Economist Corporate IT Survey: Cloud Computing

Spent much of last week delving into my weekly Economist subscription enjoying the Corporate IT survey on Cloud Computing.

The story covering the market for Enterprise SaaS has the following graph from Gartner (pre- or post global financial meltdown?!?!?!) which speaks volumes:

Slides from Chch .NET code camp cloud services talk

I very much enjoyed giving a talk at the 2008 Christchurch .NET Code Camp on Saturday, although some in the audience may have noticed that I hadn't timed the slides beforehand! (ended up squashing half the talk into the last 5 minutes - oops). Anyway, the event was excellently organised by Matt Smith, Andy (Scrasé ☺), Chris Fairbairn and the rest of the team - thanks I really enjoyed the event. Unfortunately I had to run off immediately and look after 10 six year olds at my daughter's birthday party - but I'm still alive! ;-)

I've attached the slides here in PDF format - please get in touch if you would like to discuss any of the topics I discussed.

Microsoft announce "Azure" services platform at PDC - no hard pricing yet

Microsoft's big Cloud announcement finally came out yesterday at PDC: the "Windows Azure" services platform:

"The Azure™ Services Platform (Azure) is an internet-scale cloud services platform hosted in Microsoft data centers, which provides an operating system and a set of developer services that can be used individually or together."

More info at What is the Azure Services Platform?

Also, take a look at the section on Pricing and Licensing: no hard pricing is available yet as this announcement is just for the CTP - planning to go into production in H2 2009.

Given the pricing competition from Amazon EC2 and other players on a spending spree like Rackspace this is going to get pretty darwinian pretty quickly. However, this is good for everybody (except perhaps Microsoft $hareholder$ who were expecting monopoly revenues forever!) - there are far fewer opportunities for vendor platform lock-in in the frictionless cloud: Microsoft can reinvent their revenue model around the stuff which delivers the most *real* value - which will be .NET from now on - but I don't think we'll be seeing >90% market share any time soon. ;-)

"The Azure™ Services Platform business model is aligned around four basic principles. These are:

* Consumption-based model
* Pricing attractive with the market
* Market expansion opportunity for Microsoft partners
* Easy access through the Web, or through existing channels and programs"

Consumption is based upon:

" * Compute time, measured in machine hours
* Bandwidth requirements (transmissions to and from the Azure data center), measured in GB
* Storage, measured in GB
* Transactions, measured as application requests such as Gets and Puts"

If you dive a bit deeper into the FAQs, you can see the production schedule:

" * Availability Timeframe – H2 2009
o Acquire directly through the Microsoft Online Customer Portal
o Acquire though ISVs (independent software vendors): purchase an ISV application which utilizes the Azure Services Platform, and pay the ISV through their own licensing and pricing model"

Intergen's Chris Auld is blogging the PDC - see his take on the Azure announcements here.

Amazon announcements: General Availability (99.95%) and Windows on EC2. Windows cost benchmarked at 25-40% over Linux to provision!

Amazon have done it - they have committed to "General Availability" (GA) with a service level agreement of 99.95% within a "Region". If availability falls below this level, customers will receive service credits. Read more information at http://aws.amazon.com/ec2-sla

In a simultaneous announcement Amazon have announced that Windows and SQL Server images are now available on EC2 - pricing for Amazon EC2 running Windows 2003 Server begins at $0.125 per compute hour (see below). Amazon are also supporting SQL Server Express and Standard editions on EC2. The only restriction is that all instances must be in the same availability zone - read details at: http://aws.amazon.com/windows/.

Pricing comparisons are below - so now there's a benchmark: Windows costs between 25-40% over Linux to provision!

Instances

Standard Instances	Linux/UNIX	Windows
Small (Default)	$0.10 per hour	$0.125 per hour
Large	$0.40 per hour	$0.50 per hour
Extra Large	$0.80 per hour	$1.00 per hour

High CPU Instances	Linux/UNIX	Windows
Medium	$0.20 per hour	$0.30 per hour
Extra Large	$0.80 per hour	$1.20 per hour

Microsoft Cloud Announcements

2 "Microsoft" "Cloud" press releases made it out simultaneously today.

First, Steve Ballmer pre-announced the launch of "Windows Cloud" operating system (which isn't Midori):

Secondly Amazon announced EC2 with Windows:

Both press releases predictably make no mention of pricing and licensing models - Microsoft's share price would tank if they did... ;-)

Microsoft's big Cloud launch at PDC 2008

Went to a good talk yesterday by Nigel Parker (slides here) of Microsoft New Zealand on Cloud Computing, IE8 and Silverlight. The talk was general scene setting for the Cloud computing paradigm, showcasing of MS's latest demos of gadgets like Photosynth, Live maps and Mesh, and generally painting Microsoft's future vision of Cloud computing (=Microsoft, Google, (Amazon?) and, er, no-one else can afford to play on their scale!?!).

Key announcement is that after the Bill Gates/Jerry Seinfeld teaser ads (Youtube: here and here ), Microsoft are finally launching their Cloud services platform into the wild at PDC in a month's time. See the post on Gianpaulo's blog for full details of the Cloud Services Symposium they are holding on day 4, and some sneak preview slides of architectural guidance for Cloud Services Architecture.

Good stuff - about time from Microsoft, too.

Data property rights: a banking analogy

Further on from previous comments on data portability, I read an interesting post on GigaOM from a while back from Nitin Borwankar: Data Property Rights, Not Portability. Nitin makes some really clear points regarding the rules which *should* govern your data which is placed in a third party's system (ie YouTube, Facebook), if you took a classic "property" analogy:

1. Data Accessibility
2. Data Visibility
3. Data Removal
4. Data Ownership

(...read the full post for details).

This makes me think of traditional business models surrounding being a trustee for other people's property: the classic model is banking. With a bank, I place my money in their trust, and am free to withdraw the money according to the agreement I have with them (ie savings / chequeing / fixed term investment account types). Conversely, while they have my money they are free to invest that money for their own profit (again, within certain limits - for example maybe I would specify that arms and tobacco investments are off-limits).

In the same way, for a piece of data or content that I own, I can choose which "trustee" I place my data with and can "withdraw" (ie to another service provider) my data according to the terms of my service agreement. Meanwhile, that trustee is free to try and make profits from my content by driving advertising, social mapping or other revenue from it.

Sounds fair enough to me.

Couple of afterthoughts, however:
- Banking is regulated: the internet will potentially need a regulator to achieve the "liquidity" of content outlined above.
- If these content ownership rules become embedded in internet culture over the next few years, and Facebook, YouTube and all the rest are just trusted, temporary custodians of their customer's content: what implications does that have for internet company valuations?

Cloud services enterprise architecture part 2

We've developed the EA further from my last post - adding an output service of software development consulting, and adding the following input services:


Messaging services:
-IM
-SMS
-Tweets (down with the kids!)

Work management services:
- Task management
- Workflow
- Timesheets

Mind mapping services:
- Mind mapping

Business continuity services:
- Backup

Legal services
- Legal advice

Software development services:
- Application platform
- Database platform
- IDE (Integrated Development Environment)
- Test management
- Architecture
- Requirements

Here's the latest picture: now to find the right providers for each of these services!

Interesting posts on the "Principles of Cloud Oriented Architecture", and "Cloud Computing Bill of Rights"

I've been reading James Urquhart's blog The Wisdom of Clouds for some time now - a leading thinker in the emergent space of Cloud-based architecture.

In particular, the following recent posts are especially worth reading:

Update: the Cloud Computing Bill of Rights

The Principles of Cloud Oriented Architecture

Generally I agree with James that, since the world is now coasting towards a single common, shared Cloud Oriented Architecture that a set of common principles, rights and responsibilities can and should be drafted (but I would ask by whom?). As with any technological advance, the social and legal effects cannot be thought through soon enough before the impact of the change is felt. The question of jurisdiction will always be hardest - which authorities govern and legislate for data and other services in the (international and potentially off-planet) Cloud? Technology moves ever more quickly than the human population can keep up.

In some ways this "Bill of Rights" reminds me of a political manifesto - there will be diametrically opposing views on privacy and security for example from the governments of many countries, and so the practical question is *how* such a BoR would ever come to realised.

However, another way to look at the BoR is as a requirements spec trying to solve 3 discrete technical problems:

Namely:

• Providing clear ownership of data and avoiding Cloud services providers ever "owning" their customers' data.
• Providing clear accountability (=measurable!) for Cloud service levels
• Providing clear ownership of (patented?) intellectual property underlying a Cloud service
  

James has brought us all a long way by articulating these vulnerabilities in today's Cloud services model - however I personally think that it's more likely that these issues will be addressed successfully (and cheaper!) using technology rather than by the law.

An alternative Microsoft-based Cloud Services Architecture

Just had a read of my friend Matt Smith's blog post from a couple of weeks ago, which covers very similar ground to my last post on the cloud services I've started using. Matt is a Microsoft fanboy - he even once proposed SharePoint as a viable alternative to a girlfriend in a presentation - these things come back to haunt you, you know! ;-) - and so is pretty keen on MS' Mesh services (must take a closer look at these) - I'm mostly using Google at the moment. Compare and contrast at http://blog.mattsmith.co.nz/Lists/Posts/Post.aspx?ID=40.

Cloud Services Manifesto

OK here we go. To start with, a “Cloud Services manifesto” to look back on in future years.

Definition:

“The Cloud” = “The universe of all economic services”.

- Cloud Services are all-encompassing - we’re not just talking about web services here. Every economic good or service belongs in and can be exchanged in the Cloud.

- Cloud Services are what's important to the end user so that’s what we will talk about: “what” rather than “how”. Talk of ‘Cloud Computing’ is already backwards-facing.

- Cloud Services will be Darwinian in their evolution: in any particular service niche, ultimately “there can be only one”, since all Cloud Services will eventually be able to scale to 6.6 billion users (and counting). There will, however, be an ever-expanding number of niches.

- We are now at the early stages of when we use Cloud Services for all aspects of life and business. The economic and social implications of this change need to be surfaced and recognised.

- Cloud Services will make what was previously achievable faster, easier and cheaper until they are commoditised and effectively free.

- Cloud Services will make new things achievable faster, easier and cheaper to more people, businesses and geographies.

- Part of me (/my business/my organisation) will live in the Cloud from now on: the Cloud is an extension of a consciousness, an extension of a business, with increasing symbiosis and decreasing boundaries between each entity.

Of course, only time will tell how prescient these predictions actually are... ;-)