Amazon, Google & Microsoft Discuss Cloud Computing at SXSW
This is my site Written by Alora on March 17, 2009 – 10:22 pm

Computing in the CloudWhen Amazon launched AWs in 2006, Businessweek labeled it “Jeff Bezos’ Risky Bet.” However, to Amazon, it made sense: the amount of time, energy and resources the ecommerce company was putting into building a world class infrastructure was immense. It only made sense to try to monetize it.

Today at SXSW, in the panel called “Cloud Computing: Defending the Undefinable,” Amazon Web Services CTO Werner Vogels, Microsoft Azure‘s Yousef Khalidi and Google App Engine‘s Kevin Gibbs discussed the past, present and future of cloud computing for a packed room of conference attendees.

Eating Their Own Dogfood

When asked if the internal teams used the company’s cloud computing services, each of the representatives said yes — and, in many cases, their cloud computing model started out of an attempt to meet their organizational needs for computing services. When asked about how AWS prioritizes Amazon.com vs. their other clients, Vogel insists that Amazon.com does not get preferential treatment. In response to a skeptical audience he quickly noted: “Believe me! The other customers are paying us money!”

At Microsoft, Yousef Khalidi states, the internal teams (often very small) were having to go through an expensive and tedious hardware acquisition process to support the small apps they were developing, and an internal cloud computing model was the a result of needing to support the ‘long tail’ of the small apps deployed in the corporate environment.

The Cloud and Security

“Where would you rather have your money: in your mattress or in the bank?” asked Kevin Gibbs of Google, to the ubiquitous question of how secure is the cloud. Obvious economic quips notwithstanding, his point is that finding providers who are experts in this space allows end users the opportunity to keep focused on the things they do best, without having to invest in the expense and difficulty of building out a scalable infrastructure themselves.

Yousef Khalidi of Microsoft addressed this question very pragmatically, though, with the needs of the enterprise in mind: knowing that there are some parts of a business that lend themselves to cloud computing better than others. Things like collaboration tools or some supply chain systems are quick and fairly easy to move into the cloud with huge amounts of pain or concern. On the other hand, core business data, legacy systems, or systems adhering to various regulatory requirements are less likely to be eagerly pushed into the cloud.

Werner Vogels of Amazon points out, however, that cloud computing solutions are often capable of meeting regulatory requirements, and he cited several examples of healthcare organizations that must meet HIPPA guidelines as AWS clients.

How Green Are Cloud Services

Werner Vogels is adamant that, when it comes to most data center operations, most things that spell “efficiency” (and therefore lower costs) are also usually “green.” As a result, though none of the panelists had any specific statistics to share (and cited a lack of standardization in this area as an issue: what stats are truly meaningful?), he maintains that it is fundamentally in the best interest of scalable infrastructure solutions to be as “green” as possible.

And, per Kevin Gibbs’ response, the very nature of cloud computing is more “green” by definition than it is for a software shop to host their own infrastructure, because on-demand use prevents the expenditure of energy when an application is not in use — which obviously does not happen in self-hosted environments.

The Future of Open Standards

When asked about the support of open standards in the space, each of the panelists expressed a desire to ensure maximum portability and interoperability by supporting open standards in this space – at least as much as possible. However, they were also quick to point out that “open standards” is a broad term, and that how they are applied is the real question that has yet to be answered. As standards are increasingly codified, each team recognizes the value in ‘playing nicely with others’ and respecting the evolution of the community.

Is There Profit in the Cloud Business?

According to Vogel, “Absolutely!” He is emphatic: Amazon would not be in the business if they did not think there was great profit potential in it. And while they do not break out their financials to be able to reflect the financial status of this one area of their business, it is clearly a valuable market for them and they believe in the profitability of it.

Microsoft concurs. Khalidi emphasizes that Microsoft has a history of believing that there is tremendous profit potential in solutions based around economies of scale, which is exactly what cloud computing is. Gibbs notes that, while Google only started charging recently and so it is too soon to tell, they are confident that there are profitable margins to be found in this space – though they could need some time to work out the best way to tap into it.

What Are the Trends Among Transitions to the Cloud?

Werner Vogels says that the two dominant trends AWS sees among clients who move into the cloud is taking advantage of the opportunity to implement automation and scalability.

Kevin Gibbs further notes that the very nature of cloud computing will continue to evolve the field of development, since new apps can often find themselves ‘overnight sensations’ that go from no traffic to off-the-charts traffic in no time. As a result, development practices designed around maximum scalability will continue to be increasingly important to the architecture and development of even the most seemingly small applications.

Convincing the Enterprise to ‘Go Cloud’

The concern of many enterprise organizations when it comes to cloud computing is a common concern, and one that both Microsoft and Amazon are constantly discussing with both clients and potential clients. (Since Google’s focus is web apps, this is less of an issue among their customer base.)

Supporting Enterprise concerns in this area is a large part of what Microsoft has been focused on as they’ve been getting their Azure platform on its feet. Part of the plan they anticipate deploying to support the enterprise-specific issues is the idea of a ‘hybrid’ solution that includes “local cloud computing” and “traditional” cloud computing in combination. This would allow Enterprises to move non-sensitive applications out into the cloud, while gaining ‘cloud-like’ benefits behind their own firewall for the systems they need to keep locally.

Vogels adds another point: historical concerns about cloud computing are dwindling a bit as socialization of the idea takes root, and the novelty wears off. Even more importantly, however, is that with the change of the economic tide, financial savings is a much higher priority than it was a year ago. This factor alone is driving the cloud computing debate in some organizations that had previously refused to consider it.

Of course, the other thing Vogel noted is that we are still only “on Day 1” of the evolution of this space. As a truly “disruptive” solution, things are constantly changing and the eco-system of customers within the marketplace will drive how things evolve more than any other factor.