Category Archives: Software as Service

Rackspace’s Bridge Between Clouds

OpenStack has generated plenty of sound and fury during the past several months, and, with sincere apologies to William Shakespeare, there’s evidence to suggest the frenzied activity actually signifies something.

Precisely what it signifies, and how important OpenStack might become, is open to debate, of which there has been no shortage. OpenStack is generally depicted as an open-source cloud operating system, but that might be a generous interpretation. On the OpenStack website, the following definition is offered:

“OpenStack is a global collaboration of developers and cloud computing technologists producing the ubiquitous open source cloud computing platform for public and private clouds. The project aims to deliver solutions for all types of clouds by being simple to implement, massively scalable, and feature rich. The technology consists of a series of interrelated projects delivering various components for a cloud infrastructure solution.”

Just for fun and giggles (yes, that phrase has been modified so as not to offend reader sensibilities), let’s parse that passage, shall we? In the words of the OpenStackers themselves, their project is an open-source cloud-computing platform for public and private clouds, and it is reputedly simple to implement, massively scalable, and feature rich. Notably, it consists of a “series of interrelated projects delivering various components for a cloud infrastructure solution.”

Simple for Some

Given that description, especially the latter reference to interrelated projects spawning various components, one might wonder exactly how “simple” OpenStack is to implement and by whom. That’s a question others have raised, including David Linthicum in a recent piece at InfoWorld. In that article, Linthicum notes that undeniable vendor enthusiasm and burgeoning market momentum accrue to OpenStack — the community now has 138 member companies (and counting), including big-name players such as HP, Dell, Intel, Rackspace, Cisco, Citrix, Brocade, and others — but he also offers the following caveat:

“So should you consider OpenStack as your cloud computing solution? Not on its own. Like many open source projects, it takes a savvy software vendor, or perhaps cloud provider, to create a workable product based on OpenStack. The good news is that many providers are indeed using OpenStack as a foundation for their products, and most of those are working, or will work, just fine.”

Creating Value-Added Services

Meanwhile, taking issue with a recent InfoWorld commentary by Savio Rodrigues — who argued that OpenStack will falter while its open-source counterpart Eucalyptus will thrive — James Urquhart, formerly of Cisco and now VP of product strategy at enStratus, made this observation:

“OpenStack is not a cloud service, per se, but infrastructure automation tuned to cloud-model services, like IaaS, PaaS and SaaS. Intsall OpenStack, and you don’t get a system that can instantly bill customers, provide a service catalog, etc. That takes additional software.

What OpenStack represents is the commodity element of cloud services: the VM, object, server image and networking management components. Yeah, there is a dashboard to interact with those commodity elements, but it is not a value-add capability in-and-of itself.

What HP, Dell, Cisco, Citrix, Piston, Nebula and others are doing with OpenStack is creating value-add services on top (or within) the commodity automation. Some focus more on “being commodity”, others focus more on value-add, but they are all building on top of the core OpenStack projects.”

New Revenue Stream for Rackspace

All of which brings us, in an admittedly roundabout fashion, to Rackspace’s recent announcement of its Rackspace Cloud Private Edition, a packaged version of OpenStack components that can be used by enterprises for private-cloud deployments. This move makes sense for OpenStack on couple levels.

First off, it opens up a new revenue stream for the company. While Rackspace won’t try to make money on the OpenStack software or the reference designs — featuring a strong initial emphasis on Dell servers and Cisco networking gear for now, though bare-bones OpenCompute servers are likely to be embraced before long –  it will provide value-add, revenue-generating managed services to customers of Rackspace Cloud Private Edition. These managed services will comprise installation of OpenStack updates, analysis of system issues, and assistance with specific questions relating to systems engineering. Some security-related services also will be offered. While the reference architecture and the software are available now, Rackspace’s managed services won’t be available until January.

Building a Bridge

The launch of Rackspace Cloud Private Edition is a diversification initiative for Rackspace, which hitherto has made its money by hosting and managing applications and computing services for others in its own data centers. The OpenStack bundle takes it into the realm of provided managed services in its customers’ data centers.

As mentioned above, this represents a new revenue stream for Rackspace, but it also provides a technological bridge that will allow customers who aren’t ready for multi-tenant public cloud services today to make an easy transition to Rackspace’s data centers at some future date. It’s a smart move, preventing prospective customers from moving to another platform for private cloud deployment, ensuring in the process that said customers don’t enter the orbit of another vendor’s long-term gravitational pull.

The business logic coheres. For each customer engagement, Rackspace gets a payoff today, and potentially a larger one at a later date.

Limits to Consumerization of IT

At GigaOm, Derrick Harris is wondering about the limits of consumerization of IT for enterprise applications. It’s a subject that warrants consideration.

My take on consumerization of IT is that it makes sense, and probably is an unstoppable force, when it comes to the utilization of mobile hardware such as smartphones and tablets (the latter composed primarily and almost exclusively of iPads these days).

This is a mutually beneficial arrangement. Employees are happier, not to mention more productive and engaged, when using their own computing and communications devices. Employers benefit because they don’t have to buy and support mobile devices for their staff.  Both groups win.

Everybody Wins

Moreover, mobile device management (MDM) and mobile-security suites, together with various approaches to securing applications and data, mean that the security risks of allowing employees to bring their devices to work have been sharply mitigated. In relation to mobile devices, the organizational rewards of IT consumerization — greater employee productivity, engaged and involved employees, lower capital and operating expenditures — outweigh the security risks, which are being addressed by a growing number of management and security vendors who see a market opportunity in making the practice safer.

In other areas, though, the case in favor of IT consumerization is not as clear. In his piece, Harris questions whether VMware will be successful with a Dropbox-like application codenamed Project Octopus. He concludes that those already using Dropbox will be reluctant to swap it for a an enterprise-sanctioned service that provides similar features, functionality, and benefits. He posits that consumers will want to control the applications and services they use, much as they determine which devices they bring to work.

Data and Applications: Different Proposition

However, the circumstances and the situations are different. As noted above, there’s diminishing risk for enterprise IT in allowing employees to bring their devices to work.  Dropbox, and consumer-oriented data-storage services in general, is an entirely different proposition.

Enterprises increasingly have found ways to protect sensitive corporate data residing on and being sent to and from mobile devices, but consumer-oriented products like Dropbox do an end run around secure information-management practices in the enterprises and can leave sensitive corporate information unduly exposed. The enterprise cost-benefit analysis for a third-party service like Dropbox shows risks outweighing potential rewards, and that sets up a dynamic where many corporate IT departments will mandate and insist upon company-wide adoption of enterprise-class alternatives.

Just as I understand why corporate minders acceded to consumerization of IT in relation to mobile devices, I also fully appreciate why corporate IT will draw the line at certain types of consumer-oriented applications and information services.

Consumerization of IT is a real phenomenon, but it has its limits.

Cloud Buyers Put Vendors on Notice

No matter where you look in the vendor community, cloud-computing strategies proliferate. It doesn’t matter whether the vendors sell servers, storage, networking gear, management software, or professional services, they are united in their fervor to spin compelling private, public, and hybrid cloud narratives.

Secret Sauce or Sticky Glue?

At the same time, of course, many of these vendors seek competitive differentiation that features a proprietary secret sauce that ultimately serves more as glue than comestible, binding paying customers to them indefinitely.

Customers, many of which are familiar with the history of information technology, are cognizant of the vendor maneuvering. They’ve seen similar shows in the past, and they know how those productions usually end — with customers typically bound to technology investments they may not want to perpetuate while enmeshed in unhealthy relationships with vendors that delivered dependency disguised as liberation.

Ideally, vendors and customers should enjoy mutually beneficial relationships, with each side deriving value from the engagements. Unfortunately, vendors seek not only to deliver value to customers, but also to differentiate themselves from their competitors, often by finding a way of locking the latter out of their customer base. Proprietary technologies — not so interoperable with the those offered by other vendors — often serve the purpose.

Won’t Get Fooled Again

In the realm of cloud computing, customers are trying not to get fooled again. They’re banding together on multiple fronts to ensure that their requirements are fully acknowledged in the development and realization of cloud-computing industry standards covering data portability, cloud interoperability, and cloud security. What they obviously fear is that big vendors, without customer oversight and constant vigilance, will find ways to gerrymander the standards process in their favor, perhaps to the long-term disadvantage of cloud-computing clientele.

With that in mind, organizations such as the Cloud Standards Customer Council (CSCC), announced by OMG in April, and the Open Data Center Alliance, launched last fall, have formed.

The Open Data Center Alliance bills itself as an independent IT consortium led by global IT organizations – including BMW, China Life, Deutsche Bank. JPMorgan Chase, Lockheed Martin, Marriott International, Inc. and other well-known corporate entities — that is committed to provide a unified vision for long-term data center and cloud infrastructure requirements. It pursues that objective through the development of a vendor-agnostic usage-model roadmap. Intel Corporation serves as a technical advisor to the alliance, which suggests that it is not without vendor representation.

For its part, the Cloud Standards Customer Council also is infused with vendor blood. Among its founding enterprise members are IBM, Kaavo, CA Technologies, Rackspace, and Software AG.  Organizations (and major IT buyers) that have joined the council include Lockheed Martin, Citigroup, State Street, and North Carolina State University.

It’s interesting that Lockheed Martin is involved with both the Open Data Center Alliance and the Cloud Standards Customer Council. That indicates that, while overlap between the two bodies might exist, Lockheed Martin believes each satisfies — at least for it needs and from its perspective — a distinct purpose.

Activist Language

The Cloud Standards Customer Council says it is an “end user advocacy group dedicated to accelerating cloud’s successful adoption, and drilling down into the standards, security, and interoperability issues surrounding the transition to the cloud.” It says it will do the following:

  • Drive customer requirements into the development process to gain acceptance by the Global 2000
  • Deliver customer-focused content in the form of best practices, patterns, case studies, use cases, and standards roadmaps.
  • Influence the standards development process for new cloud standards.
  • Facilitate the exchange of real-world stories, practices, lessons and insights.

Its tone, despite the presence of vendors among its founding members, is relatively activist regarding the urgent need for customer requirements and real-world insights as essential ingredients in the standards-making process.

It remains to be seen how the Cloud Standards Customer Council and the Open Data Center Alliance will evolve, separately and together, and it’s also too early to say whether customers will be entirely successful in their efforts to get what they want and need from cloud-computing standards bodies.

Nonetheless, there’s already a tension, if not a distrust, between buyers and sellers of cloud-computing technology and services. The vendors are on notice.

3PAR Shareholders Dance Jig of Joy

3PAR shareholders must be doing a vigorous jig of joy.

Even if Dell’s previously announced acquisition of the company, for approximately $1.15 billion in cash, had gone ahead, 3PAR would have achieved a rich premium on its pre-buyout valuation. Now, though, with HP belatedly rushing back to the negotiating table — apparently HP had discussed acquiring 3PAR before Mark Hurd’s alleged indiscretions came to light — 3PAR’s backers stand to make out like highway bandits. (Actually, they’ll make out like highway bandits on a poorly policed, well-traveled thoroughfare used by affluent commuters in luxury vehicles.)

Indeed, news hit the wire this morning that HP has proposed to acquire the cloud-centric virtualized-storage vendor for $24.00 per share in cash, or an enterprise value of $1.6 billion. That amounts to approximately 33 percent more than Dell had proposed to pay, which represented a whopping 85-percent premium on 3PAR’s closing price immediately before that apparently short-lived deal was announced.

HP Waives Termination-Fee Provision

HP is proposing acquisition terms that are identical to those Dell specified save for one exception: HP dropped a provision for a termination fee. Speaking of which, now that it appears HP has waylaid Dell on the way to the altar, the latter will qualify for special dispensation of $53.5 million from 3PAR for refusing to consummate the corporate union.

Effectively, that breakup fee will transferred from HP to 3PAR to Dell. Some 3PAR shareholders might be upset at seeing their mountain of lucre slightly diminished as a result of the payout, but I’m fairly confident they’ll get over it.

What Philosophers Counsel on the Private Cloud

“The beginning of wisdom is the definition of terms,” — Socrates

“If you wish to converse with me, define your terms.” — Voltaire

As Socrates and Voltaire knew, meaningful discourse depends on a shared understanding of the topic under discussion. To have shared understanding, clearly defined and agreed terms are prerequisites.

In the sphere of cloud computing, defined terms and shared understanding have been at a premium. Protracted debates have ensued regarding the definitions of various permutations of cloud computing. Debate and discourse should eventually resolve into enlightenment, but discussion of cloud computing often produces more heat than light. It’s been that way for a long time.

Consensus Hard to Find

This year, the latest cloud-computing flashpoint involved a battle over the definition of the private cloud. As far as I can tell, the battle still rages with no end in sight. Many definitions have been advanced by a number of notable individuals and groups — and sometimes heated discussion has followed their introduction — but the disputation still hasn’t resulted in consensus and shared understanding, though some organizations, such as the National Institute of Standards and Technology (NIST), have made valiant efforts to deliver much-needed clarity.

Technical criteria aside — such characteristics and qualifiers have been discussed at length by accomplished software architects, illustrious infrastructure personages, and all manner of engineers and market analysts — what seems to be occurring is a power struggle.

Our philosopher friends quoted above observed that a solid definition of terms was the starting point for meaningful conversation and wisdom. That’s true, of course. But it’s also true, as political philosophers will tell us, that knowledge — which is based on the understanding that accrues from agreed terminology — is power.

Battle for Control

Accordingly, we can understand the battleground of cloud computing — some have called it a “circus,” but a circus aims at entertainment and amusement — if we consider its political aspects. It’s here that we can see the central conflict.

On one side, we have an established order or status quo — represented by the way IT has been supplied, delivered, and managed until now — arrayed against the forces of change, represented by cloud computing’s purest adherents and most passionate proponents. Each side wants to control the discussion, which is why the battle over terminology is so intense and why definitions are constantly revised and challenged.

For those waging the battle, the fight itself makes sense. Each side, as noted, wants to control terminology so that it can condition and facilitate a desired result. Unfortunately, disinterested observers, including enterprises and organizations trying to set their IT-related roadmaps and strategies, are confused by the tumult. They’re not getting what they need from the principals in the debate.

Cutting Through the Noise

Fortunately, there is a way for these organizations to cut through the noise, to gain the insight and understanding they require to set their course and ascertain whether, how,  and where new methodologies, service models, and technologies are applicable.

How they do it, of course, is by being as self-interested as the disputants on either side of the cloud-computing debate. What they must do is demand clear answers as to how what’s being pushed at them will add value to their organizations.

When a vendor or service provider makes a pitch, prospective customers must step back and consider the implications. Who benefits? Is it just the vendor or service provider making the pitch, either by retarding change or hastening it, or is it the customer, which must support established applications and processes while charting an assured course toward lower costs, higher productivity, and greater overall efficiency? The answer to that question is the real litmus test, for the solicitous vendor as well as the prospective customer.

It is What it Does

According mathematician-cum-philosopher Alfred North Whitehead, a thing is what it does. If a vendor is pushing a hard sell on the public or private cloud, customers should challenge the vendor to clearly state the customer-centric benefits, costs, and implications of the proposed offering. Then, after the vendor has made its case, the customer can evaluate it. In the end, each individual customer should and must make its own decision, based on its objectives, its needs, its requirements, its risk tolerance, and its culture.

If there is no common industry-wide definition — and the vendor community has been responsible for the cloud-computing muddle — then each prospective customer will have to reach his or her own conclusions about what’s really being discussed. That’s how it needs to be, anyway.

Microsoft Leads Analysts Astray

Microsoft today will host its annual meeting with market analysts. The company will bring the visitors up to speed on strategic initiatives, discuss salient market and technology trends, spotlight key products and solutions, and perhaps reset or gently massage market expectations for the year ahead.

As I read what analysts had on their minds as they prepared for the gathering in Redmond, I lost hope that Microsoft finally would muster the courage to look itself the mirror and acknowledge the earnest business-solution purveyor that stares back at it. I was tempted to say that the analysts are part of Microsoft’s problem — that they’re focused on the wrong things, that they don’t understand the essence of Microsoft, that they don’t appreciate the company’s inherent strengths and weaknesses — but, you know, that just wouldn’t have been fair, much less right.

Analysts take their cues from the companies they follow. If the market watchers monitoring Microsoft are stumbling down a blind alley, that’s because Microsoft led them there, perhaps even setting the wrong GPS coordinates on a doomed Windows Mobile application.

It follows, then, that if the guests at Microsoft today are focused on the wrong things — if they’re looking for answers and guidance on markets where Microsoft shouldn’t be playing, where it should scale back its efforts and investments, or where it needs to rethink its strategy — the fault is entirely Microsoft’s. The analysts are preoccupied with Microsoft’s consumer-facing product roadmaps, revenue projections, margins, and earnings (or lack thereof) because that is where Microsoft has focused their attention.

Rather than pointing at its potential to expand its presence and to achieve further growth in its core business markets — SMBs and large enterprises, and where and how those constituencies will consume application and computing services in future — Microsoft perversely has chosen to showcase its embarrassments and warts. It’s not a pretty sight, as the Kin fiasco demonstrates.

Meanwhile, if Microsoft would only listen, its customers — even its closest partners — are trying to set it straight. Yesterday, for example, HP confirmed that it would pursue a dual-tablet strategy, providing a Windows 7-based tablet for business customers and a webOS-based tablet for consumers. HP knows where Microsoft is strong and where it’s not so strong.

Microsoft might get the message one of these days. I’m just not expecting the epiphany to arrive today.

Cloud Pitch Puts Microsoft on Firmer Ground

Earlier this week in Washington, D.C., at its Worldwide Partner Conference (WPC), Microsoft made clear that it is serious about maintaining an industry-leadership position as businesses and enterprises make the transition from conventional data-center computing to cloud-based alternatives.

At the forefront of Microsoft’s pitch was the Windows Azure Platform Appliance (WAPA). Appliances aren’t new concepts. As hardware-based software-delivery platforms, they’ve been around for some time. But Microsoft’s conception of WAPA deviates from any conventional definition of a standard networked appliance. Although Microsoft calls it an appliance, its exact form factor has yet to be defined precisely.

Initially WAPA is likely to take the form of containerized infrastructure for data-center deployment. In time, much of its functionality might get squeezed into a rack. We just don’t know.

There’s a lot we don’t know about WAPA. The form factor, availability dates, pricing, how it will be sold to customers — all of that is to be determined by Microsoft and its partners.

Speaking of which, partners were and remain key considerations in Microsoft’s plans for cloud computing. Microsoft’s channel partners are critical to its success, and Microsoft needs top-drawer technology partners to bolster and disseminate its products and technologies in the marketplace.

Microsoft’s latest proclamations, then, should be viewed as a concerted bid to get partners under its cloud-computing tent. Channel partners, who have been concerned about the implications of cloud business models on their current revenue and margins, also have grown anxious about whether Microsoft might encroach on their turf. Accordingly Microsoft was at pains this week to demonstrate that cloud computing is good not only for Microsoft but for its partners, too. Quoting from Computer Reseller News:

In a later keynote, Stephen Elop, president of Microsoft’s Business Division, sought to dispel the idea that channel partners can’t make money reselling Microsoft services. He cited a study the company made of 40 sales contracts for Microsoft Online Services through channel partners (average deal size $24,000) and concluded that each generated $167 per seat in revenue for solution providers. That included $35 per seat for providing managed services such as desktop management, $66 per seat for business consulting and customization work, $46 per seat for migration and integration services, and $20 per seat for provider-of-record fees.

“It is no longer a question of if, but when our customers should move to the cloud,” Elop said. “Increasingly our customers are purchasing suites of online services. Customers are speaking with their wallets.”

As for technology partners — Dell, HP, Fujitsu — Microsoft needs them to have skin in the proverbial game. It needs them to derive benefits not only from providing enterprise cloud services but also from selling their own hardware and software into enterprise accounts that favor private clouds rather than public ones. (And there are a great many enterprises that aren’t ready to take a blithe hop, skip, and jump toward the public cloud.)

The super-sized appliance approach gets three big system vendors onside, each of them offering unique complementary value and market coverage. Microsoft clearly has given this some thought, and it’s tapping Dell, HP, and Fujitsu for very specific reasons. Dell has been with Azure from the inception, providing the hardware and considerable assistance for Microsoft’s first Azure data center; HP has global services coverage and direct access to well-heeled enterprise customers; Fujitsu is strong in Asia and Europe, and it brings its own technological resources to the table.

In fact, what impressed me about Microsoft’s Azure announcement earlier this week was that it was so coherent, focused, logical, and purposeful — all the attributes typically absent from Microsoft’s consumer forays. True, Azure has advanced unevenly, and Microsoft still has to provide considerably more detail before we can evaluate it thoroughly, but I see an acuity and confidence from Microsoft that is at odds from its awkward and ungainly posturing in consumer markets.

This is an area where Microsoft can compete effectively, where it can leverage its installed base, corporate resources, expertise, and institutional knowledge. It’s where Microsoft needs to put more resources, not less. When one compares the smoothness and viability of this narrative with the stuttering tales Microsoft spouts on behalf of its Windows Phone 7 and slate/tablet misadventures, one finds it hard to believe they’re coming from the same company.