A Cloud That Cares? Or About Eating Your Cloud And Having it too.

Although self-service -together with elasticity, pooling/sharing, etc. - is a defining attribute of cloud computing, many of the companies expressing an interest in cloud computing do not seem to be aware of that.

In fact, when asked: who do you expect to provision your services to the cloud?; who will monitor your services' performance and availability? and; who do you expect to take action if something goes wrong?, a majority of the companies asked look to be somewhat surprised by the question, as they simply assumed that their service provider would do so.

This is a bit like going to a supermarket (a typical self-service facility), pointing to the ingredients you like and expecting the cashier to clean, cook and serve them for you. The name we generally use for such a service however is "restaurant" and it comes with significant different expectations and pricing, as demonstrated by the price of a bottle of the wine in a restaurant versus that same bottle at a supermarket (which is one reason restaurants prefer to buy from exclusive wine merchants and not to put bottles or their wine list that are available in retail).

The supermarket versus restaurant analogy may sound like a silly comparison, but is useful to further illustrate the difference between cloud computing and more traditional IT services. It is not just that the product is vastly different: a raw steak on styroform and a brown bag with vegetables versus a prepared steak - cooked to our liking - on a nice plate, brought to our table with a smile.

The much more telling difference lies in what we would reasonable expect to happen if something goes wrong. For example: if a supermarket burns down, we would expect the supermarket to - first and foremost - concentrate on building a new facility so it can restore its service. We would not expect the supermarket to call us and help us plan tonight’s meal or offer any alternatives on an individual basis. Likewise expect cloud providers to focus primarily on getting their cloud back up in case of problems.

However, if a restaurant burns down we would find it reasonable they would call people that have made reservations. And if we booked a wedding there for next weekend, we would expect the restaurant to help us find a new facility, help us agree the new menu with the new chef and reimburse any additional cost (unless we change the menu from steak to lobster).

Self-service in most cases means the provider is not aware of what the individual customer is using its product or service for. As a result it is not getting involved with individual outcomes (as it simply does not know those). This separation is also not uncommon in self-service infrastructure and even used as line of defense in case that infrastructure turned out to be used in “less than legal” ways.

Hybrids

Self-service supermarket have a lot of benefits that restaurant customers may also be interested in: choice, speed, price, no need to make a reservation, ample parking, to name just a few. So is there a way to eat our cake and have it to?

One option are self-service restaurants, like the ones you may find along most European highways. Service tends to be fast, no need to make a reservation and if the restaurant happens to be full, we just drive to the next one. Here self-service is the overriding attribute. It’s a supermarket with cooked foods, in most cases without the price advantage. And we probably would not plan having something important, like a wedding (or another mission critical event) there.

An option closer to the desired experience may be eating at a full service restaurant that sources from a supermarket. Such a restaurant could source it ingredients on demand (by simply walking across the street), it could offer enormous choice and would in most cases not run out of ingredients. It would however likely have to pay retail prices for these ingredients (supermarkets margins are thin and they do not have a lot of room for additional discounts, especially if you don't buy in bulk). But retail prices might conceivably still be lower than what a restaurant would normally pay from it traditional channels (like the exclusive wine merchant).

Pricing

As the prices of the underlying ingredients are now transparent, end-user pricing becomes an issue. Do we pay for an all in price a cooked meal (including seat and cutlery) or do we pay separate for cooking, serving and use of the facilities. In North America paying separate for service is still customary, and although not too long ago - in the southern parts of Europe - you would be charged separately for the couvert and the service, European restaurants now largely evolved to all-in-pricing. The drawback of such fully inclusive prices is that people compare it to the publicly known ingredient prices (a problem not unfamiliar to many an IT manages, who tried to explain the difference between the TCO based price of the fully managed PC their department offered and the price of that same PC in the local mall or - even more pronounced - from an on-line retailer).

Resilience

But -just like cloud computing is not all about cost - eating out is not just about price, it is also about agility, productivity and resilience. By not having to spend time cooking, people can have more quality time or -more likely - spend more time at work: finishing that last assignment, winning that additional customer. This does however mean we are now dependent on the restaurant for a pretty essential part of our life: eating. So what happens if our restaurant - that now sources from a third party self-service supermarket- runs into problems?

As we are not buying this as self-service, we would expect the restaurant to care about the outcome (us being hungry or fed) and take DR measures in case something goes wrong. But in how far is it fair to expect that the restaurant can reasonably do this, as they are now dependent on the supermarket? Can the restaurant stay open if the supermarket closes for a holiday or if I order something after supermarket closing hours. Or is it relegated to being a middle man no longer able to control its own SLAs.

Having the supermarket and the restaurant under the same management (meaning the restaurant guys have keys to the supermarkets’ back door) can help. But only if the supermarket manager allows his restaurant colleagues to interfere in his operations and impact his targets and quality (something not very common in larger organizations).

Smart restaurant would likely source from two or more supermarkets - preferably from separate chains, located in different streets. So it will be able to serve its customers even if one of them closes or burns down. And maybe that should also be the conclusion if you are looking (even though the definition would argue there is no such thing) for a non self-service cloud. In other words if we want to eat your cloud and have it too.



Disclosure: Before getting caught up in IT & Clouds, the author worked as a manager at the largest restaurant in the Netherlands, which indeed did burn down during that period but managed to restore it services within a week and keep it running throughout the reconstruction.

On Dog Years, Cloud Years, and A-years

Innovations are commonly judged by how fast they reached 50 million users (Radio, 38 years; TV, 13 years; Internet, 4 years; iPod, 3 years, etc.). Another way to look at this is by time equivalents: If one Dog Year equals 7 human years than how many years of traditional IT do we travel in one Cloud Year?

This cloud year we saw quit a lot of change - also from existing mega vendors entering the cloud market - but did it match 7 years of progress in traditional IT (taking us roughly from SOA till today)? And do we really expect the next three years to bring as much change as we saw since the days of client-server or the next seven years to be the equivalent of the journey from the days of the mainframe to today?

Now Einstein pointed out that speed is relative to the point of view of the beholder. In that spirit one of my former employers handed out gold watches after 10 years, instead of after the customary 20 years, because he felt “It all moves a little faster here”. I never made the 10 year mark there (not would that have mattered as they changed the policy in my seventh year), but I did make my first A-year last month (A as in Analyst). No watch here either, just some musings on time.

Talking about musings on time, several dog years (and a few employers) earlier, I wrote a small time perspective on the ERP market, called “the Best Years” (named after the little rural town called Best, where we had kept office till then). I did not keep a copy of that internal note but the main theme was that in just a few years the way customers procured ERP had completely changed. From vendors leading the sales process, often doing custom demoes that wowed prospects with fancy features (features that BTW seldom got to be implemented post sale), to cookie cutter selection cycles where third party consultants fed vendor profiles and offerings through standardized spreadsheets generating normalized scores. Vendor offerings became more and more comparable and our RFP responses were demoted to becoming column fodder for the Lotus123 sheet (Yes, was some time ago, when there was still a market and not an oligopoly).

Question is whether the cloud market - or more specifically the Infrastructure as a Service market - has started on a comparable journey and at what speed. At Gartner we are currently working in full swing on the next iteration of the Cloud IaaS Magic Quadrant giving us an upfront view of convergence and comparability (or even compatibility) of various offerings. For those of you interested in the MQ process, I suggest reading the recent blogs of my colleague Lydia Leong, who shares some useful background and pointers.

Closing out my first A-year I also got to write technology profiles for a few of the Hype Cycle reports (such as the ones on PaaS, on CSP infrastructure, on the Telecommunications Industry and for the brand new Hype Cycle dedicated to Cloud Service Brokerage , an increasingly popular topic, also for European CSPs). These Hype Cycle reports reflect our official take on speed (years to mainstream adoption) and impact (low, moderate, high or even transformational) of such new developments. More on these later.

First however putting some focus on increasing my personal speed, as some deadlines (like for the upcoming Barcelona Symposium) are approaching rapidly.

On Plate Tectonics, Glacier Shifts and Cloud Forecasts

Not all major changes are visible to the naked eye. Standing next to a glacier it is difficult to determine direction (does it grow or shrink across seasons) and watching continents move takes even some stamina for the casual observer. Luckily this is not the case for cloud computing.

Apart from the very noticeable cloud hype (more on the cycle of that soon) there is also very noticeable growth.   At the end of a deep and wide group effort,  Gartner published its "Forecast: Public Cloud Services, Worldwide, 2010-2016, 2Q12 Update" accompanied by Market Definitions and Methodology: Public Cloud Services. As I highlighted several years ago in Can the Real Cloud Market Size Please Stand Up? definitions are all important when trying to compare various cloud forecasts and especially cloud forecast categories.

This year I was on the creating side of a cloud forecast, working on  “Compute” services, which  together with “Storage” and “Print”  makes up the section “Cloud System Infrastructure Services (IaaS)”. Other sections in today’s published forecast are “Cloud Business Process Services”, “Cloud Application Services (SaaS)”, “Cloud Application Infrastructure Services (PaaS)” and the new “Cloud Management and Security Services”.  I am sure there will be some public press announcements with numbers, percentages and stats later today, so I won’t go into that here.

Most publications picking up on this will likely focus on the overall biggest number ( the total of all cloud services in the furthest away  year).  Not sure that overall total has the granularity that makes it useful to anyone in particular -  as it includes many different markets (IT and non IT) and areas (from IaaS all the way to BPaaS ). But at that level of granularity you could say that the size of the public cloud service market is developing from being roughly the size of Luxembourg’s GDP only a few years ago, via sizes comparable to countries like Oman, Angola, Vietnam, Hungary, New Zealand  and Romania, into a size being roughly  equal to the current size of the Irish economy by 2016.  For reference, today’s overall Enterprise IT spend of 3.7 trillion per year is roughly equivalent to the size of the economy of Germany, so still plenty of room for growth. But that growth has to come from somewhere. One of the more interesting questions –more interesting than absolute size - is which traditional market  glaciers are melting (or at least slowing down their progress) as a result of the global warming caused by cloud computing.   A lot of the cloud growth comes from enabling stuff (technical term for new services, new markets) that simply was not possible before. 

But - with global growth stagnating in some regions - some of the cloud growth will come from cannibalizing traditional markets. Scientists have not yet decided (at least the last time I looked)  what  actually killed the dinosaur and how long it took for them to become extinct, but for traditional IT it is safe to say it won’t be as sudden as a meteor hit, but it could happen significantly faster than global warming. And just like with these phenomena’ s, some people will be in denial (adapting too late)  and others will be adapting too early . Guess –as always- timing is everything, and - as usual - timing is the hardest to get right, something our forecast efforts aim to help with.

Are SLA’s like wedding vows?

It seems like every time a major cloud provider runs into an outage (like yesterday), the topic of cloud SLAs rises to the surface. But in many cases the benefit of an SLA may be limited  to using it as a paper handkerchief to dry the tears of frustration of the user, while he waits for his provider to come back online?

At the risk of simultaneously offending two groups (people who believe in wedding vows XOR people with trust in SLA’s) lets compare the two a bit further. In both cases (you would hope) participants start with the best intentions. And although few will consult the agreed paperwork before making daily operational decisions, you would expect they follow policies in line with the original intentions  (for example refrain from ...fill in the blanks ... and/or from buying old, refurbished hardware).  But once we have a breach, hitting the partner over the head with a copy of the agreement only gives some emotional reprieve.

While discussing SLAs with a colleague we -only partly in jest - concluded that most SLAs are not worth the paper they are printed on, and consequently, on-line SLAs – which are generally not printed – are worth even less.   But – you may ask – is that not what penalty clauses on SLA breaches are for? Strangely enough, not many people are using penalty clauses in their wedding vows. Vows are about trust, and having a financial or other compensation clauses seems to contradict this trust. Of course Ronald Reagan popularized the idea of  “Trust but Verify” but that was in the context of the cold war, and if your partnering situation is comparable to that, no amount of SLAs or vows will help you.

Not to mention that verifying anything in the cloud is still severely hampered by lack of provider transparency. In many cases success is more about monitoring input and behavior than about monitoring output. Just like a good sales manager should not routinely ask his reps “How much have you sold today!”, but rather “How many new prospects did you call, how many demo’s did you agree and how many proposals did you send?” Likewise,  SLAs (and vows) are best monitored by checking policies and behavior upfront.  That is also the only way to do some verification of how realistic the given SLAs are.  We have all seen the calculation that five components with 95% availability give an overall availability of barely 78% (95%⁵ or (1-5%)⁵), however having a spare for each of these five, increases availability to 98.7% ( (1-(5%)²)⁵ ) , which by the way is still about 7 days of unplanned, unexpected and undesired downtime per year.

If a provider does not offer the transparency needed to verify the numbers (the input), you may conclude that all you can ask for are penalties. But such penalties are known to invite calculative behavior, with partners evaluating – in a rational but not very partner-like way: “What is more expensive? Paying the penalty of addressing the issue?” Which quickly leeds to aforementioned cold war feelings.

PS As I am writing this blog, the Dutch papers are filled with in-depth analysis of  –no, not of a cloud outage – but of the latest soccer celebrity divorce.  Somehow this seems to be more newsworthy than the EU cup predicament of the Dutch Soccer team, which has somehow managed to miss all its SLAs (to the large frustration of its customers/fans). And just like with today’s cloud outages, the debate about what went wrong (and who is to blame) happens mainly through public interviews, blogs and articles.  It seems that when something goes really wrong, transparency quickly becomes the norm again.

Disclaimer: blogs are not research, they are not peer reviewed (except maybe through heated comments below) and yes, I agree some (but not all) SLAs and/or vows may make (some) sense.

Are Conference Calls the New Coffeehouses of Idea Enlightenment?

Edison is believed to have said “Genius is 1% inspiration and 99% perspiration”, and 9 out of 10 times “implementation trumps innovation” when it comes to achieving commercial success, but is it just me, or has the well of new ideas around cloud computing run a bit dry recently?

Big Data is rapid gaining ground on cloud computing when it comes to search popularity on gartner.com. And SDN (Software Defined Networking) may be flavor of the month in cloud blogs, but although there is a succinct impact on cloud computing, this is really more a networking idea. Now off course,  cloud computing is only one force – and mainly an enabling one - in the nexus of cloud, information, social and mobile, but when monitoring the various publicly available industry news feeds, I get a bit of a groundhog day (the movie) feeling. You might even say we have taken a step back in some cases, with enterprises implementing older concepts - such as managed hosting - under the moniker of cloud, as my colleague David Mitchel Smith described in a recent post on reverse cloudwashing.

Is it because everyone is so busy hammering out existing cloud ideas into products, that there seems to be less new ideas around? Back in 2009 I wrote about the 4P’s of Innovation  (Problem, Ponder, Publish, Pilot), and although there still are a lot of publications, many of them revisit ideas first seen in various cloud industry blogs. Now I understand that blogs are supposed to be about things that haven’t been built yet (otherwise we would call them brochures), and that today’s publication also cover implementations, references and even failures, but it did make me stop and think about the process of idea creation.

Nowadays any thinking starts with browsing, and that led me almost straight to a TED talk on “Where good ideas come from?” TED evolves around “ideas worth sharing” and possibly an even more effective way to share ideas is to animate them in the way the RSAnimate project of the Royal Society of Arts been doing.  What the video clip did to music, these short animations are doing to ideas, visionary speeches and pitches (=put them on YouTube). Here the 4 minute animation of “Where good ideas come from” (ending with a book plug).

In Gartner we have what I would call “institutionalized idea mechanisms”, that include the creation of regular publications such as hype cycle reports, predicts and - a bit down the implementation road - cool vendor reports. Over the past months I have had the pleasure of participating in some of these, and all serve towards rating, categorizing and vetting ideas and concepts. 

In addition we have our Research Communities (RCs). The form factor of most of these RCs are conference calls, and although these in general are more productive (although less funny) than the classic ”the Conference Call”  by David Grady, I am glad we complement “the days we work with Sparky” with in-person and off-site meetings.

As Steven Johnson discusses, most ground breaking ideas were not epiphanies or eureka moments and like good wine, ideas do get better when shared, regardless of whether they are shared in a meeting, a conference call or a nineteenth century coffeehouse. Look forward to sharing some of the ideas I’m currently socializing here, but meanwhile let me know if you think I missed some recent cool new cloud ideas.

Truth in (round) numbers?

Statistics matter, not only in business, but increasingly also in our social life – well, at least in our social media life. Some of the statistics I noticed this week were round numbers, like 1000. With 1000 representing both the number now showing under “followers” in Twitter and the revenue number for research (that’s excluding events, consulting and other items) we grew to in 2011.

And on my blog I saw – a bit to my surprise - it has been of full 10 weeks since my last post! That’s however more a case of bloggers block than writers block, as I did (co-)author the round number of 10 research notes since joining this summer. To catch up, I am including below a short overview of the topics these research notes covered (Gartner clients only) and that I likely will explore further in the future - both in research and using (social) media.

So what topics did these 10 research notes address? First to mention are the Predicts 2012. I participated in two this year, one called Predicts 2012: Cloud Computing Is Becoming a Reality in which we revisited an earlier prediction on cloud lock-in and explored the idea of a Maslov type hierarchy of needs for cloud computing customers. In this needs hierarchy fear of lock-in will be gaining ground as more basic needs like security are better understood.

In the second Predicts 2012: CSPs Need to Redefine Their Business Scope we focused on the expected penetration of Cloud Service Brokering among leading Communication (and increasingly Cloud) Service Providers or CSPs. Cloud Service Brokerage (CSB) was also the topic of an Emerging Services Analysis note. As discussed during the 2011 symposium keynotes brokerage of individual solutions into more whole, aggregated and integrated solutions is increasingly becoming a necessity in the world full of cloud specialists typically offering one thing at enormous scale and lowest possible price points.

But the emerging cloud computing discipline also has distinct touch points with IT markets and disciplines that have been around for many years, like outsourcing (particularly in Europe) and with the IT operations management (ITOM) discipline. With regard to the first I contributed to work from our colleagues in the outsourcing & IT services team on a Market Map and Compass, aiming to give some guidance on when to choose which approach. Meanwhile in the ITOM area a note was published called Cloud Management Platforms: A Step toward ‘ERP for IT’. I did not participate in this one personally, but given my earlier writings like "Lean, and the art of Cloud Computing Management”, you will understand I welcome this approach whole-heartedly.

A foundational element and quantitative bearing point for all these types of research notes are the industry Forecasts and Forecast Analysis notes, such as the one for Enterprise Network Services (which includes hosting, colocation and cloud IaaS services) that our team publishes in a quarterly cadence. In these we expanded the forecast horizon to 2016, which somehow feels a lot less round that the previous horizon of 2015.

A less broadly known but very interesting part of our research are the Marketing Essentials notes aimed at technology and service providers. I worked on ”Four Strategic Options for CSPs to Explore Cloud Computing Opportunities which came out shortly after this Competitive Landscape on the approaches of two European CSPs (Telecom Italia and Orange Business Services) and the earlier mentioned Emerging Technology Analysis regarding the use of self-service portals and APIs in cloud computing. APIs are becoming an increasingly important part of cloud computing and my latest research on Market Trends explores further how dynamic allocation of network capacity through use of an API (enabled by emerging software defined networking standards such as Openflow) could become the third foundational element of infrastructure as a service (next to compute and storage as a service). In this note we explore how enterprises may want to command a business class of networking services - similar to how enterprises (in the good old days) commanded a business class of airline services – but all using the same underlying infrastructure as consumer offerings.

So what’s next?
First of all lots of the day to day analyst activities I described in my (talking of round numbers) cloud in a hundred days post and more recently by my colleague Lydia Leong in a post called Five reasons you should work here. First upcoming item on the publication calendar in an overview of the research agenda our team will be writing against in 2012 and of course the annual 2012 cool vendor reports for which the nominations now are all in.

With regard to the momentum of cloud computing, I guess it is fair to say that even when one might believe we had seen the top of the hype(cycle), the amount of buzz and excitement around cloud computing continues to grow. In some cases resembling the mad rush of the days of Open Systems (where boards with no particular insight or interest in technology would a mandate a move to "open systems" (what ever that meant), sometimes even despite what business cases and common sense would suggest). And if we wanted, we could fill every week here by attending briefings from provider- and vendor-organizations on their new cloud computing plans and offerings.

But as with any new technology the proof of the pudding lies not in cooking it (or even in writing about it), it lies in eating it. And that is the next step. Moving from specific use cases (such as test-dev, customer facing web applications and high performance computing) to the generic - deploying, more and more parts of enterprise’s vast application portfolio’s using cloud based datacenter services. It’s this crossing of the chasm that has consistently proven to be the most difficult step for both vendors and technologies to take. It’s the numbers (round or not) that will eventually be the judge of how successful the transition will be.
PS. Almost all of the above notes were written in cooperation with other Gartner analysts, for a who's who see the detailed listing of lead- and co-authors by document here.

The rise of IT-industrialization

A few days ago I attended the analyst summit of one of Europe’s large service providers and the theme of industrialization rang through very clearly in many of the presentation and interview sessions. Those of you who followed my earlier writings know that applying the lessons of modern manufacturing to today’s IT, is a topic near to my heart.  Back in 2004, long before joining Gartner, I wrote an article on IT-dustrialization in CFO magazine , followed by many blogs, later bundled in “Lean and the art of cloud computing management”. At Gartner IT services industrialization is covered in my area under the topic of IUS (Infrastructure Utility Services) and I am currently working with two of my European colleagues - who have been covering IUS for several years - on a market map and compass for this IT industry area.

But, as mentioned earlier publishing in many cases precedes (best) practices, so it was refreshing to see how the ideas of industrialization were very much present during the mentioned analyst day. It would go too far (also given our blog policy) to list the whole story here, but let’s look at some of the more interesting bits and sound bites.

In a very open welcome talk, the CEO acknowledged that maintaining quality is one of the hardest things when moving to a more industrialized production method. To me this sounded a lot like the problems that the Japanese car industry faced when first importing into Europe. The cost of their cars was significantly lower, but they came with a quality level to match. Now we all know that in those years Dr. W. Edwards Deming made his first visits to Japan, introducing statistical analysis and simple tools to apply quality control at all stages, and the rest is history, with Japanese quality for many years matching or even exceeding global quality (Later the Deming circle formed an important foundation of other best practice movements in both manufacturing and IT).

The several ten thousand strong production department of this provider went through a similar transition. All staff was immersed in (on-line, multi-media and in person) training programs and  processes were defined and orchestrated to an extent comparable with the ballet-like orchestration you see in modern factories. Comparing itself with internal and external benchmarks was made a way of life and statistical measurement tools were applied widely. Inspiration for much of this came from conversations the head of production of this provider had with his customers: large manufacturing organizations employing several hundred thousands of factory workers with a high focus on product and process quality. (Note: Don’t mistake the term factory worker we use here for the traditional blue collar versus white collar division of labor. Today’s factory workers are often higher educated, better trained and in many cases even better paid than most clerical white collar jobs, while the production activities they are responsible for are more automated and supported by more robot technology than most regular office - or IT - work).

But in IT, even more than in manufacturing, changes are a major enemy of quality. And with the type industrialized scale we are talking about here that means that thousands or even tens of  thousands of change requests are to be applied each night or weekend. In manufacturing it is nowadays best practice that any factory worker can stop the production line when he/she feels quality is somehow at risk. But - as availability is one of our primary definitions of quality - stopping the line, a.k.a an outage,  is exactly what we don’t want to do in IT . So in this case a best practice from the airline industry was applied. Any change has to be checked by 4 eyes before being implemented into production. In other words, it has to be reviewed by at least two people, call it the pilot and the co-pilot. An intermediate step that at first may seem expensive - just like most people in the eighties felt it was crazy to have any worker be able to stop a multi-million dollar assembly line - but that in the end reduces overall cost. Also because doing things right the first time is - over time - always cheaper than incurring rework, penalties and other cost of non-quality.

But industrialization goes further, also for the customer who is at the receiving end of these industrialized services.  In this case the CIO of one of the global customers of this provider gave his insigtfull perspectives on the changes the industry is going through. Again a couple of soundbites.

This CIO is driving his organization toward obtaining “anything as a service”, which eventually – as he put it - enables CIO’s to separate the I from the T (allows focus on the Information, not the Technology). For providers this means moving from delivering traditional system integration projects, to standardized products that are delivered as a service. This change does not only impact how it is delivered, but also how it is procured. Again a car analogy. When this CIO was to order a new car, he did not go shopping around; he did not even test drive his final choice. As he had a history of good experiences with this manufacturer, a rough idea of the type of model he wanted (eg. 4 door sedan, no MPV, no SUV), and a number of minimum requirements (think of automatic, diesel, navigation), he basically picked the car unseen, as he knew it would be “good enough” for his requirements. I would classify this as a mature buyer in a mature market. Where the immature buyer will shop around, go on test drives in many makes and models (including in two door models he is not even allowed to order as a company car) and from manufacturers he may have never heard of, the mature buyer knows what he wants and rather spends his valuable time on stuff that really matters (in business terms: on activities that differentiate the company).

At this stage the market has not many mature buyers yet (even for cars, I know because I just selected mine and that took me more than a couple of calls). But mature buying also requires a mature market. In the car industry, buyers know that most of the major brands now deliver high quality and reliability. While the brands that did not reach that trusted status yet, offer warranty periods that even Charles Deming could only have dreamed off. It is this kind of trusted quality level the industry will need to reach.
As for cost, also there the ambitions and expectations are high. As Adam Smith showed in his wealth of nations, a traditional craftsman might manufacture one pin a day. A pin factory, however, created 48,000 pins a day using ten men. In the light of what Taylorism and scientific management did in manufacturing, the voiced ambition of reducing IT cost by 90% seems a lot more feasible. Especially when realizing that in some of today’s on-line "factories" (i.e. consumer web shops) the cost of an IT item already might be 1/10 of the TCO based cost that IT departments charge in their internal catalogs of IT services (and when procuring things as a service there is no "ownership", so also no Total Cost of "Ownership", although there may be other governance related cost).

I’ll finish off with a last (car) anecdote from this CIO: When Karl Benz and Gottlieb Daimler originally estimated the size of the overall addressable car market, they came to about 1 million cars (which is about as accurate as the max of 5 computers that Thomas Watson once arrived at). But more interesting than the overall number is the way they arrived at it. As there were no available statistics on cars, they estimated the number of households that would be wealthy enough to afford a chauffeur.  We now know that overwhelming majority of cars are bought by users who drive these cars themselves. When extending this to IT, the idea would be that future CIO’s would be like today’s chauffeurs, the people that drive IT in a very small set of special cases, while most of IT would be “bought and driven“ by users.  An interesting idea, let’s hope IT-industrialization can drive the required maturing of the supply side fast enough to be ready for this scenario.

Any comments/questions send me a mail at gregor.petri at gartner.com.

The art of listening

One of the first tips I got when entering the workforce was "You have two ears and only one mouth for a reason!", meaning that in conversations with customers you should spend twice as much time listening as you do talking. Point was to avoid becoming like a radio with only one button: "Send".

Over the years I learned that above also applies to "new media" such as email, blogging, tweeting and podcasting. You need to use the receive button at least twice as much as the send button. Although less obvious, I am trying to maintain this ratio also as an analyst. Maybe not in every single conversation - our type of analyst inquiries are not like psycho-analysts calls where the analyst just keeps asking the patient repeatedly "and how do you feel about this?" - but overall it still makes sense to allocate substantially more time to input (also from colleagues, peers and even competitors) than to output.

With modern management techniques increasingly focused on managing a workforce that is increasingly spread out and that maintains work hours outside the traditional nine to five, it may – across many industries - feel increasingly difficult for individuals to maintain this balance of input versus output (as only the latter seems to gets measured and formally acknowledged nowadays).

Luckily there is modern technology - like podcasts and RSS feed readers - to help streamline at least parts of the input process. Funny thing is that some of this technology is not that new at all. My first encounter with Gartner's "podcast avant la lettre" was with the "Talking Technology" series that back then came on “compact cassettes”  (for young readers that may never have seen a cassette - not even in your "my first Sony" -  there is now an iPhone app that emulates the experience). This "Talking Technologies" series still exists (feed here, subscription required), in fact our High Tech and Technology Providers team just participated in the November edition with a segment on  the "4G, the Next frontier for Cellular Networks" special report that describes why 4G matters and what impact it will have on both providers and consumer (Personally I just hope we will use 4G at least as much to receive as to broadcast).

Just like the classic "Talking Technologies" cassette tapes and the subsequent CDs, these podcasts require a subscription. Fairly recently we added to this a series of almost daily Gartner webinars, which are open to all interested parties after a short registration process. You can register for these webinars  here, but to make it even more convenient you can also subscribe to a feed with the upcoming webinars or to a feed with all replays. This Tuesday (November 15th) I will be doing my first contribution to this series. In this webinar, called "The Crowded Cloud", I will talk about  how many different industry players, including Communication Service Providers, are trying to become the Cloud Service Provider (CSP) of choice for their enterprise customers. Would love to welcome you there.

As you gathered by now the above is part of the 1/3th of  my activities focused on output/sending, but I look forward to balancing that out soon with more personal and more two way communications. Meanwhile please feel free to comment below.

Cloud in one hundred days (and nights)

This week the Gartner Symposium visited an unexpectedly sunny Barcelona. This year’s theme for the Gartner Symposium is  "Re-imagine IT" and how the forces of Cloud, Social, Information (incl. big data) and Mobile are forming a nexus (Websters: a connected group or series) of change, see the bottom of this post for a link to the on-line replays. While here I ran into a former colleague who reminded me that this is also around day 100 in my new role as analyst. And although I am all too aware that being an analysts is not even remotely like running a country, this seems as good a point in time as any to have short look back and forward.
Apart from the usual getting acquainted with some new and some familiar (not to say classic) systems, here are some of the things that kept me busy:

• A core activity is off course writing research, in October an Emerging Technology Analysis on  How Self-Service Portals for Cloud Infrastructure Services Impact the Customer Experience published, followed by a European focused Competitive Landscape on  Two CSP Approaches to Cloud Computing  in November.
  Still in the process of peer reviews, fact reviews, editing etc. are a co-authored piece on Cloud Service Brokerage and a Marketing Essentials document describing four strategic options for Cloud Service Providers. Upcoming are also the annual Gartner Predicts for 2012, for which I got to submit a new SPA (Strategic Planning Assumption) and had a look back at an earlier one.
• But analysts also get out on occasion, for example to host a forum during the press day of a cloud datacenter opening at Amsterdam’s Schiphol Airport (some coverage here). Or to participate in a cloud brainstorm with the lead architects and national CTO’s of a large European communication services provider. And on the end user side: to facilitate  a global cloud strategy workshop for a leading European life sciences organization and to moderate a European vendor day for an international freedom and security alliance.
• In addition there are the inquiries.  I stopped counting at some point, but spoke with numerous banks, governments, manufacturers and many service providers in all shapes and forms (from gaming agencies to health care providers) and from all parts of the world, including Africa, Asia, Europe and the America’s about their cloud computing strategies. Also met in person with several members of our EXP program and had briefings with and/or visited several cloud and communication service providers (CSPs).
• These cloud service providers included traditional (and not so traditional) hardware providers, software companies, hosters, co-locators and a surprisingly large number of cloud providers form other continents that are in the process of setting up European facilities in Amsterdam. Also managed to squeeze in a visit to the European edition of VMworld and spoke with their executives about the (European) market.
• Given the fast growing number of cloud providers in Europe we also set up a continuous survey (see last month’s blog), so if you are providing (or planning to provide) cloud services in Europe it makes sense to have a look, also if you’re interested in the process of setting up a vendor briefing around your offering.
• On the internal research front started to participate in the communities covering IaaS, PaaS, IUS (Infrastructure Utility Service) and ITOM (IT Operations Management incl. private cloud).  Other internal activities included onboarding training, getting a phone, ordering a car and last week I was asked to become the second or backup agenda manager in our team (Our agenda management is not about scheduling or calendars, but about setting and managing the agenda storyline of key trends and key issues that we write to).
• Looking forward: I am hosting a customer roundtable at symposium about  “How private or public should your ideal infrastructure cloud be?” and next Tuesday (15 Nov) I am presenting a Gartner Tech Tuesday webinar called “The Crowded Cloud – Opportunities for CSPs”  (open for viewing after registering here). Going forward I plan to find more time for blogging again and for writing more in depth research on the topics covered in this blog.

Meanwhile you may want watch highlights from this year’s Symposium, like in other years these are open for general viewing (after a short free registration process) at www.gartnereventsondemand.com. In addition to the Gartner keynotes, the special guest keynote interviews and other highlights, you can also watch sessions from the symposium sponsors there, some even adapted their session –like Google – to the keynote from earlier on the day.
Apart from the earlier mentioned nexus, my personal favorite sound bites from the opening keynote were: Spending on cloud currently is already far in the tens of Billions but still only a small percentage (around 3%) of total enterprise IT spend and growing much more rapidly than traditional spend. And: Cloud will do for IT what supply chain models did for manufacturing. Both topics I hope to touch upon further in upcoming research, talks, presentations and blogs.

Using a cloud service to … collect information on European cloud infrastructure services

The public cloud infrastructure as a service market is developing quickly, also in Europe. Over the past months we saw the number of international IaaS providers setting up shop in Europe increase, while also several European based providers launched new or upgraded offerings.

To keep a finger on the pulse of developments we started, as part of the European Cloud IaaS coverage at Gartner, surveying pan-European providers of Public Cloud Infrastructure as a Service . We are now extending the invite to participate in that survey more widely (like we recently did for the CIO survey).

Especially in Europe we see cloud IaaS services being offered as an extension to existing services, this survey focuses therefore on how IaaS services fit with the overall service portfolios of providers, so it also includes short questions on adjacent offerings in areas such as PaaS, SaaS, Managed Desktops & VDI, DC Outsourcing, Infrastructure Utility Services, Managed Hosting, Co-location and  IT Professional & Brokerage Services.

If you are providing IaaS services in at least two European regions, then please take some time to fill out this survey. The data received will be used to gauge the overall state of the pan-European Public Cloud IaaS landscape, not to describe individual providers (for these we use other information such as the regular vendor briefing process, see here how to apply for such briefings).

You can take the survey from the Gartner Blog Network (GBN) page here

If you have any questions please send a short email to gregor.petri at gartner.com