Welcome!

Weblogic Authors: Yeshim Deniz, Elizabeth White, Michael Meiner, Michael Bushong, Avi Rosenthal

Related Topics: @CloudExpo, Microservices Expo, Containers Expo Blog

@CloudExpo: Blog Post

Will Cloud Computing Models Impact Pricing?

BriefingsDirect analysts pick winners and losers from cloud computing's economic disruption and impact

The latest BriefingsDirect Analyst Insights Edition,cloud computing and dollars and cents. Our panel dives into more than the technology, security, and viability issues that have dominated a lot of cloud discussions lately -- and move to the economics and the impact on buyers and sellers of cloud services.

When you ask any one person how cloud will affect their costs, you're bound to get a different answer each time. No one really knows, but the agreement comes when the questions move to, "Will cloud models impact how buyers and providers price their technology? And over the long-term what will buyers come to expect in terms of IT value?"

What comes when we move to a cloud based pay-per value pricing, buying, and budgeting for IT approach? How does the shift to high-volume, low-margin services and/or subscription models affect the IT vendor landscape? How does it affect the pure cloud and software-as-a-service (SaaS) providers, and perhaps most importantly, how do cloud models affect the buy side?

Join the panel of Dave Linthicum, CTO of Bick Group, a cloud computing and data-center consulting firm; Michael Krigsman, CEO of Asuret and a blogger on ZDNet on IT failures as well as writer of analyst reports for IDC, and Sandy Rogers, an independent industry analyst.

Here are some excerpts:

Rogers: A lot of the enterprises are going to learn from those organizations that have to act at web scale and understand which are the right use-cases to put out there and how to leverage it. ... A lot of the innovation that we see happening on the cloud is really other providers that are starting to build their businesses on the cloud.

They're learning that there is a web-scale business to be obtained out there, and that's really where we are seeing the biggest innovation.

They're learning that there is a web-scale business to be obtained out there. What is also really interesting is that it's more than just technology. It's really transitioning to engage with services and services providers. Those who are attempting to move out there onto the cloud are learning that that is a big piece of the puzzle. Many technology providers have to grow into the role of a service provider.

Krigsman: I ask the question ... Is cheap IT really the goal [of cloud computing]? To me, the real question, the longer-term strategic question, is "How does this new IT infrastructure map onto our business processes and our business requirements looking long-term?" There are some mismatches and mismatched expectations.

When you have one group that is expecting certain types of outcomes and results and you have another group that is capable of delivering results that don’t match the first, namely between buyers and sellers [of cloud services], then the end result is predictable failure or disappointment somewhere down the line.

Improvement model

I'm bullish on cloud computing being a catalyst for architectural change and typically for the better. So cloud is not great at security and governance as of yet, but in many instances it's much better than the current security and governance in lots of these existing enterprises, which is poorly defined or nonexistent.

Ultimately, as people revamp their architectures to leverage cloud, moving into SOA, looking at cloud as an architectural option for bit pieces of parts of their data and parts of their processes, they go through an improvement model.

They go through some architectural changes, create new governance models, and create new security models. They leverage identity management versus simple encryption. They learn to be more secure. If they didn't have a chief security officer, they may now have a one, if they are moving into cloud.

The target systems that are using cloud computing, the target architectures that are leveraging cloud computing, are almost always more secure than the traditional systems from which they came. That doesn't mean they're completely secure and without issues, especially in the cloud computing side.

But people make logical choices about what pieces of information and what processes to run in the cloud and which ones to run on-premise based on security models, and typically, if they are revamping into a new architecture, they are always going to be more secure and better governed, if the architects know what they're doing.

The pay-as-you-go model of cloud computing, even though it can be more expensive in many instances, when you really kind of amortize the cost over many years, is something that's attractive to at least United States IT. It's not always to foreign corporations, but definitely in the United States.

We like the pay-as-you-go cable bill kind of thing that we get, and also the ability to turn the stuff off or move away from it, if we need to, without having a big footprint already in the data center and things we need to deinstall and millions of dollars of hardware that we have to sell on Craigslist if the thing doesn’t work out.

The selling point

That becomes a selling point and really is part and parcel of value of cloud computing. But, it also can be the Achilles' heel of cloud computing, because ultimately people are going to make decisions around financial metrics that may not be realistic. If you look at those financial metrics in light of the requirements of the business, in many instances people are buying cloud computing because of the cost model and not necessarily the strategic value it's going to have to the architecture and therefore have to the business.

Krigsman: Driving toward cloud changes the architecture and requires proper governance. The lack of governance that exists today across the industry is pretty startling. So as organizations move in this direction, there is simply no question that the cultural dimension of getting IT to work more effectively with the business side and so forth must drive with it.

If it doesn't, then, in the end, the solutions that are built with cloud will still have the same set of problems from a business standpoint that current IT solutions have today. This has nothing to do with technology. This is a matter of collaboration and communication across these various information silos.

Rogers: One thing that we're finding from those cloud service providers that had originally targeted the end business customer, is that they're working with the CIOs and the IT departments more. They're working through those issues of security and having backup contingency plans.

It's just a state of education that varying parties within the IT ecosystem have to come on board and understand how to leverage this.

One of the biggest points ... is it's still a mixture of different technologies that have to come together. That’s always been one of the biggest, complex roles that IT needs to serve.

Right now, there are a lot of dependencies on specific technologies internally. A lot of organizations do not want to make those same mistakes with external cloud providers. They're really looking to the IT group as an adviser to guide them and help them in the decisions moving forward.

Krigsman: This is a fundamental point -- the cloud computing winners are going to be those who combine architectural vision and discipline with superior governance and who are also capable of making the adaptive cultural and business transformation changes, such as you were just talking about, things like budgeting, for example. Success in the cloud will require a mixture of all of these things together.

Start now

You need to start committing to this stuff right now and putting some skin in the game, and I think a lot of people in these IT organizations are very politically savvy and want to protect their positions. There are a few of them who want to put that skin in the game right now.

I think we are going to see kind of an unfairness in business. People who are starting businesses these days and building it around cloud infrastructures are learning to accept the fact that a lot of their IT is going to reside out on the Internet and the cost effective nature of that. They're going to have a huge strategic advantage over legacy businesses, people who've been around for years and years and years.

There are going to be a lot of traditional companies out there that are going to be looking at these vendors and learning from them.

As they grow and they start to go public and they start to grow as a business, they get up to a half a billion mark, they are going to find that they are able to provide a much more higher cost and price advantage over their competitors and just eat their lunch ultimately.

We're going to see that, not necessarily now, because those guys are typically smaller and just up and coming, but in five years, as they start to grow up, their infrastructure is just going to be much more cost effective and they are just going to run circles around the competition.

... Ultimately, it would be about the ability to leverage technology that's pervasive around the world. What you're going to find is the biggest uptake of any kind of new technological shift is going to be in the United States or the North American marketplaces. We're seeing that in the U.S. right now.

We could find that the cloud computing advantage it has brought to the corporate U.S. infrastructure is going to be significant in the next four years, based on the European enterprises out there and some of the Asia-Pacific enterprises out there that will play catch-up toward the end.

More Stories By Dana Gardner

At Interarbor Solutions, we create the analysis and in-depth podcasts on enterprise software and cloud trends that help fuel the social media revolution. As a veteran IT analyst, Dana Gardner moderates discussions and interviews get to the meat of the hottest technology topics. We define and forecast the business productivity effects of enterprise infrastructure, SOA and cloud advances. Our social media vehicles become conversational platforms, powerfully distributed via the BriefingsDirect Network of online media partners like ZDNet and IT-Director.com. As founder and principal analyst at Interarbor Solutions, Dana Gardner created BriefingsDirect to give online readers and listeners in-depth and direct access to the brightest thought leaders on IT. Our twice-monthly BriefingsDirect Analyst Insights Edition podcasts examine the latest IT news with a panel of analysts and guests. Our sponsored discussions provide a unique, deep-dive focus on specific industry problems and the latest solutions. This podcast equivalent of an analyst briefing session -- made available as a podcast/transcript/blog to any interested viewer and search engine seeker -- breaks the mold on closed knowledge. These informational podcasts jump-start conversational evangelism, drive traffic to lead generation campaigns, and produce strong SEO returns. Interarbor Solutions provides fresh and creative thinking on IT, SOA, cloud and social media strategies based on the power of thoughtful content, made freely and easily available to proactive seekers of insights and information. As a result, marketers and branding professionals can communicate inexpensively with self-qualifiying readers/listeners in discreet market segments. BriefingsDirect podcasts hosted by Dana Gardner: Full turnkey planning, moderatiing, producing, hosting, and distribution via blogs and IT media partners of essential IT knowledge and understanding.

@ThingsExpo Stories
Join IBM November 1 at 21st Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA, and learn how IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Cognitive analysis impacts today’s systems with unparalleled ability that were previously available only to manned, back-end operations. Thanks to cloud processing, IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Imagine a robot vacuum that becomes your personal assistant tha...
In a recent survey, Sumo Logic surveyed 1,500 customers who employ cloud services such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP). According to the survey, a quarter of the respondents have already deployed Docker containers and nearly as many (23 percent) are employing the AWS Lambda serverless computing framework. It’s clear: serverless is here to stay. The adoption does come with some needed changes, within both application development and operations. Tha...
In his Opening Keynote at 21st Cloud Expo, John Considine, General Manager of IBM Cloud Infrastructure, will lead you through the exciting evolution of the cloud. He'll look at this major disruption from the perspective of technology, business models, and what this means for enterprises of all sizes. John Considine is General Manager of Cloud Infrastructure Services at IBM. In that role he is responsible for leading IBM’s public cloud infrastructure including strategy, development, and offering ...
SYS-CON Events announced today that Avere Systems, a leading provider of enterprise storage for the hybrid cloud, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Avere delivers a more modern architectural approach to storage that doesn't require the overprovisioning of storage capacity to achieve performance, overspending on expensive storage media for inactive data or the overbui...
Widespread fragmentation is stalling the growth of the IIoT and making it difficult for partners to work together. The number of software platforms, apps, hardware and connectivity standards is creating paralysis among businesses that are afraid of being locked into a solution. EdgeX Foundry is unifying the community around a common IoT edge framework and an ecosystem of interoperable components.
SYS-CON Events announced today that TidalScale will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. TidalScale is the leading provider of Software-Defined Servers that bring flexibility to modern data centers by right-sizing servers on the fly to fit any data set or workload. TidalScale’s award-winning inverse hypervisor technology combines multiple commodity servers (including their ass...
SYS-CON Events announced today that N3N will exhibit at SYS-CON's @ThingsExpo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. N3N’s solutions increase the effectiveness of operations and control centers, increase the value of IoT investments, and facilitate real-time operational decision making. N3N enables operations teams with a four dimensional digital “big board” that consolidates real-time live video feeds alongside IoT sensor data a...
As hybrid cloud becomes the de-facto standard mode of operation for most enterprises, new challenges arise on how to efficiently and economically share data across environments. In his session at 21st Cloud Expo, Dr. Allon Cohen, VP of Product at Elastifile, will explore new techniques and best practices that help enterprise IT benefit from the advantages of hybrid cloud environments by enabling data availability for both legacy enterprise and cloud-native mission critical applications. By rev...
With major technology companies and startups seriously embracing Cloud strategies, now is the perfect time to attend 21st Cloud Expo October 31 - November 2, 2017, at the Santa Clara Convention Center, CA, and June 12-14, 2018, at the Javits Center in New York City, NY, and learn what is going on, contribute to the discussions, and ensure that your enterprise is on the right path to Digital Transformation.
Join IBM November 1 at 21st Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA, and learn how IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Cognitive analysis impacts today’s systems with unparalleled ability that were previously available only to manned, back-end operations. Thanks to cloud processing, IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Imagine a robot vacuum that becomes your personal assistant th...
Digital transformation is changing the face of business. The IDC predicts that enterprises will commit to a massive new scale of digital transformation, to stake out leadership positions in the "digital transformation economy." Accordingly, attendees at the upcoming Cloud Expo | @ThingsExpo at the Santa Clara Convention Center in Santa Clara, CA, Oct 31-Nov 2, will find fresh new content in a new track called Enterprise Cloud & Digital Transformation.
Smart cities have the potential to change our lives at so many levels for citizens: less pollution, reduced parking obstacles, better health, education and more energy savings. Real-time data streaming and the Internet of Things (IoT) possess the power to turn this vision into a reality. However, most organizations today are building their data infrastructure to focus solely on addressing immediate business needs vs. a platform capable of quickly adapting emerging technologies to address future ...
Most technology leaders, contemporary and from the hardware era, are reshaping their businesses to do software. They hope to capture value from emerging technologies such as IoT, SDN, and AI. Ultimately, irrespective of the vertical, it is about deriving value from independent software applications participating in an ecosystem as one comprehensive solution. In his session at @ThingsExpo, Kausik Sridhar, founder and CTO of Pulzze Systems, will discuss how given the magnitude of today's applicati...
SYS-CON Events announced today that Golden Gate University will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Since 1901, non-profit Golden Gate University (GGU) has been helping adults achieve their professional goals by providing high quality, practice-based undergraduate and graduate educational programs in law, taxation, business and related professions. Many of its courses are taug...
What is the best strategy for selecting the right offshore company for your business? In his session at 21st Cloud Expo, Alan Winters, U.S. Head of Business Development at MobiDev, will discuss the things to look for - positive and negative - in evaluating your options. He will also discuss how to maximize productivity with your offshore developers. Before you start your search, clearly understand your business needs and how that impacts software choices.
SYS-CON Events announced today that Ryobi Systems will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Ryobi Systems Co., Ltd., as an information service company, specialized in business support for local governments and medical industry. We are challenging to achive the precision farming with AI. For more information, visit http:...
As popularity of the smart home is growing and continues to go mainstream, technological factors play a greater role. The IoT protocol houses the interoperability battery consumption, security, and configuration of a smart home device, and it can be difficult for companies to choose the right kind for their product. For both DIY and professionally installed smart homes, developers need to consider each of these elements for their product to be successful in the market and current smart homes.
SYS-CON Events announced today that Avere Systems, a leading provider of hybrid cloud enablement solutions, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Avere Systems was created by file systems experts determined to reinvent storage by changing the way enterprises thought about and bought storage resources. With decades of experience behind the company’s founders, Avere got its ...
High-velocity engineering teams are applying not only continuous delivery processes, but also lessons in experimentation from established leaders like Amazon, Netflix, and Facebook. These companies have made experimentation a foundation for their release processes, allowing them to try out major feature releases and redesigns within smaller groups before making them broadly available. In his session at 21st Cloud Expo, Brian Lucas, Senior Staff Engineer at Optimizely, will discuss how by using...
In this strange new world where more and more power is drawn from business technology, companies are effectively straddling two paths on the road to innovation and transformation into digital enterprises. The first path is the heritage trail – with “legacy” technology forming the background. Here, extant technologies are transformed by core IT teams to provide more API-driven approaches. Legacy systems can restrict companies that are transitioning into digital enterprises. To truly become a lead...