Cloud Computing 2011

A Joint SAP/Churchill Club/GABA Panel Discussion at SAP Labs in Palo Alto, April 13

Last night I had the pleasure of opening another panel discussion on Cloud Computing. This time the panel was part of SAP’s Virtualization Week 2010 and moderated by Rachel Chalmers, Research Director at “the 451 group”, an independent technology-industry analyst company focused on the business of enterprise IT innovation. On the panel we had executives from SAP, Citrix, T-Systems, and AT&T Business Solutions.



I remember that in 2005 I had organized the first panel for GABA on a similar topic, only that at the time we called it Adaptive or Utility Computing and not Cloud Computing. Obviously Cloud Computing seems to be a more popular term and I wonder who started it. Was it Salesforce.com or Google or Amazon? It was definitely not SAP, they just adopted this term because it seems to be more than just another buzzword du jour.

The lively discussion about cloud related issues like security, bandwidth, certifications, cloud standards and others made very clear that Cloud Computing for enterprises, especially Cloud Computing for SAP, is not the kind of Cloud Computing we are all familiar with from Google. Who cares what happens with your data, when your Google search command ends up in a public cloud. All we care about is a precise answer in a timely manner. And although this requirement may also be true for any SAP user, you want to make sure that your data stays in the country and is secure at any time. But is data more vulnerable when it resides in a cloud rather than in your own data center? Our panelists seem to think that there is no perfect security solution and there will always be somebody trying to break though your fire wall.

However, companies like AT&T and Deutsche Telekom (T-Systems’ mother ship) are not only investing millions of dollars into more bandwidth, but also in high-security data centers. The buyer’s expectation is to lower the cost of ownership, increase ease of consumption and fast time to value.




Under Rachel’s excellent moderation, panelists discussed the shift from on premise to on demand computing, and from upfront to as needed consumption of compute power: Customers want flexibility  even if it is only a hybrid approach to Cloud Computing, e.g. keeping core applications in-house and sending edge applications into the cloud. Another good first step for companies to experience the cost savings and agility of Cloud Computing would be using the cloud for their batch processes or peek situations. Large corporations offering HR Self Services to their employees during the Open Enrollment period at the end of the year, utilities sending out millions of invoices at the end of each month, e-commerce retailers coping with Back to School or Holiday Season demands... these are all  opportunities for Cloud Computing

What I personally took home from this event is that Cloud Computing is no longer just a hype – it is reality. It may not yet be perfect, but it is a great way of lowering a company’s total cost of ownership coming with agility and better performance. I know that this will not be the last panel discussion on Cloud Computing for GABA. The mid-market customer is expecting SaaS Software-as-a-Service, where a user wouldn’t have any upfront investments but only pay what he uses - SAP from tap, so to speak. Stay tuned.

Sincerely,

Uwe Wagner
GABA Software Co-Chair and Principal & Founder of Tiburon Consulting LLC

Phone Wars II - The Software

On Wednesday April 7, 2010, a distinguished panel of experts in the smartphone industry was convened to discuss the current state and future predicitions for the fast growing smartphone market.



As a cell phone user, have you noticed how your buying decision has changed from a few years ago? Before, the first decision might be the carrier and the calling plan. The phone itself might have been an afterthought. Today, some people begin to make their decision based on the platform. "Do I want an Android phone, an iPhone, or maybe a Palm Pre?" After that choice is made, you are more or less stuck with a carrier and plan. There is a new war going on in the cell phone industry - the software war.

We started the evening with a poll of the audience. The biggest smartphone share was for RIM (Blackberry), followed by iPhone, and Android. This does not represent the market as a whole - worldwide, Symbian (Nokia) is still the majority smartphone platform by far! However, it's clear from the marketing numbers we presented that Android is growing rapidly, iPhone is holding its share quite nicely, and the others (Palm, RIM, Nokia) are beginning to lose. The panelists agreed that the numbers shown seem to reflect the reality as they understand it.

The panelists acknowledged that iPhone does seem to deserve its high customer satisfaction ratings compared to other platforms - but they believed that Android's open architecture will create more opportunities for cooperation and innovation than iPhone. Google's own Android phone, Nexus One, is a flop when judged by sales numbers, but one panelist mentioned that Google may have created this phone more as a reference platform than as an end user device. Now the standard is set, and other handset makers will need to meet or beat this standard.

Android, as an open standard, is in danger of confusing consumers with its plethora of different OSes and functionalities across numerous handsets. Google seems to be working to bring this under control, and our audience didn't think that consumers cared about OS versions (from my
personal perspective though, I think they *will* care when the Android phone they just bought runs a different version of Google Maps without any of the cool functionality that their friend has on another Android phone).

Microsoft is about to introduce a new OS platform for smartphones, based on Windows 7. At least one panelist thought Microsoft would make a strong entry, eventually placing at #3, behind Android and iPhone on the marketshare side.

Wrapping up the other platforms - None of the panelists were very positive on Palm Pre's prospects. This platform seems to be on the wane. Symbian (Nokia) is a strong phone platform of course, but its current smartphone efforts do not impress - but we were warned not to count out Nokia - based on their market position in the overall phone sector, they can change the smartphone dynamics in an instant. Everyone seemed worried about RIM's prospects, since the future may very much depend on application developers, and not Blackberry's original strengths with email.



As expected, the "Open" vs. "Closed" discussion caused some mutterings among the audience and panelists, especially as I tried to draw comparisons with the PC industry. If you look at how the PC industry played out, it essentially became a battle between Microsoft and Apple. Microsoft was based on an "Open" platform (this is where I heard the muttering), while Apple is and stays closed. I was referring to the hardware, of course, not necessarily the software. But is there a similar battle brewing between Google and Apple? Will Android be the cheaper smartphone option, but with more "blue screens of death", since the eco system will not be as tightly controlled? Will iPhone be the more expensive, more exclusive option with better performance? I think I got at least one panelist to agree with me on this, but as you can expect, the mood in Silicon Valley strongly favors the "Open" contender. We all agreed that Android is and will remain a strong (if not the strongest) contender in the smartphone platform wars - note that eventually Microsoft (my so-called "open" solution) won the day on the PC and almost drove Apple out of business!

We briefly covered the "Fourth Screen" - i.e. in-between devices such as iPads and Ereaders. Nobody thought these would compete with the smartphone. People would continue to buy smartphones.

We also discussed international implications. One panelist made an excellent observation: "the world does not necessarily revolve around items designed in Cupertino", i.e. the international market may favor an open platform where developers sitting outside the USA can create innovations targeted to specific cultures.

This summer promises the introduction of a new class of Android smartphones, that can run on Sprint's 4G network, with rumored download speeds of 10Mbps. But the panel thought that there is plenty of room for other phones as well, since availability of the 4G network will be very limited. Nobody seemed to have any inside information on what new phone Apple will introduce this summer (not surprised), personally, I expect a game changer - Apple's platform hasn't changed in 3 years. Yesterday's SDK announcements from Apple were just the tip of the iceberg... One panelist noted that we should expect phones to do more with motion sensing - for example, a distinctive shake may dial a certain number, or just the act of turning the phone over might silence it.

That wrapped up the evening. Thank you to the panelists (Daniel Kellmereit, Angela Nicoara, Ray Milhem, Christof Wittig) and to a great audience!

You can download the presentation slides pdf from the GABA Website.

Steffen Bartschat - Co-chair, GABA Software IG www.linkedin.com/in/bartschat