp. Naturally I enjoy the opportunity of speaking however web 2.0, utility computing and enterprise 2.0 are all becoming mainstream topics these days and are losing their lustre.

So I thought I'd give a summary of my talks from E-Tech, OSCon, FOWA and Web 2.0 last year. However, after writing up the synopsis it occurred to me that this stuff is really becoming old hat. Hence I've put up the synopsis here in the hope of getting some feedback.

Title: Gang up now before the *aaS cloud gets you.

Synopsis [draft]:
Cloud computing is a hot marketing topic at the moment, as can be seen by the plethora of *aaS terms being touted. Despite protestations about *aaS from many quarters of the IT industry, we will adopt it in much the same way that many well know brands have embraced the outsourcing of manufacturing to service providers.

Outsourcing to service providers should, and can, be successfully applied to commodity-like activities which are well defined and ubiquitous. The benefits of adopting a service approach and using service providers are achieved through componentisation (higher velocity in product release), economies of scale (lower price for the same quality of service) and the balancing of supply and demand (dealing with capacity planning and bursty demand).

The commoditisation of IT is at the heart of cloud computing. As with any commodity, substitutability between providers is a key strategic concern. For software services this means portability (and interoperability) between service providers which in turn requires that the core technology be provided as open sourced standards.

From an economic point of view such an approach mirrors the shift of IT from a product to a service economy with competition based upon price and quality of service rather than product differentiation. Unfortunately many vendor offerings are little more than our product "as a service"

Without substitutability between service providers, any consumer is facing a strategically weak position in terms of competitive pricing, security and the risks of monopoly. However not using *aaS can equally create a competitive disadvantage due to the Red Queen Effect.

What is a business consumer to do?

Business consumers need to push vendors towards open sourcing their technology. Whilst it might be possible to do this by forming consumer organisations (hence ganging up), the more likely route is the long wait for government regulation. This probably won't happen until after we experience a couple of high profile reruns of the lessons of second sourcing. Despite the best efforts of vendors, there will be a black swan in the *aaS world and a catastrophic systems collapse due to some form of systemic failure (i.e. the *aaS cloud gets you).

Whilst a few enlightened vendors (for example Google, FaceBook and Bungeelabs) seem to have realised that open source is the way forward, many more vendors remain stuck in a product mindset. Except for those lucky few who find a role in a niche product area, some vendors will find themselves ill equipped to cope with a world where reputation and service become the source of competitive advantage.

It's a hard luck life ...

It turns out that anti-terrorist laws are being used to snoop on ordinary members of the public suspected of petty offences. People have been bugged and spied upon for breaching the smoking ban to housing benefit fraud to playing music loudly. If only those same laws had been used on the snout trough-ing members of government who have been lavishly spending the public purse on nannies, private accommodation and other perks.

Just for laughs, whilst asking the country to show restraint in wage rises, a group of London MPs have been awarded inflation busting increases. There is even talk of a 40% pay rise for MPs to make up for some of their perks being taken away. Until that arrives, the poor loves have been told that they now have to buy their own TVs and kitchen furniture out of their £60K+ p.a. salary. How will they cope?

It shouldn't be forgotten that in the past MPs asked for everyone to show restraint and set the example by awarding themselves low wage increases. Of course, we all suspected that they were racking up hidden perks. At least we now know just how much they've been coining it.

So should they get huge rises? Well in my opinion they should not only get pay rises pegged to the CPI but their lavish expenses should go. I know that Andrew Neil (from "This Week") doesn't believe that £60K+ is much money, but most people think it's a fortune.

3 is the new 2 ...

There are three accelerators to change hidden in the concepts commonly associated with web 2.0. These are :-

• componentisation through the internet as a platform
• network effects through social networks
• increasing participation though reducing barriers to entry, collaborative approaches and the levelling of any disparity between opportunity and ability.

I mention this because Salesforce have decided to define Platform as a Service (a term which they coined and used successfully to gain thought leadership on what was already a common concept) as "Web 3.0".

Seeing that the internet as a platform is a key part of web 2.0, this change will just cause confusion and will be of little benefit to consumers. However, it will give the pundits plenty to talk about.

Expect "Process as a Platform as a Cloud as a Service" or PaaPaaCaaS (aka web 4.51 rc 2) soon. Sounds gibberish? It is, and so are these new terms being touted.

From Web 2.0 to Enterprise 2.0

This is a recreation of my talk from the Enterprise 2.0 conference in Milan (June 2008).

During the talk I examined the concepts of web 2.0, enterprise 2.0 and the forces behind change. The talk links together a number of topics from componentisation, software as a service, participation, network effects, innovation and commoditisation into a single theme (most of this stuff is old hat for those who have seen any of my presentations over the last few years).

The video covers in very simple and general terms:-

• What is commoditisation?
• What is innovation?
• Why is web 2.0 important?
• Why is web 2.0 important now?
• Why is enterprise 2.0 important?
• Some basic lessons on managing enterprise 2.0.

From Web 2.0 to Enterprise 2.0 (50 mins approx)

The Age of Innovation ... oh no it isn't .... oh yes it is ...

Following on from a less than enlightened discussion about age and innovation, I've decided to put down the basic tenets of the argument in a graphical form (click on each image for a larger view).

Part I - the opening question

Part II - challenging beliefs

I'm slowing coming to the conclusion that I've found the "Hazard" age group.

Some basic SaaS questions ...

SaaS is simply the move of IT from a product to a service based economy and as a result it promises all sorts of benefits through componentisation. If you want to realise those benefits then there are two basic questions you need to ask:-

1. Is there a standard service?
2. Are there alternative providers of the standard service that I can simply and almost instantaneously switch between?

Unless the answer to both questions is yes, then you will in effect be locking yourself into a strategically weak position in terms of pricing, competition and security. Of course there are other methods of lock-in including network effects such as market reports but portability and interoperability are the most primitive methods.

Just be aware that there is a severe risk of lock-in in the SaaS world today. Whilst there are circumstances where it is reasonable to allow your company to be locked-in to a single provider, they are few and far between.

Eh?

I don't get this at all.

Where's our cut?

According to Clay Shirky, Wikipedia has taken approximately 100 million hours of human effort. Also, according to Clay Shirky, the internet connected population watches 1 trillion hours of TV per year. As Clay says, 1% of our time spent watching T.V. is enough to create 100 Wikipedias.

Whilst this is a wonderful example of how human capital can be spent to create incredibly valuable public resources, it also creates a slight problem. According to Silicon Alley Insider, Wikipedia is worth approximately $7 billion. In other words, each one of those 100 million hours of human capital provided is worth approximately $70.

This means that the T.V. industry has been potentially using $70,000,000,000,000 of human capital each year and as far as I can see they haven't paid a penny for it. Now that just doesn't seem fair.

Future of Web Apps

This year I was invited to help out with the schedule for FOWA (Future of Web Apps).

I'm really pleased to be involved as FOWA is one of my favourite events. Ryan and the crew have already put together a strong line up of speakers, including Kathy Sierra. The schedule isn't finished yet, but it certainly is shaping up to be an outstanding event.