SKYY ETF 4+ Years On

Well, it seems that First Trust's Cloud ETF has done fairly well over the past 4+ years, opening at about $20 USD and closing last Friday at $27.06. That's about a 35% increase in value despite an initial drop down to $15 and a rocky road ever since.

The list of companies held in the ETF has grown over time, but it's interesting to note that the top 10 holdings represent an interesting cross section of the industry that covers IaaS, PaaS and SaaS companies and service providers as well as hardware manufacturers. Interestingly, Alphabet (the GOOG parent holding company) sits at number 3 and Red Hat (the only software company that markets a cloud platform, OpenStack) rounds out the top 5.

Total Number of Holdings: 36

Security Name	Identifier	Classification	Weighting
Equinix, Inc.	EQIX	Real Estate Investment Trusts (REITs)	4.36%
SAP SE (ADR)	SAP	Software	4.20%
Alphabet Inc. (Class A)	GOOGL	Internet Software & Services	3.97%
Zynga Inc.	ZNGA	Software	3.97%
Red Hat, Inc.	RHT	Software	3.96%
F5 Networks, Inc.	FFIV	Communications Equipment	3.93%
Facebook, Inc. (Class A)	FB	Internet Software & Services	3.92%
EMC Corporation	EMC	Technology Hardware, Storage & Peripherals	3.87%
NetSuite Inc.	N	Software	3.87%
salesforce.com, inc.	CRM	Software	3.87%
Cisco Systems, Inc.	CSCO	Communications Equipment	3.84%
Open Text Corporation	OTEX	Software	3.83%
Oracle Corporation	ORCL	Software	3.80%
Amazon.com, Inc.	AMZN	Internet & Catalog Retail	3.77%
Juniper Networks, Inc.	JNPR	Communications Equipment	3.72%
Akamai Technologies, Inc.	AKAM	Internet Software & Services	3.68%
Netflix, Inc.	NFLX	Internet & Catalog Retail	3.66%
VMware, Inc.	VMW	Software	3.61%
Teradata Corporation	TDC	IT Services	3.48%
NetApp, Inc.	NTAP	Technology Hardware, Storage & Peripherals	3.25%
Rackspace Hosting, Inc.	RAX	Internet Software & Services	3.24%
International Business Machines Corporation	IBM	IT Services	2.57%
Microsoft Corporation	MSFT	Software	2.56%
Hewlett Packard Enterprise Company	HPE	Technology Hardware, Storage & Peripherals	2.39%
Apple Inc.	AAPL	Technology Hardware, Storage & Peripherals	2.29%
Brightcove Inc.	BCOV	Internet Software & Services	1.30%
CA, Inc.	CA	Software	0.94%
Adobe Systems Incorporated	ADBE	Software	0.92%
Intuit Inc.	INTU	Software	0.92%
j2 Global, Inc.	JCOM	Internet Software & Services	0.92%
Wipro Ltd. (ADR)	WIT	IT Services	0.90%
Activision Blizzard, Inc.	ATVI	Software	0.89%
Check Point Software Technologies Ltd.	CHKP	Software	0.86%
Polycom, Inc.	PLCM	Communications Equipment	0.81%
NetScout Systems, Inc.	NTCT	Communications Equipment	0.80%
EVS Broadcast Equipment S.A.	EVS.BB	Communications Equipment	0.38%

As an ETF, we do expect that the equity mix is more than likely based on growth opportunity of the stock, company and product line/sales than on fidelity to the cloud paradigm. The usual suspects in cloud are found in the rest of the list

But, (I can't resist!) it's interesting to see that there are a couple of companies represented in the list that appear to offer "services in the cloud" rather than actual IaaS, PaaS or SaaS services. While it is possible that their offerings are actually SaaS, but they do seem to rely on marketing to brand their services/products as "cloud".

Updated Cloud Stats Page

The Cloud Stats page has been updated with new graphs and revised analysis of the graphs as of January 15, 2016.

While this is not authoritative, it's interesting to watch the evolution of search for cloud-related terms. It's clear that we've entered a new era of introspection by Information Technology teams: are we a Mode 1 shop, or Mode 2? Is there room for our Mode 2 in a Mode 1 environment? Can we run pet-like workloads in a cattle environment?

To me, this means that we are on the cusp of a revolution in IT. Decisions are being made that will affect the future of service delivery, internal or external, and that will define once and for all whether IT is a cost center, a profit center, or a center for innovation.

OpenStack videos

UPDATE: There are new videos from the Tokyo OpenStack Summit (2015) on the OpenStack Information Page. --PX--

In case you missed it, I put up a new page to document some seminal OpenStack videos for your convenience.

I will try to curate these videos going forward so that they represent a cross section depicting the current state of OpenStack as well as introductory content for neophyte OpenStack Admins and Operators.

Please feel free to reach out to me if you feel I have omitted anything. This is the first version and it will most definitely evolve from here.

OpenStack: the Open Source IT Transformation Tool

I've noticed one thing that has stood out about OpenStack and that's that everyone thinks of it as open source software. Well, it is at its core, but I'd like to think of it as more than just that. Over the past 2 years, I've worked with customers who were launching new revenue streams, reinventing their business model and implementing DevOps methodologies and philosophies. So, you ask me how I think of OpenStack? I think of it as an open source IT transformation tool.

OpenStack is definitely an open source software project complete with the challenges of open source development: it's organized into projects (e.g., Nova the compute project, Neutron the networking project) which have developers that are focused on developing for that project. Releases occur every six months which means that the feature set is ever changing and improving. This means that companies that publish distributions need to keep up with them and support published versions for a period of time.

The growth of OpenStack has been interesting to watch. The number of commits have increased 10000% between 2010 and 2015. While they seem to be plateau-ing, OpenStack is seeing more and more adoption, particularly in private clouds where about half of these clouds are OpenStack based. That's not to say there aren't other high level use-cases like distributed storage for CDN-like activities, multi-site clouds or public clouds (though, admittedly, the economics of building a public cloud can be prohibitive). The OpenStack Architecture Design Guide provides additional information on these use-cases.

Given all of the above, it's easy to see why OpenStack is viewed simply as open source software. But, what they neglect to consider is what it means to deploy OpenStack within the organization:

• Bimodal IT: Gartner and other IT analyst firms have been promoting a framework that differentiates between legacy IT and the new IT ("Mode 1" and "Mode 2" in Gartner's lexicon, respectively; the difference being that Mode 1 was primarily concerned with the stability and longevity of systems whereas Mode 2 is more concerned with agility and rapid iteration). OpenStack is a Mode 2 enabling tool: it helps organizations shift their IT operations to a more dynamic model and facilitates the adoption of DevOps and PaaS.
• Transformation: Adopting Cloud is not an easy undertaking. It takes much planning to deploy it, certainly from a project perspective, but also from a governance and management perspective. The ability to manage and administer the environment is not innate in IT ops teams that tend towards Mode 1 operations; rather they require a significant will and desire to change and adapt to Mode 2 operations. OpenStack catalyzes this transformation, making it easier to adopt DevOps philosophies and PaaS deployment projects.

Essentially, OpenStack is an Open Source IT transformation tool.

What is Going on at HP?

HP is adjusting its cloud strategy:

1. The PTL for TripleO (OpenStack on OpenStack), the OpenStack installer, stepped down (the new PTL is from Red Hat);
2. The hardware dedicated to TripleO testing and development has been repurposed;
3. New releases of Helion with Eucalyptus.

Clearly HP is betting that Red Hat can do a better job of developing TripleO so that they can refocus their resources on other projects and initiatives. Given the news of new integration features with Eucalyptus, it's obvious we can look for a stronger hybrid cloud play against VMware and Microsoft.

Of course this begs the question of what the longer term strategy will be and whether HP will stay the course with open source or fork parts of it to maintain proprietary control over the integration points with other HP software products.

Time will tell.

The Cloud Value Chain

Consumers of cloud computing have clamored for a more unified approach to the services they use, be it IaaS, SaaS, PaaS or some other cloud based service. The knee jerk response is to federate services. While the approach is sound, allows seamless access across services and would in theory provide some modicum of security, this does not necessarily mean that they are provided by the same cloud services provider (CSP) leaving the consumer to manage relationships and SLAs with multiple CSPs. One possible solution is for CSPs to be a one-stop-shop that allows customers to create value by building up the stack, so to speak.

Pause------------------------------------------

Before we get any further, let's keep in mind the classic pyramid diagram of cloud computing:

OK, it's a cheesy graphic, but we all understand that software (SaaS) is built on programming platforms (PaaS) which are run on infrastructure (IaaS). Clearly the graphic is not drawn to proportions because the SaaS market has outstripped the IaaS market. An inverted pyramid wouldn't cut it either because PaaS is a smaller market than IaaS. (Maybe an hourglass shape... But I digress.) A variant would be a more Application Service Provider (ASP) model where software is installed on an IaaS-based instance and offered for the use of customers. This latter variation is not strictly speaking SaaS but is a reasonable hand drawn facsimile.

Unpause----------------------------------------

Let's say one such CSP has launched a cloud computing service that offers these services to customers (say IaaS, PaaS, and SaaS to keep it simple and avoid getting into any sticky discussions about cloudwashing).

So now we have a stack based on software created by software vendors or by the open source community on which value can be created. CSPs add value by tying the three service models together and offering them transparently to customers; CSP customers add value by using the tools to write apps and programs that their customers in turn use. Hence a cloud value chain. This, of course, does not take into account value added by cloud brokers or aggregators.

The interesting bit is what happens when the app is written and then launched. The current typical development cycle sees a dev team working to create an app and then making the architecture fit the app. This is backwards and I have lived it firsthand through cloud RFPs. This is because there is a gap in the knowledge and understanding of cloud computing among developers and their management. Schools generally don't teach students to write programs with cloud computing in mind. They teach them to write stand alone apps and programs that can be run on individual servers or, more often than not, in VMware-based virtual machines--AKA, the application service provider model.

The ASP model is inefficient because it relies on individual servers (whether virtual--no this is not cloud computing--or physical) to deliver the service and defeats the purpose of cloud computing: the flexibility to acquire only those resources necessary to meet demand.

In a perfect world, customers would acquire a SaaS seat via some self-service portal; the app or program would automatically create an instance or partition for that customer; and the app or program would be written on a PaaS to make it somewhat self-aware: that is, capable of making use of APIs to scale IaaS according to demand without mucking about with middleware. This raises the ugly spectre of vendor lock-in, but then, if you like the service, it meets your needs, and is flexible as you need it to be, why would you move?

OpenStack simplified: OpenStack Training by Sean Roberts and Colin McNamara)

Want to start out with OpenStack? Check out the FREE training guides on the OpenStack foundation site. The guides offer various levels of training ranging from beginner to architect, each guide building on the previous material.

Training available for consumption via:

• Self paced book
• Instructor led training
• Community Instructor led training

One of the most common complaints I hear from potential users, operators and customers is that OpenStack is complicated. Sean and Colin echoed this when they said that there are thousands of features released every 6 months (the development cycle of OpenStack). This training platform will go a long way to helping to demystify OpenStack based cloud computing environments and how to implement and operate them.

Still queasy at the thought of launching an internal project yourself? Find yourself an integrator. At least you'll be able to participate and truly partner with your integrator of choice.

Hooray! Everyone's a Winner!

IDC Canada published its "IDC MarketScape: Canadian Dedicated Private infrastructure as a Service 2014 Vendor Assessment" earlier this year. The figure is the MarketScape from that report. Does anyone else see anything wrong with this picture?

Before I go any further:

1. I have not had the opportunity read the IDC Marketscape report in its entirety and, as of this writing, have been limited to vendor articles and press releases. If anyone would like to send me a copy of the $15,000 document, I'd be more than happy to read it through and reconsider what you're about to read.
2. In fairness, IDC's MarketScape has a methodology which states that the "...criteria selection, weightings, and vendor scores represent well-researched IDC judgement about the market and specific vendors."

Unfortunately, I think that IDC Canada missed the mark in their analysis because not everyone can be a leader. This is like saying that every athlete that participates in the Olympics finishes in first place. The simple fact that all the vendors included in the report are grouped in the top right hand corner of the MarketScape figure suggests that the criteria used probably don't differentiate between the vendors sufficiently.

I would assume that subsequent versions of this report will differentiate between the vendors and provide more valuable information for readers by providing more comparative and contrasting analysis of the various offerings.

Keystone Security and Architecture Review: Keith Newstadt

Pertinent notes from the Keystone Security and Architecture Review at the OpenStack Summit in Atlanta, 2014.

Keystone is the gatekeeper for OpenStack and allows authentication to all OpenStack services. 

Keystone:

• Is the single point of authentication for all OpenStack services
• Offers SSO to OpenStack services
• Is the common API layer on top of various authentication protocols
• Reduces exposure of credentials

Basically:

• User authenticates by sending credentials --> Keystone
• Keystone sends a token once authenticated --> User
• Keystone shares token --> OpenStack service
• Service validates identity of user via token

Users identity credentials are sent to the LDAP server that then confirms the user ID and associated roles. Services can also authenticate with Keystone and act on a user's behalf. This presents different problems that can be mitigated by securing cached credentials, limiting the scope of this delegation, expiring tokens and direct management of Keystone and OpenStack.

Of course, as with any software, Keystone has an attack surface that opens it up to spoofing, tampering, repudiation, information disclosure, denial of service and elevation of privileges. Newstadt suggests "Supply chain management":

Download --> build --> deploy --> patch

The key is the last step to ensure that the software deployed is free of vulnerabilities.

There has also been considerable interest in using industry standards including SAML, OpenID and OAUTH because they provide SSO, improved integration, control over user credentials and a unified user experience.

Newstadt's parting thoughts:

Protect credentials everywhere. Think about how they can be attacked.Securing Keystone is an ongoing process.Share findings and ideas. This is how we'll improve Keystone and security in OpenStack.

OpenStack Session: Security for Private Clouds (Bryan Payne)

Private clouds need security too, not just public clouds. Attack vectors are no longer limited to edge devices. "Found" USB keys loaded with malware can open up the cloud environment to attack from within an organization not to mention poorly designed security controls and policies. The bottom line is that no one wants a bot net running in their data center!

The way around this is to apply security principles to the environment. Logically separate specific use environments; make use of VPNs

Also, understanding the environment is key. Basically:

Orchestration + Known hardware = Secure infrastructure

[Applying security best practices at the outset and consistently throughout the life cycle of the environment with known hardware can help service providers (IT or actual CSPs) to protect the environment.]

Payne identified some of the biggest threats to clouds:
API endpoints
Web dashboard
Information leakage*
VM breakout*
Hardware sharing
Default images
Secondary attacks

*Easily the biggest threats according to Payne.

Information leakage can be mitigated by using TLS to protect communications between API endpoints, the web dashboard, Log feeds, AD/LDAP and external storage. VM breakouts can be basically prevented by using mandatory access controls, removing unnecessary privileges from the physical node and by hardening the build, the compiler and physical nodes.

Other attacks of concern include control plane compromise (mitigated by layered security via bi-directional firewalling, limiting data propagation, unique passwords everywhere) and upstream vulnerabilities (mitigated by security audits, aggressive security update policies).

Ultimately, cloud needs to be secure at least as everything else in the enterprise and deserves our attention. That said, I don't think we should despair because of complexity; rather, we've been through this before as web browsing, e-commerce and virtualization came into their own over the past 20 years.

Change hurts. But, it shouldn't be painful.

One of the major issues faced by organizations with respect to the adoption of cloud computing is how to change in order to be able to take advantage of all the benefits. This challenge is not insurmountable. In fact, we've overcome such challenges at least twice before, and even more often than that if you're an IT or telecom lifer.

If you're reading this, it's probably because you've purchased something online in the past few years. It wasn't always this easy to buy from Amazon or eBay and there was a time that online transactions were viewed with suspicion. Of course, that has been replaced with a wildly positive approach to e-commerce; some analysts are calling a record volume of transactions for this coming Black Friday.

What we're talking about here is the introduction of game changing business models and technologies: distributed computing; e-commerce; virtualization; security; outsourcing. Each of these has caused major upheaval among the brightest stars in business and on the Internet and organizations that have adopted these models and technologies all undergone a period of adjustment. And yet they all came through on top.

Cloud computing is no different. It's one of those things that scare companies because of the unknowns. Security almost always tops the list of concerns and barriers to adoption in surveys. Of course, security and governance is personal to an organization--there is no one-size-fits-all--which seems to intimidate potential adopters. Early adopters are learning that security is manageable and is improving steadily (rapidly) much as security improved in the early days of the web and e-commerce.

And, regardless of what the top dog in IT is called--CIO, CTO, VP, CEO--management is facing these same challenges today when it comes to adapting the organization to a new way of consuming IT resources. Eventually, if not already, this will become a competitive advantage; the flexibility and agility afforded by cloud computing will make leaner and meaner competitors. As with all competitive advantages, though, organizations that make the move earlier will reap the greatest benefits.

Is Rogers taking aim at Bell and Telus?

Seems that Rogers is taking a page from Bell and Telus' playbook... While Bell and Telus were busy trying to out position each other in the data centre market, Rogers picked up 3 data centre service providers: BlackIron earlier this year, and now Pivot and Granite.

What's interesting here is that Rogers instantly gains a significant foot hold in the enterprise data centre and hosting market but also gains cloud computing capabilities via the Granite acquisition. One wonders if Rogers is moving into the enterprise managed services market and making a play for the lucrative long term hosting and services contracts that Bell and Telus have enjoyed for so long.

Recall that both Bell and Telus launched their cloud infrastructure products last year, which were really underwhelming as product offerings, and, as far as anyone can tell, haven't really gained much traction in the market. Probably because their respective IaaS offerings were marketed to increase demand for that oh-so-precious-commodity-with steadily-eroding-profit-margins: bandwidth. How's that working out now?

The questions now, are:

• Will Rogers use the same tactic and try to use the DC and IaaS offerings to drive bandwidth sales?
• Will Rogers use it to promote and grow a user community that will serve the ever-growing-with-steady-margins mobile market?
• Will Rogers use this foothold to drive managed services sales?

Time will tell. But the Telecom market is heating up!

Don't cut, innovate!

The Royal Bank of Canada (RBC) has been in the news lately because of a planned layoff of a number of its IT staff. The kicker is that, before they leave, they have to train their replacements and their replacements are supposedly "temporary foreign workers" who will eventually leave Canada and go back to their country of origin (I'm not being coy; I want to keep this post a bit more general than what's been reported in the media). This, of course, has caused an uproar.

I teach a course on E-Business/Managing e-Commerce at McGill University and one of the topics we discuss in class is outsourcing and its relative advantages/disadvantages, costs/savings, etc. I've worked for an outsourcer before. I also advocate it under the right circumstances. Maybe there is a part of your operations that is not core to your business. An example of this might be server management, or some other aspect of your business for which you have no expertise such as security, or a new regulatory requirement that can be addressed by a highly specialized firm.

So, why am I on this soapbox? Because this is going to eventually become an issue for organisations who are taking or will take advantage of cloud computing and their service providers. At some point, a CIO, CFO, or VP of Finance will realise that there are cost savings associated with cloud computing and decide, "Well, we don't need an IT department of [insert number of IT staff here] people anymore, let's cut [insert number of employees to lay off here]."

This is, without a doubt, a knee jerk reaction (albeit a difficult one according to those doing the cutting) and absolutely the wrong decision. Yes, some organisations justify the cuts based on the bottom line and revenue promises to futures markets, and sometimes this is justified, but it should not be the first choice by any stretch of the imagination.

Those employees, who know your core business, have been trained by you, and are more than likely competent individuals, should be retasked. That's right, not only should you find them comparable work, but give them a goal to help create value for your customers and your organisation; these individuals no doubt have some idea(s) how to improve some aspect of your business.

[Aside: Incidentally, RBC has backpedaled and announced publicly that they would offer comparable work to the individuals affected by this latest round of outsourcing.]

The US and Canada are suffering from a drain on jobs that are leaving for cheaper climes. How do we continue to maintain living standards when decent paying jobs are being cut? The answer is to promote innovation.

The 'O' word is greatly feared by employees. It is humiliating, upsetting, and demoralizing to be 'let go', or to be told that 'the business has decided to go in a different direction' and that 'your services are no longer required'. Before getting to that point, ask them: what can you do to help the organisation; do you have any ideas that can improve our business; are our processes as efficient as they can be; can you take on an innovative new project? I think you'd be surprised by the answer.

Don't cut, innovate!

Megaupload and Equinix Make History in Canada (?)

Megaupload and Equinix are in the news today. Apparently the Attorney General of Canada applied to the Ontario Superior Court for an order requiring them to turn over "cloud servers" on behalf was US Government (as reported by Chris Bennett of Davis LLP on Mondaq.com).

What's not clear to me yet is what is actually meant by "cloud servers" and how this could impact cloud computing in particular. We all know how the term "cloud" has been used repeatedly in cases where the service is not actually cloud computing (see my previous posts on the topic of cloudwashing and other posts on nomenclature). Are the servers actually IaaS and fit the NIST definition of cloud computing or are they simply hosted web servers and databases?

It appears that the judicial system could use some clarification as to what cloud computing actually is and the difference between cloud computing and cloud based services.

More to come as this story develops.

Can we talk about SaaS for just a sec?

Don't know about you, but I've been inundated by emails, banner ads, sponsored links, LinkedIn group updates, tweets, and Facebook ads all announcing that some product is now available in a SaaS format. Yes, even by word-of-mouth. It occurred to me that many of these companies may not even know what the as-a-service moniker even means.

I recently sat in on a cloud-101 type presentation by Dan Koffler and, in his presentation, he discussed the interrelationship between IaaS, PaaS, and SaaS. To sum it up, IaaS supports both PaaS and SaaS implementations, and PaaS supports SaaS implementations. This brings up an interesting point: does SaaS conform to the NIST standard definition of cloud computing? Here's an excerpt of the NIST definition:

Software as a Service (SaaS). The capability provided to the consumer is to use the provider’s applications running on a cloud infrastructure 2.

 The footnote at the end of that sentence reads:

2 A cloud infrastructure is the collection of hardware and software that enables the five essential characteristics of cloud computing.

And, as we all know, one of the essential characteristics is "Rapid elasticity". The fact that the upper service model(s) are served by the lower one(s) indicates that any true SaaS implementation would necessarily be elastic. This is the true test of whether a product is SaaS or an ASP (application service provider) implementation where the software is simply hosted on a server.

So, the next time a vendor pitches you on a SaaS product, ask them this question: "Does the product's resources (i.e., compute power, RAM, storage) scale automatically as my organization reaches predetermined usage thresholds (e.g., % utilization of resources or number of users)? Or do I have to call you to increase these resources?" If the answer is "Yes," and "No," in that order, it's a true SaaS implementation. If the answer is "No," and "Yes," it's ASP and you should definitely ask what the SLA is on the vendor completing the request.

Whatever the answer, I assure you that the answer to this question will be telling. Whether the sales rep knows the answer or not will interesting in and of itself.

How to Win in Cloud Computing

And the winner is... 

OK, we're not there yet. But, it's becoming obvious that the cloud computing market is heating up: there's been some downward pressure on IaaS pricing because of the number of competitors and, more importantly, because of the competition between Amazon and Google. Of course, this is to be expected because Google is trying to steal market share and AWS is trying to protect its share. Can we expect the same in the SaaS market? Probably, given that there has been a proliferation of SaaS companies (cloudwashing aside, see my previous post) in the last couple of years,. But then, there doesn't seem to be an enormous amount of overlap in the types services offered (yet?) because of the variety of solutions that are available for conversion to SaaS so we may not see the same price pressure as in the IaaS market.

That said, I don't think that the winner will be decided by its implementation of IaaS: the winner will be decided by PaaS. The reason for this is that every successful business model has had a strong developer community. Consider that the same thing happened with browsers and operating systems, and is currently happening with smartphones: smartphone leaders have stronger developer communities while weaker/less popular smartphones have fewer; such is the difference between iPhone and Blackberry. Granted, the gap between iOS devices and BB devices has other reasons as well, the point is that if BB had a stronger developer community than the iPhone, it would have won out earlier and not have to jump through hoops like it's doing right now.

Mobile providers should really take the hint here. Telcos are fighting for mobile market share but haven't really clued in that what attracts customers is not the phones themselves because every carrier has roughly the same phones for sale. What's really attracting them is the cool factor of what they can do with those phones. If the carriers really wanted to attract customers, they'd open up development platforms/PaaS environments for developers to create apps for free and then, when the app goes live, charge the developers to host their apps or collect ad revenue in exchange for free hosting. Like AT&T has done. Instead, most telcos and mobile carriers, are ignoring the PaaS possibility and looking to commoditized services with slowly eroding margins, like cabled connectivity, or to be me-toos in an almost saturated IaaS market to help grow their business.

There is no doubt that AWS is leading the way with $3.8B revenues projected for 2013. This definitely defines a leader in the market and AWS is certainly running away with the IaaS market. But Amazon did not stop at IaaS. It created a constellation of products built around EC2 to facilitate developer adoption. And that is why AWS is way ahead in the market.

It remains to be seen whether competitors in the PaaS market can steal away market share from AWS:

• Will Microsoft's Azure software development kit for Windows Phone attract developers to Azure?
• Will ActiveState's deal with HP will help it gain traction?
• Will SalesForce's Force.com ever face any real competition?
• Will mobile providers ever wake up and smell the coffee?
• Or will the PaaS winner be the platform that integrates with AWS?

There are many more questions that we can list here, and certainly more than there are answers. Give it a year or two. Then we'll start to see some clear(er) patterns in the PaaS market.

TDWI Cloud BI Solution Summit Roundup

Last week, I attended the TDWI Cloud BI Solution Summit as a speaker. I was fortunate enough to sit through some of the other presentations and I learned something interesting about the market place for Big Data and Cloud: not everyone is ready for it. This may sound like a given; American organisations are way ahead of Canadian organisations, but I found that there are still some fairly big fish out there that are still grappling with these concepts in the US.

Initially, I figured that the audience, composed mainly of senior IT people, middle managers, and executives, was up to speed with cloud computing and that its use was a forgone conclusion. This was clearly not the case.

There were questions from attendees such as:

"What is cloud BI?"
"Where is the data?"

And, a response to informal polls showed that:

• The majority of organisations represented did not have a "cloud BI solution".
• Few were considering moving their BI to the cloud.
• Licensing is still a concern.
• Performance is a concern.
• Data lifecycle management in the cloud is a concern.

So, it would seem that, while Cloud Computing (well, at least IaaS and SaaS; PaaS is coming into its own) has entered the vernacular of IT departments and some executive level suites, Big Data is still not there. Gartner has Big Data *just* entering the phase they call the "Peak of Inflated Expectations" which means that we are now looking to Big Data as a means of increasing our competitiveness without necessarily having the skills and knowledge of how to do so.

This leaves us in an interesting situation: if we can't do it ourselves, we have to subcontract to those who can. What are the costs? How is this agreement governed? If there are no stellar insights, whose fault is it? Is it even someone's fault? The fact that these questions exist is interesting because we're at the same stage we were at when the web came to prominence, when e-commerce was new, when the concept of outsourcing caught on, and more recently, as Cloud Computing became a new IT service delivery model.

The evolution of Big Data and its adoption will be interesting to follow. But one thing is for sure: look for Big Data to leverage public, low cost, commodity compute resources, and for more and more public cloud service providers to offer such services. After all, AWS has already launched such a service...

NYSE Euronext's Capital Markets Community Platform: Public or Community Cloud?

Last year, NYSE Euronext (NYSE) launched their Capital Markets Community Platform (Community Platform, as abbreviated by NYSE) for financial institutions doing business with and on the exchange. This week, VMware announced on its blog that the platform was rolled out in a data centre located near London to service customers in Europe. VMware has dubbed this a public cloud, but it seems that the characteristics of this deployment more closely resemble those of a community cloud.

Let's ignore, for the moment, that the service's name also includes the word "platform" and focus on VMware's assertion that the Capital Markets Community Platform is a public cloud.

A review of the features of the offering on NYSE's website indicates that its characteristics are more closely aligned to a community cloud as they address specific requirements of a subset of cloud computing customers, let's call them a "community", and are not suitable for consumption by the general public.

Recall that, according to the NIST, a public cloud is "...provisioned for open use by the general public. It may be owned, managed, and operated by a business, academic, or government organization, or some combination of them. It exists on the premises of the cloud provider," whereas a community cloud is "provisioned for exclusive use by a specific community of consumers from organizations that have shared concerns... It may be owned, managed, and operated by one or more of the organizations in the community, a third party, or some combination of them, and it may exist on or off premises."

Clearly, both definitions apply. However, because a public cloud is for use by the public at large and a community cloud is specifically designed for use by users with similar needs, such as security or some other concern, the Capital Markets Community Platform is definitely a community cloud, and not a public cloud. The product information page also goes so far as to specify target customers (Agency Broker, Investment bank, Low-latency Hedge Fund, All sizes of Financial Services Firms), their specific needs, and how the Community Platform addresses them.

NYSE Euronext is right to bet on a community cloud because its importance will only grow in the coming years. Government and the healthcare verticals represent other important sectors that can benefit from a community cloud as they have multiple users with specific legal and regulatory requirements that must be met.

More generally, community clouds are not only for verticals with rigid requirements. Rather, the private sector can benefit from integrating vertical operations into a community cloud environment as this would open up many opportunities for investment and innovation. For example, the retail sector's value chain is interesting. It includes manufacturers, logistics companies, distributors, and retail outlets, all of which could cooperate to improve just-in-time stocking or manage returns more efficiently, just to pick a couple of possible opportunities.

Live Blog -- Cloud Launch: Val Bercovici

Netapp's Val Bercovici, AKA Big Data Czar, says that, in the cloud hierarchy, data is foundational and most valuable and that we can reach it and share more easily than ever before. It is because of this that we are able to use it in ever more creative ways such as Big Data (yes, big B, big D) to create value for our organisations.

He also said that the amount of data stored tends to exceed the capability of the network to carry it and why analytics and Big Data are done locally to the data rather than remotely. Cisco and telecom companies will be happy to note that uploading and downloading data is not simple and subject to the contraints of the network forcing any organisation or person who wants to move these quantities of data to buy more bandwidth.

Ultimately, the infrastructure planning and architecture should depend on where data will be stored, your governance, minimizing data movement, and maximizing data use.

Live Blog -- Cloud Launch: Jeff Seifert

Cisco's John Seifert discussed their cloud strategy and the rationale behind building a pool of compute and storage resources that is embodied in the UCS and how workloads and storage can be moved dynamically from data centre to data centre using the fabric.

Seifert pointed out that Cisco has been developing flexible IT for some time now and has reduced the time to deliver from 6-8 weeks to 2-3 weeks to around 15 minutes.

The cloud is not just one thing, according to Seifert, because of regulatory environments, the needs for security, connectivity, cost structure etc. And all of this over a public-->private continuum. So true.