The topic arose at the clouderati-filled Cloud 2020 meetup in Las Vegas last week (where someone suggested we’ll have a cloud duopoly of Amazon Web Services and Google) and it’s back in the public eye again this week with the general availability of Google Compute Engine. I think we might get an idea how the cloud computing market will play out by looking at the fast-food industry.

The analogy goes like this: Fast food restaurants offer their consumers essentially the same things as public clouds offer their customers – convenience, speed, standardization, flexibility and everything else that comes with not having to prepare a meal from scratch or deploy applications on physical gear. And if all anyone wanted was fast, cheap hamburgers, fries and maybe some sort of chicken sandwich, the more than 33,000 McDonald’s across the world would probably do the trick.

However, when I come to any major intersection in a big city (and even in some small towns), I usually see no less than two national fast food chains taking up corner real estate. If I drive a little down the road, I’ll likely see a few more, and possibly some regional chains thrown in, as well.

Not all hamburgers are created equal, it seems.

Why should cloud computing be any different? If all anyone wanted was a virtual server, they’d probably go with the omnipresent Amazon Web Services. But when features, price, security, network connectivity and related services come into play, it becomes easy to see why there’s such an appetite for more options.

Amazon is to McDonald’s as Google is to …

Amazon Web Services = McDonald’s and Yum Brands rolled into one: AWS is to the cloud what McDonald’s is to fast food. It was the first, it’s the biggest and it’s the best known. All things being equal, there would be no reason for anyone to go anywhere else for cloud computing because AWS delivers reasonable services at a fair price (sometimes downright cheap), is omnipresent and can pretty much handle whatever scale you throw at it.

Only, if we consider the virtual server the hamburger of public cloud, the object store the French fries and the cloud database a chicken sandwich, AWS starts to look like a lot more than just a McDonald’s. You might look at it more like Yum Brands, the parent company of Taco Bell, KFC and Pizza Hut. The Amazon platform is about far more than just machine images and some standard storage and database features. It has myriad services covering everything from configuration to big data, and they’re all designed to integrate tightly with one another — like one of those KFC/Taco Bell combination restaurants that dot the urban landscape.

AWS, like McDonald’s, is the undisputed champion. Source: Wikipedia Commons

Rackspace = Wendy’s: Wendy’s is the No. 2 fast-food franchise in the United States, a title I think Rackspace probably holds in the cloud space (although assessing cloud market share is a little more difficult than assessing fast-food market share). And much like Wendy’s places a premium on the quality of its products, Rackspace places a premium on the quality of its service. CEO Lanham Napier has gone so far as to say it’s “playing a different game” than Amazon.

What he means is that Rackspace doesn’t need to compete with AWS by constantly driving down prices because Rackspace customers value service and will pay for it. Maybe, but the company might take a hint from what’s happening with Wendy’s as it struggles to maintain its No. 2 status against a feisty Burger King that’s largely following the McDonald’s playbook. If market share is important, higher prices aren’t often the best recipe for maintaining it.

The Angry Whopper, like App Engine, probably isn’t for everyone.

Google = Burger King: That cloud version of Burger King nipping at Rackspace’s heels is Google. It already has all the standard fare in servers, storage and databases, but it’s also hipper than the rest (or at least it tries to be), it takes some chances on product design (sometimes to the love-it-or-hate-it extreme) and, like Burger King with the Whopper, what it does well, it does really well. In Google’s case, that’s perform at scale.

If Google keeps adding services and cutting the costs of everything, there’s no reason it can’t become the world’s No. 2 cloud provider — some have already bestowed that honor upon it — and maybe challenge AWS a decade down the road.

Microsoft = Arby’s: Despite Microsoft’s best efforts to market it otherwise, Windows Azure is still largely viewed as a cloud platform for running .NET applications and generally doing all things Windows. Not that that’s a bad thing — a lot of people really like Windows and, by many accounts, Windows Azure is a fine platform. It’s like going to Arby’s: the menu offers a lot of things, but you go for the roast beef.

Joyent, Virtustream, CloudSigma et al = In-N-Out Burger, Culvers, Five Guys et al: These cloud providers, like their analogous restaurant chains, are damn good at what they do and their patrons are loyal. They’re typically designed for maximum performance, maybe security, too, and will play around with new infrastructural or programming components in order to maintain their edge. They might even be the best at certain things and have some major customers (I’ve seen Maseratis leaving the In-N-Out drive-thru), but cost, geography or the desire to get a chicken sandwich, too, limit the number of users they can attract.

Yes, In-N-Out is delicious — and that’s about the entire menu.

VMware = Del Taco: According to my colleage Barb Darrow, VMware’s new VMware vCloud Hybrid Service will “be run from partner data centers and sold by VMware’s channel but managed by VMware.” Del Taco sounds like a Mexican place but also has hamburgers, fries, shakes and even iced coffee. And I don’t know anyone who eats there.

OpenStack = Frozen French fries, or cheeseburger-flavored Doritos: It really depends on who you ask (some would even say it’s like kale). If you’re grilling burgers and cooking fries, you’re essentially trying to recreate the fast-food experience at home. On the bright side, when you’re making the hamburger patties and cooking the fries, you can control how much salt you add and ensure everyone who handles them washes their hands. It might turn out great, but it’s never really the same.

Perhaps I’m being overly pessimistic, but I’m beginning to suspect that OpenStack-based public clouds (of the non-Rackspace( rax) variety) will end up being a lot like cheeseburger-flavored Doritos. In name, they’re like cheeseburgers, but after a few bites you’re left saying, “Hey, Doritos doesn’t make cheeseburgers …”

Everyone else = everyone else: Even after all this, we’re still left a bunch of different cloud providers and a bunch of different fast food chains. You might compare the telcos to Jack in the Box, Carl’s Jr. and Hardees in that they’re big and make money, but they’re pretty much non-factors in the grand scheme of things. Then there are your various web hosts and others, which might compare with some local chain restaurants. And different countries will certainly have their own cloud providers just like they have their own takes on fast food.

In the end, though, it’s just hard to see how cloud computing becomes a two-horse race any more than the fast-food industry is a two-horse race. Sure, there are three clear leaders (with No. 1 having a big lead), but there’s plenty of business to go around because aside from some core similarities, no two providers are the same. And as long as more applications are developed and need a cloud to call home, there will be developers and CIOs with very different ideas of what makes a cloud platform great.

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The Microsoft that produced the Windows-Office monopoly let its products get fat, dumb and happy. The Microsoft that must contend with the Oracle database juggernaut puts out a pretty good database. That’s why the sudden influx of new public cloud riches exemplified by this week’s official launch of the Google Compute Engine, coming a few weeks after Microsoft launched its Windows Azure IaaS options, may be tough on the competitors but could be very good for smart IT consumers.

Look for price cuts to continue, along with a flow of new services, and better APIs to access those services.

While I haven’t parsed the instance-by-instance price comparison between GCE and AWS, Google’s decision to sell compute instances in sub-hour increments could lead to cost savings vs. Amazon, which prices by the full hour. Don’t be surprised if Amazon responds, however.

We’ve already seen several price skirmishes in cloud including five or six price cuts in cloud storage in the span of a few weeks late last year between Google, AWS and Microsoft. Heck, even Rackspace, which touts its fanatical support rather than low prices, got into the act a little bit later.

Look for this sort of one-upsmanship (one-downsmanship?) to continue as these extremely well-funded and highly motivated competitors angle to get your workloads on their respective clouds. For the discerning IT buyer, whether she’s at a startup or a Fortune 100 company, that is only good news.

Photo courtesy of  Flickr user Official U.S. Navy Imagery

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The theory behind tools like these is basically this: sure, public cloud computing is billed as cheap, but too often it turns into a wasteland of dormant instances and other fallow resources. So as inexpensive as it can be, it’s not necessarily efficient or as cheap as it could be. Companies like Newvem, Cloudability, Cloudyn, CloudVertical et al say they can help you optimize all that and save more.

Newvem for Windows Azure covers many of the same core usage and cost metrics as the AWS version. A “heat map” helps users visualize their workloads as they move from on-premise implementations to the cloud, according to Newvem VP of marketing Cameron Peron. The free beta is available now to all Azure users. Newvem’s AWS version started out free as well, and a base level of capabilities remain free, but as of late last year, the company started charging for higher-level services.

Newvem said it sees Azure — which launched its AWS-like Infrastructure-as-a-Service  capabilities last month — gaining traction.

“The size of the Azure installed base is probably one of [Microsoft's] best-kept secrets,” Peron noted. Well, not that secret since Microsoft recently said Azure is a $1 billion-a-year business – a claim that some find difficult to swallow. Newvem would not comment when asked if Microsoft helped fund its Azure tool, but given that Microsoft wants to build the Azure ecosystem and compete better with AWS (as well as the spanking new Google Compute Engine), I’d say it’s a safe bet.

It’s also true that companies like Newvem, which built services around AWS, have been perplexed to see AWS adding richer and deeper monitoring and management services like Trusted Advisor. Given that, it makes sense that these companies offer multi-cloud capabilities.

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My money’s on Google taking the GA plunge but then again the company is known for fielding “preview” products for years. Still, Urs Hölzle, SVP of technical infrastructure and Greg DeMichillie, director of product management for Google’s Cloud Platform, will host a session Wednesday afternoon on the next-generation of cloud computing which will feature “announcements and demo important new features of the Platform.” Hmmm, smells like a GA announcement to me.

A Google spokeswoman said she had nothing to share at this time but referred users to the above-mentioned session. One of the things Google is expected to do is drive use of its cloud platform via its Google Drive and Apps franchises and right on cue, Google on Monday said customers will get 15 GB of unified storage across Google Apps, Drive and Google +. According to the Google Drive blog post:

“So, instead of  having 10 GB for Gmail and another 5 GB for Drive and Google+ Photos, you’ll now get 15 GB of unified storage for free to use as you like between Drive, Gmail, and Google+ Photos.”

While that’s not really tripling the amount of storage for Google users, as some have reported — it actually spreads it across Google properties. But 15GB is still more than what competitive free services offer. Dropbox offers 2GB for free; Microsoft SkyDrive starts users at 7GB for free while Apple iCloud and Amazon Cloud Storage provide 5GB before charges apply.

GA or not, here it comes

But getting back to GCE, here’s the thing:  even some AWS cronies say that GCE is the cloud infrastructure to watch in the upcoming year given Google’s experience in scale-out computing. It would also make sense for Google to roll out a for-real load balancer service, which one AWS partner said is a huge hole in Google’s platform strategy compared to both AWS and Rackspace. Google has also been working to beef up Google App Engine capabilities, something that Snapchat co-founder Bobby Murphy will doubtless address at GigaOM’s Structure event next month. The popular Snapchat photo sharing service runs on GAE. Google telegraphed (by virtue of its Google I/O agenda) that it will add a new language to the fold for its Google App Engine Platform as a Service (PaaS). GAE now supports Java, Python, and Go. Speculation at Reddit is that PHP will get the nod . Thomas Clayburn over at InformationWeek would prefer to see Google add Node.js or JavaScript first, so we’ll see. Some also say Google needs better integrate its Cloud SQL database service into its cloud platform

Battle for public cloud workloads ratchets up

Whatever Google’s official roll-out plans, GCE is already considered a contender in a hard-fought battle for public cloud infrastructure dominance by virtue of Google’s size and expertise.  AWS, launched in 2006, has a prodigious head start, but now with Microsoft’s Windows Azure  and GCE coming on line, AWS faces two extremely well-funded and tech-savvy rivals, both of which seem  determined to carve out a healthy chunk of this market. And then there are all the OpenStack-based public cloud options from Rackspace, HP and others. It’s still very early on in the cloud deployment game so things should get very interest in the race to add services — and cut prices. It could be a very good time to be a buyer of cloud services over the next few years.

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Just in time for Google I/O, Google will support the Debian Linux distribution in its Google Compute Engine, which is still in preview mode. From now on, Debian will be the “default image mode” for GCE, according to the Google AppEngine Blog. Google cited Debian’s improved handling of 32/64 bit compatibility as one reason for the move

According to the Thursday blog post:

“Today we’re adding Debian images for Google Compute Engine.  Debian, in collaboration with us, is providing images for both Debian 7.0 “wheezy” and the previous stable release, Debian 6.0 “squeeze.”   This support will make it easy for anyone using Debian today to migrate their workloads onto Compute Engine.”

A Google spokesperson told eWeek  that “customers will get a great experience having a Linux distribution that is maintained by the Debian community. Debian and derivatives thereof (such as Mint and Ubuntu) are among the most popular on the Internet, and Google itself is a heavy contributor to the Debian code base. We will also continue to offer CentOS, and are actively exploring other operating system options based on feedback from our customers.”

Google has a complicated relationship with the open source world. Most of its underpinnings are built on open source software and it does contribute a lot of technology to the community. But its own infrastructure is seen as a black box to many in that community. It’s interesting that there were a grand total of two comments as of Sunday on this blog post — one was removed and the other offered good wishes but added “the thing I’d like to see in future is how community members could be part of this project.”

While Google isn’t saying, folks expect the company will announce general availability of Google Compute Engine, which will compete with Amazon Web Services this week at the big show. GCE was announced last June and the preview was expanded to anyone paying for Gold support last month. Many cloud watchers say GCE, once fully available, will be the second-largest IaaS in terms of capacity after Amazon Web Services or AWS. Microsoft launched its Windows Azure IaaS capabilities in April.

In other words, buckle up, the cloud wars we’ve seen so far, are going to get rougher.

New tool allows AWS management from Microsoft consoles

Speaking of AWS and Microsoft, the new AWS Management Pack for Microsoft System Center means that a Windows admin at a company — at least one running System Center 2012 — can now use one console to monitor on-premises Windows resources as well as EC2 Linux or Windows instances, Elastic Load Balancing, CloudFormation and Elastic Beanstalk running on AWS.

As GigaOM PRO analyst Janakiram MSV pointed out in his report Thursday, this move is just one more example of Amazon’s push into the enterprise where  Windows reigns.  He points out that Tom Rizzo, a Microsoft vet, headed up this project at Amazon. Janakiram wrote:

“In 2010, Microsoft launched the Management Pack for Windows Azure deployments making it easier to manage on-premise and cloud infrastructure. Customers running Windows-based workloads on Amazon EC2 had to use a different set of tools based on Amazon CloudWatch, Nagios, OpsView, Nimsoft or other third-party software to monitor their deployments.  Through the AWS Management Pack, Amazon made it easy for enterprise IT teams to manage the servers running within on-premise, Windows Azure and AWS. Microsoft enterprise customers will welcome this.”

Interestingly Rizzo’s AWS blog post does not mention that the console was part of a joint effort with Microsoft, something that Microsoft rectified in it’s post about the news a day later.

Adobe tests the market for all-cloud delivery

Well, my  post on Adobe’s plan to move all updates of Creative Suite to a subscription service characterized it as a low-risk gamble. For Adobe anyway. Well, gauging by reader response,I should have talked to more graphic designers and artists who are fighting mad. Many vowed to stick with their old version as long as possible and then seek other non-Adobe options. Their beef? That even $50 per month per user will end up costing them way more than the current pay-once-use-forever model.

A Change.org petition asking Adobe to rethink its plan had more than 8,500 signatories as of Sunday morning

At any rate, Microsoft ,which has more at stake here than anyone with its zillions of Office users, was quick to weigh in. In short, it says subscription SaaS is the way of the future because it ensures users are always on the latest-and-greatest versions and can use their subscriptions across devices.  But:

” … unlike Adobe, we think people’s shift from packaged software to subscription services will take time. Within a decade, we think everyone will choose to subscribe because the benefits are undeniable. In the meantime, we are committed to offering choice–premier software sold as a package and powerful services sold as a subscription.”

News from around the web:

From Data Center Knowledge: Equinix unveils new crown jewel Ashburn Campus

From GigaOM: Box acquires Crocadoc to make document previews richer

From CITEworld: Office web apps: Not bad for free, but on demand is way better

From TechCrunch:  Microsoft to fold Yammer sales team into Office 365, identity surfaces as a core focus

From GigaOM:  Laggard Rackspace growth sparks concerns: is there enough cloud growth to go around?

From Fox Business News; U.S. judge orders Hewlett-Packard to face shareholder lawsuit

From InformationWeek: Google I/O preview

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But there is nagging worry, sparked anew by Rackspace’s laggard Q1 cloud growth, that the appetite for cloud services may not be unlimited after all. For its first quarter ending March 31, Rackspacelogged $91 million in public cloud revenue, up 4 percent sequentially and 40 percent year over year. It is the quarter-over-quarter number that has people spooked; given that Rackspace has been touting its new OpenStack public cloud, folks expected much better numbers.

To be fair there are nuances about the Rackspace quarter to be examined. First, it blamed some of the inertia on price cuts on some services during the quarter. And the newer OpenStack-based public cloud business was up 75 percent sequentially, CEO Lanham Napier told analysts on the company earnings call Thursday night. The problem is demand for the older Slicehost-based cloud technology evaporated and bookings for the new cloud haven’t taken up the slack. New customers are being directed to the OpenStack option.

RAX data by YCharts

There are Rackspace-specific issues but there are more macro concerns, which I’ll get to in a minute.

Bryan McGrath, Rackspace’s director of finance, acknowledged that there may be vendor consolidation, just as there has been in other areas when technology matures.

“There are lots of versions of Linux out there but only a few are widely adopted,” he noted. But his point is that even with consolidation, Rackspace is well positioned to prevail. After all, he noted, he company was able to build a $300 million business on its older cloud technology, which was admittedly less scalable and capable than giant Amazon Web Services.

“People bought that because of our support and service. Now we have a new, much better cloud based on OpenStack with new features and functions,” he said. “We’ll marry that with our dedicated business to offer customers what they need.”

Now for the macro cloud problem

Of perhaps greater concern is that so many vendors are jumping into the cloud services game that there may not be enough customers to support them all. IBM will doubtless sell its OpenStack options as they come online to its typical Fortune 500 accounts, the biggest of the big companies. That leaves other smaller — yet still big companies — with OpenStack options from Hewlett-Packard, Red Hat, Rackspace and perhaps Dell, Cloudscaling, Nebula and other players going forward. Or they’ll go with CloudStack or Eucalyptus or OpenNebula clouds.

Telcos, carriers and hosting companies are gearing up their own cloud services based on their own or partnering with aforementioned OpenStack or Joyent. Microsoft just last month came online with its Azure IaaS option, which will probably get traction among the zillions of Windows shops. While Google Compute Engine, which will probably become generally available next week at Google I/O, is not really seen as a business class public cloud, you’d be foolish to rule it out completely. And then there is the big, bad incumbent, AWS, which continues to churn out new services, price cuts and service options by the week.

No matter what we make of Rackspace’s quarter, if you thought the cloud wars were hot before, you better gear up for the next round. The big question is whether there really is enough cloud work to support all these players going forward.

My best bet? Nope.

Amazon.com CTO Werner Vogels, Rackspace President Lew Moorman and other cloud luminaries will no doubt map out this competitive landscape at GigaOM’s Structure event next month.

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The Amazon experience

Amazon has a fair amount of experience in the public-cloud realm, having launched AWS in 2006 and, Jassy said, having envisioned it a decade ago. Since then, Amazon’s S3 offering has grown to encompass 2 trillion objects stored on behalf of third-party developers who can’t necessarily afford to run their own infrastructure or don’t want the management hassles.

As for Microsoft, it made Windows Azure generally available as an IaaS cloud earlier this month. As my colleague Barb Darrow reported, Microsoft initially went for Platform as a Service (PaaS) instead of IaaS, and developers kept moving toward AWS for all of its standard services. But that’s a different story.

Amazon doesn’t want to rest on its history: Jassy talked up the smorgasbord of AWS technologies and services, from the Elastic MapReduce Hadoop implementation to the Redshift data warehouse. “What (customers) don’t want to settle for is an AWS 2009 type of platform,” Jassy said. “As a lot of other companies are just launching their solutions, we have much better technology than anybody else. We are iterating and innovating at a very fast clip.” Since the beginning of 2013, Jassy said, AWS has introduced 71 services and features. Compare that with, say, 82 new services and features Amazon rolled out in the entirety of 2011.

The virtuous price cycle

Jassy also talked up the “virtuous cycle” of adding AWS customers, increasing usage, creating economics of scale and, in turn, getting new customers. Through its Trusted Advisor feature, the company can suggest to customers that they scale down compute instances if they’re sitting idle, and at the same time AWS keeps lowering prices again and again — 31 times since 2006, Jassy said. In other words, Amazon’s pitch is that AWS can be good at a low price. (To be fair, other cloud providers can outperform Amazon’s EC2 computing service in certain instances when it comes to running an application and serving up the result.)

Conference attendees walk the exhibition floor at the AWS Summit 2013 in San Francisco, April 30, 2013

On top of those traits, AWS already has built up an ecosystem of customers, from startups such as Mailbox to enterprises such as Shell. A marketplace has sprung up for products that customers can run on top of AWS. And with operations in nine regions, AWS is global, permitting its customers to become global, too.

Is public better?

Jassy took a minute to talk about how “old-guard tech companies” are pitching private clouds as secure, even though private clouds might not be able to match the benefits of sharing Amazon infrastructure. But he did say he understands that some companies need to keep certain operations on premise, and in that case companies should consider services such as Direct Connect to bridge the divide between an AWS deployment and a local data center.

How did all of this play with conference attendees? Many people I spoke with said Amazon was ready when people needed elastic compute and storage services and now, even if Google, Microsoft, Rackspace and others can match up, they’ve already committed to Amazon, at least for core features such as S3 and EC2, and are looking at paying for other services. One entrepreneur working at a startup said he relies on AWS to run his applications, and his fallback is to deploy in a second AWS region. Only if that doesn’t work would he look at other public-cloud providers.

Of course, this is an Amazon event, so it’s not surprising to hear such things. But perhaps as Google, Microsoft and Rackspace get their own virtuous cycles going, the story will be different in a year or so.

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Microsoft’s Chicago data center is one of eight worldwide.

While he did not characterize Azure IaaS as an “Amazon killer,” Azure GM Bill Hilf did say Microsoft will match AWS on price for any of its base-level infrastructure — storage, compute instances, etc. — continuing a price war that flared last November when AWS, Google and Microsoft traded price cuts on their respective cloud storage offerings.

And, Azure IaaS pricing will be uniform across all geographies and data centers. Microsoft runs 8 data centers worldwide, 4 in the U.S., 2 in Europe and 2 in Asia. This is a pointed response to AWS, which relies heavily on its aging-but-humongous U.S. East data center farm in Ashburn, Virg. Many AWS services debut there and prices for U.S. East services are often lower than the same services originating in other AWS regions. “Many customers architect their applications in really weird ways to take advantage of that pricing,” Hilf said. U.S east is also the epicenter for most of the AWS outages over the past year or so.

And before you write off Azure as too late to matter, consider this: For the many companies that run Windows applications and may want to move them betwixt and between a public cloud and their own Windows-centric server rooms, Azure may be a really smart choice. In the run up to this news Microsoft announced Active Directory for Azure  last week.

PaaS priority hurt Azure

Microsoft’s problem is that it zigged when it probably should have zagged 3 years ago when it rolled out Azure as a full Platform-as-a-Service (PaaS). It was a great idea in theory, but by then developers — especially those in startups — were already flocking to AWS and its easy-to-spin-up-and-pay-for infrastructure.

That interest started to spread to bigger, more established businesses or departments within enterprises where developers loved the idea of being able to quickly build their own sandbox on AWS without IT interference. Fair or not, the perception soon became that Azure was a development and deployment platform for old-world Windows and .Net applications. It was deep and rich, but it was attacking a moribund market.

Ironically, those old-school Windows shops could now be Azure’s saving grace. The majority of legacy enterprise applications run on Windows and many of those enterprises are evaluating cloud deployments, although not many of them are wild about moving enterprise applications to a public cloud. Hilf’s argument is that since Azure’s underpinnings mirror those of Windows Server 2012 shops, applications can run on premises or in the cloud and partially in either.

Google Compute Engine, aka the wild card cloud

For many developers, the great unknown here is what impact Google Compute Engine will have when it becomes widely available. I would bet that might happen at Google I/O  next month, but who knows, Google may want to counter program this Azure news. Plus the OpenStack Summit is this week with lots of news coming out of companies including Rackspace, IBM, HP and others —  which hope to combat with AWS with OpenStack-based public clouds.

But many think that Google, by virtue of its sheer scale, will be the cloud to watch vis-a-vis Amazon Web Services.

The other issue is whether Amazon, which is by all accounts the world’s largest public cloud provider, can maintain the advantages of being first to market with its gigantic cloud and whether it can attract enterprise accounts with higher-end services like RedShift data warehousing.

AWS has rolled out hundreds of services and features since launching in 2006 — Amazon CEO Jeff Bezos  put the count at 159 new features last year alone. That’s quite a head start and Amazon fans say it’s market position is unassailable.

But remember: People used to say the same about Microsoft.

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Scalr is clearly a big fan, but even if you don’t buy its rather impressive report card, there are other reasons that Google Compute Engine should be considered the biggest potential rival to AWS.

Google knows from scale

Even Google bashers will concede that the company understands massive scale. It has the data center fire power; it has the software tools to harness that power; and it has a deep engineering bench that includes several key hires from — you guessed it — AWS. A quick LinkedIn search shows some of these hires, but omits many. One of those is Sunil James, who worked on the AWS Virtual Private Cloud and Direct Connect and who now heads up networking services and technologies for the Google Cloud Platform.

Multi-cloud strategies demand a back-up cloud

As big and great as AWS is, most existing and potential business customers will not lock into a single cloud provider. They are still bruised from the current generation of vendor lock in. On the other hand, they can’t afford to support too many. “You can only make so many bets, and it’s clear that Google is in this public cloud game to stay,” said one vendor exec who would not be named because his company does business with Amazon.

Companies who made early bets on GCE are Cloudscaling, the OpenStack player which said last fall it will support both the AWS and GCE APIs, and RightScale, a pioneer in cloud management and monitoring that signed up as GCE’s first reseller in February.

Google is serious about GCE

Let’s face it: Google does have a bit of a credibility problem for launching, then deep-sixing services. (Hello, er, goodbye Google Reader.) But no one can seriously doubt that GCE is a priority.

“This is no skunkworks. This is not some little company they acquired. There’s a big team on the engineering side and if you look at the data center footprint, the fiber, the tech expertise, the internal platform and tools, they are serious about this,” said the vendor exec.

Dan Belcher, co-founder of Stackdriver, a Boston startup, said the time is ripe for an AWS contender to surface. The industry, he said, appears to be waiting for someone — Google? Rackspace? Someone else? to challenge AWS.

“Clearly, Google’s strategy is to differentiate on performance (overall and consistency thereof,)” he said via email. “Our first test suggests that they are delivering on that promise … so far,” he noted. He also pointed out that GCE’s admin console UI needs work and that less than a year in, there are limited services and features compared to AWS. A new Stackdriver blog details its first impressions of GCE.

The big question is how performance will hold up when the service actually leaves beta and opens up to the real world. There are reportedly tens of thousands of users queued up and ready to jump in when that happens. “Sure it feels fast with my six instances in limited preview. How will it feel when I am sharing with the rest of the world? And what has Google done to limit the host, network and API contention that plague large AWS customers?” Belcher asked.

Lack of legacy baggage helps GCE

Microsoft Windows Azure is paying the price now for Microsoft’s huge installed base of Windows and .NET legacy applications. While it’s done a good job incorporating support for open-source technologies under the Azure umbrella, that support is not on par with Windows, at least when you ask developers outside the .NET world.  Microsoft remains”weighted down by its Windows and Office mentality,” said one vendor who weighed supporting Azure but decided against it. “There are aspects of Azure that are technically superior but then their APIs are atrocious,” he said.

On the other hand …

Skeptics will always wonder if Google’s heart is in anything other than internet search and advertising. And, Google, like AWS is not particularly known for working well with others in the partner community.

The other issue is that while Google Apps has gained traction in business accounts — largely because it’s so much cheaper than Microsoft Office —  one long-time Google watcher wonders if it will ever “get its enterprise act together.”  In his view, Google Enterprise Search appliance never got traction so Google has to prove its credibility outside internet search.

Going forward, Google will also have to offer a more comprehensive menu of services. And, most importantly, it will have to bring more enterprise workloads on board so all of those companies looking for an AWS backup (or alternative) can really put GCE through its paces.

We will be talking about public and private cloud adoption, gating factors to that adoption, and other hot-button topics at GigaOM Structure in San Francisco in June.

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Here are a few of the posts to the Windows Azure status dashboard: 

22-Feb-13  ·  9:45 PM UTC

Access Control v2, Service Bus, WindowsAzure.com and WebSites services are impacted by Storage service degradation worldwide. We are actively validating the recovery steps to resolve it as soon as possible. Further updates will be published to keep you apprised of the situation. We apologize for any inconvenience this causes our customers.

22-Feb-13  ·  8:44 PM UTC

We are experiencing an issue with Storage Worldwide and this is impacting all dependent services. We are actively investigating this issue and working to resolve it as soon as possible. Further updates will be published to keep you apprised of the situation. We apologize for any inconvenience this causes our customers.

Folks on Twitter and elsewhere attributed the snafu to the lack of a new SSL certificate. If such a certificate does expire, users cannot authenticate against their various services: No authentication, no access.

Update: As of Saturday morning, this message was posted to the Azure status page — there was no timestamp so it is unclear when it posted. All of the storage areas affected on Friday still showed “service interruption” status.

On Friday, February 22 at 12:44 PM PST, Storage experienced a worldwide outage impacting HTTPS traffic due to an expired SSL certificate. This did not impact HTTP traffic. We have executed repair steps to update SSL certificate on the impacted clusters and have recovered to over 99% availability across all sub-regions. We will continue monitoring the health of the Storage service and SSL traffic for the next 24 hrs. Customers may experience intermittent failures during this period. We apologize for any inconvenience this causes our customers

I’ve asked Microsoft for comment and will update this when they do. Whatever the cause of the problem, it’s been an up-and-down week for Windows Azure. On Tuesday, Nasuni, a company that manages cloud storage for business customers, said Windows Azure storage outperformed all four other cloud services — including Amazon S3 —  in rigorous performance testing. Despite Azure’s performance, Nasuni said it would stick to S3 as its primary supplier, citing its maturity. Looks like that may have been the right call.

Windows #Azure Blob Storage service is down due certificate issue. Check update at Windows Azure Service Dashboard:
windowsazure.com/en-us/support/…—
Avkash Chauhan (@avkashchauhan) February 22, 2013

Well, as Sinatra sang: “Riding high in April, shot down in May.” Web time just accelerates the process.

This story was updated February 23 at 6:25 a.m. PDT with a newer statement from the Microsoft Azure status page.

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