Welcome!

Web 2.0 Authors: Trevor Parsons, Esmeralda Swartz, Elizabeth White, Pat Romanski, Carmen Gonzalez

Related Topics: Cloud Expo, .NET

Cloud Expo: 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
P2P RTC will impact the landscape of communications, shifting from traditional telephony style communications models to OTT (Over-The-Top) cloud assisted & PaaS (Platform as a Service) communication services. The P2P shift will impact many areas of our lives, from mobile communication, human interactive web services, RTC and telephony infrastructure, user federation, security and privacy implications, business costs, and scalability. In his session at Internet of @ThingsExpo, Robin Raymond, Chief Architect at Hookflash Inc., will walk through the shifting landscape of traditional telephone a...
SYS-CON Events announced today that SOA Software, an API management leader, will exhibit at SYS-CON's 15th International Cloud Expo®, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. SOA Software is a leading provider of API Management and SOA Governance products that equip business to deliver APIs and SOA together to drive their company to meet its business strategy quickly and effectively. SOA Software’s technology helps businesses to accelerate their digital channels with APIs, drive partner adoption, monetize their assets, and achieve a...
From a software development perspective IoT is about programming "things," about connecting them with each other or integrating them with existing applications. In his session at @ThingsExpo, Yakov Fain, co-founder of Farata Systems and SuranceBay, will show you how small IoT-enabled devices from multiple manufacturers can be integrated into the workflow of an enterprise application. This is a practical demo of building a framework and components in HTML/Java/Mobile technologies to serve as a platform that can integrate new devices as they become available on the market.
SYS-CON Events announced today that Matrix.org has been named “Silver Sponsor” of Internet of @ThingsExpo, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Matrix is an ambitious new open standard for open, distributed, real-time communication over IP. It defines a new approach for interoperable Instant Messaging and VoIP based on pragmatic HTTP APIs and WebRTC, and provides open source reference implementations to showcase and bootstrap the new standard. Our focus is on simplicity, security, and supporting the fullest feature set.
BSQUARE is a global leader of embedded software solutions. We enable smart connected systems at the device level and beyond that millions use every day and provide actionable data solutions for the growing Internet of Things (IoT) market. We empower our world-class customers with our products, services and solutions to achieve innovation and success. For more information, visit www.bsquare.com.
How do APIs and IoT relate? The answer is not as simple as merely adding an API on top of a dumb device, but rather about understanding the architectural patterns for implementing an IoT fabric. There are typically two or three trends: Exposing the device to a management framework Exposing that management framework to a business centric logic • Exposing that business layer and data to end users. This last trend is the IoT stack, which involves a new shift in the separation of what stuff happens, where data lives and where the interface lies. For instance, it’s a mix of architectural style...
SYS-CON Events announced today that Utimaco will exhibit at SYS-CON's 15th International Cloud Expo®, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Utimaco is a leading manufacturer of hardware based security solutions that provide the root of trust to keep cryptographic keys safe, secure critical digital infrastructures and protect high value data assets. Only Utimaco delivers a general-purpose hardware security module (HSM) as a customizable platform to easily integrate into existing software solutions, embed business logic and build s...
SYS-CON Events announced today that Red Hat, the world's leading provider of open source solutions, will exhibit at Internet of @ThingsExpo, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Red Hat is the world's leading provider of open source software solutions, using a community-powered approach to reliable and high-performing cloud, Linux, middleware, storage and virtualization technologies. Red Hat also offers award-winning support, training, and consulting services. As the connective hub in a global network of enterprises, partners, a...
Internet of @ThingsExpo Silicon Valley announced on Thursday its first 12 all-star speakers and sessions for its upcoming event, which will take place November 4-6, 2014, at the Santa Clara Convention Center in California. @ThingsExpo, the first and largest IoT event in the world, debuted at the Javits Center in New York City in June 10-12, 2014 with over 6,000 delegates attending the conference. Among the first 12 announced world class speakers, IBM will present two highly popular IoT sessions, which will take place November 4-6, 2014 at the Santa Clara Convention Center in Santa Clara, Calif...
Samsung VP Jacopo Lenzi, who headed the company's recent SmartThings acquisition under the auspices of Samsung's Open Innovaction Center (OIC), answered a few questions we had about the deal. This interview was in conjunction with our interview with SmartThings CEO Alex Hawkinson. IoT Journal: SmartThings was developed in an open, standards-agnostic platform, and will now be part of Samsung's Open Innovation Center. Can you elaborate on your commitment to keep the platform open? Jacopo Lenzi: Samsung recognizes that true, accelerated innovation cannot be driven from one source, but requires a...
Connected devices are changing the way we go about our everyday life, from wearables to driverless cars, to smart grids and entire industries revolutionizing business opportunities through smart objects, capable of two-way communication. But what happens when objects are given an IP-address, and we rely on that connection, sometimes with our lives? How do we secure those vast data infrastructures and safe-keep the privacy of sensitive information? This session will outline how each and every connected device can uphold a core root of trust via a unique cryptographic signature – a “bir...
Almost everyone sees the potential of Internet of Things but how can businesses truly unlock that potential. The key will be in the ability to discover business insight in the midst of an ocean of Big Data generated from billions of embedded devices via Systems of Discover. Businesses will also need to ensure that they can sustain that insight by leveraging the cloud for global reach, scale and elasticity.
WebRTC defines no default signaling protocol, causing fragmentation between WebRTC silos. SIP and XMPP provide possibilities, but come with considerable complexity and are not designed for use in a web environment. In his session at Internet of @ThingsExpo, Matthew Hodgson, technical co-founder of the Matrix.org, will discuss how Matrix is a new non-profit Open Source Project that defines both a new HTTP-based standard for VoIP & IM signaling and provides reference implementations.

SUNNYVALE, Calif., Oct. 20, 2014 /PRNewswire/ -- Spansion Inc. (NYSE: CODE), a global leader in embedded systems, today added 96 new products to the Spansion® FM4 Family of flexible microcontrollers (MCUs). Based on the ARM® Cortex®-M4F core, the new MCUs boast a 200 MHz operating frequency and support a diverse set of on-chip peripherals for enhanced human machine interfaces (HMIs) and machine-to-machine (M2M) communications. The rich set of periphera...

SYS-CON Events announced today that Aria Systems, the recurring revenue expert, has been named "Bronze Sponsor" of SYS-CON's 15th International Cloud Expo®, which will take place on November 4-6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Aria Systems helps leading businesses connect their customers with the products and services they love. Industry leaders like Pitney Bowes, Experian, AAA NCNU, VMware, HootSuite and many others choose Aria to power their recurring revenue business and deliver exceptional experiences to their customers.
The Internet of Things (IoT) is going to require a new way of thinking and of developing software for speed, security and innovation. This requires IT leaders to balance business as usual while anticipating for the next market and technology trends. Cloud provides the right IT asset portfolio to help today’s IT leaders manage the old and prepare for the new. Today the cloud conversation is evolving from private and public to hybrid. This session will provide use cases and insights to reinforce the value of the network in helping organizations to maximize their company’s cloud experience.
The Internet of Things (IoT) is making everything it touches smarter – smart devices, smart cars and smart cities. And lucky us, we’re just beginning to reap the benefits as we work toward a networked society. However, this technology-driven innovation is impacting more than just individuals. The IoT has an environmental impact as well, which brings us to the theme of this month’s #IoTuesday Twitter chat. The ability to remove inefficiencies through connected objects is driving change throughout every sector, including waste management. BigBelly Solar, located just outside of Boston, is trans...
SYS-CON Events announced today that Matrix.org has been named “Silver Sponsor” of Internet of @ThingsExpo, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Matrix is an ambitious new open standard for open, distributed, real-time communication over IP. It defines a new approach for interoperable Instant Messaging and VoIP based on pragmatic HTTP APIs and WebRTC, and provides open source reference implementations to showcase and bootstrap the new standard. Our focus is on simplicity, security, and supporting the fullest feature set.
Predicted by Gartner to add $1.9 trillion to the global economy by 2020, the Internet of Everything (IoE) is based on the idea that devices, systems and services will connect in simple, transparent ways, enabling seamless interactions among devices across brands and sectors. As this vision unfolds, it is clear that no single company can accomplish the level of interoperability required to support the horizontal aspects of the IoE. The AllSeen Alliance, announced in December 2013, was formed with the goal to advance IoE adoption and innovation in the connected home, healthcare, education, aut...
SYS-CON Events announced today that Red Hat, the world's leading provider of open source solutions, will exhibit at Internet of @ThingsExpo, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Red Hat is the world's leading provider of open source software solutions, using a community-powered approach to reliable and high-performing cloud, Linux, middleware, storage and virtualization technologies. Red Hat also offers award-winning support, training, and consulting services. As the connective hub in a global network of enterprises, partners, a...