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CIO's Guide to On-Demand

Thursday, January 15, 2009

2009 Prediction - Rise and Fall of the Private Cloud

#6 in our series of 2009 predictions

2008 Recap

2008 saw massive hype around the concept of a “private cloud,” roughly defined as a adopting the technology and practices from public cloud providers for a single company behind the firewall. “Private clouds are the future of corporate IT” declared Gartner. “Private Clouds Take Shape,” gushed InformationWeek, citing the funding of companies like Elastra and Parascale. “Get off my cloud” said eWeek, questioning the security of public cloud environments compared to private clouds.

2009 Prediction

Here’s the rub: Private clouds are just an expensive data center with a fancy name. We predict that 2009 will represent the rise and fall of this over-hyped concept. Of course, virtualization, service-oriented architectures, and open standards are all great things for every company operating a data center to consider. But all this talk about “private clouds” is a distraction from the real news: the vast majority of companies shouldn’t need to worry about operating any sort of data center anymore, cloud-like or not.

The idea that somehow companies can use “private cloud” technology to offer their employees web services similar to Google, Amazon, or salesforce.com will lead to massive disappointment. Here’s why:
  • Private clouds are sub-scale: There’s a reason why most innovative cloud computing providers have their roots in powering consumer web technology—that’s where the numbers are. Very few corporate data centers will see anything close to the type of volume seen by these vendors. And volume drives cost—the world has yet to see a truly “at scale” data center.
  • You can’t teach an old dog new tricks: What do you get when you move legacy applications as-is to a new and improved data center? Marginal improvements on your legacy applications. There’s only so much you can achieve without truly re-platforming your applications to a cloud infrastructure… you can’t teach an old dog new tricks. Now that’s not entirely fair…. You can certainly teach an old dog to be better behaved. But it’s still an old dog.
  • On-premise does not equal secure: the biggest driver towards private clouds has been fear, uncertainty, and doubt about security. For many, it just feels more secure to have your data in a data center that you control. But is it? Unless your company spends more money and energy thinking about security than Amazon, Google, and Salesforce, the answer is probably “no.” (Read Craig Balding walk through “7 Technical Security Benefits of Cloud Computing”)
  • There’s no secret sauce: There’s no simple set of tricks that an operator of a data center can borrow from Amazon or Google. These companies make their living operating the world’s largest data centers. They are constantly optimizing how they operate based on real-time performance feedback from millions of transactions. (check out this presentation from Jeff Barr and Peter Coffee at the Architecture and Integration Summit). Can other operators of data centers learn something from this experience? Of course. But the rate of innovation will never be the same—private data centers will always be many, many steps behind the cloud.

There’s also something very suspicious in all this discussion of private clouds…. private clouds are advocated mainly by companies who make their money from selling or operating data centers, and risk losing their shirts as real cloud computing drives more and more computing onto shared infrastructure. I understand why these companies are reluctant to embrace true cloud computing: Imagine being the junior partner in IBM Global Services pitching a client to develop an application on Amazon, Google, or Salesforce. Not only are you taking money out of the pocket of your colleagues in hardware and software….. you are also taking money out of the pocket of your colleagues in professional services, since integration and app development are so much easier using on-demand platforms.

That’s not to say that there’s no place for the technology behind private clouds. In certain cases where it simply isn’t an option to utilize a public cloud, this technology can have a significant impact. But those use cases are few and far between, and the benefits to be achieved are insignificant relative to the benefits of moving to a public cloud. Here’s who should be thinking about private clouds:
  • Cloud Providers: This is an easy one… companies that plan on being in the business of providing cloud computing capabilities to others need to think about how to effective provide their own cloud. But we’d argue that very few companies actually need to be in this business (e.g., we believe most on-demand BI vendors should be running on public cloud infrastructure).
  • Highly regulated industries: Government regulation will always lag behind commercial application of technology. There will inevitably be instances where nervous politicians or policy makers write up requirements that can only be met through a private cloud.
  • Companies in the process of moving to a public cloud: Of course, no company of any significant size can move its IT infrastructure to the cloud all at once. In fact, Appirio specializes in helping companies figure out what the right first step is away from their on-premise infrastructure. For the IT infrastructure that hasn’t yet moved, it definitely makes sense to think about how to use “private cloud” technology. But that means the private cloud is a temporary stop-gap, not the “future of enterprise IT.”
Implications for customers.
Of course any customer with a data center should be thinking about how to use the technologies behind “private clouds” to improve their efficiency. But this should be a minor element of your long-term IT strategy. The most important thing any IT department can do in 2009 is chart out a thoughtful plan to migrate significant portions of your IT infrastructure to the public cloud. Don’t let “private clouds” be a distraction from that goal.

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Monday, December 08, 2008

Force.com for Google App Engine: Apps "Native" to a Cloud Community

Ryan Nichols

Salesforce.com made two fantastic announcements today at their CloudForce event in New York. The first is Force.com for Google App Engine (demonstrated on stage by Marc Benioff and our own Narinder Singh using an extension of our work with Harrah's). The second is Force.com Checkout for native apps (Appirio Adoption Accelerator is one of the 19 apps in the pilot). These announcements illustrate two important elements of Salesforce's platform strategy: "Connecting the cloud" and "Go Native." We think Salesforce is uniquely positioned to bring these two concepts together into a powerful platform. Here's what we mean:

1. Force.com for Google App Engine is a natural extension of Salesforce's strategy to “Connect the Cloud.” We’ve already talked about why we’re so excited about Salesforce’s recent partnership with Amazon and Facebook, and the deepening relationship with Google. If you've been reading this blog or following Appirio's own news over the last year, it's clear we share Salesforce’s vision of “connecting the cloud.” (And we’re flattered that Salesforce has adopted our term so enthusiastically!). Today's integration with Google App Engine takes that idea to the next level-- highly scalable, consumer-focused web applications built on App Engine fully integrated with Force.com.

2. Force.com checkout is a natural extension of Salesforce's strategy to encourage "Native" Apps. Salesforce rightly argues that there’s something unique about applications that run entirely on Force.com. Force.com is a powerful, trusted platform, and there’s a confidence that customers can have in applications that rely on that technology. That’s why Appirio has built dozens of custom applications for our customers entirely on Force.com, offers several 100% native apps, and strives to have all of our products that interact with Salesforce run native functionality.

Here's the power of the Salesforce platform strategy: Salesforce customers can now have the best of both worlds. Salesforce is combining the strengths of multiple, complementary, on-demand platforms, delivered through applications that customers can trust.

Here's why this is so remarkable: there are many types of applications that Salesforce is very good at supporting. There are other applications for Salesforce customers that wouldn't be effective to build entirely on Force.com. Salesforce.com recognizes this, and partners with Google, Amazon, and Facebook to create a "virtual platform" for the entire industry. This is game changing - and should scare the daylights out of the old big four of Microsoft, Oracle, SAP, and IBM.

Each of these on-demand platforms have different and complementary strengths:
  • Force.com excels at modeling business processes, workflow and UI
  • Google excels at scalable, consumer-focused applications that extend its strengths in communication, collaboration, search, and advertising
  • Amazon excels at highly scalable low-level computing power and storage
  • Facebook excels at viral applications that leverage a user’s social graph and its community of 120M+ participants
Salesforce knows this--they formed these partnerships to differentiate from the isolation of legacy "platforms." Salesforce customers know this—that’s why they are eager to use applications that bring together the best of multiple platforms. Just look at the number one app on Appexchange (Appirio’s Calendar Sync for Google Apps) as well as 5 of the other top 10 on Appexchange. These solutions draw on the capabilities of the Salesforce, Google, AND Amazon platforms. That’s what customers want and need, and Salesforce is in a unique position to deliver on this promise.

After all, there is still a huge difference between an AppExchange application that largely runs on a server under my desk (of course, not native) and a Force.com application like Appirio Calendar Sync that runs certain intense computations on Amazon's EC2 or Google's App Engine. One is running on a set of trusted platforms, the other is not. There is real value in Salesforce working with partners to build stable connections with trusted on-demand platforms, and recognizing applications that take advantage of these platforms in a way that customers can have confidence in.

Today's announcement of integration between Google App Engine and Force.com enables a new class of applications that are "native" to a community of trusted cloud providers. And at the end of the day this will be one of the key ways Salesforce will distinguish its own on-demand platform from that of Microsoft…. Look for an upcoming blog post on "Microsoft—is it lonely up there in your Azure cloud?”

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Wednesday, October 22, 2008

Waiting for the On Demand Generation?

Ryan Nichols

One of our pet peeves is when cloud computing pundits talk about on-demand applications coming to the enterprise when "Generation Y is in charge."  Taken to mean that on-demand is inevitable, we absolutely agree.  Taken to mean that we'll have to wait until today's teenagers become CIO and CEO before most companies take advantage of SaaS, we absolutely disagree.

New technologies rarely "age" their way into the enterprise.  Do certain age groups tend to be "early adopters" more than others?  Absolutely.  But if there is real end-user benefit to a technology, its adoption will spread across age groups rapidly.  The same older managers who once had their secretaries print out their email are now on Blackberries or iPhones.  For the most part, these aren't different people--individuals of all ages are willing to learn and adopt new technology that has a real impact on their personal productivity. And if there's no real impact, adoption won't occur no matter how long you wait. 
 
What does this have to do with the fact that Salesforce announced last week that the great '90's band Foo Fighters would be performing at November's Dreamforce conference instead of the great '80's band Journey?  Probably nothing.  But our mission is to make sure that the benefits of Software as a Service are clear to the Journey generation....not just to the Britney Spears generation or even the Foo Fighter generation.  

Last week, the young leaders of the consumer internet caught flak for their lip-sync video of Journey's "Don't Stop Believing" (filmed on a junket to Cyprus), bemoaning the bursting of the Web 2.0 bubble.  In the enterprise, the message to the Journey generation is quite different-- in today's economic environment, its time to start believing in the real business benefits delivered by on-demand applications. You can't afford not to.

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