"cloud computing" entries

Public vs. private cloud: Price isn’t enough

The risk relative to the savings isn’t enough to justify a shift to public cloud.


This post was originally published on Limn This. The lightly edited version that follows is republished with permission.

Last October, Simon Wardley and I stood on a rainy sidewalk at 28th St. in New York City arguing politely (he’s British) about the future of cloud adoption. He argued, rightly, that the cost advantages from scale would be overwhelming compared to home-brew private clouds. He went on to argue, less certainly in my view, that this would lead inevitably to their wholesale and deep adoption across the enterprise market.

I think Simon bases his argument on something like the rational economic man theory of the enterprise. Or, more specifically, the rational economic chief financial officer (CFO). If the costs of a service provider are destined to be lower than the costs of internally operated alternatives, and your CFO is rational (most tend to be), then the conclusion is foregone.

And, of course, costs are going down just as they are predicted to. Look at this post by Avi Deitcher: Does Amazon’s Web Services Pricing Follow Moore’s Law? I think the question posed in the title has a fairly obvious answer. No. Services aren’t just silicon; they include all manner of linear terms, like labor, so the price decreases will almost certainly be slower than Moore’s Law, but his analysis of the costs of a modestly-sized AWS solution and in-house competition is really useful.

Not only is AWS’ price dropping fast (56% in three years), but it’s significantly cheaper than building and operating a platform in house. Avi does the math for 600 instances over three years and finds that the cost for AWS would be $1.1 million (I don’t think this number considers out-year price decreases) versus $2.3 million for DIY. Your mileage might vary, but these numbers are a nice starting point for further discussion.

These results raise an interesting question: if the numbers are so compelling, why did Walmart just reveal that they are building a ginormous private cloud? Why would anyone? Read more…

Comments: 10

Big data’s move to the cloud

A new survey shows the market is ready for cloud-based big data services.

Migrating_big_data_analytics_cover_lg_2One night when our son was two years old, he abruptly decided that he didn’t like taking baths. As my wife recalls, he struggled mightily against the ritual of bathing for several months until, suddenly and mysteriously, he decided that he liked bathing again. We’re happy to report that he has managed to stay relatively clean ever since.

When I speak with CIOs and other IT leaders about moving big data operations into the cloud, I am reminded of our son’s unexplained loathing of the bathtub.

Nearly everyone associated with IT understands that most IT operations — including big data analytics — must eventually move into the cloud. The traditional on-premises approaches are simply too costly, and CIOs are under crushing pressure to shift budgetary resources to value-added, customer-facing activities.

For most companies, the writing is already on the wall. The cloud offers greater agility and elasticity, and quicker product development cycles — and can reduce costs. When you add up the benefits, it seems inevitable that the bulk of IT operations will move into the cloud. Nevertheless, the foot-dragging and excuse-making continues. Read more…

Comment: 1

OpenStack creates a structure for managing change without a benevolent dictator

Can education and peer review keep a huge open source project on track?

When does a software project grow to the point where one must explicitly think about governance? The term “governance” is stiff and gawky, but doing it well can carry a project through many a storm. Over the past couple years, the crucial OpenStack project has struggled with governance at least as much as with the technical and organizational issues of coordinating inputs from thousands of individuals and many companies.

A major milestone was the creation of the OpenStack Foundation, which I reported on in 2011. This event successfully started the participants’ engagement with the governance question, but it by no means resolved it. This past Monday, I attended some of the Open Cloud Day at O’Reilly’s Open Source convention, and talked to a lot of people working for or alongside the OpenStack Foundation about getting contributors to work together successfully in an open community. Read more…

Comment: 1

How did we end up with a centralized Internet for the NSA to mine?

The Internet is naturally decentralized, but it's distorted by business considerations.

I’m sure it was a Wired editor, and not the author Steven Levy, who assigned the title “How the NSA Almost Killed the Internet” to yesterday’s fine article about the pressures on large social networking sites. Whoever chose the title, it’s justifiably grandiose because to many people, yes, companies such as Facebook and Google constitute what they know as the Internet. (The article also discusses threats to divide the Internet infrastructure into national segments, which I’ll touch on later.)

So my question today is: How did we get such industry concentration? Why is a network famously based on distributed processing, routing, and peer connections characterized now by a few choke points that the NSA can skim at its leisure?
Read more…

Comments: 7

Financial analytics as a service

Analytic services are tailoring their solutions for specific problems and domains

In relatively short order Amazon’s internal computing services has become the world’s most successful cloud computing platform. Conceived in 2003 and launched in 2006, AWS grew quickly and is now the largest web hosting company in the world. With the recent addition of Kinesis (for stream processing), AWS continues to add services and features that make it an attractive platform for many enterprises.

A few other companies have followed a similar playbook: technology investments that benefit a firm’s core business, is leased out to other companies, some of whom may operate in the same industry. An important (but not well-known) example comes from finance. A widely used service provides users with clean, curated data sets and sophisticated algorithms with which to analyze them. It turns out that the world’s largest asset manager makes its investment and risk management systems available to over 150 pension funds, banks, and other institutions. In addition to the $4 trillion managed by BlackRock, the company’s Aladdin Investment Management system is used to manage1 $11 trillion in additional assets from external managers.

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Comment: 1

OpenStack release offers more flexibility and aids to performance

The Havana release features metering and orchestration

I talked this week to Jonathan Bryce and Mark Collier of OpenStack to look at the motivations behind the enhancements in the Havana release announced today. We focused on the main event–official support for the Ceilometer metering/monitoring project and the Heat orchestration project–but covered a few small bullet items as well.

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Survey on the Future of Open Source, and Lessons from the Past

Quality and security drive adoption, but community is rising fast

I recently talked to two managers of Black Duck, the first company formed to help organizations deal with the licensing issues involved in adopting open source software. With Tim Yeaton, President and CEO, and Peter Vescuso, Executive Vice President of Marketing and Business Development, I discussed the seventh Future of Open Source survey, from which I’ll post a few interesting insights later. But you can look at the slides for yourself, so this article will focus instead on some of the topics we talked about in our interview. While I cite some ideas from Yeaton and Vescuso, many of the observations below are purely my own.

The spur to collaboration

One theme in the slides is the formation of consortia that develop software for entire industries. One recent example everybody knows about is OpenStack, but many industries have their own impressive collaboration projects, such as GENIVI in the auto industry.

What brings competitors together to collaborate? In the case of GENIVI, it’s the impossibility of any single company meeting consumer demand through its own efforts. Car companies typically take five years to put a design out to market, but customers are used to product releases more like those of cell phones, where you can find something enticingly new every six months. In addition, the range of useful technologies—Bluetooth, etc.—is so big that a company has to become expert at everything at once. Meanwhile, according to Vescuso, the average high-end car contains more than 100 million lines of code. So the pace and complexity of progress is driving the auto industry to work together.

All too often, the main force uniting competitors is the fear of another vendor and the realization that they can never beat a dominant vendor on its own turf. Open source becomes a way of changing the rules out from under the dominant player. OpenStack, for instance, took on VMware in the virtualization space and Amazon.com in the IaaS space. Android attracted phone manufacturers and telephone companies as a reaction to the iPhone.

A valuable lesson can be learned from the history of the Open Software Foundation, which was formed in reaction to an agreement between Sun and AT&T. In the late 1980s, Sun had become the dominant vendor of Unix, which was still being maintained by AT&T. Their combination panicked vendors such as Digital Equipment Corporation and Apollo Computer (you can already get a sense of how much good OSF did them), who promised to create a single, unified standard that would give customers increased functionality and more competition.

The name Open Software Foundation was deceptive, because it was never open. Instead, it was a shared repository into which various companies dumped bad code so they could cynically claim to be interoperable while continuing to compete against each other in the usual way. It soon ceased to exist in its planned form, but did survive in a fashion by merging with X/Open to become the Open Group, an organization of some significance because it maintains the X Window System. Various flavors of BSD failed to dislodge the proprietary Unix vendors, probably because each BSD team did its work in a fairly traditional, closed fashion. It remained up to Linux, a truly open project, to unify the Unix community and ultimately replace the closed Sun/AT&T partnership.

Collaboration can be driven by many things, therefore, but it usually takes place in one of two fashions. In the first, somebody throws out into the field some open source code that everybody likes, as Rackspace and NASA did to launch OpenStack, or IBM did to launch Eclipse. Less common is the GENIVI model, in which companies realize they need to collaborate to compete and then start a project.

A bigger pie for all

The first thing on most companies’ minds when they adopt open source is to improve interoperability and defend themselves against lock-in by vendors. The Future of Open Source survey indicates that the top reasons for choosing open source is its quality (slide 13) and security (slide 15). This is excellent news because it shows that the misconceptions of open source are shattering, and the arguments by proprietary vendors that they can ensure better quality and security will increasingly be seen as hollow.
Read more…

Comments: 2

U.S. Senate to consider long overdue reforms on electronic privacy

The silver lining in the role of cloud-based email in the CIA Director's resignation is a renewed focus on digital privacy.

In 2010, electronic privacy needed digital due process. In 2012, it’s worth defending your vanishing rights online.

This week, there’s an important issue before Washington that affects everyone who sends email, stores files in Dropbox or sends private messages on social media. In January, O’Reilly Media went dark in opposition to anti-piracy bills. Personally, I believe our right to digital due process for government to access private electronic are just as important.

Why? Here’s the context for my interest. The silver lining in the way former CIA Director David Petraeus’ affair was discovered may be its effect on the national debate around email and electronic privacy, and our rights in a surveillance state. The courts and Congress have failed to fully address the constitutionality of warrantless wiretapping of cellphones and the location of “persons of interest.” Phones themselves, however, are a red herring. What’s at stake is the Fourth Amendment in the 21st century, with respect to the personal user data that telecommunications and technology firms hold that government is requesting without digital due process.

On Thursday, the Senate Judiciary Committee will consider an update to the Electronic Communications Privacy Act (ECPA), the landmark 1986 legislation that governs the protections citizens have when they communicate using the Internet or cellphones. (It’s the small item on the bottom of this meeting page.)

UPDATE: Senator Leahy’s manager’s amendment to ECPA passed but Politico’s Tony Romm reports that the full Congress is unlikely to pass ECPA reform in this session.

Read more…

Comments: 4

OpenStack Foundation boosts vendor participation

Firming up the organization is good for everyone

Organizational stabilization has been more of an urgent task for OpenStack than most community, open-source projects because it has grown to fast and so much is at stake in the computer industry. I reported on the creation of OpenStack a little more than two years ago and on the announcement that a foundation would be set up a little less than one year ago. This past Wednesday, the OpenStack Foundation came officially into existence.

Up until the creation of the foundation, the myriad technical and organizational components of OpenStack were coordinated by Rackspace, one of the contributors of the original software (the other contributor was NASA). I imagine that Rackspace’s management was as eager as anyone to hand over official control to a neutral body, because they had to take a lot of the heat for decisions and directions that sometimes verged on the chaotic. Read more…


Recombinant Research: Breaking open rewards and incentives

Can open data dominate biological science as open source has in software?

To move from a hothouse environment of experimentation to the mainstream of one of the world's most lucrative and tradition-bound industries, Sage Bionetworks must aim for its nucleus: rewards and incentives. Comparisons to open source software and a summary of tasks for Sage Congress.