Welcome!

Agile Computing Authors: Yakov Fain, Tim Hinds, Alois Mayr, Cloud Best Practices Network, Scott Allen

Related Topics: @CloudExpo, Microsoft Cloud

@CloudExpo: Article

Amazon, Google, Microsoft - Big Three Cloud Providers Examined

GOOG very much believes that the web is the platform; we have a divergent opinion

Brandon Watson's "Many Niches" Blog

There’s been quite a bit of chatter on the web about the Azure Services Platform. Obviously I’m excited to see people talking about our new platform, especially when there is plenty of good, some bad, and some good if not somewhat rambling. There will be no shortage of guessing as to what Microsoft is “really up to” with our development efforts.

I wanted to take a crack at that one, but from a completely different perspective. I want to frame the discussion centered on the motivations of the platform providers, and let that be a guide to understanding the delivered product.

Amazon
Let me start by giving a hat tip to the AMZN guys. Their web services platform (AWS) has really been at the tip of the spear for cloud computing. or the sake of this discussion, when I use the term “cloud computing,” I am talking about the developer platform, not things like GOOG apps. The AMZN services are a loosely coupled set of services targeted at developers looking to avail themselves of infrastructure buildout. Their infrastructure as a service (EC2) is a great way for developers to reduce their capital expenditures and take on a variable costing model for their servers.

The services, all up, encompass several key pieces for building applications that can take on a range of workloads. The ability to now run Windows Server 2003 (which should get you terminal services) means that as a developer, you can deploy varying application types into AWS, beyond simply web apps. From a developer standpoint, however, there is no unified development experience. Which brings me to the discussion around motivations.

AMZN essentially spends 10 months out of the year building out servers. They build out massive numbers of servers for the two months out of the year when they are handling the Christmas shopping season. AMZN is, for all intents and purposes, a giant mall. They spend hundreds of millions of dollars a year building more capacity for their mall. Their store is the primary reason shoppers come in the front door, and most of the year, their mall is empty, relative to the size of the mall. As a retailer with an ecommerce backend, their problems are no different than most enterprises. They have machines that are sitting around doing little or nothing for large portions of the year. Unlike most other enterprises, AMZN has the financial capacity to build out their server capacity. At some point, AMZN made the decision to no longer be the primary traffic draw to their mall. They realized that they could completely offset their own traffic (and then some) by taking the technology that they had built for themselves and making it available to other developers.

AMZN is, essentially, in the load management business. They are a low margin retail operator that is running a hugely expensive infrastructure for which they are seeking maximum utilization. They would like nothing more than to be noise in their own system. AMZN is relentlessly metrics driven. As such, they have a pretty good idea of how much money to expect off of traffic that walks through their front door. They know how much to expect from traffic ending up at one of their marketplace partners. With the addition of AWS, they have a new way to monetize their capacity, and with their predictable pricing model, they know exactly how much money they are going to make off of customers who deploy applications to their service.Traffic on their network makes them money. It may not make your app money, but it makes them money, so they are happy. It more than likely saves you money, so you are probably happy too.

So, AMZN is motivated by maximization of infrastructure capacity, and optimization of what would otherwise be very low margin businesses. They do this by delivering a loosely coupled set of services to developers looking for infrastructure as a service. They aren’t necessarily targeting developers. They aren’t a platform, per se. They are targeting anyone who is looking to move workloads off of their own infrastructure and onto AMZN.

Google
Ahh, Google. I love those guys. They have done plenty of cool things, and their release of the AppEngine (GAE) was welcomed with very loud praise from many in the tech community. According to some reports, they had 25,000 developers sign up for GAE in the first few hours of releasing it.Taken as a whole, GAE is a very tightly coupled set of services designed to allow developers to build applications that will have no problem scaling up to, theoretically, infinite capacity. The rigid requirements for a developer deploying into the GAE are such that you use one language (Python) and their database (big table).

Once again, when considering what has been built, one need look no further than the motivations of GOOG to really get where they are going. When you consider the stricture imposed on the architecture of apps built for GAE (singple process, no long running queries, no local file access, no network access), a developer is all but required to build standard CRUD web applications. There is no stack for enterprise integration. The delivery vehicle is the web browser. The data that is created goes right into big table.

Some might say that GOOG’s core business is search. I actually have a different opinion. GOOG’s core business is the monetization of page views. Search is their instantiation of that business model, but many of their other applications have nothing to do with search, and everything to do with the monetization of page views. Think about gmail - ads on the sidebar.

Applicaitons on GAE are mostly CRUD apps, storing structured data into big table. As a developer, building an applicaiton on GAE, you are essentially feeding the GOOG beast. While they have not yet released final pricing, allow me to put on my pointy tin foil hat and talk about what might come to pass. GOOG knows exactly how much it costs to run their infrastructure, and as such could hand developers a bill for the resources which they consume. However, GOOG doesn’t have AMZN’s problem. Their traffic is mostly linear, and going up and to the right. It’s probably logarithmic at this point, but who’s counting? In any event, since they have little variability in their traffic patterns, they don’t have to get into the load management business. By allowing developers to build applications on their infrastructure, they are incurring unnecessary costs. Their motivations, however, are driven by their business model. Each new app that is plugged into the infrastructure ads new data to their data set, and creates new opportunities for page monetization.

Think of the case where GOOG shows up to a developer and says, “hey, moboganda.com - how are you doing? That’s a great app you put up on GAE. We’ve been going over the data and we figured out that if we ran AdSense on your pages 20% of the time, we could actually recoup the cost of running the infrastructure for you. In fact, you don’t even need to do anything, since we own the infrastructure, the feature is already in there. You can turn it off with a JavaScript include.” As the young CEO of a web startup, this could sound like a pretty cool deal. Free infrastructure and they didn’t have to do anything to get that turned on. Not bad. Let’s take this game of what-if one step further. The GOOG guys come back in two months with the following, “hey buddy, that app of yours is performing really well. You made more money on those 20% ads than we thought. What we would love to do is run ads 100% of the time. Of course, you are free to sell that ad space yourself. I’m sure you have a full time ad sales force. We’re only a multi-billion dollar company focused soley on monetizing pageviews, but feel free to go it alone if you want.” To the developer, this could be music to your ears - focus on building the application, and GOOG does the monetization for you. If you really wanted to go crazy, one could imagine a world where GOOG says to their developers, “$5 bounty for all new GOOG accounts created through your app.”

Bottom line: GOOG is motivated by feeding the GOOG beast and monetizing pageviews. That shines through in the design of their app delivery vehicle, the tight coupling of the services, and the expected design patters of the applications to be built on their infrastructure.

Microsoft
With all of the above points in mind, hopefully you can start drawing some pretty good conclusions about the potential future directions of the competitive cloud platforms in the market. As for MSFT, there are plenty of things I could say, but let me simply state what I believe to be our motivations. We are a platform company. We very much believe that we are in the business of delivering the best platform and tools to developers to build great applications. Our on-premise stack has proven to be extremely successful over the last several decades. With the release of the Azure Services Platform, one of the core design tenets was that we would like to achieve parity between our on and off-premise stacks. The entirety of the Azure Services Platform is designed to enable experienced MSFT developers to be combat effective on day one.

However, the platform, from my point of view, is but a part of the engine. The heart of the engine is the application that you plan to build. GOOG very much believes that the web is the platform, and thus the web browser is the only delivery vehicle for applications. We have a divergent opinion. It seems absolutely crazy to me that a person carries around more computing power in their pocket today (cell phone) than was available a scant 15 years ago in the high end desktop computers, and GOOG believes that those processor cycles should be shunted aside. Our software plus services strategy really is about enabling developers to deliver the right experience to their customers, on the preferred end point device, at the right time from a single piece of infrastructure. We are motivated by our developers building great applications, and Azure is the final leg of the software plus services strategy.


[This post appeared originally here and is republished in full with the kind permission of the author.]

More Stories By Brandon Watson

Brandon Watson is Director for Windows Phone 7. He specifically focuses on developers and the developer platform. He rejoined Microsoft in 2008 after nearly a decade on Wall Street and running successful start-ups. He has both an engineering degree and an economics degree from the University of Pennsylvania, as well as an MBA from The Wharton School of Business, and blogs at www.manyniches.com.

Comments (0)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


@ThingsExpo Stories
What a difference a year makes. Organizations aren’t just talking about IoT possibilities, it is now baked into their core business strategy. With IoT, billions of devices generating data from different companies on different networks around the globe need to interact. From efficiency to better customer insights to completely new business models, IoT will turn traditional business models upside down. In the new customer-centric age, the key to success is delivering critical services and apps wit...
SYS-CON Events announced today BZ Media LLC has been named “Media Sponsor” of SYS-CON's 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. BZ Media LLC is a high-tech media company that produces technical conferences and expositions, and publishes a magazine, newsletters and websites in the software development, SharePoint, mobile development and Commercial Drone markets.
WebRTC is bringing significant change to the communications landscape that will bridge the worlds of web and telephony, making the Internet the new standard for communications. Cloud9 took the road less traveled and used WebRTC to create a downloadable enterprise-grade communications platform that is changing the communication dynamic in the financial sector. In his session at @ThingsExpo, Leo Papadopoulos, CTO of Cloud9, will discuss the importance of WebRTC and how it enables companies to fo...
SYS-CON Events announced today TechTarget has been named “Media Sponsor” of SYS-CON's 18th International Cloud Expo, which will take place on June 7–9, 2016, at the Javits Center in New York City, NY, and the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. TechTarget is the Web’s leading destination for serious technology buyers researching and making enterprise technology decisions. Its extensive global networ...
With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo 2016 in New York and Silicon Valley. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be! Internet of @ThingsExpo, taking place Nov 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with 17th Cloud Expo and will feature technical sessions from a rock star conference faculty ...
The essence of data analysis involves setting up data pipelines that consist of several operations that are chained together – starting from data collection, data quality checks, data integration, data analysis and data visualization (including the setting up of interaction paths in that visualization). In our opinion, the challenges stem from the technology diversity at each stage of the data pipeline as well as the lack of process around the analysis.
The 19th International Cloud Expo has announced that its Call for Papers is open. Cloud Expo, to be held November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, brings together Cloud Computing, Big Data, Internet of Things, DevOps, Containers, Microservices and WebRTC to one location. With cloud computing driving a higher percentage of enterprise IT budgets every year, it becomes increasingly important to plant your flag in this fast-expanding business opportunity. Submit y...
Internet of @ThingsExpo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, is co-located with the 19th International Cloud Expo and will feature technical sessions from a rock star conference faculty and the leading industry players in the world and ThingsExpo New York Call for Papers is now open.
SYS-CON Events announced today that ContentMX, the marketing technology and services company with a singular mission to increase engagement and drive more conversations for enterprise, channel and SMB technology marketers, has been named “Sponsor & Exhibitor Lounge Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York City, New York. “CloudExpo is a great opportunity to start a conversation with new prospects, but what happens after the...
In his keynote at 18th Cloud Expo, Andrew Keys, Co-Founder of ConsenSys Enterprise, will provide an overview of the evolution of the Internet and the Database and the future of their combination – the Blockchain. Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life ...
There are several IoTs: the Industrial Internet, Consumer Wearables, Wearables and Healthcare, Supply Chains, and the movement toward Smart Grids, Cities, Regions, and Nations. There are competing communications standards every step of the way, a bewildering array of sensors and devices, and an entire world of competing data analytics platforms. To some this appears to be chaos. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will discuss the vast to...
SYS-CON Events announced today that Enzu, a leading provider of cloud hosting solutions, will exhibit at SYS-CON's 18th International Cloud Expo®, which will take place on June 7-9, 2016, at the Javits Center in New York City, NY. Enzu’s mission is to be the leading provider of enterprise cloud solutions worldwide. Enzu enables online businesses to use its IT infrastructure to their competitive advantage. By offering a suite of proven hosting and management services, Enzu wants companies to foc...
Customer experience has become a competitive differentiator for companies, and it’s imperative that brands seamlessly connect the customer journey across all platforms. With the continued explosion of IoT, join us for a look at how to build a winning digital foundation in the connected era – today and in the future. In his session at @ThingsExpo, Chris Nguyen, Group Product Marketing Manager at Adobe, will discuss how to successfully leverage mobile, rapidly deploy content, capture real-time d...
A strange thing is happening along the way to the Internet of Things, namely far too many devices to work with and manage. It has become clear that we'll need much higher efficiency user experiences that can allow us to more easily and scalably work with the thousands of devices that will soon be in each of our lives. Enter the conversational interface revolution, combining bots we can literally talk with, gesture to, and even direct with our thoughts, with embedded artificial intelligence, wh...
IoT generates lots of temporal data. But how do you unlock its value? How do you coordinate the diverse moving parts that must come together when developing your IoT product? What are the key challenges addressed by Data as a Service? How does cloud computing underlie and connect the notions of Digital and DevOps What is the impact of the API economy? What is the business imperative for Cognitive Computing? Get all these questions and hundreds more like them answered at the 18th Cloud Expo...
SYS-CON Events announced today that 24Notion has been named “Bronze Sponsor” of SYS-CON's 18th Cloud Expo, which will take place on June 7-9, 2016, at the Javits Center in New York, New York. 24Notion is full-service global creative digital marketing, technology and lifestyle agency that combines strategic ideas with customized tactical execution. With a broad understand of the art of traditional marketing, new media, communications and social influence, 24Notion uniquely understands how to con...
Whether your IoT service is connecting cars, homes, appliances, wearable, cameras or other devices, one question hangs in the balance – how do you actually make money from this service? The ability to turn your IoT service into profit requires the ability to create a monetization strategy that is flexible, scalable and working for you in real-time. It must be a transparent, smoothly implemented strategy that all stakeholders – from customers to the board – will be able to understand and comprehe...
The demand for organizations to expand their infrastructure to multiple IT environments like the cloud, on-premise, mobile, bring your own device (BYOD) and the Internet of Things (IoT) continues to grow. As this hybrid infrastructure increases, the challenge to monitor the security of these systems increases in volume and complexity. In his session at 18th Cloud Expo, Stephen Coty, Chief Security Evangelist at Alert Logic, will show how properly configured and managed security architecture can...
When it comes to IoT in the enterprise, namely the commercial building and hospitality markets, a benefit not getting the attention it deserves is energy efficiency, and IoT's direct impact on a cleaner, greener environment when installed in smart buildings. Until now clean technology was offered piecemeal and led with point solutions that require significant systems integration to orchestrate and deploy. There didn't exist a 'top down' approach that can manage and monitor the way a Smart Buildi...
Korean Broadcasting System (KBS) will feature the upcoming 18th Cloud Expo | @ThingsExpo in a New York news documentary about the "New IT for the Future." The documentary will cover how big companies are transmitting or adopting the new IT for the future and will be filmed on the expo floor between June 7-June 9, 2016, at the Javits Center in New York City, New York. KBS has long been a leader in the development of the broadcasting culture of Korea. As the key public service broadcaster of Korea...