Click here to close now.

Welcome!

CloudExpo® Blog Authors: Liz McMillan, Pat Romanski, Hovhannes Avoyan, Harry Trott, Elizabeth White

Related Topics: CloudExpo® Blog, Java IoT, Linux Containers, BigDataExpo® Blog, SDN Journal

CloudExpo® Blog: Blog Post

Cloud Wars – How Many 800lb Gorillas Can Fit in the Room?

In their latest magic quadrant report on IaaS, Gartner describes the market as still evolving and maturing

There is a common phrase, often attributed as a Chinese proverb/curse, "May you live in interesting times." For those following the cloud technology space, we are definitely living in interesting times. In their latest magic quadrant report on IaaS, Gartner describes the market as still evolving and maturing. This would imply the market leadership is in flux, yet according to Gartner "AWS is the overwhelming market share leader, with more than five times the compute capacity in use than the aggregate total of the other fourteen providers in this Magic Quadrant." I would say that makes AWS an 800lb gorilla in the room that the competition must get by. Many of those competitors could be considered 800lb gorillas in their own right. Microsoft, IBM, Google are not small companies, yet AWS has managed to create a dominant position in the marketplace.

Can AWS maintain that dominance? Who among the other ‘gorillas' could potentially knock AWS from its perch?

The Big Public Cage Match, IBM vs Amazon
As one would expect, the original 800lb gorilla, IBM, wants to be the one to knock AWS from that perch. Early last year, Amazon beat out IBM for a lucrative four year $600M cloud contract with the CIA. IBM immediately filed a bid protest in February, which was partially upheld by the GAO in June (A Big Win for Big Blue). The battle between the two behemoths continued through the summer. IBM worked to strengthen its IaaS credentials with the acquisition of SoftLayer. In October, what appeared to be a successful bid protest by IBM was overturned by the US Court of Federal claims, and IBM withdrew its injunctive action (IBM Steps back from CIA deal). The battle continued in November when IBM started a significant ad campaign, claiming it held a larger cloud business than Amazon. This blitz included running ads on buses in Las Vegas during Amazon's premier re:Invent conference. In January of this year, IBM committed to a 1.2B investment to expand their global cloud footprint.

The battle has created very diverse views in the industry as to who will finally win. Rob Enderle wrote a very compelling piece on why IBM will win the war with Amazon Web Services. He points out in their over 100-year history, IBM has battled many other disruptive competitors - a fact I am well aware of, being a former employee of Digital Equipment Corporation. Digital (DEC) rose in the '60s, disrupting the mainframe computing industry with a disruptive concept, the mini-computer. DEC eventually rose to being the number two computer manufacturer in the world (behind IBM). DEC is now a fond memory as it was since acquired by Compaq (a PC manufacturer) who was later acquired by Hewlett-Packard. IBM putting you in their sights is not to be taken lightly.

On the flip side, a very good counter argument to that viewpoint was written by David Linthicum, in his article Amazon Web Services has no reason to worry about IBM. One of the key points David makes is the argument that IBM will have difficulty adjusting to selling the cloud service model. He points out "the more cloud services that IBM sells, the less money it will make." In essence, it will displace existing IBM hardware and software with its own "public cloud offering." Add into this viewpoint, IBM doesn't always win. When Oracle first came on the scene, it disrupted the database world, and IBM came out guns a blazing. Oracle has not gone anywhere.

What About the Other Gorillas?
With all the coverage the IBM/AWS cage match has gotten this year, sometimes it's easy to forget there are other significant players in this marketplace. These players are not sitting back and waiting for the results of the IBM / AWS battle. Gartner analyst Lydia Long, in Where are the challengers to AWS?, states: "I think there's a critical shift happening in the market right now. Three very dangerous competitors are just now entering the market - Microsoft, Google and VMware. I think the real war for market share is just beginning." Forrester echoes a similar viewpoint. When viewing the market through a lens of the services provided (compute, RDBMS, storage), Forrester analyst Jeffery Hammond sees Microsoft and Google making strong inroads in the RDBMS and storage services space. As with IBM, Microsoft and Google have deep pockets to compete in this space and are not going to give up without a fight. What I find telling is that both these analysts did not even mention IBM vs. AWS, which has been getting the majority of the public attention. Google just announced a partner program that includes three tiers of third-party vendors providing technical and consulting services for Google's cloud platform.

Verizon Joins the Battle
Last October Verizon announced a new cloud offering built from the ground up to compete with AWS and the other IaaS vendors. This offering is different from their existing Verizon / Terramark cloud offering. The new offering is based on technology from CloudSwitch, a company Verizon acquired a little over two years ago. Verizon hopes to differentiate their offering by allowing the client to define specific performance capabilities around compute, I/O, memory and storage. Verizon states their technology allows them to avoid the ‘noisy neighbor' problem seen from other vendors, a not so subtle swipe at AWS.

In January Verizon announced a partnership with Oracle for their cloud environment. "Beginning in the first quarter of 2014, Oracle customers will be able to license Oracle Database 11g and 12C, Oracle Fusion Middleware and Oracle Enterprise Manager to run in Verizon's Managed Hosting and Enterprise Cloud virtual infrastructures, according to a Verizon document that details the Oracle partnership." While AWS does provide the ability to use Oracle 11g in their environment, the addition of the middleware components could be a key differentiator for Verizon.

This by itself is not a game changer, but is a sign that Verizon is serious about competing in this space. Verizon has its sights squarely in AWS's corner. In its announcement Verizon noted that it will continue to expand partnerships and the ecosystem around its cloud offerings. It quickly demonstrated that was just the first salvo. Verizon announced this week that it is extending its partnerships with CloudBees and CloudFoundry, including committing a monetary investment in CloudBees through its venture arm.

Net Neutrality, Could It Be a Game Changer?
In 2010 the FCC adopted the Preserving the Open Internet, Broadband Industry Practices as a means to enforce the concept of net neutrality on the Internet. This was in response to the practice of a variety of broadband providers (including Comcast and Verizon) that were throttling bandwidth usage based on the source. Some of these sources could have been considered competitors. The FCC net neutrality rule had three key components:

  • Transparency - providers must disclose network management and performance information
  • No Blocking - providers may not block lawful content and services
  • No Unreasonable Discrimination - providers may not unreasonably discriminate in transmitting lawful traffic

Now the federal appeals court has struck down that rule. The suit was brought by Verizon. It immediately raised a question in my mind. Does this mean Verizon, in theory, could throttle access to public cloud providers (such as AWS), and provide better access to their own public cloud services? Imagine the impact that could have on the marketplace. Verizon could effectively lock the other gorillas in a room and start their own room.

Will this happen? Not overnight, that's for sure. The FCC has already said they would appeal the decision. Additionally the court did give the FCC some wiggle room in modifying the rule in a way that would pass the courts muster. The battle over net neutrality is far from over, but how it finally gets resolved could have long-term impact for us and the public cloud providers.

Who Will Still Be Standing in Two Years?
One thing that is clear, the market is still in flux. Gartner predicts that one in four cloud providers will be gone by 2015. IBM has already demonstrated the consolidation direction with their purchase of SoftLayer. Concerns about the risk of a cloud provider still being around could start creating a self-fulfilling prophecy for the smaller vendors. The failure of cloud storage provider Nirvanix last year has put this concern at the forefront for many buyers. If the small vendors become acquired, or forced out of business over the next two years, we could easily end up with a room full of just the 800lb gorillas as the market shakes out. The question will then become, how many of these 800lb gorillas can we fit in the room?

More Stories By Ed Featherston

Ed Featherston is a senior enterprise architect and director at Collaborative Consulting. He brings more than 34 years of information technology experience of designing, building, and implementing large complex solutions. He has significant expertise in systems integration, Internet/intranet, client/server, middleware, and cloud technologies, Ed has designed and delivered projects for a variety of industries, including financial services, pharmacy, government and retail.

Comments (0)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


@CloudExpo Stories
If cloud computing benefits are so clear, why have so few enterprises migrated their mission-critical apps? The answer is often inertia and FUD. No one ever got fired for not moving to the cloud - not yet. In his session at 15th Cloud Expo, Michael Hoch, SVP, Cloud Advisory Service at Virtustream, discussed the six key steps to justify and execute your MCA cloud migration.
Container technology is sending shock waves through the world of cloud computing. Heralded as the 'next big thing,' containers provide software owners a consistent way to package their software and dependencies while infrastructure operators benefit from a standard way to deploy and run them. Containers present new challenges for tracking usage due to their dynamic nature. They can also be deployed to bare metal, virtual machines and various cloud platforms. How do software owners track the usag...
SYS-CON Events announced today that BMC will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. BMC delivers software solutions that help IT transform digital enterprises for the ultimate competitive business advantage. BMC has worked with thousands of leading companies to create and deliver powerful IT management services. From mainframe to cloud to mobile, BMC pairs high-speed digital innovation with robust...
Containers Expo Blog covers the world of containers, as this lightweight alternative to virtual machines enables developers to work with identical dev environments and stacks. Containers Expo Blog offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. Bookmark Containers Expo Blog ▸ Here Follow new article posts on Twitter at @ContainersExpo
Compute virtualization has been transformational, yet security policy implementation and enforcement has lagged behind in agility and automation. There are a number of key considerations when implementing policy in private and hybrid clouds. In his session at 15th Cloud Expo, Malcolm Rieke, the Director of Product Management at Catbird, discussed the impact of this new paradigm and what organizations can do today to safely move to software-defined network and compute architectures, including: ...
Cloud and Big Data present unique dilemmas: embracing the benefits of these new technologies while maintaining the security of your organization's assets. When an outside party owns, controls and manages your infrastructure and computational resources, how can you be assured that sensitive data remains private and secure? How do you best protect data in mixed use cloud and big data infrastructure sets? Can you still satisfy the full range of reporting, compliance and regulatory requirements? In...
In this scenarios approach Joe Thykattil, Technology Architect & Sales at TimeWarner / Navisite, presented examples that will allow business-savvy professionals to make informed decisions based on a sound business model. This model covered the technology options in detail as well as a financial analysis. The TCO (Total Cost of Ownership) and ROI (Return on Investment) demonstrated how to start, develop and formulate a business case that will allow both small and large scale projects to achieve...
The move to the cloud brings a number of new security challenges, but the application remains your last line of defense. In his session at 15th Cloud Expo, Arthur Hicken, Evangelist at Parasoft, discussed how developers are extremely well-poised to perform tasks critical for securing the application – provided that certain key obstacles are overcome. Arthur Hicken has been involved in automating various practices at Parasoft for almost 20 years. He has worked on projects including database dev...
Building low-cost wearable devices can enhance the quality of our lives. In his session at Internet of @ThingsExpo, Sai Yamanoor, Embedded Software Engineer at Altschool, provided an example of putting together a small keychain within a $50 budget that educates the user about the air quality in their surroundings. He also provided examples such as building a wearable device that provides transit or recreational information. He then reviewed the resources available to build wearable devices at ...
There has been a lot of discussion recently in the DevOps space over whether there is a unique form of DevOps for large enterprises or is it just vendors looking to sell services and tools. In his session at DevOps Summit, Chris Riley, a technologist, discussed whether Enterprise DevOps is a unique species or not. What makes DevOps adoption in the enterprise unique or what doesn’t? Unique or not, what does this mean for adopting DevOps in enterprise size organizations? He also explored differe...
Storage administrators find themselves walking a line between meeting employees’ demands to use public cloud storage services, and their organizations’ need to store information on-premises for security, performance, cost and compliance reasons. However, as file sharing protocols like CIFS and NFS continue to lose their relevance, simply relying only on a NAS-based environment creates inefficiencies that hurt productivity and the bottom line. IT wants to implement cloud storage it can purchase a...
The emergence of cloud computing and Big Data warrants a greater role for the PMO to successfully manage enterprise transformation driven by these powerful trends. As the adoption of cloud-based services continues to grow, a governance model is needed to orchestrate enterprise cloud implementations and harness the power of Big Data analytics. In his session at Cloud Expo, Mahesh Singh, President of BigData, Inc., discussed how the Enterprise PMO takes center stage not only in developing the app...
Cloud Foundry open Platform as a Service makes it easy to operate, scale and deploy application for your dedicated cloud environments. It enables developers and operators to be significantly more agile, writing great applications and deliver them in days instead of months. Cloud Foundry takes care of all the infrastructure and network plumbing that you need to build, run and operate your applications and can do this while patching and updating systems and services without any downtime.
Are your Big Data initiatives resulting in Big Impact or Big Mess? In her session at Big Data Expo, Penelope Everall Gordon, Emerging Technology Strategist at 1Plug Corporation, shared her successes in improving Big Decision outcomes by building stories compelling to the target audience – and her failures when she lost sight of the plotline, distracted by the glitter of technology and the lure of buried insights. The cast of characters includes the agency head [city official? elected official?...
In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect at GE, and Ibrahim Gokcen, who leads GE's advanced IoT analytics, focused on the Internet of Things / Industrial Internet and how to make it operational for business end-users. Learn about the challenges posed by machine and sensor data and how to marry it with enterprise data. They also discussed the tips and tricks to provide the Industrial Internet as an end-user consumable service using Big Data Analytics and Industrial C...
After a couple of false starts, cloud-based desktop solutions are picking up steam, driven by trends such as BYOD and pervasive high-speed connectivity. In his session at 15th Cloud Expo, Seth Bostock, CEO of IndependenceIT, cut through the hype and the acronyms, and discussed the emergence of full-featured cloud workspaces that do for the desktop what cloud infrastructure did for the server. He also discussed VDI vs DaaS, implementation strategies and evaluation criteria.
We certainly live in interesting technological times. And no more interesting than the current competing IoT standards for connectivity. Various standards bodies, approaches, and ecosystems are vying for mindshare and positioning for a competitive edge. It is clear that when the dust settles, we will have new protocols, evolved protocols, that will change the way we interact with devices and infrastructure. We will also have evolved web protocols, like HTTP/2, that will be changing the very core...
How do APIs and IoT relate? The answer is not as simple as merely adding an API on top of a dumb device, but rather about understanding the architectural patterns for implementing an IoT fabric. There are typically two or three trends: Exposing the device to a management framework Exposing that management framework to a business centric logic Exposing that business layer and data to end users. This last trend is the IoT stack, which involves a new shift in the separation of what stuff happe...
Connected devices and the Internet of Things are getting significant momentum in 2014. In his session at Internet of @ThingsExpo, Jim Hunter, Chief Scientist & Technology Evangelist at Greenwave Systems, examined three key elements that together will drive mass adoption of the IoT before the end of 2015. The first element is the recent advent of robust open source protocols (like AllJoyn and WebRTC) that facilitate M2M communication. The second is broad availability of flexible, cost-effective ...
Collecting data in the field and configuring multitudes of unique devices is a time-consuming, labor-intensive process that can stretch IT resources. Horan & Bird [H&B], Australia’s fifth-largest Solar Panel Installer, wanted to automate sensor data collection and monitoring from its solar panels and integrate the data with its business and marketing systems. After data was collected and structured, two major areas needed to be addressed: improving developer workflows and extending access to a b...