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Is Amazon in Danger of Becoming the Walmart of the Cloud?

October 25, 2008 Leave a comment

Update: Serious misspelling of Walmart throughout the post initially. If you are going to lean an argument heavily on the controversial actions of any entity, spell their name right. Mea culpa. Thanks to Thorsten von Eicken for the heads up.

Also, check out Thorsten’s comment below. Perhaps all is not as bleak as I paint it here for established partners…I’m not entirely convinced this is true for the smaller independent projects, however.


I grew up in the great state of Iowa. After attending college in St. Paul, Minnesota, I returned to my home state where I worked as a computer support technician for Cornell College, a small liberal arts college in Mount Vernon, Iowa. It was a great gig, with plenty of funny stories. Ask me over drinks sometime.

While in Mount Vernon, there was a great controversy brewing–well, nation wide, really–amongst the rural towns and farm villages struggling to survive. You see, the tradition of the family farm was being devastated, and local downtowns were disappearing. Amidst this traumatic upheaval appeared a great beast, threatening to suck what little life was left out of small town retail businesses.

The threat, in one word, was Walmart.

Walmart is, and was, a brilliant company, and their success in retail is astounding. In a Walmart, one can find almost any household item one needs under a single roof, including in many cases groceries and other basic staples. Their purchasing power drives prices so low, that there was almost no way they can get undercut. If you have a WalMart in your area, it might find it the most logical place to go for just about anything you needed for your home.

That, though, was the problem in rural America. If a Walmart showed up in your area, all the local household goods stores, clothing stores, electronics stores and so on were instantly the higher price, lower selection option. Mom and Pop just couldn’t compete, and downtown businesses disappeared almost overnight. The great lifestyle that rural Americans led with such pride was an innocent bystander to the pursuit of volume discounts.

Many of the farm towns in Iowa were on the lookout then, circa 1990, for any sign that Walmart might be moving in. (They still are, I guess.) When a store was proposed just outside of Cedar Rapids, on the road to Mount Vernon, all heck broke loose. There was strong lobbying on both sides, and businesses went on a media campaign to paint Walmart as a community killer. The local business community remained in conflict and turmoil for years on end while the store’s location and development were negotiated.

(The concern about Walmart stores in the countryside is controversial. I will concede that not everyone objects to their building stores in rural areas. However, all of the retailers I knew in Mount Vernon did.)

If I remember correctly, Walmart backed off, but its been a long time. (Even now, they haven’t given up entirely.)

While I admire Amazon and the Amazon Web Services team immensely, I worry that their quest to be the ultimate cloud computing provider might force them into a similar role on the Internet that Walmart played in rural America. As they pursue the drive to bring more and better functionality to those that buy their capacity, the one-time book retailer is finding themselves adding more and more features, expanding their coverage farther and farther afield from just core storage, network and compute capacity–pushing into the market territory of entrepreneurs who seized the opportunity to earn an income off the AWS community.

This week, Amazon may have crossed an invisible line.

With the announcement that they are adding not just a monitoring API, not just a monitoring console, but actual interactive management user interface, with load balancing and automated scaling services, Amazon is for the first time creeping into the territory held firm by the partners that benefited and benefited from Amazon’s amazing story. The Sun is expanding into the path of its satellites, so to speak.

The list of the endangered potentially include innovative little projects like ElasticFox, Ylastic and Firefox S3, as well as major cloud players such as RightScale, Hyperic and EUCALYPTUS. These guys cut their teeth on Amazon’s platform, and have built decent businesses/projects serving the AWS community.

Not that they all go away, mind you. RightScale and Hyperic, for example, support multiple clouds, and can even provide their services across disparate clouds. EUCALYPTUS was designed with multiple cloud simulations in mind. Furthermore, exactly what Amazon will and won’t do for these erstwhile partners remains unclear. Its possible that this may work out well for everyone involved. Not likely, in my opinion, but possible.

Sure, these small shops can stay in business, but they now have to watch Amazon with a weary eye (if they weren’t already doing that). There is no doubt that their market has been penetrated, and they have to be concerned about Amazon doing to them what Microsoft did to Netscape.

Or Walmart did to rural America.

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Cloud Computing on Google Groups is Dead to Me

September 18, 2008 Leave a comment

Update: OK, I got a little emotional here. I am upset at the way this played out, but the title and some of the sentiment expressed are a little harsh. Perhaps, “Cloud Computing on Google Groups, I’m moving on” would have been more appropriate. Also, while I will be moving on (unless invited back), the group will no doubt remain active and interesting. Just be aware of how it is moderated–and be aware that there other venues in which to discuss cloud computing.

Unbelievable.

A couple of days ago, I reacted to a post by Sam Johnston outlining a scary exchange with the moderator of the Google Groups Cloud Computing group, Khazret Sapenov, in which Sam found himself locked out of the group with no public or private explanation. I wrote the post because I wanted Khazret and Reuven Cohen (also implicated) to have an opportunity to respond to Sam’s charges, and for the community to work this out fairly and openly. I considered the post a “reconciliation post”, nothing more, nothing less. (I will admit that I should have rethought the title, though.)

This morning, my first attempt to view the group home page resulted in this:

Now, here’s the kicker: I absolutely did not post a thing to the group between the time of the reconciliation post and when I was locked out, so I couldn’t have been locked out for a violating the group’s rules, whatever they may have been, unless there was a problem well before I posted. This reaction is almost certainly to the reconciliation post itself, which did not at all take place in the group threads.

Google Groups Cloud Computing is dead to me. It’s not even worth fighting this. I loved the insights of the group, but there are other viable communities to turn to that are open and transparent, and that can be considered credible. This group is none of those things, apparently.

To have two leading cloud computing bloggers locked out of a supposedly open community–without any public or private explanation–signals bias and dangerous politics.

Here is a little more detail:

  • Since I posted the reconciliation post, I’ve had three other emails confirming Sam’s claim that moderation has been strange, arbitrary and at times very slow. Not an overwhelming response, but significant enough to note that Sam is not alone in his thinking.

  • At the same time, I’ve had no emails or comments explaining what happened to Sam.

  • This morning, I received a comment from Reuven claiming that neither he nor Enomaly have had anything to do with the controversy, despite his founding of the group and (I would imagine) subsequent assignment of moderating duties to Khazret–his Director of R&D, according to LinkedIn. He even offered to join any new open community that might be formed. I will accept that at face value. If I were him, however, I’d have a chat with Kharzet about the costs of his actions. He is killing, or at least maiming, the Google group, and will taint Enomaly’s name.

  • I remain convinced that this could all be worked out easily by the community if an open conversation was allowed. Since that is not happening, I welcome others concerned about an open, fair exchange of ideas to follow me to greener pastures.

If you are a member of the group, and would like some of the facts in detail, please send me an email at jurquhart at yahoo dot com, and I’ll take the time to fill you in.

Here is where I will be hanging out:

  • Twitter, user ID “jamesurquhart

  • FriendFeed, user ID “jamesurquhart“, and the Cloud Computing room. This is the place I have the highest hopes for, as FriendFeed’s features combine streams with discussion to create a truly dynamic community, and the Room helps narrow the discussion to keep it on target.

  • Sam has a WIKI started at http://wiki.cloudcommunity.org and I will likely be putting some of my more permanent content there for the community to hack (e.g. the Principles of a Cloud Oriented Architecture series)

  • One other intriguing option is Hug The Cloud (an unfortunate name), a Ning community that adds some excellent social networking features to the general discussion. Check it out, let me know what you think.

  • Update: I should also say, if anyone out there knows of a good alternative, open cloud computing forum, list, or network, please, please plug it in the comments below! I’ll only moderate off topic spam for this one post. 🙂

This is really a sad day for me. I wish cooler heads had prevailed. See you on the streams!

Is the Future of Global Services "Work From Home"?

September 12, 2008 Leave a comment

Software consulting is a heck of a fun gig. However, one of the downsides to this…well…lifestyle, really, is that the big money jobs almost always require a willingness to travel–a lot. There is good reason for this; consultants are expected to be deep experts on specific technologies or processes, and the market for each of those specifics is limited in any one city. However, nation-wide there is plenty of business in most mature markets.

I always loved the job of consulting, but the lifestyle beat me up pretty bad. Truth be told, I probably wouldn’t be married with two lovely kids today if I had stayed on the road. I’m just not good at maintaining distance relationships, and I had to get off the road to meet and spend time with the perfect woman before she would agree to marry me. (OK, enough of that schmaltz.)

Something intriguing occurred to me while researching cloud vendors for Alfresco, however. What if the “network centric” nature of the cloud actually creates an opportunity to change the lifestyle of software consulting? What if consultants didn’t have to travel for every billable hour, but could do a significant portion–if not all–of their work from a local office, or even from home?

First, think about the possibility. How should, for instance, vendor services be handled when the software is delivered in the cloud?

  • If most of the work of the consultant is assisting in planning and reviews, does every engagement need to be face to face, even if neither the hardware nor the network is owned by the client?
  • For longer term engagements, given the collaboration tools that are now (and will soon be showing up) on the Web, do teams really need to sit in the same building to be effective?
  • If the cost of travel (air and lodging) can be eliminated from the overall cost of using vendor services, would clients be more likely to use the service or less?

I honestly don’t know the answers to these questions. But I think the requirements for consulting services are significantly different in the cloud, especially when it comes to what you can do for your client when and from where. I’d be interested in what others think about that.

I do know that there are certain services that will always be face-to-face; workshop facilitation, for instance; or certain kinds of project reviews. However, open source has taught us a lot about how “network organized” teams can work, and I think more and more consulting will look like open source contribution and less “on-site guru”. Then, maybe..just maybe…I can be a big time consultant and still tuck my kids into bed every night…

Cloud Computing and the Constitution

September 8, 2008 Leave a comment

A few weeks ago, Mark Rasch of SecurityFocus wrote an article for The Register in which he described in detail the deterioration of legal protections that individuals and enterprises have come to expect from online services that house their data. I’ll let you read the article to get the whole story of Stephen Warshak vs. United States of America, but suffice to say the case opened Rasch’s eyes (and mine) to a series of laws and court decisions that I believe seriously weaken the case for storing your data in the cloud in the United States:

  • The Stored Communications Act, which was used to allow the FBI to access Warshak’s email communications without a warrant, his consent, or any form of notification.

  • The appeals court decisions in the case that argue:

    1. Even if the Stored Communications Act is unconstitutional, Warshak cannot block introduction of the evidence as “the cops reasonably relied on it
    2. Regardless of that outcome, the court could not determine if “emails potentially seized by the government without a warrant would be subject to any expectation of privacy”
  • The Supreme Court decision in Smith v. Maryland, in which the court argued that people generally gave up an expectation of privacy with regards to their phone records simply through the act of dialing their phone–which potentially translates to removing privacy expectation on any data sent to and accessible by a third party.

Rasch notes that in cloud computing, because most terms of service and license agreements are written to give the providers some right of access in various circumstances, all data stored at a provider is subject to the same legal treatment.

This is a serious flaw in the constitutional protections against illegal search and seizure, in my opinion, and may be a reason why US data centers will lose out completely on the cloud computing opportunity. Think about it. Why the heck would I commit my sensitive corporate data to the cloud if the government can argue that a) doing so removes my protections against search and seizure, and b) all expectations of privacy are further removed should my terms of service allow anyone other than myself or my organization to access the data? Especially when I can maintain both privileges simply by storing and processing my data on my own premises?

Couple this with the fact that the Patriot Act is keeping many foreign organizations from even considering US-based cloud storage or processing, and you see how it becomes nearly impossible to guarantee to the world market the same security for data outside the firewall as can be guaranteed inside.

It is my belief that this is the number one issue that darkens the otherwise bright future of cloud computing in the United States. Simple technical security of data, communications and facilities is a solvable problem. Portability of data, processing and services across applications, organizations or geographies is also technically solvable. But, if the US government chooses to destroy all sense of constitutional protection of assets in the cloud, there will be no technology that can save US-based clouds for critical security sensitive applications.

It may be too late to do the right thing here; to declare a cloud storage or processing facility the equivalent of a rented office space or an apartment building–leased spaces where all constitutional protection against illegal search and seizure remain in full strength. When I was younger and rented an apartment, I had every right to expect law enforcement wishing to access my personal spaces would be required to obtain a warrant and present it to me as they began their search. The same, in my opinion, should apply to data I store in the cloud. I should rest assured that the data will not be accessed without the same stringent requirements for a search warrant and notification.

Still, there are a few things individuals and companies can do today that appear OK to thwart attempts to secretly access private data.

  1. Encrypt your data before sending it to your cloud provider, and under no circumstances provide your provider with the keys to that encryption. This means that the worse a provider can be required to do is to hand over the encrypted files. You may even be able to argue that your expectations of privacy were maintained, as you handed over no accessible information to the provider, simply ones and zeros.

  2. Require that your provider modify their EULA/ToS to disavow ANY right to directly access your data or associated metadata for any reason. The exception might be file lengths, etc., required to run the hardware and management software, but certainly no core content or metadata that might reveal the relevant details about that content. This would also weaken the government’s case that you gave up privacy expectations when you handed your data to that particular cloud provider.

  3. Store your data and do your processing outside of the United States. It kills me to say that, but you may be forced into that corner.

If there are others that have looked at this issue and see other approaches (both political and technical) towards solving this (IMHO) crisis, I’d love to hear it. I have to admit I’m a little down on the cloud right now (at least US-based cloud services) because of the legal and constitutional issues that have yet to be worked out in a cloud consumer’s favor.

Oh, and this issue isn’t even close to being on the radar screen of either of the major presidential candidates at this point. I’m beginning to consider what it would take to get it into their faces. Anyone have Lawrence Lessig’s number handy?

Children of the Net: Why Our Decendents Will Love The Cloud

January 23, 2008 2 comments

Our children–or perhaps our grandchildren–won’t remember a time when there was a PC on every desk, or when you had to go to Fry’s Electronics to buy a shrink-wrapped copy of your favorite game. This, as Nick notes frequently in The Big Switch, is one of the real parallels between what our ancestors went through with electrification and what we have yet to go through with compute utilities. Heck, I already find it hard to remember when I didn’t have access to the World Wide Web, and in what year all of that changed. Also, I’m frankly already taking the availability of services from the cloud for granted.

My Dad used to tell me stories of when he lived in a house in Scotland with only a few lights and no other electrical appliances, no indoor plumbing and no telephone. I can’t imagine living like that, but it was just about 50-60 years ago. Those born in the latter half of the twentieth century (in an industrialized country) are perhaps the first to live a lifetime without seeing or experiencing life without multiple sockets in every room. It is unimaginable what life was like for our ancestors pre-electrification.

There will likely be both positive and negative consequences that come from any innovation, but to the innovator’s descendants, they won’t remember things any other way. In the end, once basic needs are taken care of, all human kind cares about is lifestyle anyway, so the view of how “good” an “era” is, is largely driven by how well those needs are taken care of. One of those basic needs is the need to create/learn/adapt, but another one is the need for predictability of outcome. This constant battle between the yearn for freedom and the yearn for control is what makes human culture evolve in brilliantly intricate ways.

I for one hold out hope that our descendants will be increasingly satisfied with their lifestyles, which–in the end–is probably what we all want to see happen. Will those lifestyles be better or worse from our perspective as ancestors? Who knows…but it won’t really matter, now, will it?

Of course, one of the biggest challenges to humanity is meeting even the basic needs of its entire population. To date, the species has failed to achieve this–the study of economics is largely targeted at understanding why this is. Cloud computing could, as Nick suggests, actually make it more difficult for some groups of people to meet their basic needs, but I would argue that this would be counter productive to the rest of society.

At the core of my argument is the fact that so much of online business is predicated on massive numbers of people being able to afford a given product. Nick argues that life in the newspaper world shows us the future of most creative enterprises; the ease of the masses to create and find content makes it difficult to sell advertising to support newspapers, thus the papers struggle. But if huge numbers of people are out of work, with no one valuing their talents and experience, that will lead to less consumer spending. Less consumer spending will lead to less advertising, which will in turn lead to less income for “the cloud” (i.e. those companies making money from advertising in the cloud). Its a horribly negative feedback cycle for online properties/services, and one I think will fail to come to pass.

The alternative is that the best of the talent out there continue to find ways to get paid, while the masses are still encouraged to participate. Newspaper journalists are already finding opportunities online, though perhaps at a slower pace then some would like. I believe that ventures such as funnyordie.com and even YouTube will create economic opportunities for videographers and film makers to rise above the noise. Musicians are already experimenting with alternative online promotion and sales tools that will change the way we find, buy and consume music. Yes, the long tail will flourish, but the head of the tail will continue to make bank.

The result of this is simply a shifting of the economic landscape, not a wholesale collapse into a black hole. Yeah, the wealth gap thing is a big deal (see Nick’s book), but I believe that the rich are going to start investing some of that money back into the system when the new distribution mechanisms of the online world mature–and that should create jobs, fund creative talent and create a new world in which those that adapt thrive, and those that don’t struggle.

Did I mention I think the utility computing market is a complex adaptive system?