ElasticVapor - Life in the cloud

Intel's #DigitalNibbles Livecast - Pilot Episode

2011-12-16T13:49:00.001-05:00

I'm happy to announce the new Intel #DigitalNibbles livecast with @techallyson & myself is launching Jan 4th.

In this our pilot episode Allyson and I talk with Raejeanne Skillern from Intel about the company's perspective on the cloud and where cloud computing will take us. John Kenevey from Facebook also stops by to talk about the Open Compute Project and transforming the data center.

Listen to our pilot episode.

Virtustream Acquires Enomaly, Inc

2011-12-15T09:26:00.003-05:00

Toronto, Ontario, Canada—December 15, 2011— We are happy to announce today that Enomaly Inc., has entered into a definitive agreement to be acquired by Virtustream, Inc., a leading global cloud solutions provider. Terms of the deal were not disclosed, and the deal is expected to close in Q1 of 2012.

Virtustream owns and operates its own data centers in the U.S. and U.K., and has offices in Washington, D.C., New York, San Francisco, Atlanta, London and Dublin. Virtusteam clients include some of the worlds largest and most successful firms including Domino Foods and Yum Brands.

“Cloud computing is evolving quickly and we believe Virtustream to be among the fasting growing and best positioned for the massive opportunity within the enterprise cloud space. Virtustream is ideally positioned to capitalize on the needs of complex enterprises migrating to the cloud.” said Reuven Cohen, Founder of Enomaly. “We are ecstatic to be joining the Virtustream team.”

Enomaly is credited with pioneering the first cloud brokerage, SpotCloud, which provides a marketplace for buyers and sellers to exchange available compute and storage capacities. Virtustream will make two key enhancements to SpotCloud. First, the company will delay the production launch of SpotCloud 1.0, which is currently in beta release with thousands of registered users, so as to enhance its robustness and security. Secondly, Virtustream will significantly enhance SpotCloud’s workload exchange with the xStream Infrastructure Unit (IU). The IU, invented and patented by Virtustream, is a cloud atomic element - an extensible container of compute, memory, bandwidth and IOPS, smaller than a virtual machine, which enables highly efficient cloud management for customers and industry leading service level guarantees.

Along with these upgrades, Virtustream will continue to support released versions of Enomaly’s software products. Furthermore, the company will also integrate specific components of SpotCloud into its future product suite, which will include a trusted exchange for clients looking for business-class cloud federation using the xStream cloud ecosystem. Virtustream’s xStream cloud platform is available today and includes off-premise virtual private cloud services, off-premise public cloud services and on-premise private cloud enablement software.

Another key driver of the acquisition is the acceleration of Virtustream’s expansion into the Asia Pacific region. Earlier in the year, Virtustream announced a strategic partnership with XYBASE to drive cloud computing adoption in Southeast Asia, including Malaysia, Indonesia and Thailand. With the acquisition of Enomaly, the company will quickly expand its distribution into China.

“Enomaly has gained its most significant market traction in AsiaPac, specifically China” said Rodney Rogers, Chairman and CEO of Virtustream. “This acquisition allows us to leverage their customer base in this region and to expand upon it by bringing these customers a much broader capability set with the xStream Cloud Platform.”

About Enomaly
Enomaly (www.enomaly.com) has been a pioneer and leader in the cloud computing space. Enomaly's SpotCloud platform is the world's first many-to-many cloud platform, interconnecting hundreds of suppliers and thousands of cloud infrastructure users in a global marketplace of cloud computing capacity. Enomaly's Elastic Computing Platform and its High Assurance Edition empower service providers, governments, and enterprise end-user organizations to deliver highly scalable "infrastructure as a service" (or IaaS) services to their customers and stakeholders. Enomaly is based in Toronto, Canada, with additional operations in Vancouver and in major APAC markets. Needham & Company, LLC acted as financial agent to Enomaly in this transaction. Enomaly is also creator of CloudCamp, an informal global series of cloud computing events that provide a common ground for the introduction and advancement of cloud computing.

About Virtustream
Virtustream (www.virtustream.com) is an innovative cloud provisioning firm committed to delivering next-generation infrastructure services to enterprise class customers. We leverage our secure high performance platform, xStream, to deliver highly available and elastic compute resources at true consumption-based pricing. We lead our Cloud Platform Services with Cloud Advisory Services, providing expertise in the areas of cloud adoption, migration and architecture strategies and infrastructure-related integration services. We provide ongoing support for our Cloud Platform Services through two groups: our Cloud Cover team provides a managed service, from core infrastructure through enterprise applications and the Cloud Staging and Networks group that provides colocation, security and network services. Virtustream owns and operates its own data centers in the U.S. and U.K., and has offices in Washington, D.C., New York, San Francisco, Atlanta, London, Dublin and the Channel Islands. Keep tabs on us with Twitter: www.twitter.com/rjrogers87 and www.twitter.com/Virtustream.

###

Media Contacts:

Lisa Desmond Mercedes Carrasco

Virtustream, Inc. Schwartz MSL
(615) 368.7325 (781) 684.0770
lisa.desmond@virtustream.com virtustream@schwartzmsl.com

Reuven Cohen
Enomaly Inc.
(416) 710-5831

Reuven Cohen Added as TechStars Cloud Mentor

2011-09-27T13:41:00.000-04:00

I'm happy to announce that I've agreed to pitch in as a TechStars Mentor for their new Cloud accelerator program.

For those of you unfamiliar with TechStars, it's the #1 startup accelerator in the world. Not to mention one of the most selective – although thousands of companies apply each year, they only take about ten companies per program. This gives them a selection rate lower than most Ivy League schools, so you have to be among the best of the best to be in TechStar.

TechStars Cloud is a vertically-focused accelerator that funds companies focused exclusively on cloud computing and cloud infrastructure. For me, the more exciting aspect of the TechStars Cloud program is that it's specifically targeting cloud infrastructure startups exclusively. Yes, something I have a bit of experience with.

What do you get? How's $100k cash sound? Oh did I mention it's provided by top venture capital firms including Avalon, DFJ Mercury, Foundry Group, IA Ventures, Right Side Capital, Silicon Valley Bank, SoftBank Capital, DFJ Mercury, RRE, as well as TechStars Alumni and several individuals.

Oh, and thats not all. They're some pretty sweet perks too.

So, do you have a great idea for company, but don't have the funds to get it off the ground? Go ahead and apply for the upcoming Cloud accelerator program (deadline for applications is Oct 21)

Who knows, you might have me as your mentor. Tell'em @ruv sent ya :)

Talking about The China Cloud

2011-09-16T15:47:00.000-04:00

Reuven Cohen is the founder of Enomaly, a cloud services provider. He is also one of the original CloudCamp founders. He travels more than most people I know. And a lot of that travel is to China and the Asia Pacific region. He is one of the first cloud people to start doing business in China and the Asia Pacific region.

Original link
http://ruv.net/a/zi

Announcing SpotCloud for OpenStack

2011-04-28T13:38:00.000-04:00

SpotCloud, the world's best place to buy & sell cloud computing capacity, is happy to announce support for the OpenStack platform.

The open source SpotCloud OpenStack Connector is available for immediate use as a free Apache-licensed download (http://dl.enomaly.com/spotcloudopenstack). The SpotCloud OpenStack Connector provides an easy and effective way for service providers deploying OpenStack based clouds to sell cloud computing capacity through the global SpotCloud market.

This release represents another step in opening up the SpotCloud market with support for the widest range of cloud services. The SpotCloud market is open to all buyers of cloud computing services through www.spotcloud.com, offering the world’s best pricing and availability for cloud services from service providers on four continents, now including service providers using OpenStack as their cloud platform.

Key facts about the SpotCloud OpenStack Connector:

The SpotCloud OpenStack Connector easily connects any existing or new OpenStack deployment to SpotCloud

Through SpotCloud, service providers can choose to sell excess cloud capacity anonymously, and can also offer their fully branded cloud services for sale

Service providers have full control over how much of their cloud capacity is made available to SpotCloud buyers, what configurations are offered through SpotCloud, and at what price

SpotCloud provides detailed reporting of all transaction activity and provides payment settlement services in over 80 currencies

The SpotCloud OpenStack Connector is free open source software, supported and released under the Apache license

Download the free SpotCloud OpenStack Connector today

Curious how SpotCloud works? For a limited time, receive a free credit for cloud services when you sign up as a buyer!

SpotCloud Update - Non-Opaque Provider Branding Options

2011-04-20T09:41:00.002-04:00

This is a quick note to let you know that we’ve added an exciting new “Non Opaque” feature for SpotCloud providers. This new branding option for hardware profiles allows you to selectively choose which profiles are made visible under your own company name and logo while allowing other profiles to remain opaque (hidden) to our more then 1200+ registered SpotCloud buyers.

By promoting your brand, you’ll benefit by attracting buyers who are willing to pay extra for the trust your brand implies.

To enable this feature please login to the SpotCloud dashboard as a provider, then go to the “settings” tab and upload your logo, your company name and website.

Next go to the “Pricing” tab and edit the profiles you would like to make your brand visible with by selecting the “branding” check box in each profile. Once approved your company, logo and link to your website will be visible to all SpotCloud buyers. You can login as a buyer to see this in action with our example "Enomaly Inc" provider.

Real-time SpotCloud Market Data API Released

2011-03-23T15:00:00.002-04:00

One of the most requested additions to the SpotCloud API is the ability to get realtime market data. I'm happy to announce that we've added this to the latest SpotCloud Provider API update V1.2.

These new API calls allow you to adjust your pricing to be based on market conditions or simply see what the most popular locations or instance type are at any given moment giving our providers an extra level of insight into the SpotCloud market.

You can grab the latest API docs from the following locations.

Request

GET /api/v1/provider/market.{json|xml}

Response Fields

average_package_size - The average appliance storage size.
popular_cpu - A list of popular CPU counts used when creating instances.
popular_memory - A list of popular memory sizes used when creating instances.
popular_location - A list of popular geographic locations used to deploy instances.
average_memory_cost - The current average cost per GB of memory.
average_cpu_cost - The current average cost per CPU.

SpotCloud Update (New App Directory)

2011-03-11T14:14:00.003-05:00

We’re happy to announce that we’ve launched a new Appliance Directory for SpotCloud. The integrated appliance directory allows you to more easily deploy from a directory of pre-built SpotCloud appliances to any of our providers from around the globe. To get started, login to the SpotCloud management dashboard as a buyer, select a providers and you’ll see a list of appliances in the drop down.

We are actively adding new appliances to the directory, so check back frequently. Some of the appliances we have available currently included:

Webmin
The SpotCloud Webmin appliance is our generic Ubuntu 10.10 with a Webmin management console added to it. This allows you to visually configure all aspects of your server, including installing packages and managing users.

BOINC SpotCloud (Distributed Grid Computing Platform)
The BOINC appliance allows you to create clients anywhere in the world for handling distributed processing jobs. To operate the appliance, create a new instance with it. You can then ssh into the instance for configuration. The configuration script only asks for one item, and that is the IP address your BOINC management server that issues jobs.

OpenVPN
Built using the SpotCloud Ubuntu OS, the SpotCloud Open VPN appliance allows peers to authenticate each other using a pre-shared secret key, certificates, or username/password. Essentially, using Open VPN on SpotCloud allows for on-the-fly, anonymous internet access using on-demand, regional spot instances.

Ubuntu 10.10
Ubuntu JeOS (pronounced "Juice") is an efficient variant of the Ubuntu Server operating system, configured specifically for use as virtual appliances. This is a specialized installation of Ubuntu Server Edition with a tuned kernel that only contains the base elements needed to run within a distributed SpotCloud environment.

AflexiCDN
Built on Ubuntu JeOS & Aflexi's CDN automation control panel is the first CDN software especially catered for cloud computing. The Aflexi software allows you to quickly and easily build your own global content delivery network using SpotCloud resources from around the globe.

Varnish Cache
This is a fully functional SpotCloud appliance built on Ubuntu JeOS and Varnish Cache. It includes a one time command line configuration example accessible via SSH console on any SpotCloud provider. Once configured, the appliance automatically locks itself down preventing further access.

Get Listed in our Directory
We’re looking for more reference SpotCloud appliances, If you have an application well suited for SpotCloud please get in touch with us.

The Amortization of Cloud Futures and Derivatives

2011-03-08T16:01:00.008-05:00

Really interesting tweet from @jayfry3 earlier today. In it he noted a reference by @joeweinman that said Netflix treats reserved AWS instances as CapEx and depreciates it's cost over 3 yrs. This immediately got me thinking -- Wow, now that's an interesting concept.

Before I go any further I warn you I am not a tax expert, and if you are, please feel free to correct anything I say from this point forward. This is a random thought, more than a proof.

First of all, I don't think what they were referring to is actually depreciation since depreciation strictly refers to tangible assets. Instead I think what they're talking about is a very similar concept of amortization which is basically the same but for intangible assets.

A quick recap in tax law, according to Wikipedia "amortization refers to the cost recovery system for intangible property. Although the theory behind cost recovery deductions of amortization is to deduct from basis in a systematic manner over an asset's estimated useful economic life so as to reflect its consumption, expiration, obsolescence or other decline in value as a result of use or the passage of time, many times a perfect match of income and deductions does not occur for policy reasons."

With the launch of SpotCloud which essentially is a Spot Market for computing capacity, the concept of being able to reserve computing capacity in the form of a futures contract or derivative has been a popular topic of conversation during my various presentations and pitches lately. Previously I saw the opportunity for "cloud futures" from the point of view of the provider the capacity. Basically allowing the provider a greater level of insight into future capacity consumption, inventory and capacity planning. The missing part of the equation has been on the buy side, other then potentially locking in a future price, (as a hedge) the rationale for buying future computing capacity was fairly limited. With the introduction of amortization to the equation the concept dramatically shifts from not only a capacity planning exercise but also to a tax and accounting strategy for major buyers of computing capacity.

So much like traditional depreciation, amortizing future computing capacity bought as a "reservation" or derivative allows the compute asset to be deferred rather than treated as a current expense with the difference of the spot price of the compute asset as recorded on the Spot market at that the time of consumption defining a gain or loss. Taking this concept even further, if the 'depreciable' or amortized compute asset is not actually used, but instead re-sold on a computing Spot market such as SpotCloud, the business can again recognize a gain or loss based on net basis of the asset. (The net basis is cost less amortization) Yup, crazy, and it would seem -- totally do-able.

Are we on the verge of a cloud futures market? Maybe sooner than you think.

The Rise of The Cloud Aggregator

2011-03-06T10:51:00.011-05:00

Recently there has been a lot of renewed talk of "Cloud Aggregators" a term that has been thrown around quite bit of the the last few years. But what is a cloud aggregator really? How does one define this segement? How do you qualify a company or service as a cloud aggregator? It's time for my turn to attempt to define this some-what vague term.

First, more generally what is a aggregator? One of the best descriptions I could find is described as "a system or service that combines data or items with similar characteristics (geographic area, target market, size, etc.) into larger entities. Value is derived from cost savings, or the ability to reach a larger market and charge higher prices from bundling multiple goods or services."

I'm not sure I agree with the higher prices part, but I do think the key point is the value in assembling "a system or service" that brings together a group of formally distinct components or web services. For example Google at its heart is an aggregator, all those websites found on the Internet would and do exist regardless of Google, but easy access to all of them through a simple, power and effient interface had previously not existed (at least not in a way that was relevant). Then there are marketplace aggregators such as Ebay, in this case without the ebay platform each of these vendors could not exist beyond potentially a physical storefront. Ebay provided both the aggregation, facilitation (which makes tasks for others easy) and fulfillment (completing the transaction).

So using Google and Ebay as two ends of the aggregator spectrum. You have Google the market disrupter versus ebay the market maker. Each important, but important for very different reasons. Both share common traits in that they provide easy access to something that was previously not very easily accessible. Yet each derive their true value in completely different ways. Google brought order to chaos through the use of advanced algorithms and massive computational power and ebay created a structured marketplace that had never existed in an area that needed it.

Now back to cloud aggregators. Here's my definition.

Cloud Aggregator - a platform or service that combines multiple clouds with similar characteristics (geographic area, cost, technology size, etc.) into a single point of access, format, and structure. Value is derived from cost savings and greater efficiency found from the ability to easily leverage multiple services providers.

Living on the Edge

2011-03-03T13:13:00.007-05:00

There's somethin' wrong with the cloud today, I think I know what it is. We're seeing things in a different way, but should we be judging a cloud provider by the color of their -- logo?

It's seems that for many, the only basis of comparing cloud providers is based upon superficial aspects. I know of the company, recognize the logo, or read a random review. But the reality is we're moving away from the traditional vendor driven marketing fluff of a single provider world to a multi-cloud, federated ecosystem of capacity providers, where brand recognition is less important than performance and price. I'm talking about living on the edge, the edge of the network.

One of the more interesting recent announcements was Amazon's Japan availability zone, in describing their launch AWS spoke of latency for users within Tokyo being less than 10ms. Hitting directly at the heart of the opportunity. Yet on the flip side, they also mentioned that the Japanese zone was ideal for other nearby geographies, to which I say they're missing the point. Using Japanese resources in South Korea makes little sense given the rapid advancement and availability of cloud capacity in South Korea. The opportunity going forward isn't to address generalized areas of the world, but to address the specifics, not just on a country basis but on a city or even a neighbourhood basis. A single provider will never be able to get this level of granularity regardless of how much money they have. Economies of scale will always be limited by total market size, the more granular the market the less economies of scale work in favor the large provider. The only way to address this growing movement toward edge based, latency dependent application deployment is to federate many providers with many customers across many diverse geographies.

I admit that this is easier said than done, ask anyone who's attempted to use more than one provider in a federated, intercloud connection global cloud of clouds type of deployment and tell me what you think about your sit-u-a-tion. They'll tell you it's complication, and aggravation.

I know a few of you will point back to the inevitable economies of scale that an AWS or Google bring forth. Yes, they probably spent many millions building their Japanese cloud infrastructure. But did they have to? Economies of scale are important factors mostly for true for commoditized IT aspects such as bandwidth. But for areas such as ultra-localization computing, this is not practical for even the largest web companies. Sure there are many factors that cause a cloud providers average cost per compute unit to fall as the scale of output is increased, purchasing power is probably the most relevant. Essentially the biggest Internet companies can buy the most servers at a massive volume thus getting the lowest cost per unit of compute time and therefore achieving the best margins at the lowest cost. But even this equation has a practical limit when it comes to geography.

When it comes to ultra-localization the boundaries of the so-called provider economies of scale, commoditiziation and volume quickly breakdown. Now it becomes a question of federation and aggregation. Many providers connected through a normalized or structured market interface rather then one provider attempting to address all markets. I'm not just talking about what we're doing with SpotCloud, but what I believe to be the move toward a market centric economy of federated cloud ecosystems, a move I think is inevitable. Ultra-local capacity or edge based computing, or whatever you chose to call it in a nutshell is the opportunity moving forward.

The choice will quickly become one of choosing a single provider (one to many) or an aggregator (many to many). I believe the choice will quickly become obvious to anyone who has a geographic component to their applications. The opportunity is living on the edge.

SpotCloud Beta Update (March)

2011-03-01T15:16:00.003-05:00

To say we’ve had a spectacular launch would be putting it lightly. Since our Valentines Day SpotCloud Launch, we’ve been inundated with interest in the marketplace. Buyers, sellers, investors and media have flocked to us in the thousands from around the world.

As of today we have dozens of active providers online from Hafnarfjörður (that’s in Iceland) to Boston to Brisbane to Hong Kong. There are also in the hundreds of providers who have signed up and are in various stages of preparation and set-up of their SpotCloud environments. We are actively on-boarding new providers as fast as we can. If you haven’t done so yet, go ahead and get started as a provider.

We’re also seeing a lot of interest from the buyer side as well with a ratio of 5:1 buyers to sellers. It’s been great to observe an increasing rate of buyers converting from the initial “tire-kicking” phase to becoming more active users. The market is now open and free to browse. So go ahead and sign up as a buyer.

Some Various SpotCloud Market Updates

Instance Renewals
We just pushed an update to the SpotCloud marketplace that fixes a few bugs, but, most importantly, adds the ability for SpotCloud buyers to renew their instances at the current spot market price. Previously, at the end of the maximum duration, a buyer’s appliance would be automatically terminated (deleted). Now, if a SpotCloud seller enables this feature, a buyer will have the option to keep their instance at the end of the duration and pay the current spot price going forward. More importantly, they can keep their IP address and data. An email is automatically sent to the Buyer when their instance is close to being terminated to provide the option of having it renewed.

As a seller, to enable this feature, you must login to the SpotCloud management interface as a seller at https://spotcloud.appspot.com/provider/pricing and select the check box on each hardware profile labeled "Instance renew allowed"

As a buyer, you’ll see the new option in your instance information or via an email sent to you before termination. We hope to include this in our API in an upcoming release.

New SpotCloud Apppliances
We’ve published several new sample spotcloud Appliance including a OpenVPN appliance and Aflexi CDN appliance. In the next few weeks we will be releasing a built-in App Directory in the SpotCloud market, to enable much easier deployment of SpotCloud Appliances.

Get Featured in our upcoming App Directory
If you have an application that would make a great sample SpotCloud appliance, we’d love to include it in our upcoming App Directory, so please get in touch.

Create your own appliance using the SpotCloud CLI & appliance bundling tool
You can now easily convert an existing VM to the SpotCloud Appliance format using our SpotCloud CLI and Appliance Bundling Tool. This tool also provides an easy command line API access to the SpotCloud marketplace enabling a true hybrid cloud computing experience.

Selected Media Coverage

Economist Magazine - Cloud computing: A market for computing power
“LIKE oil or pork bellies, computing capacity is now a tradeable commodity. February 14th saw the launch of SpotCloud, the world’s first spot market for cloud computing. It works much like other spot markets”.

Eweek Review - SpotCloud Explores the Cloud's Utility Computing Future
“One of the most popular images used to illustrate the concept of cloud computing is the electrical grid. The “cloud” can be tricky to pin down, but everyone is familiar with plugging into a standardized socket and drawing the juice necessary to run many electrical devices from a network of large power plants.”

SpotCloud Beta Update (Jan 25th)

2011-01-25T14:01:00.003-05:00

Another strong week of development on the SpotCloud.com platform. Unfortunately, some of the coolest new additions relate to our administration and management system so we can’t show them to you. However, we plan to do a major 1.2 release next week with lots of other new eye candy for you.

We’ve also been busy signing up and on-boarding new providers from all over the world and hope to have all continents covered by our February public launch. A few notable additions to the SpotCloud market this week include, Brazil, Iceland, and Italy. I’d like to point out that we could use additional capacity from Asia, so if you have capacity or know of someone who does, please send them along.

Setting ECP SpotCloud Permissions
We’ve encountered a minor work-flow oversight that relates to the installation of ECP SpotCloud Edition. When installing ECP, users seem to skip the last step which is to set the correct permissions for their SpotCloud user. To help, we’ve updated our Setup_broker.py script which will complete the setup as well as configure the correct permissions.

Pricing Your Capacity
One of the most asked questions lately is “How do I price my capacity on the market?”
We've created a SpotCloud Pricing Guide for capacity providers. You can grab it here. In an upcoming release we will also include a market overview for sellers.

Documentation Error (Storage requirement)
I’d like to outline an error in the original SpotCloud Setup Guide whereby we outline a “2TB” per-host requirement. This is not correct. The actual number is 500GB per Host. In reality, you’ll be okay even if you only provide one server.

Press
Some more press: “Can a New IaaS Cloud Really Compete?” http://ruv.net/a/if

How to Make Money on SpotCloud (Provider Pricing Guide)

2011-01-21T12:17:00.003-05:00

One of the first questions SpotCloud providers ask me after they've setup their infrastructure and made their capacity available on SpotCloud is how to effectively price their capacity. There really is no easy answer, there are a lot of factors that dictate SpotCloud capacity pricing.

For example competition from a particular geography can lead to a higher or lower price. (Basic supply and demand) What I have noticed is that providers from specific regional hot spots such as Brazil, Russia and Asia tend to be able to price higher than places like San Francisco which tend to be more capacity saturated. Another question is what should the price be based on. My answer is typically it should be a combination of your fixed costs and a markup. It's also better to base it on the element that is the hardest (costliest) to share and delegate which in our case is typically RAM or potentially bandwidth. Also before you can hope to define a price you need to be able to understand what your own costs are on a monthly basis, utilization is also a key component.

To help with the SpotCloud pricing process, we've created a simple SpotCloud Provider Pricing Guide in the form of an Excel spreadsheet on Google Docs or Download the Excel Spreadsheet directly. (Feedback is greatly appreciated)

SpotCloud Beta Update

2011-01-18T15:24:00.002-05:00

We continue to see significant participation on the SpotCloud sell-side with providers from around the globe signing up for the service (Here’s a nice overview from GigaOM). We are currently adding providers to the market as we get ready to open the platform to buyers in the next few weeks. We have a select group of buyers who are currently helping us test the system and plan to include a broader group in early February.

We want to highlight that we are continually improving the workflow to help simplify on-boarding of both buyers and sellers. One area in particular that we want to bring to your attention relates to entering your hardware pricing information after you’ve registered as a provider. For those of you who have submitted API registration, you will receive an email once approved. At this point it is important to log into the platform and enter your hardware prices so that your capacity can be made available on the SpotCloud market. If you don’t set a price, your capacity will not be visible to buyers. Going forward we plan to improve the workflow to make this requirement more obvious.

To help you select the optimal price we plan to add a market overview for sellers so that it will be easy to assess how other providers are pricing their capacity. Furthermore, a number of sellers have indicated they’d also like to be buyers. These features and more have been added to our roadmap.

Over the coming days we will be rolling out new features frequently including improved interface elements and reporting. So, log in frequently to see the changes!

New SpotCloud API’s
We’re also happy to inform you that we’ve published the first drafts of our Buy and Sell side API’s. These API’s are great if you're looking to define a broader automated workflow (such as time of day or utilization based costing) you may want to download a copy of our API docs.

For Sellers

For Buyers

If you’d like access to a SpotCloud API sandbox, please get in touch.

Sample Spot Cloud Appliance
A few of our beta users have asked us for a sample SpotCloud appliance to test their third party platforms. We’ve created a small appliance & guide to help you!

SpotCloud Appliance Creation Guide (For Buyers)
http://ruv.net/a/scbuyerguide

This guide will help buyers through the process of creating a virtual machine image (an "appliance") that will work well with SpotCloud.

Sample SpotCloud Appliance (XVM2) 345MB
http://dl.enomaly.com/varnish - user: root - pass: spotcloud

This is a fully functional SpotCloud appliance built on Ubuntu JeOS & Varnish Cache. It includes a one time command line configuration example accessible via SSH console on any SpotCloud provider. Once configured, the appliance automatically locks itself down preventing further access. It's fully functional and serves as a great SpotCloud example appliance.

What Does it do?

Varnish is the key software that speeds up your web site. It is Open Source, built on industry standards and requires very few resources. Once configured this appliance will automatically replicate your website to any SpotCloud instance in the world. Just point your dns to the ip address. (Anycast + Geotargeting recommended) Essentially it's an instant global CDN.

Getting Started as a Provider
If you haven’t already done so, we’re giving you two options for participating as a Capacity Provider in the SpotCloud Beta.

1. Using the free Enomaly ECP SpotCloud Edition
You can use the Free Enomaly ECP SpotCloud Edition to provide capacity to the market.

2. Using your own cloud platform
It’s easy to integrate your own cloud with SpotCloud (some service providers have completed the process in a few hours). We’ve written a guide to assist service providers (capacity sellers) who would like to integrate their internally-developed or third party cloud infrastructure software platforms or services with the SpotCloud market.

Register to get the download at www.spotcloud.com and get access today!

Examining Compute Commodities

2010-11-29T11:09:00.002-05:00

Over the last several weeks I've been doing quite a bit of studying of the commodities markets, mostly around the emergence of energy trading in the early 1990's. During my research a few things have become pretty clear to me. I thought I'd outline a few of the more interesting observations.

In looking at corollaries in treating compute resources as a commodity, the closest is probably that of energy creation and power plant financing. In the energy world, commodities trading desk are used to protect power companies from dramatic price shifts, using a so called "Hedge". These hedges are done in a number of very interesting ways. First of all, most of the major banks act as both a provider of capital for buyers and sellers of power plant assets and the companies themselves. The majority of the major finance players in the energy world also have commodities desks, allowing them to operate in the commodities market as well as in the more traditional loan / financing businesses. They can offer issuers (power providers) access to commodity markets where hedges can be created to protect an energy company from dramatic changes in prices of coal, natural gas or oil. Many utilities that provide electricity, for example, use coal to fire their plants are protected from price swings and more importantly the banks who are trading these commodities have greater influence and protection from these price spikes by sitting on both sides of the deal. In essence dovetailing leverage finance with commodities. In return, these banks are granted the ability to not only finance the development of the power plants, they also buy the future contracts on the energy itself which in turn gives the energy providers a guarantee of future revenue which then can be used as collateral for the development of their various energy assets and reduces the risk for all involved.

Let me explain this concept using the data center space as an example. Imagine being able to build a data center with a guarantee that a portion of your capacity will be bought at a certain price for an extended period of time before you even built your data center? This in a nutshell is the driver for the commoditization of computing resources. It has less to do with the actual computing resources so much as the ability to provide enhanced insight into future cash flows while reducing the risk surrounding the un-certainty of future utilization levels. Data centers are the new power plants.

What SpotCloud does is provide a general structured framework for the creation of a Compute Spot Market - an essential requirement before you can potentially have the ability to buy future capacity in bulk. Now imagine for a moment a SpotCloud Price Index (SCPi) where buyer are given a normalized average (a weighted average) of prices for a given class of compute services (based on a key hardware metric) in a given region, during a given interval of time. This is where things start to get interesting, an index is a requirement for any futures market. Without this critical statistic, it would be very difficult to compare how compute prices, taken as a whole, differ between time periods or geographical locations. With this data, hedges and arbitrage are now possible regardless of whether the quality of compute resources differs because you can use the average with traditional finance methodologies allowing for differences among providers answering the problem of not all compute resources are actually the same. Money itself being the great equalizer.

I readily admit that selling any debt in the current market is tough, but given the current trends in computing and the ever increasing need for computing resources around the globe, it's a fair bet to say that the demand for these types of resources will continue for the foreseeable future.

Pork Bellies, Bandwidth and Cloud Computing

2010-11-14T17:59:00.000-05:00

-- Update ---
I'm happy to announce that we've launched SpotCloud, the first Cloud Capacity Clearinghouse and Marketplace. Check it out at www.spotcloud.com

--
In May 1999 Enron announced to the world that it was creating a new market for trading Bandwidth. A wired article from 2001 noted that it seemed to many that the then energy giant had found a new pot of virtual gold. Enron and a broader group of their experienced traders believed it was only a matter of time before bandwidth (as well as other virtual resources) would be bought and sold in much the same way that commodities markets trade everything from petroleum to pork bellies. Now, more then 10 years later this transition has yet to occur. In this post I will examine why the idea of trading bandwidth never took off and see if today might be the ideal time to try again.

Looking back at the previous attempts to create virtual commodities exchanges including Enron's failed attempt, it now appears that it was indeed a great opportunity, but just about a decade too early. In the case of Enron, they had a right vision, but suffered from the now obvious fact that it was born from an overwhelming greed. In other words, the right idea but the wrong people at the wrong time.

Today with the emergence of cloud computing looking at these past failures such as the failed bandwidth markets and as well as the successes of the energy markets of 1990's may represent a case study in how to we might go about creating a successful commodity compute marketplace.

One of the first problems in getting bandwidth trading off the ground was timing. The bursting of the dotcom bubble meant that there was a significant disconnect between an over supply of bandwidth versus the demand for it. Basically there weren't enough companies who wanted to buy and too many selling. Making the market go in one direction, down. This discouraged both buys and sellers from getting involved. The key to an active market and ecosystem is growth.

Secondly, as the wired article points out, the telecom firms that owned the fiber optic networks didn't like the idea of selling their services as a commodity. Some made the case that "not all networks perform equally well." Basically there were no measurement standards and therefore no easy way to determine the good from the bad. In addition, most telecom firms preferred to negotiate prices with customers, rather than be stuck with a one-size-fits-all pricing scheme. In a sense they would rather lose on the excess capacity and make up the difference by charging more for the capacity that was actually used. In contrast, the benefit to a commodity style approach, you may charge less overall but make more money because you have a higher utilization of your resources (volume).

Another major problem was at that time the adoption of broadband was at its infancy. Most Internet users in 1999 we're still using dial up connections. Compounding things was other than a few notable exceptions (Napster) the majority of web applications were static and light weight. Mobile apps, streaming media, social web applications, realtime web and cloud computing (Internet centric computing) had yet to be widely accepted. Fast forward to today and these applications have become the key drivers to a recent explosion of rich user generated content and the ever increasing need for realtime compute capacity to process it all.

Thanks in part to the increasing popularity of cloud computing, the idea of just-in-time compute capacity has helped lower some of barriers that limited the previous bandwidth markets from flourishing. For many the concept of distributed batch processing and compute elasticity have become critical parts of modern business IT strategies. These kind of flexible and elastic compute usage models are ideally suited to that of a spot market for commodity compute capacity (provided via a method that is quoted for immediate (spot) settlement for both payment and delivery. Also the announcement last month that Amazon Web Services would start offering excess EC2 capacity using a spot market approach has also helped legitimized the concept. The notion of selling your excess compute capacity now has a poster child (AWS), this may lead to increased acceptance of selling excess compute resources using a commodities approach. This is in much the same way that Amazon EC2 has encouraged companies to use cloud like strategies within their internal systems (private clouds). In a very real way, AWS is blazing a path for the broader industry.

I see tremendous opportunities for the trading of excess Cloud Computing resources or compute capacity and believe the most viable market example may be that of the energy marketplace. The energy market is similar to bandwidth and compute capacity in that the commodities are variable, transient and don't store well. The concept of selling excess capacity in cloud centric data centers may also make sense in that cloud providers must have significant additional capacity on hand just in case of demand spikes.

As I've said before, unused compute capacity = lost revenue. It's better to sell your excess then to have it disappear. For a lot of larger players such as Telecoms and large content providers this means un-utilized compute capacity is making you nothing. The notion of a public spot market may help address this problem.

The great example for a compute centric market may be based on that of the electricity wholesale markets. Like compute capacity, electricity is difficult to store because of it's transient nature. It needs to be available on demand, and unpredictable demand spikes may occur. Using the energy trading market as a model provides an existing proven context that may translate well into compute centric environments, not mention there are wide variety of trading platforms already built that may be easily modified to address the needs of a compute exchange market.

One of the more common energy trading models uses a automated central scheduler to balance supply and demand and calculate the market price. Another model is that of conducting auctions in various time scales, i.e. auctions for yearly and daily provision of power, with additional spot market that resolves the need for accommodating short-term demand spikes.

Before a widely accepted commodity compute trading market may form and begin trading, governments may also need to provide a common regulatory framework as well as standards and liability controls. Otherwise the market will be doomed to serve as a novelty or worst yet, limited to academic use only.

So what's next? First a trading organization must form, preferably in a transparent not for profit context, so to help avoid future Enron type scenarios. I'd also say the capital to develop such a trading platform, the will of the industry to help make this happen and some standard processes for the measurement of the cloud capacity itself. So will this happen? Certainly, but question of when is still up for debate.

SpotCloud Update (Free ECP SpotCloud Edition & Webinar)

2010-11-10T14:21:00.000-05:00

It's been a crazy week at Enomaly after last week’s SpotCloud announcement. We'd like to take a brief moment to update you on some new and exciting opportunities that have emerged out of our discussions around the SpotCloud Marketplace (http://www.spotcloud.com).

Buyer / Seller Traction
Signups for both the buy and sell side for SpotCloud have been very strong with hundreds registering for the service. One of the more interesting statistics is the ratio of buyers to sellers is tracking at 5:1 for buyers. This shows there’s a lot of buy-side demand for the service. For those of you who have already registered, we are selectively adding new buyers and sellers while we work through the beta phase, so hold tight, we haven't forgotten about you. If you haven't registered yet, go ahead and add yourself today.

Announcing the Free Enomaly ECP SpotCloud Edition
We're happy to announce that we are now offering a Free Enomaly ECP SpotCloud Edition (Shipping next week). This is a feature-limited version of the Enomaly Elastic Computing Platform specifically tailored for cloud providers, as well as private and public data centers looking to sell excess capacity on the SpotCloud market. By simply installing ECP SpotCloud edition on a few spare servers, providers are able to easily participate in the marketplace. No public cloud or payment systems are required. Just a few servers and the Free ECP SpotCloud IaaS software and you're ready to start making money. To get access to the ECP SpotCloud Beta, simply register as a seller athttp://www.spotcloud.com and check the box for the ECP SpotCloud edition.

Third Party IaaS / Cloud Platform Support
Due to strong demand from non ECP-based, cloud providers and IaaS platforms, we have decided to open up our marketplace to any and all platforms. In the next week we will publish seller integration instructions for the SpotCloud marketplace so platforms powered by other technologies can easily participate . If you haven't already done so, please sign up to be notified when the docs are ready.

Joint Marketing and PR Opportunity
Responses to our initial SpotCloud announcement has been overwhelming. A number of buyers and sellers have indicated they would like to participate in a broader announcement highlighting our partners. If you'd like to participate in our upcoming PR announcement, please feel free to get in touch with us.

SpotCloud Webinar and Live Demo Friday, Nov 19, 2010
Interested in seeing how SpotCloud works or just have some questions? Join the SpotCloud Webinar next Friday.

Topic: SpotCloud Demo
Time: 12:00 pm, Eastern Standard Time (New York, GMT-05:00)

Register for the SpotCloud Webinar at http://ruv.net/a/cz

Group Buying For Cloud Computing Capacity

2010-11-05T15:58:00.003-04:00

As many of you know, I've been to China many times this year. The market for cloud computing is booming over there. But what you may not know is that these trips to China have been a key part of the inspiration for the creation of SpotCloud. Some of my inspirations has come from the popular concept of group buying know as tuangou in Chinese.

If you haven't heard of Group buying wikipedia describes it as follows:

Group buying, which refers to social buying or collective buying as well, is the buying an offer which has been significantly reduced, due to the fact that it is only valid if enough buyers are found. Recently, group buying has been taken online in numerous forms, although group buys prior to 2009 usually referred to the grouping of industrial products for wholesale (especially in China).

Group buys are a variation of tuangou buying that also occurs in China, in which an item must be bought in a minimum quantity or dollar amount, otherwise, the seller will not allow the purchase. Since individuals typically do not need multiples of one item or do not have the resources to buy in bulk, group buys allow people to invite others to purchase in bulk jointly. These group buys often result in better prices for the individual buyers or ensure that a scarce or obscure item is available for sale.

So now lets think about how this approach could be applied to the buying of cloud infrastructure resources through a marketplace such as SpotCloud. A simple example could be buying Amazon EC2 reserve instances. With Reserved Instances you pay a one-time fee and in turn receive a significant discount on the hourly usage charge for that instance over a 1 to 3 year term. Using this model of reserved Instances can save you up to 49% over the cost of On-Demand EC2 instances. But there is a small problem, you need to commit to at least 1 - 3 years with a fairly high utilization for the full savings to be realized.

Now apply group buying to EC2 reserved instances, say 100 or so capacity buyers who need cheap capacity for short periods of time. The brokerage (SpotCloud) essentially buys on behalf of the group and makes the the capacity available at a greatly reduced cost for all market participants. The group buying approach also leads to interesting arbitrage models for increased cost reduction by taking advantage of a price difference between two or more cloud resource providers (Amazon's Spot Instances for example), as well as potentially negotiating wholesale discounts on behalf of the collective buying group from other large cloud capacity providers.

Lots of interesting SpotCloud ideas. I'll keep posting as they come to me.

SpotCloud Launch Overview (Week 1)

2010-11-05T14:13:00.006-04:00

So by now you've probably heard about the SpotCloud announcement. If you missed it, after more than a year of development, we finally took the covers off our SpotCloud Capacity Clearinghouse and Marketplace for service providers. The feedback so far has been tremendous, with hundreds of registrations for the SpotCloud service including a good portion of the major "Non ECP" based cloud providers signing up. One particularly interesting stat is the ratio of buyers to sellers registering for the service at a ratio of 5:1 for buyers, indicating significant interest from the demand / buy side. A key metric for a successful marketplace.

But what I really want to tell you is some of the opportunities that have emerged in my discussions with both providers and buyers. Most of which I hadn't even considered before this weeks launch.

The first usage example is with managed service providers. With the recent downturn in the economy a lot of dedicated and managed hosting providers are seeing large amounts of customers abandoning their dedicated servers for various reasons, causing a major influx of un-used racked servers. One director of IT for a large hosting firm indicated that last week one of his long time customers had defaulted on 100+ dedicated servers. He said that they had no plans to create a "public" cloud service but thought that the ability to offer these servers through the SpotCloud marketplace would be an ideal way for his company to cover their "carrying costs" while they attempted to resell / lease these servers to other hosting customers at a much higher margin. Turns out this concept has legs, I had the very same conversation this week at the CloudExpo in Santa Clara with no less then 20 different hosting companies all telling me the same story, not interested in public cloud, very interested in private capacity offering through an opaque market. I used the analogy of renting a new or used car before selling it.

Another recurring opportunity was that of what I have started describing as a "private cloud exchange" where a group of aligned companies or organizations share capacity amongst each other through a private version of the SpotCloud marketplace. A kind of capacity consortium. One particularly good example was from a major Asian Telecom with many various divisions around the globe, each with their own data centers and no effective way to share capacity between the business units who run independently from one another. Another private exchange idea was focused with in specific industry verticals such as Finance, healthcare, entertainment and eduction. Think of a group of private clouds with specific regulatory controls sharing or selling capacity with each other.

What's next for SpotCloud? Going forward we plan to release SpotCloud integration instructions for working with Non ECP based cloud providers and suppliers. This will allow SpotCloud to support the broadest group of capacity suppliers with out having to directly use ECP. We've also had a lot of interest in doing a Free Enomaly ECP SpotCloud edition, which we hope to have available in the near future. As soon as these are ready, I'll post the links on this blog.

We are hoping to do some public announcements around actual buyers and sellers in the coming weeks, ping me if you'd like to be included in this announcement.

Do you have an interesting use case for SpotCloud? Please let me know.

Introducing SpotCloud, The First Clearinghouse & Marketplace for Cloud Computing Services

2010-11-01T02:53:00.008-04:00

Enomaly Inc., the leading vendor of Infrastructure-as-a-Service (IaaS) cloud computing software, is proud to announce that it has launched the beta of SpotCloud (http://www.spotcloud.com) the first cloud computing clearinghouse & marketplace.

For cloud service providers, the SpotCloud Marketplace Platform provides an easy way to sell unused cloud capacity. Cloud providers can use SpotCloud to clear out unused capacity and sell computing inventory that would otherwise go unsold, enabling increased utilization and revenue, without undermining their standard pricing.

In order to avoid directly competing with regular retail sales of cloud services, SpotCloud uses an "opaque" sales model, similar to sites such as Hotwire.com. The SpotCloud service meters, tracks, and bills capacity buyers, and pays capacity sellers directly.

For Cloud Capacity buyers, SpotCloud bridges many disparate regional cloud providers, allowing buyers to find the best cloud providers at the best price. SpotCloud serves as the central place to discover and buy computing capacity, based on performance, cost and location parameters, through a simple and easy to use web dashboard and API.

By 2014, IDC predicts, sales of cloud computing products or services will generate almost $56 billion in annual revenues. Gartner analyst Daryl Plummer has stated that by 2015 “cloud service brokers will be the largest revenue growth opportunity”, going on to say that “20 percent of cloud services will be consumed via a broker.“

“The market driven approach of SpotCloud is a game changer for both buyers and providers of cloud computing resources.” said Reuven Cohen, Enomaly founder and CTO. “For service providers, SpotCloud enables the most important feature – the ability to make more money. Each service provider can define prices for the excess capacity offered through the service and adjust these based on time and utilization. For consumers, SpotCloud provides a secure central location to buy from a global pool of providers at highly competitive prices.”

How it Works

How it Looks

Signup for our Beta at www.spotcloud.com

Enomaly, Autonomic Resources, Carpathia, and Dell Win US Federal IaaS Cloud Contract

2010-10-26T21:42:00.000-04:00

Enomaly Inc., the leading vendor of Infrastructure-as-a-Service (IaaS) cloud computing platform software, announced today that it has been selected by US Government under the first Government-wide contract for cloud computing. Under the GSA’s blanket purchase agreement (BPA # GS00Q11AEA003), Enomaly ECP High Assurance Edition (HAE) software will help power Autonomic Resources ARC-P Public Cloud (IaaS) services platform for U.S. Government customers.

Enomaly was chosen to be included in Autonomic Resources ARC-P Public cloud stack that will provide US Government customers the benefits of on-demand computing with no compromise in security. ARC-P integrates Enomaly with the ARC-P Dell hardware stack that will provide for trusted virtual machine assurance via Trusted Execution Technology. Additionally, Enomaly integration with Secured by SPYRUS technology for multi-factor authentication and sets a new “bar” for cloud security. ARC-P’s multi-factor solution utilizes the already approved US Cybercom USB flash drives, following Federal standards to levels not yet available on any commercial platform.

“We’re delighted to have been selected for this opportunity,” said Dr. Richard Reiner, CEO of Enomaly. “As the only third-generation IaaS platform in the industry, Enomaly ECP is ideally suited to meet the needs of the most demanding Government users for mature, massively scalable, highly reliable cloud services. The unique capabilities of our High Assurance Edition, delivered from FISMA certified data centers with standard multi-factor authentication access, will ensure that Government users can benefit from access to trusted and secure solutions for all their cloud computing needs.”

“Enomaly helped ARC-P address many of the IaaS demands of the Federal government. In developing ARC-P our focus was to differentiate our offering based on secure and flexible on-demand cloud” said John Keese, President of Autonomic Resources.

About Enomaly Inc.
Enomaly, based in Toronto, Canada, is the leader in empowering telecom and IDC operators to deliver the benefits of Cloud Computing to their customers. Enomaly’s Elastic Computing Platform (Enomaly ECP) has often been described as the world's first true IaaS platform.

Today, Enomaly ECP 3 benefits from our 6+ years of cloud computing leadership to empower telecom and IDC operators in North America, the UK, Europe, and Asia to deliver some of the world’s most advanced cloud computing services. Enomaly ECP 3 is available in the core Service Provider Edition as well as the security-enhanced High Assurance Edition, which offers a unique set of hardware-based security mechanisms to enable the application of cloud computing for higher-assurance environments.

About Autonomic Resources
Autonomic Resources ( www.autonomicresources.com ) is a service integration firm and cloud provider serving the U.S. federal government. Core capabilities include the implementation of strategic technologies related to long term IT services as well as strategic services like data center automation, cloud computing, open source adoption, IA, NextGen networking, BI and software development services. Headquartered in Cary, N.C., Autonomic is a certified 8(a) SDB - Search GSA Schedule #GS-35F-0587R on http://www.gsaadvantage.gov .

The Cloud Computing Opportunity by the Numbers -[update]-

2010-10-11T13:08:00.002-04:00

How big is the opportunity for cloud computing? A question asked at pretty well every IT conference these days. Whatever the number, it's a big one. Let's break down the opportunity by the numbers available today.

By 2011 Merrill Lynch says the cloud computing market will reach $160 billion.

The number of physical servers in the World today: 50 million.

By 2013, approximately 60 percent of server workloads will be virtualized

By 2013 10 percent of the total number of physical servers sold will be virtualized with an average of 10 VM's per physical server sold.

At 10 VM's per physical host that means about 80-100 million virtual machines are being created per year or 273,972 per day or 11,375 per hour.

50 percent of the 8 million servers sold every year end up in data centers, according to a BusinessWeek report

The data centers of the dot-com era consumed 1 or 2 megawatts. Today data center facilities require 20 megawatts are common, - 10 times as much as a decade ago.

Google currently controls 2% of all servers or about 1 million servers with it saying it plans to have upwards of 10 million servers ( 10⁷ machines) in the next 10 years.

98% of the market is controlled by everyone else.

Hosting / Data center providers by top 5 regions around the world: 33,157

Top 5 break down
USA: 23,656
Canada: 2,740
United Kingdom: 2,660
Germany: 2,371
Netherlands: 1,730.

According to IDC, the market for private enterprise "Cloud servers will grow from an $8.4 billion opportunity in 2010, representing over 600,000 units, to a $12.6 billion market in 2014, with over 1.3 million units.

Market opporunity based purly on server count. $160 billion dollars divided by 50 million servers = $3,200 per server.

The amount of digital information increased by 73 percent in 2008 to an estimated 487 billion gigabytes, according to IDC.

World Population 2009: 6,767,805,208
Internet Users 2000: 360,985,492
Internet Users 2009: 1,802,330,457
Overall Internet User Growth: 399.3%
Fastest Growth Markets (Last 10 years) - Africa +1,809.8%, Middle East, +1,675%, Latin America +934.5%, Asia +568.8%

Slowest Growth Markets - North America +140.1%

Cloud value by world population: $23.64 per person

Cloud value by Global Internet population: $88.77 per person

-- Update --
Netcraft Finds 365,000 Web Sites on EC2

June 4th 2010
IBM says The Cloud cuts IT labor costs by up to 50%, improves capital utilization by 75%

July 1st 2010
IDC estimates that sales of public cloud services will grow at a 25 percent annual clip. The annual growth rate for typical IT projects, conversely, is 5 percent.

July 26 - 2010
SaaS Revenue to Grow Five Times Faster Than Traditional Packaged Software Through 2014, IDC Finds

By 2012, IDC expects that less than 15% of net-new software firms coming to market will ship a packaged product (on CD). By 2014, about 34% of all new business software purchases will be consumed via SaaS, and SaaS delivery will constitute about 14.5% of worldwide software spending across all primary markets.
By 2012, nearly 85% of net-new software firms coming to market will be built around SaaS service composition and delivery; by 2014, about 65% of new products from established ISVs will be delivered as SaaS services.
SaaS-derived revenue will account for nearly 26% of net new growth in the software market in 2014.
Traditional packaged software and perpetual license revenue are in decline and IDC predicts that a software industry shift toward subscription models will result in a nearly $7 billion decline in worldwide license revenue in 2010. As a result, a permanent change in software licensing regime will occur.
SaaS segment mix will shift toward infrastructure and application development and deployment/PaaS, and away from U.S. dominance. IDC expects that by 2014, applications will account for just over half of market revenue. This shift will happen in part as a result of increasing IT cloud spending by enterprise IT groups and commercial cloud services providers (cloud SPs) relative to end-user spending

October 2010
Internet Keeps Growing! Traffic up 62% in 2010 (13.2 Tbps of new Internet capacity)

-- Conclusions --
Based on these numbers, a few things are clear. First server virtualization has lowered the capital expenditure required for deploying applications, but the operational costs have gone up significantly more than the capital cost savings making the operational long tail the costliest part of running servers.

Although Google controls 2 percent of the global supply of servers, the remaining 98 percent is where the real opportunities are both in private enterprise data centers as well as in 40,000+ public hosting companies.

This year 80-100 million virtual machine will be created, the traditional management approaches to infrastructure will break. Infrastructure automation is becoming a central part of any model data center. Providing infrastructure as a service will not be a nice to have but will be a requirement. Hosters, Enterprises and small business will need to start running existing servers in a cloud context or face in-efficiency which may limit potential growth.

Surging demand for data and information creation will force a migration to both public and private clouds specially in emerging markets such as Africa and Latin America.
Lastly, there is a tonne of money to be made.

The Intel Cloud Builder Series Webinar Featuring Enomaly (Oct 14th)

2010-09-30T20:30:00.003-04:00

Webcast: The sky’s the limit: How Enomaly’s Elastic Computing Platform removes the upper limit on VMs in cloud deployments

Join this discussion of Enomaly’s aptly named Elastic Computing Platform (ECP), which brings nearly infinite scalability and provisioning flexibility to cloud deployments. Learn how Enomaly’s ECP can support very large clouds with many thousands of servers, and virtually eliminate the upper limit on the number of virtual machines that can be provisioned. Cloud experts from Enomaly and Intel will present a logical blueprint for a typical configuration, discuss the unique attributes of ECP, and answer questions at the end of the presentation. Register today to hold your spot.

Thursday, October 14th, 2010 2:00 p.m. ET - Register Today!

Infrastructure Elasticity versus Scalability

2010-09-21T12:23:00.003-04:00

Over the last few years I've gotten a lot of pressure to call our Elastic Computing Platform, a Cloud Computing Platform. Some may wonder why I've resisted to make this some-what semantic change in the branding of our platform. Yes, our customers are deploying cloud infrastructures, but how they're doing it is what this post is about.

For me, 'the cloud' represents the Internet, or more specifically it's a way of looking at application development and deployment from a network centric point of view. It's pretty much about thinking about applications that treat or use the Internet as the operating system. To enable such an environment takes a new way of thinking about your underlying infrastructure. A unified (API driven) infrastructure that is distributed, an infrastructure that is global, an infrastructure that is fault tolerant and most importantly scalable & elastic.

Some may think that being scalable is the same as being elastic, but I'm not convinced. Being scalable means being able to grow to the demands of an application and it's user base. This says nothing about what happens after this scale as been achieved. Being 'elastic' means being able to adapt (up, out and down again) The ablity to adjust readily to different realtime conditions. The metric that matters in an elastic computing environment isn't just how many users can I support, but how fast can I adapt to support those users. Speed and performance are key. How fast can I provision a new VM, how well does that VM perform once deployed, and how much will it cost me are what matters most. The problem with scalability is the question of what happens afterward. Elasticity is all about what is happening now.