Computing the way we know it will disappear. Right now there is so much innovation in the
compute space that it is hard to avoid.
There are many things that are driving this but the main cause is a lot
of creative people all over the world are looking at the way business is done
and looking for the inefficiencies in the system. They are looking for the areas where
corporations have extracted large amounts of profits and looking for disruptive
ways that they can get a piece of the pie (or even make a new pie).
For example, I recently ran across startup
named the The Currency Cloud that is looking to disrupt the currency
exchange market (FX). The (FX) market is
a trillion dollar business. They make
enormous amounts of money by playing on the swings in currency values between
countries. Any business that deals with
this is at the mercy of the big banks and clearing houses that convert currency
each day. It has been a very profitable
sector for many years. Many businesses
hate it because it introduces uncertainty into the business of doing global
transactions. How do you set prices for
products and services and still remain profitable in different parts of the
world. A startup named has created a
quicker faster cheaper alternative to the traditional structure. If they are successful the traditional Forex
markets will be disrupted.
A second example of this is related to investments. People have been trading stocks, bond and
commodities for years. There has been a
small group of companies and investors that have had the capability to get in
on the big ideas before they become big.
The rest of the people had to wait on the sidelines until those
companies went public. Second Market has started to change
that by offering a way for regular investors to get into the emerging markets
before it is too late. Government
regulations make it a little bit difficult for the small investor to use Second
Market (you need to have 1 million dollars of net worth which rules out a lot
of people), but it is an example of another disruptive technology.
While attending an entrepreneurs group in NYC I ran across a
company that was creating a new paradigm for providing wireless connectivity to
underserved communities. In poorer areas many people cannot afford to have
their own internet so a company called Keywifi
has come up with a way to share the bandwidth of your wireless network. So in poorer neighborhoods a couple of people
can sign up to be “hotpots” and people can rent bandwidth from them at a lower
cost. This could have huge implications
in developing regions of the globe.
These three examples are just scratching the surface how a
difficulty with the way technology is used today opens up new markets in the
future. Right now there is an enormous
amount of change going on in IT. Cloud Computing,
Tablet Devices, Video, Social Networking, Converged Networks, fully integrated
platforms (pre-staged networking, storage, and compute resources), etc. All these things all have a common string to
them. Someone looked at what we were
doing and said “there has to be an easier more efficient, more effective way to
do this.”
Let’s take cloud computing for instance. In the past every company that had some
computational needs were forced to create or buy their own infrastructure. Even small businesses would buy servers and
some networking gear and maybe some storage and backup gear to carry out the
day to day operations. The problem with
that is they had to hire a staff that would support that environment. This is great for employment because lots a
people have jobs. But for a business
this added additional cost and complexity to their businesses. Supporting that environment meant a lot more
than just buying some hardware. There
needed to be
- space for the equipment
- power and cables
- cooling to the equipment.
- those cables also needed to be run to all the users’ desks so they could get access to the equipment.
- Operating Systems and software and each of those systems needed to be loaded
- systems needed to be secured, backed up and patched.
This changed in the early 2000s when some companies started
to offer subscription services to their software. So instead of running you applications on
your own hardware it would run in someone else’s datacenter and you would just
add your data. This was not a new
concept. IBM had pioneered this with
their mainframe software. You would pay
for what you used. The early innovators
in the cloud space were able to say it is easier for me to run the entire
infrastructure for all of these companies as opposed to all of the companies
having to do it for themselves. There
were some factors that accelerated this move.
Virtualization (once again stealing from the IBM mainframe concept) enabled
companies to take more advantage of less expensive hardware to make this
sharing model more affordable to the end users.
Increases in network bandwidth also made this more palatable. If everyone was running on 10mb Ethernet we
would see less people willing to do this.
Now most desktops have 1 gb connections and 40 and 100gb networks are
just starting to ship. The wireless
space has also experienced this bump. With
4G networks I can get my data almost as fast as a Wireless N device. Companies like Google and Amazon have been
pioneers in this space. And it was all
because someone finally figured out the easier way for the consumer to do this.
Converged Networking is also a good example of this metamorphosis. In the
past there were multiple ways to attach to networking devices: ethernet, token ring, FDDI etc. In the end one standard won out - Ethernet. Not necessarily because it was a best
technology. It was just easier. In the late 90’s attaching to external
storage arrays became a new way to do business.
The reasoning was that it was more cost effective to share disks with
multiple servers that to let them go under-utilized inside the servers. This led to new ways to attach to storage,
and new network-like infrastructures.
Fibre Channel and SCSI cables were introduced initially to attach the
disk to servers. As time went on a
separate infrastructure of switching equipment was built with its own separate
connectors and cabling. The complexity
of the environment was increased.
In this
growing mess the bandwidth that could be achieved by Ethernet and FC interfaces
increased to an extent the outstripped the computer’s ability to move that
data. Somewhere some engineer said “what
would happen if we ran the storage traffic over the same cable and
adapters". That would mean one less
component in the servers and one less cable and one less switch to deal
with. Converged networks were born. Cisco was one of the innovators in
this field. The reasoning is obvious. They benefit the most by moving
things into a a converged network infrastructure. Now Cisco, HP, IBM, Dell and a host of other
companies all have their converged networking platforms.
All of this came about because existing
networks were getting too complex.
The old guard will continue to fight the erosion of their
margins by the competitors that embrace the new changes. I recently read an article entitled Oracle
has a cloud computing secret about Oracles dilemma in regards to pricing of
on-demand instance of their software. They
stand to lose a significant chunk of revenue if they use the model. The main problem with this philosophy is that
train may have already left the station.
In numerous customer calls over the years I have dealt with people who
are looking for ways around Oracles licensing. So much so the tools like MySQL
(which is now owned by Oracle) and Microsoft SQL server and alternatives that
are having a great deal of success. The cable companies are starting to get
this as well where people are starting to say that they just want specific
channels not every channel. Subscribers
are shutting off traditional cable and our getting a lot on of the same content
from the Internet. Just last night I
watched the NCAA tournament on my computer.
Being the vendor that is living in the past model is a precarious state.
Right
now is a very exciting time for IT. It
is changing very rapidly. Barriers for
innovation and costs of innovating have been reduced. It makes for a wild ride.
No comments:
Post a Comment