2011 Cloud Predictions

Happy new year to fellow Cloud technologists, vendors, capitalists and enthusiasts!  There are almost too many Cloud year-in-review and Predictions to keep track of, and I apologize for adding yet another to the list, but these three predictions were inspired by a variety of sources, including smart work colleagues, respected industry voices and random online sources.  I've tried to give credit where it's due.  I look forward to sharing another very exciting year in the cloud community with you.

1.   Cloud becomes the default IT platform – We’re seeing growth estimates of 20-30% for public cloud offerings, and anywhere from 10-15% of IT spending being redirected to the cloud, so it should be a safe bet that Cloud will continue to grow in 2011.  But 2011may be the tipping point where for most companies, IT Project leaders will have to start considering a cloud option for every new project, and perhaps will be required to present the more demanding business case for On-Premise deployment versus the default of using Amazon, Azure or a SaaS provider.

2.   Hybrid cloud becomes the key battlefield – For now, most investment has been clearly either internal ‘private’ cloud or external SaaS, PaaS or IaaS, and never the twain shall meet.  IT teams in 2011 will have an epiphany that it all needs to connect together, whether because of performance, compliance or manageability.  Expect to see wide adoption of heterogeneous cloud management tools, continued investment and growth in the WAN optimization and cloud gateway space, as well as the convergence of SAN/LAN/WAN capabilities within underlying networking gear.

3.   Cloud M&A Peaks – Fueled by a low growth environment and cheap capital, we can expect to see a number of acquisitions across the IT landscape, including mega deals like Oracle buying Salesforce.com and/or CSC, IBM buying NetApp, HP buying SAP.  And specific Cloud-related deals will also rise, with vendors filling networking and capabilities gaps, such as Cisco buying Riverbed, Dell buying Brocade, and Cloud management tools like Rightscale, Abiquo and Joyent being snapped up and folded into the IT management suites of IBM and HP.

Special thanks to: Brook Reams http://brook.reams.me/, Datapipe http://www.datapipe.com/, IDC www.idc.com, Channel Buzz Canada http://www.channelbuzz.ca

Cloud on the Top of the Hype Curve

I know there's a lot of talk out there about the Cloud and how hyped it is.  It's true.  If you look at Gartner's latest Hype cycle on Emerging technologies, you can see where they place it: literally at the top of the cycle. 

But that's OK - A lot of hype means a lot of awareness. As a vendor this adds wind in our sails and as a customer it makes it easy to find the content that will help make informed decisions.  In fact, last I checked, the term 'Cloud Computing' was yielding over 34 million hits on Google.  Sounds like lots of information for folks who want to learn more.

Another popular topic about Cloud is how long will it take to become a significant movement.  Well, if you believe the leading, trusted analysts in the space like Frank Gens from IDC (I know I do), he already puts the Cloud market -- and let's be specific -- this is the market for External Cloud services (not 'private cloud' spending) at $15.6 billion as of 2009.  That's a big Total Addressable Market.  Far bigger than many segments of IT as we know it today.   And the growth rate is expected to be 27% annually between now and 2014, with some areas such as Cloud Storage racing ahead at a 37% compound annual growth rate. 

Let's look at just Cloud Storage.  According to those same IDC numbers, it's already 9% of the market, and at the current growth rate, that would make it about $1.8bil this year.  That's almost as large as the entire SAN storage networking market, and growing far faster.  Projecting forward, by 2014 Cloud Storage spending will exceed $7 bil.  And by that time external Cloud spending will account for 10% of the IT budget. 

So some are saying Cloud is over-hyped.  Some, that it's under-hyped.  I'd say it's about right for where it is in its maturity.  The perception for some is that Cloud is just for deep file archiving, Test/Dev and limited web-based development.  In reality, early adoptors are already running 60-70% of their business apps in the cloud.  We're seeing the Government laying the groundwork for serious investments in Cloud-based services through programs such as FedRAMP.  And enterprises are swarming shows like VMworld to understand the art-of-the possible, and continue to build upon their internal 'cloud' efforts to be able to extend them towards carrier and service provider clouds.

So long as Cloud vendors continue to deliver capex and opex savings, improved efficiencies, decent quality and security, and fast time-to-solution, then the growth will continue, with or without the hype.

Newest Cloud Storage Enabler

I was fielding an inquiry from one of my engineers and thought I'd share it, as it's probably a common question, esp. as we continue to see Cloud awareness spread, while the network barriers to external Cloud service adoption remain. Enjoy.

-----Original Message-----

Sent: Monday, September 20, 2010 5:30 PM
Subject: Cirtas

Hi Mike,
I'm interested in Cirtas, because a user asked me. What do you think of this kind of storage?

-----Original Message-----

From: Mike Harding
Sent: Tuesday, September 21, 2010 9:36 AM
Subject: RE: Cirtas


This is a very valuable solution. Much of 'Cloud storage' is not useful for companies for at least a few key reasons:

1) Security -- It's the #1 inhibitor to using external cloud services. Customers are worried that their data will be compromised either in transit outside of the corporate firewall, or after it's been stored, especially within a multi-tenant hosting environment.

2) Performance -- The second biggest problem with hosting your data in the cloud is that it's far away from the applications and users. So the distance between you and your data creates latency as well as other common WAN issues such as jitter, lost packets, etc. This is why we've seen much of cloud storage being for deep archiving or uses where you don't care how long it takes to either put or retrieve your data, such as email archiving for regulatory reasons.

3) The need to change your application -- Many providers, even those using brand name enterprise-class storage hardware such as EMC Atmos, are only allowing access via a RESTful API. This means that the customer needs to write an application that uses this API in order to store and access the data, and for all intents and purposes, limits the use of that cloud storage for web application media and data.

Cirtas, which just launched publically, is a great example of what I call a Cloud Storage Enabler in that they allow customers to overcome these barriers to adopting the external cloud. Their product, Bluejet, encrypts your data so it's secure both in transit and at-rest. It accelerates the transit with data compression and deduplication. And it emulates local storage, so it looks like any NFS/CIFS target to your applications and users. Cirtas is one of a number of companies with similar Cloud Enabler solutions - you should also consider Nasuni, TwinStrata, Panzura and StorSimple.

Thanks, and good luck,

Mike Harding

Hybrid Cloud: The Preferred Approach

I've been a big believer for awhile now that 'Hybrid cloud' was where the industry needs to be going.  It's the big idea that truly allows companies and their IT organizations to seamlessly knit together their internal resources with those of their technology vendors.  And I'm a little biased these days working for a networking company, where it has been painfully obvious for some time that the Network is the key to unlocking a lot of latent demand in external cloud computing... with concerns over data Security, Availability and Performance as the biggest barriers to adopting externally-based Cloud services.

But aren't these insurmountable barriers, only leaving companies able to do 'Private Clouds'?  Well what is a Private cloud?  Some would say it doesn't exist - it's just a new label for what a lot of companies have been trying to accomplish within their data centers for some time now, with key capabilities being Server Virtualization, Automation, Self-service provisioning, and Chargeback for usage-based cost allocation.  Gartner called this Real Time Infrastructure. Others termed it Data Center Automation.  Others Utility Computing. 

The reality is that Hybrid cloud computing is already the preferred approach for organizations as seen in this chart from The Info Pro.  Almost 60% of companies expect to be using Both external cloud services as well as developing internal cloud capabilities.


Hybrid computing is getting top vendor support from the likes of Intel, Microsoft and others.  So we can expect to see the ability to connect across data centers -- safely, efficiently and in a manageable way -- becoming an embedded capability within the component resources that we purchase in the future.

The move to Cloud computing is happening today and the only question is at what rate. A recent Brocade study showed that 60 percent of enterprises expect to have started the planning and migration to a cloud computing model within the next two years, with key business drivers being to reduce cost (30 percent), improve business efficiency (21 percent) and enhance business agility (16 percent).  Other interesting Cloud findings included:

• More than a quarter of large organizations are planning to migrate a cloud model within the next two years; 11 percent within one year
• A quarter of organizations stated that the ability to consolidate the number of data centers was also a critical driver
• The availability of bandwidth was also a deciding factor amongst 14 percent of respondents

Conclusion: Embrace the concept of the Hybrid Cloud, and team with technology vendors that are delivering a roadmap allowing you to execute on that vision as soon as possible.

Cloud Network Optimization validated

With the explosive growth of the Cloud Services market, exceeding $68 billion this year, it was obvious to expect lots of innovation in and around this space.  I had been mostly blogging about efforts in the Cloud Infrastructure and Storage space, and was seeing a microcosm of this opportunity with new classes of optimized gear to speed and secure the links from the customer to the cloud.

We recently have witnessed the emergence of Cloud gateways that appear as local NAS but act as intelligent controllers that cache, optimize, encrypt and convert data from the LAN out to the Storage cloud. Along with TwinStrata, Cirtas, StorSimple, and Nasuni, we can now add Panzura to this vendor list.

But I still expected to see a pure-play Cloud Network product in this area.  A device that performed the caching, dedupe, and encryption of a WAN opt. appliance but specifically aimed at datacenter-to-cloud traffic, where the protocols and acceleration are tweaked for storage data and larger pipes. It would be a network device, not a storage device, thus complementing new products such as EMC VPLEX to speed storage virtualization between data centers and enabling use cases such as VMotion over distance.  I had assumed an established network player would be first to meet this need, but a new player, Infineta, took the brass ring.

Infineta has been very distinct in their positioning, focusing on datacenter to datacenter and not branch office traffic which is the established realm of Riverbed and traditional WAN optimization.  And they released a cool new video on youtube. 

It's ultimately up to the analysts as to how the markets get defined, but with this latest product entry, I'm considering Cloud Storage Networking to be a validated market.  For IT organizations, now's the time to start thinking how you can use these new products to safely and cost-effectively transition archival and nearstore data out to the Cloud.

Cloud Storage Optimization market

A new product category is shaping up in direct response to a new customer need.  As seen in recent stories like "What's keeping Data Storage Out of the Cloud?", companies want to use new Cloud Storage services from providers such as IBM, but they are concerned about the security, availability and cost of the required network connection.  Enter Cloud Storage Optimization.

To bridge this network gap customers face a number of sub-optimal alternatives:

1. Don't worry about it -- probably the most popular approach, which only works if you don't care about your job, or the value of the data going across the wire is so low that it's not a big deal if it takes forever for the transit, or it's hacked, or both.
2. Lease a private connection -- this is an option for 'too big to fail banks' or other major organizations where cost isn't an issue.  But for most companies, the incremental cost of the circuit eliminates the economic savings of the Cloud service.
3. Use a generic WAN optimization box -- Not a great solution as these are software-based appliances designed for lower-bandwidth branch-office connections and a broad mix of transactional data.  The Cloud Storage connection is really a SAN-like 'channel' which will be very data intensive, and will benefit from hardware-based compression and offload processing.  And similar to the private circuit, the cost of the WAN optimization appliance that supports the higher throughput needed for the Cloud storage will cost you more than your annual Cloud storage bill.

What we're seeing in response is an initial first step towards closing this market gap: a new category of Cloud Storage Optimization solutions, or Cloud Storage Gateways.  Representative companies include Cirtas, Twinstrata, Nasuni and StorSimple.  These are all start-ups who seem to be quickly gaining awareness and traction with companies and Cloud Service Providers.

The anatomy of a Cloud Storage Gateway is made of software that either resides within an x86 server (i.e. an appliance) or completely as software that can be deployed within a VM.  They typically are asymmetric (i.e. single-device) solutions often positioned as a NAS filer.  Typical capabilities include NAS-to-Cloud API emulation, WAN Optimization, Caching, In-transit Encryption and Data management features such as snapshots.  As software-based solutions they are flexible, and meant to be affordable and targeted to a more mid-market customer.  Similarly they are intended for not-overly-demanding throughput needs, as there is no purpose-built processor offload. 

For mid-market companies looking to add a Cloud tier of archival or similar offline data storage, these are products to consider.  For enterprises or companies who want to leverage Cloud storage as a nearstore alternative, you will want to wait for next-gen 'Cloud Networking' products built for high-throughput, hardware-assisted optimization, symmetric caching/network de-dupe capabilities, and that integrate with your existing network management framework.

Thank goodness for Twitter

Not sure about you but life is moving pretty fast these days.  And though I have a deep-seated bias against blogs as a medium for serious, thoughtful communication, versus let's say a written letter or a conversation.  Yet, most of the time I can't even muster the time required for a half-way decent blog entry.  

Enter Twitter.  140 characters provide an adequate if staccato means to share an update, a heads up on an event, an interesting Cloud article or just a passing thought.

So if you aren't finding many postings here, then be sure to look for me on Twitter. I'm @mhardi01, and am often posting #cloud related tweets.