Tuesday at the IBM Smarter Commerce Global Summit in Nashville, Tenn., IBM plans to launch the Watson Engagement Advisor, aimed at helping consumer brands better recommend products to customers and provide better customer service at scale. Yes, that’s right. This is a technology that can recommend treatments for cancer will be used to help sell people more products.

Why we need Watson-level AI for customer service today.

Still, customer service is a legitimate and complicated problem, especially in an era where social media meets our desire for a personalized and instant response to any inquiry or service issue. Firms have to engage with customers via phone calls, tweets, Yelp, Facebook posts and for all I know, angry letters. And many of those customers using new media don’t want to wait for a response. Companies that can offer good service quickly in a variety of mediums have an advantage. And Watson would allow them to do this at scale. Imagine offering Ritz Carlton service at Holiday Inn prices.

Brands who buy the Engagement Advisor software will get access to a much smarter virtual agent that can sift through massive amounts of information to respond to users’ questions quickly. As someone who was totally schooled at Jeopardy by Watson, I cannot emphasize enough how fast it is.

The IBM release notes that the Engagement Advisor software is designed to help existing customer service personnel answer questions quickly or it can be deployed via the brand’s mobile site where customers can interact with Watson directly. As IBM’s release says, “In one simple click, the solution’s “Ask Watson” feature will quickly address customers’ questions, offer advice to guide their purchase decisions, and troubleshoot their problems.”

It’s possible this will remind users of Siri, Apple’s chatty personal assistant on the iPhone and iPad. However, instead of being deployed on a device, Watson is embedded on a brand web site.

It can greet customers by name, however and offer to help them via a chat window on the company site or via a mobile push alert, that will appeal to people who want to tweet or text their customer care questions without having to stay focused on a single web page. In the ideal case Watson will have access to customer records plus the data stores it was trained on, and will be able to use both in giving a customer a recommendation or help.

The business of Watson is a big one

Instead of naming customers directly IBM writes that brands including ANZ, Celcom, IHS, Nielsen and Royal Bank of Canada are, “exploring how the Watson Engagement Advisor can help them engage with their customers.” This may be phrased this way because the initial pilot projects involving Watson require a lot of training of the computer before it becomes valuable. During Watson’s “apprenticeship period,” IBM in some cases hasn’t charged clients, or charges them lower rates.

But it’s no secret that Watson is a big business bet for IBM. At last year’s Structure conference, Dan Cerutti, IBM’s VP of Watson Commercialization, explained IBM’s ambitions for Watson, including delivering the machine as a service over more and more devices. IBM sees Watson as a new type of computing and plans to build out new business models to support it, as Cerutti detailed in our chat almost a year ago.

Along the way Watson not only impresses with its ability to filter through reams of data to correctly answer a natural language question, it also has been able to do this as it shrinks in size. Since its television debut, Watson has seen a 240 percent improvement in system performance, and a reduction in physical requirements by 75 percent. The whole system can now be run on a server that takes up the size of four pizza boxes from a giant machine that took up an entire bedroom. Smart, svelte and delivered as a service. Get ready to meet Watson in more roles and in some surprising places.

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“Every story I read about Google is us versus some other company or some stupid thing. Being negative is not how we make progress. The most important things are not zero sum.” Page said Google struggles “with people like Microsoft,” he said. As for Oracle, which is suing Google over Android’s use of Java, Google has “a difficult relationship with Oracle, including having to appear in court … Money is obviously more important to them than any collaboration.”

In comments emailed to CIO.com, Microsoft responded:

“It’s ironic that Larry is lending his voice to the discussion of interoperability considering his company’s decision — today — to file a cease and desist order to remove the YouTube app from Windows Phone, let alone the recent decision to make it more difficult for our customers to connect their Gmail accounts to their Windows experience.”

Page’s words came a few days after Microsoft announced interoperability between its Outlook.com email service and Gmail and just after word came out that Google demanded that Microsoft rip its home-built YouTube app from the Windows store (and remove the app off the Windows Phones that were already running it.) So, who’s the winner in this melee? Neither vendor comes out looking good. For Microsoft to complain about Google’s business practices is laughable given its own track record. But for Google to claim it’s not evil while restricting consumer choice is also awful. Consumers might just say a pox on both their houses.

IBM spreads Watson around …

Watson, the natural-language-understanding software that played (and won) at Jeopardy, will be made more broadly available to third-party software makers, IBM CEO Ginny Rometty said last week. Thus Watson technology could be used perhaps even by IBM competitors, to build self-teaching computer systems, according to Bloomberg News. IBM has made the most possible PR use of Watson capabilities, working to embed that intelligence in medical and other applications. Last week, IBM took its show on the road to Washington D.C. last week to show Congress the progress Watson has made in healthcare applications.

… as SAP doubles down on HANA

German enterprise software giant SAP, in a move you could see coming miles away, said this week that HANA, it’s in-memory analytical database, will be the brains of its ERP software going forward, according to InformationWeek and other  outlets. Running do-or-die ERP and CRM applications on HANA is a big step up from data warehouses because ERP and CRM cannot go down for hours or a day without severe blowback. And yet at the annual SAPPHIRE conference last week SAP announced general availability of its core Business Suite applications on HANA. Or, as CRN put it, it “bet the farm” on HANA.

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Koruta, which I profiled last November, makes a photonics chip that allows signals to pass between chips using light (photons) instead of electrons. This makes communications between chips faster, something becoming more important inside the data center as networks become flatter, faster and fatter.

The Kotura chip is a fiber-based transceiver that can deliver 100 gigabits per second inside the data center. The transceiver could live on a board next to the CPU or inside a switch and could eventually expand to deliver a terabit per second (Tbps). Currently it’s used in high-performance compute clusters, which are also the most-popular home for Infiniband. From my post in November:

While one 1 Tbps is crazy fast when you consider that many data centers are currently upgrading to 10 gigabit Ethernet between servers, it’s going to be necessary. Arlon Martin, VP of Marketing, Government Contracts & Industry Relations at Kotura, tells me that customers are building products for the high-performance computing sectors but also for real-time data processing. The goal is bringing a low-power and less expensive optical part into a rack of servers, able to scale up to terabit per second capacities.

Kotura isn’t the only company trying to bring fiber optics into the data center. Plexxi is building fiber-based switches, while Facebook and the Open Compute Project in January announced their own plans to integrate photonics into their open hardware program. Intel, Cisco and IBM all have research or have acquired startups in this space as well. With its emphasis on fast networking, it makes sense for Mellanox to follow suit.

The company plans to continue offering the Kotura transceiver and open a research center in Monterrey Park, Calif., where Kotura is headquartered. From the Mellanox release:

“Operating networks at 100 Gigabit per second rates and higher requires careful integration between all parts of the network. We believe that silicon photonics is an important component in the development of 100 Gigabit InfiniBand and Ethernet solutions, and that owning and controlling the technology will allow us to develop the best, most reliable solution for our customers,” said Eyal Waldman, president, CEO and chairman of Mellanox Technologies.

At the time of my profile, Kotura had raised undisclosed millions from ARCH Venture Partners, Fuse Capital, GF Private Equity and others. It has an established customer base in the telecommunications business where it has sold product since 2006. But last year it began targeting the data center, where it apparently attracted Mellanox’s eye.

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There weren’t a ton of details on pricing and dates which could come at the company’s annual SAPPHIRE conference, next week, but according to the release, SAP HANA Enterprise Cloud will be delivered by SAP and its partners:

 ”SAP intends to adapt this open ecosystem strategy with its managed service providers to offer the capabilities of SAP HANA Enterprise Cloud from their data centers, as well as from multiple SAP data centers worldwide.”

In a research note, Nomura Securities analyst Rick Sherlund wrote:

“SAP indicates it will price its elastic cloud-computing service based size, scale of data, and application usage. The advantages are faster time to market and time to value, with lower total cost of ownership. Offering a service that delivers quick value and easy implementation should be a nice complement to the real-time capabilities users seek from HANA for a wide variety of new, real-time business processes, in addition to the Business Suite.”

SAP will continue to offer HANA via AWS, a spokesman said. But it’s clear that more contention is arising between legacy enterprise IT players and Amazon which is starting to compete with them by offering more higher-end services that compete with their products.  AWS has made no secret about its ambitions here —  it all but called out IBM, HP, Teradata, and Oracle by name when it announced its RedShift data warehousing service last November.

Meanwhile, SAP — along with these other legacy enterprise IT giants — has rushed to embrace cloud. Better to cannibalize your own on-premises business than to let Amazon do it after all. But, SAP got a rocky start in cloud. It launched Business ByDesign as a SaaS product four years ago to underwhelming response. But it vowed to do better and started buying up cloud expertise, with its $3.4 billion  acquisition of SuccessFactors, a SaaS provider of human resources management, two years later. But HANA, the hot in-memory database and analytics product  has become the company’s focal point in  cloud and big data efforts.

What would really be surprising is if SAP didn’t offer HANA from its own cloud.

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As a refresher, the big difference between SQL on Hadoop and the Hadoop connectors that were popular a couple years ago is that SQL-on-Hadoop products query the data where it resides — in HDFS or HBase — rather than pulling it into a relational database environment to analyze it. We have been talking for months about the emergence of a large SQL-on-Hadoop market, but IBM’s name was conspicuously absent from that discussion. The company has Hadoop software called BigInsights and lots of SQL expertise, so it only made sense that IBM would get into the game at some point.

Details on Big SQL are still pretty sparse save for a few high-level blog posts and an instructional video (embedded below), but it looks to take the standard approach, as Cloudera is doing with Impala, of enabling access through traditional tools via JDBC and ODBC drivers.

Ultimately, I think the advent of big data will enable some new types of querying techniques quite a bit different than the SQL queries we’ve come to know and love over the past couple decades. But SQL is still the language du jour and might never go away, so there’s a lot of value to be had if people can put their SQL skills to work on data stored inside Hadoop or other environments, and if companies can work toward a nirvana where all the data is stored in a single place rather than across database environments.

That IBM got this message and got into the game isn’t surprising at all, but it is important. Lots of large companies buy IBM’s software.  If it wants them to follow it into the world of big data and Hadoop, it has to give them the tools they need to use it.

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Terms were not disclosed but here’s how Dell described its new acquisition:

“Enstratius is available as software-as-a-service or as on-premise software that enables full control from within a customer’s data center, or via a hosted service … and complements the capability Dell recently acquired from Gale Technologies, now Active System Manager (ASM), by providing enhanced multi-cloud management and application configuration capabilities and integrates converged offerings with cloud systems management.”

For the past few years, Dell has plotted a tricky course as it tried to morph from a PC and server vendor to a provider of software, cloud and managed services. Toward that end it has bought companies ranging from Wyse and Boomi to bolster its cloud credibility and Quest Software for its data center management and automation tools. Like its rivals in traditional IT — companies including HP and IBM, Dell faces growing competition for enterprise and webscale workloads from Amazon Web Services. 

Update: As Dell rolled out its going-private game plan, GigaOM’s Derrick Harris counseled it to get serious about buying up real cloud expertise, which it apparently has.

Here’s how GigaOM described Enstratus (the company added the “i” a few months ago) in reporting the company’s $3.5 million Series A funding in 2011:

“EnStratus is similar to the more widely known RightScale service, although enStratus actually supports more clouds. It currently claims support for Amazon Web Services, AT&T Synaptic Storage, Bluelock, Cloud Central, Cloud.com, CloudSigma, EMC Atmos (e emc), Eucalyptus, Google Storage, GoGrid, Nimbula, OpenStack, Rackspace, Terremark, VMware vSphere, VMware vCloud Express and Windows Azure.”

Not surprisingly, George Reese, CTO of Minneapolis-based Enstratius, said Dell and his company align well. Enstratius runs a tight ship and has managed to stake a claim in enterprise cloud management with “just Series A financing,” Reese said via email.

Reese added that Dell:

“Sees cloud management as a key value point in the cloud computing stack. By acquiring us, they acquire established leadership in cloud management aimed at enterprise needs. Customers don’t want a single solution on a single stack, they want a solution that enables them to interact with many different cloud platforms, public and private. The Enstratius acquisition immediately gives Dell leadership in this area over other large technology vendors.”

Dell ownership gives Enstratius more resources to attack that market faster, he added.

At least one Wall Street analyst agreed (Dell is still trading until its restructuring is complete): Wells Fargo’s Maynard Um characterized the Enstratius buy as a good use of cash. In a research note, Um wrote:

“We believe the acquisition signals 1) management remains focused strategically on transforming the company and 2) from an industry perspective, the importance of being agnostic (though we expect tight integration with Dell’s owned-portfolio).”

This news comes just an hour or so after Quest competitor BMC announced plans to take itself private. Which just goes to show, if you don’t like the current IT landscape now, just wait a minute.

This story was updated at 8:47 a.m. PDT with more context about Dell’s cloud strategy  and Wells Fargo comments.

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But there’s also the question of how to measure the market or the value. Do we count the devices themselves? The dollars spent on platforms and services that tie connected devices together? What about subscriptions to wireless networks? In GE’s case it’s counting dollars saved by implementing better data gathering systems. But the whole idea of trying to measure what is fundamentally a technological shift as a market baffles me.

There’s no question the internet of things is going to be big, but to separate the reality from the hype its worth looking for hard data. If not at market size or potential profits, then let’s just try to see where people are in terms of interest in the products. For example, check out these numbers from a March Yankee Group survey of about 2,300 people.

That seems like a relatively small percent of the population planning on buying a new connected device in the next six months. And the numbers are somewhat odd, in that I don’t think even 5 percent of users are planning to buy a new smart meter –something utilities tend to provide. So I’m taking this data with a grain of salt, but I am looking for good ways to think about the market size and understand how rapidly people and companies are adopting connected devices into their homes and business processes.

This is a real trend, but it’s clear we’re still at the beginning of the massively hyped shift that will lead to real value creation. I just don’t know how to measure how much.

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Here’s how AWS lists the three broad job descriptions covered by the certs:

• Solutions Architect: a technical individual who is skilled at designing distributed applications and systems on the AWS platform. A Solution Architect generally has knowledge across a broad array of disciplines, including distributed application architecture, networking, infrastructure, and security.
• SysOps Administrator: a technical individual who is responsible for the operational health of an application on the AWS cloud. A SysOps Administrator has in-depth knowledge of the application or service they operate, including how the application is constructed, deployed, and automated, as well as the controls and monitoring points available.
• Developer: a technical individual who has designed and built an AWS-based application. A Developer has involvement with or responsibility for operating the application on the AWS platform.

Older tech companies — Microsoft, IBM, VMware, Cisco Systems — have long relied on certifications as a way for people — either those inside IT shops or at third-party VARs and integrators (and those seeking jobs in either camp) — to show that they have what it takes to succeed working with specific technologies. As with those programs, AWS candidates must pass an exam to get their credentials. Testing will be administered by Kryterion.

Some of the more valuable certs in recent years include the VMware Certified Professional (VCP), Cisco Certified International Expert (CCIE) and Microsoft Certified IT Professional (MCITP). And Certified Information Systems Security Professional (CISSP), a more vendor-agnostic certification, is also a top draw for potential hiring companies.

In another nod to the IT concerns of enterprise accounts, AWS also launched a security blog this week. The news comes just after Microsoft opened up Infrastructure-as-a-Service capabilities in Azure that are more directly competitive with AWS and Google gears up for the public release of Google Compute Engine, which I expect will happen at Google I/O in May. While AWS dominates public cloud infrastructure by virtue of its head start, many enterprise customers in particular will likely test out these rivals as well — nobody wants cloud lock-in.

Still, given the traction AWS has among startups and increasingly at bigger businesses, I’d expect to see these certifications cropping up in lots of job postings going forward.

Photo courtesy of Shutterstock user Mega Pixel

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Researchers at the IT giant’s Almaden Lab in San Jose, Calif.  worked for ten days moving 10,000  individual atoms around on a microscopic surface to build the images of a boy and his interactions. It takes some massive gear to move 10,000 tiny atoms around and IBM’s lab had just the thing, a 2-ton scanning tunnelling microscope (STM).

One goal, according IBM, is to inspire kids to study and pursue careers in science and technology.  And, the work could lead to breakthroughs in storage and other technology fields.

According to an IBM blog post on the project:

“The ability to move single atoms, one of the smallest particles of any element in the universe, is crucial to IBM’s research in the field of atomic-scale memory. In 2012, IBM scientists announced the creation of the world’s smallest magnetic memory bit, made of just 12 atoms. This breakthrough could transform computing by providing the world with devices that have access to unprecedented levels of data storage. But even nanophysicists need to have a little fun. In that spirit, the scientists moved atoms by using their scanning tunneling microscope to make … a movie, which has been verified by Guinness World Records™ as The World’s Smallest Stop-Motion Film.”

Enough chit chat though, check out the film for yourself:

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IBM considers both efforts part of its Smarter Planet and Mobile First strategies. The box is called the IBM MessageSight, and it combines the ability to process a lot of information in real time — which experts believe the internet of things will need. The logic is that billions of sensors sending trillions of bits will need some type of special equipment to process the incoming information in real-time and send instructions back to a human or a device.

IBM uses the example of the hundreds of sensors in your car recognizing a problem, turning on your check engine light, and then notifying the dealer so it can do remote diagnostics. As someone who is heading to the dealer tomorrow for a check engine light, this example caught my eye. Yet, I’m not sold on the need for a special box over more intelligence at the sensor, or perhaps a mesh network with nominal “intelligence.”

The internet of things exaflood is coming!

The idea is compelling, but it also grossly simplifies the flow of data inside the internet of things. For example, it assumes all sensor data must be processed in “real time.” It also assumes all the data must be processed. Both of these are untrue, especially in the early days of the internet of things. But IBM is looking ahead. From its release on the MessageSight appliance:

Over the next 15 years, the number of machines and sensors connected to the Internet will explode. According to IMS Research, there will be more than 22 billion web-connected devices by 2020. These new devices will generate more 2.5 quintillion bytes of new data every day, while every hour enough information is consumed by Internet traffic to fill seven million DVDs.

It’s the same exaflood of data that telephone companies were so fearful of a decade ago. And like the telephone companies, IBM is hoping to cash in on these fears — with its box. IBM’s appliance can totally stand up to this tsunami of information, or so goes the pitch. A release from Big Blue noted that the machine can handle up to 1 million concurrent sensors and can scale to manage up to 13 million messages per second.

The new protocol for the internet of things?

Inside this magic data-defying box will be a protocol called MQTT (Message Queuing Telemetry Transport), which the OASIS standards organization recently proposed for the internet of things. The standard, which is backed by Kaazing, Red Hat, TIBCO, Cisco and IBM, is a lightweight messaging transport system for communication in machine to machine and mobile environments.

The idea is that such a lightweight protocol will allow sensors to communicate wirelessly without needing massive batteries to support a fully functional wireless radio. I’m unclear on what radio protocol one might use, but have reached out with questions. As for MQTT, it’s already in use for satellite transmissions and in medical and industrial settings where low-bandwidth communications are essential.

IBM said “sensors can use MQTT to send messages wirelessly using 10 times less battery power and 93 times faster than before, making it possible for a sensor to send real time updates that can be acted upon immediately.” IBM is positioning MQTT as the same enabler for the internet of things, as HTTP was for the web. I’m not sure I’d go that far, but it’s worth watching to see how the standard evolves.

As for IBM’s appliance, I’m pretty sure people can build connected homes, buildings and possible cities without it, but IBM’s marketing will snag customers, especially as part of an overarching integrated smarter cities deployment.

Updated at 11:41 PT: This story was updated to clarify that the MQTT protocol is new for use in the internet of things. The protocol itself is not new.

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