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A CTO’s take on cloud

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As Capgemini’s(s cap) CTO for North America, Joe Coyle hears an awful lot about cloud computing. He hears it from customers that want to evaluate cloud solutions and from vendors that want to win that business. Capgemini, a $12 billion global systems integrator, has relationships with all the major vendors and many enterprise customers, so it’s interesting to hear what Coyle has to say about the current state of the market.

Here are my main takeaways from a recent conversation with him.

1: IBM is cloudier than you think.

Big Blue has a pretty potent set of cloud options but it’s going about its business very cleverly. Given it’s big-iron heritage, IBM rarely talks about the hardware component of its cloud portfolio, Coyle said.

“They’re attacking this from a software perspective. They’ve taken Tivoli and are building this software umbrella so that you can take whatever you’re running in your data center now and put all or part of it in a public or private cloud,” he noted. IBM’s 2010 acquisition of Cast Iron also give it a slick appliance that lets customers integrate in-house apps with SaaS applications running outside.

He doesn’t see IBM cloud penetrating a ton of new smaller businesses, but for many existing IBM shops — and there are a ton of them — IBM cloud is a no brainer.

2: Microsoft Azure has a tough row to hoe

Coyle is of two minds on Windows Azure, the platform-as-a-service (PaaS) underlying Microsoft’s(s msft) cloud strategy.

“Azure’s been a bit of a disappointment,” he said. “When Microsoft briefed us on it years ago, all the national [systems integrators] were champing at the bit. But then it stumbled.”

“Then the message was the software would only run on Azure. That’ s fine, but by that point, the world had moved on, companies were already using Amazon(s amzn),” he said. The usual argument that Azure is a PaaS while Amazon Web Services (AWS) is Infrastructure-as-a-Service (IaaS) simply doesn’t matter to most customers. The big AWS draw is they know they can deploy their applications on AWS now and move them to another hosted or in-house data center, later.

On the plus side, the Azure technology is solid and, unlike previous Microsoft development technologies, forces developers to follow the rules — they can’t design software services that misbehave. “Azure is extremely powerful and if [Microsoft] can get its act together people will try it,” Coyle said.

But overshadowing all that technical mastery is the perception of Azure as a closed platform — despite its multi-language support.  Microsoft’s single biggest problem is customer suspicion that it will use Azure to lock them into the next wave of Microsoft technologies, essentially replacing the Windows/Office upgrade cycle.

“I’m not saying it’s true, but it’s what people think,” Coyle said.

3: Amazon is Amazon

Amazon Web Services are what they are: extremely flexible and leading the league in public cloud. AWS suffered a couple black eyes in 2011 with an embarrassing four-day outage in April and then a widespread reboot glitch later in the year.

Coyle is pretty forgiving of these miscues. The April outage, he said, was largely due to people  implementing their work incorrectly, something that AWS tried to fix manually. There are things you can do now in AWS to prevent this stuff, to build in more reliability and redundancy, although users will have to pay for it, he said.

The bottom line? Glitches and all, Amazon is the incumbent public cloud power and will stay that way, he said.

4: OpenStack as big-time cloud disruptor

Coyle is also bullish on the OpenStack movement, which is building a standard cloud foundation out of open-source tools. Initiated by Rackspace(s rax) and NASA, it’s achieved critical mass with nearly every IT provider — from Dell(s dell), to HP(s hpq), to Cisco(s csco), to Citrix(s ctrx) — aboard and Rackspace offloading management to a more neutral OpenStack Foundation. 

“OpenStack will change the world of cloud computing. As a lot of smaller companies look to build their own clouds, this will be a natural choice,” Coyle said.

Who stands to lose if that’s the case? Ironically, the Dells and HPs of the world — all of which are building their own clouds. “Why do you think they joined?”  His feeling is these hardware companies — many of which were building their own more vendor-specific clouds — are hedging their bets.

Will OpenStack affect Amazon? “No. Amazon is Amazon,” he said.

5: CIOs are getting over cloud phobia

It’s taken time, but the economics of cloud computing are too good for CIOs to ignore, Coyle said. Any doubts they had about moving at least some corporate data to an outside cloud storage provider, for instance, have evaporated in recent months.

And they’re getting emboldened to do more than storage. The advent of Hadoop and NoSQL technologies means that companies could actually get some use out of all that old stuff sitting on tape or in platters, he said.  Uploading that information, and massaging it with the latest analytics means that historical data can be used to test assumptions and new models, for example, seeing what a price change means to sales over time.

Wringing real value out of old data is a pretty good proposition for most CIOs.

Cloud photo courtesy of Flickr user kevin dooley.

27 Responses to “A CTO’s take on cloud”

  1. Frank Zamani

    Many smaller cloud players are offering true business value to their customers consistently. The key differentiation is they actually have live people to help customers. That’s what you don’t get from Amazon or Microsoft.

    Frank Zamani
    CEO Caspio Cloud Database

    • For AWS, you are correct. This is part of their business model. But Microsoft has a whole team of local or near local specialists available to assist in both planning and execution phases (even for a smaal company like mine). So I am not sure where you are getting your data from.

  2. I think that a major impediment to “moving to the cloud” (primarily for larger companies) is the existing service agreements that they have with companies like IBM, HP etc.

    I have worked with both and there is no reason to push cloud services. They are used to selling servers and selling data centre space and so forth. They make lots of money on currency and refresh projects that would not be available after moving to the cloud. Further, and perhaps the most significant is that once a company moves to the cloud – it isn’t very hard to move to “another” cloud. It’s a lot easier than a data centre move – orders of magnitude easier.

    Therefore, I don’t see IBM truly getting serious about the cloud anytime soon. And I can’t see anyone investing in MS services when the more mature Amazon is available.

  3. I have also noticed an increase of interest and trust. It’s been over a year since Microsoft Access 2010 internet data services. Clients are just starting to request such services and they won’t have to throw away earlier design of forms and reports.

  4. Steven Liu

    What a sale pitch comes from a big-4 consulting firm. “CIOs are getting over Cloud phobia”? Let’s try transitioning globalized complex data sets to Cloud, such as 4-500K materials, bill of materials, routings, vendors, customers, master data, and processing in real-time enterprise resource planning functions and features. I am a senior SAP and Oracle Solution Architect consultant for more than few dozens companies around the world. I am very fortunate to have the opportunity getting involved in Cloud computing technology transition process for few comnpanies which I am consulting. In my opinion, moving to Cloud is the right direction, but you must thoroughly prepare your “homework” by carefully research, study, planning and analyze whether or not your company is truly ready for such a transition. Measure twice and cut once.

  5. Steven Liu

    It really depends on the type of data one would like to transition to Cloud Computing. I absolutely agree that Amazon’s cloud services is one of the simple and easy one. However, when you are talking about complex corporate data (not to mention sensitivity involved), a thorough homework must be conducted prior to cloud computing implementation. I applause Coyle’s attempt by moving forward to this approach, but I disagree with many things he said. For example, CIO are getting over Cloud phobia which simply ins’t true. I do not believe CIOs are fear of implementing such a technology. They are simply being careful by observing, studying, researching and understanding this technology before making any decision. Wouldn’t you? As a Solution Architect consultant specialized in SAP and Oracle implementation, I can assure you that by moving globalized, complex and sensitive data sets onto Cloud computing is not as same as moving a specific function and feature of dataset across the Cloud. There are overwhelming of consideration points. In my own opinion, Gapgemini and other big-4 consulting firms are aggressively seeking Cloud computing consulting service business market share, what can be more convincing selling with set-by-example approach. Again, I love to know what information (data) that Mr. Coyle is transitioning to Cloud. 3-500K materials, bill of materials, vendors, customers, banking, financial accounting ledger sets? Realtime global enterprise resource planning data sets? global production and shopfloor control data sets? Last but not least, corporate consoldated business solution financial reporting data sets?

    When you are actually transitioning the aforementioned data sets and processing capability onto Cloud computing, I like to see whether or not you will think twice before execution.

    Here is an advice to the CIO/CTO, think and measure twice and you get one chance to cut it. Do the “homework”… spending that money… because it’s worth it. When all possible angles are taken into consideration and proven such a transition has no obstruction, your fear will then conquered. There are many ways to implement complex data onto Cloud computing. Please taking one step at a time. “HOMEWORK”!

  6. This article implies the same misconception about Azure that was more explicitly stated in Barb Darrow’s article of November 29: namely, that apps targeted at Azure “stay on Azure”.

    Well sure, if those apps make heavy use of Azure’s platform services; but that’s like arguing that the difficulty in porting desktop software that benefits from the features found on a particular OS is the fault of the OS.

    There’s nothing that says every Azure app has to be written that way. In general, existing in-house apps are easily ported to Azure — each instance is, after all, just Windows Server with some preinstalled components.

    The decision to “lock in” isn’t Microsoft’s, it’s the developer’s.

    • The arttcle clearly states Coyle saying this is the perception people have of Azure. And, given conversations i have with developers who have used both Azure and AWS, there is some truth in that perception. Given that Microsoft has encouraged developers to take advantage of Azure’s platform services, there is some truth in that perception.

      • “Given that Microsoft has encouraged developers to take advantage of Azure’s platform services, there is some truth in that perception.”

        Ah, I see! Azure is criticized for offering too much! In the future, I will remember to make _my_ software less innovative; I wouldn’t want its users to become “locked in” to a new and interesting approach.

  7. I think the Azure lock in has already proven to be untrue with the support of node.js on it. Also, customers do understand the difference between IaaS and PaaS, that’s why AWS is moving that way itself.

      • Indeed, they are on a collision course. I would consider Azure a PaaS with the option of IaaS, where AWS is going the other direction, as also underlined by their CTO: Their are IaaS provider “with benefits”.

        I do think however that this article is way to dismissive of the MS effort, and seems to be fueled by vendor board room coffee talks and not by in dept (technical) analysis.

  8. I work for the BEST Cloud Service Provider that you will never hear of. We are a tiny CSP in St. Louis and our Cloud offering will blow the doors off even the largest CSP’s. Our Cloud software is at least 3 years ahead. Our’s is cheap, reliable, completely self controlled and doesn’t require the IT person’s salary to create the ROI. Our Cloud also conforms to the guidlelines set by the NIST as IAAS. Best of luck in your Cloud endeavors. Amazon out 4 days, we would be out of business.

  9. I’m surprised he didn’t mention the vCloud initiative by VMware. Based on the Gartner MQ a couple vCloud providers are in that highly coveted upper right quad. Just seems odd for them not to get a mention in a post like this.

  10. Alon Girmonsky

    Cloud computing is revolutionary by any standard. New companies have the opportunity to level the playing field and market leaders are able to evolve and re-position themselves. New business models emerge. Companies that wait too long to adopt will be left behind. I believe the cloud revolution has proven this, allowing hundreds of fresh ideas to manifest and new companies to take a role in this new age.
    From extensive experience with AWS – I think they provide an awesome service. Downtime happens. It happened to Google few years back. I think that what AWS is doing and the way they do it, has paved an amazing standard for subsequent companies to follow.

    • Christopher Young

      Cloud computing is revolutionary…but only because it has come around again to make its latest and greatest appearance. It is not a new concept by any means. “Cloud” computing really is nothing more than centralized computing with the caveat being that you don’t know where the server is that you are using (at least in theory). Centralized computing has been around since the advent of the mainframe where access to that “cloud” was achieved via terminal interfaces. Fast forward and the migration away from mainframes in favor of distributed PCs gave rise to the establishment of client-server models which provided richer interfaces over a wider variety or protocols to “cloud” servers. Given this, if anything that is currently happening right now with “cloud” computing that is revolutionary (I would probably suggest that evolutionary would be the more appropriate term) it is that software is being developed to enable access to remotely hosted servers that can be notionally shared between numerous organizations on a time sliced / provisioned / hardware independent (think movement of VMs between physical machines) basis. This provides economies of scale leading to lower operating costs that allow cloud providers to create profits while decreasing operating costs for their clients. To your point about “companies that wait too long to adopt will be left behind”, I think you are absolutely right but mainly because the cost of operating ever growing internal IT environments will only get more expensive while the cloud has the potential at least to deliver a more cost effective scale-out model.

  11. I Am OnDemand

    I wonder what will be the best strategic option for a traditional ISV that its offering core based on MS technolgies – MS Azure or Amazon AWS? We should take in mind time to market, lock-in and shifting costs. I think that these are times to examine again the engagement with MS and maybe take the risk of the shifting only for releasing the company from its dependence on MS. What do you think ?

    • Ali Khan

      I think ‘Amazon is Amazon’, it definitely has a upper hand over Azure – thanks to its maturity, better VM options etc. However, Azure doesn’t lag much behind. I would go for AWS right now but few months down the line, Azure can become my top choice.

  12. Bryan Beal

    Yes, “Amazon is Amazon”, but a number of Cloud Providers are popping up with differentiated offerings that offer a compelling alternative to Amazon – especially for high-end, Enterprise customers.

  13. Using amazon’s cloud services, amazingly simple and easy, especially when you are used to a corporate environment with a million and one steps just to get a VM.

    The current cloud providers will be the vendors of the future. Companies that run a private cloud will copy the public cloud companies and use their technologies.