its reputation as an online bookstore and e-retailer, but its
newest business is cloud computing. one of the first vendors in
this emerging market more than two years ago, amazon is a good
starting point for any business technology organization trying to
decide where and when to plug into the cloud.
amazon's cloud goes by the name amazon web services
(aws), and it consists, so far, of four core
services: simple storage service (s3); elastic compute cloud (ec2);
simple queuing service; and, in beta testing, simpledb. in other
words, amazon now offers storage, computer processing, message
queuing, and a database management system as plug-and-play services
that are accessed over the
a tremendous amount of it infrastructure is required to provide
those services--all of it in amazon data centers. customers pay
only for the services they consume: 15 cents per gigabyte of s3
storage each month, and 10 to 80 cents per hour for ec2 server
capacity, depending on configuration.
represents three of the defining characteristics of the cloud: it
resources provisioned outside of the corporate data center, those
resources accessed over the internet, and variable cost.
amazon's first cloud service was s3, which provides
unlimited storage of documents, photos, video, and other data. that
was followed by ec2, pay-as-you-use computer processing that lets
customers choose among server
why is amazon moving so aggressively into web services? in its rise
to leadership in e-commerce, the company developed deep technical
expertise and invested heavily in its data centers. now it's
leveraging those assets by opening them to other companies, at a
time when many cios are looking for alternatives to pumping more
money into their own it infrastructures. "what a lot of people
don't understand is that amazon is at heart a technology
company--not a bookseller or even a retailer," says adam selipsky,
vp of product
management and developer relations for aws.
wooing developers to aws
developers--defined as anyone, from individuals to the largest
companies, who signs up for aws--are glomming onto amazon's
infrastructure to develop and deliver applications and capacity
without having to deploy on-premises software and servers. more
than 370,000 developers are on board.
services weren't aimed initially at big businesses, but enterprises
are tapping in for the same reasons that attract small and midsize
businesses--low up-front costs, scalability up and down, and it
resource flexibility. to better support large accounts, amazon
began offering round-the-clock phone support and enterprise-class
service-level agreements a few months ago. for instance, if s3
availability falls below 99.9% in a month, customers are entitled
to at least a 10% credit. amazon isn't foolproof--its
consumer-facing web site recently suffered a series of outages and
amazon hasn't morphed into a software-as-a-service vendor, but
startups and other software developers are using aws to offer their
own flavors of saas. they include vertica, which sells s3-based
data warehouses, and soniaf building new data centers in iowa,
oregon, north carolina, and south carolina, at an average cost of
about $600 million each.
google built a supercharged business model around searching
the internet. now it's opening its cloud to businesses in the form
of application hosting, enterprise search, and more.
google introduced google app engine, a service that lets developers
write python-based applications and host them on google
infrastructure at no cost with up to 500 mb of storage. beyond
that, google charges 10 to 12 cents per "cpu core hour" and 15 to
18 cents per gigabyte of storage. this month, google disclosed
plans to offer hosted enterprise search that can be customized for
google, like amazon, has demonstrated the risks of cloud computing.
google app engine last week was crippled for several hours. google
blamed the outage on a database server bug.
for end users, there's google apps--web-based documents,
spreadsheets, and other productivity applications. google apps are
free or $50 per user annually for a premium edition. microsoft's
pc-based office 2007 suite, by comparison, costs up to $500 per
half a million organizations have signed up for google
apps--including general electric and procter &
gamble--and there are now some 10 million google apps users. but
keep that in perspective: the majority of those users are
consumers, college students, and employees of small businesses, not
the corporate crowd. google senior product manager rajen sheth
acknowledges that google's apps aren't intended to replace business
tools like office.
google has taken steps to make its applications, originally
aimed at consumers, more attractive to it departments. last year,
the company acquired postini, whose hosted e-mail security and
compliance software is now part of google apps, and in april it
partnered with salesforce.com to integrate salesforce crm and
google apps, including a premium package that comes with phone
support and third-party software for $10 per user each month.
google is also adjusting to the reality that users sometimes
need to work offline. google gears is a browser plug-in for doing
has teamed with ibm to provide cloud computing to university
students and researchers. the google-ibm cloud is a combination of
google machines and ibm bladecenter and system x servers running
linux, xen virtualization, and apache's open source hadoop
framework for distributed applications.
great advantage we have, and one of the reasons we started to
explore this, is that we run one of the largest online apps in the
world, if not the largest," says sheth, referring to google's web
search engine. the project, sheth says, will help "foster new
innovation and new ideas" about cloud computing.
and ibm have been cagey about any plans to extend their cloud
collaboration to enterprises, but it would be an obvious next step.
"there's not that much difference between the enterprise cloud and
the consumer cloud" beyond security requirements, google ceo eric
schmidt said a few weeks ago. "the cloud has higher value in
business. that's the secret to our collaboration."
with its plug-and-compute simplicity, the cloud seems ethereal, but
don't be fooled. google's cloud represents a massive investment in
it infrastructure. google has recently completed or is in the
processing of building new data centers in iowa, oregon, north
carolina, and south carolina, at an average cost of about $600
salesforce became the proving ground for software as a
service with its web alternative to premises-based sales force
automation applications, and dozens of saas companies followed.
salesforce's next act: platform as a service.
benioff's company is making its web application platform,
force.com, available to other companies as a foundation for their
own software services. force.com includes a relational database,
user interface options, business logic, and an integrated
development environment called apex. programmers can test their
apex-developed apps in the platform's sandbox, then offer the
finished code on salesforce's appexchange directory.
in the early
going, developers used force.com to create add-ons to salesforce
crm, but they're increasingly developing software unrelated to
salesforce's offerings, says adam gross, the vendor's platform vp.
game developer electronic arts built an employee-recruiting
application on force.com, and software vendor coda crafted a
general ledger app.
at the same time, salesforce continues to advance its own
applications, which are now being used by 1.1 million people. an
upgrade due this summer will include the ability to access google
apps from within a salesforce application, more than a dozen new
mobile features, an "analytics snapshot," enhanced customer
portals, and improved idea exchange and content management.
salesforce is getting into other cloud services, too. in
april 2007, it jumped into enterprise content management with
salesforce content, which lets users store, classify, and share
information similar to microsoft sharepoint and emc
salesforce has adopted a
multitenant architecture, in which servers and other it resources
are shared by customers rather than dedicated to one account.
"there's no question there's an evangelism involved with doing
multitenancy, but, with education, customers quickly come on board
with the model," says gross.
is in the sales figures. salesforce's revenue grew to $248 million
in the quarter ended april 30, a 53% increase over the same period
a year ago, keeping it on pace to become the first billion-dollar
company to generate almost all of its sales from cloud
if any technology company has had its cloud strategy questioned,
it's microsoft. now, after a couple of years of putting the pieces
into place, microsoft is showing progress.
some vendors envision a future where most, if not all, it
resources come from the cloud, but microsoft isn't one of them. its
grand plan is to provide "symmetry between enterprise-based
software, partner-hosted services, and services in the cloud,"
chief software architect ray ozzie said a few months ago. more
simply, microsoft calls it "software plus services."
microsoft's first saas offerings for business, rolling out this
year, are dynamics crm online, exchange online, office
communications online, and sharepoint online. each will be
available in a multitenant version, generally for small and midsize
businesses, and a single-tenant version for companies requiring
5,000 or more licenses. for consumers, microsoft's online services
include windows live, office live, and xbox live.
a handful of large companies--autodesk , blockbuster, energizer,
and ingersoll-rand among them--are early adopters. anyone who
doubts that microsoft has entered the cloud services game should
consider this: coca-cola plans to subscribe to 30,000 seats of
microsoft-hosted exchange and sharepoint by next year.
senior vp chris capossela says customers can mix and match hosted
and on-premises versions of its software, an attractive option for
companies with branch offices that lack it staff. microsoft hasn't
disclosed pricing for its online services, but capossela says it's
naive to think that cloud services will be cheaper than on-premises
software over the long haul. "you're going to pay forever," he
says. "it's a subscription, for goodness' sake."
what's next? a project called matrixdb would extend on-premises sql
server databases to microsoft-hosted databases in the cloud. that's
still a couple of years away, but it hints at future possibilities.
and microsoft points to biztalk services, its hosted business
process management software, as one element in a forthcoming
"internet service bus" that functions like an enterprise service
bus, albeit online.
as for the windows operating system, microsoft's upcoming
synchronization platform, live mesh, and some of the windows live
services will be more tightly integrated with it.
the shift to cloud services has forced microsoft to rethink not
just the way its products are architected, but its data center
strategy, too. for years, microsoft leased its major data centers,
but it has now begun to design, construct, and own them, with u.s.
facilities recently completed or under construction in illinois,
texas, and washington, and another under way in dublin,
john gage, sun microsystems' co-founder, coined the phrase "the
network is the computer" nearly 20 years ago. arguably, that was
the beginning of the cloud--but the wind changed direction.
sun "got it backwards," cto greg papadopoulos now says. how so?
with its sun grid technology, sun focused on mission-critical,
highly redundant data center environments. "we found that nobody
cared about that," says papadopoulos. "they just want it to be easy
making cloud computing easy to use is now the focus of two
initiatives at sun: network.com, a collection of grid-enabled
online applications available on a pay-per-use basis, and project
caroline, a research effort to make cloud-based resources available
to developers working on web applications and services. they
coincide with what papadopoulos calls "red shift," his theory that
computing demand will exceed capacity at many companies. the
obvious solution: cloud computing.
network.com is evolving into a "virtual on-demand data center" that
customers can use in real time as business demands change, says
senior director of software mark herrin.
cloud computing must be easy, says sun's
project caroline is intended to become a hosting platform for saas
providers. the goal is to make it "far more efficient to develop
multiuser internet services rapidly, update them frequently, and
reallocate resources flexibly and cost-efficiently," according to
sun. an open source project led by sun vp of technology rich
zippel, caroline supports applications built in several programming
languages, including java, perl, python, ruby, and php. "we don't
really think that 'all applications will tie back to sun servers on
the internet,'" zippel writes on his blog. "we're really bullish
about the ability to develop, deploy, and deliver software services
on the internet."
like microsoft ，sun expects businesses to continue to
need some of their own it infrastructure. sun's
data-center-in-a-box, blackbox, is designed for companies that face
massive computing requirements but aren't ready to shift all their
infrastructure to the cloud. similarly, sun's constellation groups
together sun blade 6000 servers.
ibm last year unveiled blue cloud, a set of offerings that, in
ibm's words, will let corporate data centers "operate more like the
internet by enabling computing across a distributed, globally
accessible fabric of resources." the pieces of blue cloud include
virtual linux servers, parallel workload scheduling, and ibm's
tivoli management software. in the first phase, ibm is targeting
x86 servers and machines equipped with ibm's power processors; in
phase two, ibm will loop in virtual machines running on its system
z mainframes. blue cloud is "not just about running parallel
workloads but about more-effective data center utilization," says
denis quan, cto of ibm's high performance on demand solutions
ibm's first commercial cloud computing data center is going up in
wuxi, in southern china. it will provide virtualized computing
resources to the region's chipmaking companies.
ibm's advantage in cloud computing is its expertise in building,
supporting, and operating large-scale computing systems. ibm got
into cloud computing a few years ago with its technology adoption
program, an "innovation portal" run out of the almaden research
center to give engineers on-demand resources, such as db2 databases
and linux servers.
last october, ibm announced a partnership with google to provide
cloud computing gateways to universities. intended as a way of
teaching university students how to use parallel programming
models, the initiative is "critical to the next generation of
cloud-based applications," quan says. three cloud computing centers
for academia have gone live, one at almaden, one at the university
of washington in seattle, and one in a google data center.
for it departments, ibm's cloud software, systems, and services can
be brought together into what the vendor calls the "new enterprise
data center," with quality-of-service guarantees to reassure cios
that there's nothing hazy about the cloud.
despite its sometimes-contradictory signals, oracle was an
early proponent of the on-demand model, launching oracle business
online in 1998. at that time, ceo larry ellison described the new
web-based delivery model as an extension of the company's existing
software business. today, it's clear that oracle's destiny lies in
the cloud, even if the company has been reluctant to switch its
lucrative on-premises software license business over to a
speaking to financial analysts last september, ellison downplayed
the saas movement, saying there's no profit to be made in
delivering applications over the internet. (he's obviously wrong on
that point.) president charles phillips has said oracle plans a
"stair-step" approach to the cloud, gradually moving on-premises
customers over to web-based software.
oracle got into cloud computing in one fell swoop with its 2005
acquisition of siebel systems for $5.8 billion. at the time, oracle
executives called the deal a beachhead against sap, but it's clear
in hindsight that siebel's on-demand crm applications were every
bit as important to oracle's long-term strategy. oracle on demand
comprises much of the vendor's software stack, including the
company's flagship database.
oracle has developed a "pod" architecture for its on-demand data
centers. pods can be configured for individual customers, in
clusters for large companies with multiple departments, or in
multitenant versions for shared use.
oracle's on-demand business generated $174 million in revenue in
the fiscal quarter ended march 26, up 23% from the same quarter
last year, and it's on track for $700 million for the year. while
on demand represents only about 3% of oracle's revenue, it's the
fastest-growing part of the business, with 3.6 million users.
to support growth, oracle, like other cloud service providers,
is building a new data center. this summer, it will break ground on
a 200,000-square-foot facility in utah and puts the initial
investment at $285 million.