Is there a ‘can’ in your future?

iStock_000007298729LargeIn the eco­nom­ics of com­put­ing the most expen­sive resource is still the net­work. In sce­nar­ios where large data-sets are being processed it is almost always cheaper to move com­pu­ta­tion to the data than the other way round. My friend and for­mer col­league Dave McCrory nicely cap­tured this real­ity in his con­cept of Data Grav­ity.

Today’s cloud based com­put­ing archi­tec­tures assume that all data will flow to the cen­ter to be processed. Unfor­tu­nately, this cen­tral­ized data-processing model is not likely to be eco­nom­i­cally viable as we look for­ward to a tsunami of data being gen­er­ated by tril­lions of con­nected devices and sensors.

In the brave new world of the ‘Inter­net of Things’ — IoT — mov­ing every bit of gen­er­ated data from edge devices to the cen­ter for pro­cess­ing will likely make lit­tle eco­nomic sense. A new dis­trib­uted data pro­cess­ing archi­tec­ture is going to be required.

Con­tent Dis­tri­b­u­tion Net­works (CDNs) are a com­mon way of effi­ciently mov­ing data from the cen­ter to the edge of the net­work but a new gen­er­a­tion of Con­tent Aggre­ga­tion Net­works (CANs) may be required to make the pro­cess­ing of IoT data eco­nom­i­cally viable — is there a ‘CAN’ in your future?

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The Service Dilemma [eBook]

I’m delighted to make avail­able our new pub­li­ca­tion “The Ser­vices Dilemma” as a free eBook down­load.

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The Ser­vices Trans­for­ma­tion and the algo­rith­mic revolution

A fun­da­men­tal, multi-tiered trans­for­ma­tion of ser­vices is under­way. It is so per­va­sive and of such scope that it entails a trans­for­ma­tion of global com­pet­i­tive eco­nom­ics. First of all, it is part of a dynamic in the global econ­omy, which not only adds to the rel­a­tive growth of ser­vices, but leads to most busi­nesses inte­grat­ing a ser­vices com­po­nent into their busi­ness model. Sec­ondly, the very nature of ser­vices is being trans­formed, dri­ven by devel­op­ments in Infor­ma­tion and Com­mu­ni­ca­tions Tech­nol­ogy (ICT) tools, the uses to which they are being put, and the net­works on which they run. Finally, there is an emerg­ing strate­gic chal­lenge for ser­vices com­pa­nies that are using ICT to ad– dress the clas­si­cal pro­duc­tiv­ity chal­lenge in ser­vices, con­cern­ing the need to avoid commoditization.

The con­se­quences of this fun­da­men­tal trans­for­ma­tion of ser­vices impact the nature and the dis­tri­b­u­tion of jobs glob­ally; they change the strate­gic require­ments for suc­cess in all kinds of busi­nesses and they pose sig­nif­i­cant new chal­lenges for eco­nomic policy.

In this white book, we will map the entirety of the ser­vices trans­for­ma­tion and its impli­ca­tion for ser­vices inno­va­tion. We will be dis­cussing the strate­gic busi­ness choices that are being posed—in some core sec­tions and case stud­ies with a par­tic­u­lar focus on smaller ser­vices companies—as well as some key pub­lic pol­icy challenges.

 

Cloud Computing and Complexity

Complex Underground PipesThe busi­ness of Infor­ma­tion Tech­nol­ogy (IT) has a com­plex­ity problem.

As a domain IT requires deeply spe­cial­ized skills, the lan­guage of IT is arcane and busi­ness needs require mul­ti­ple lev­els of trans­la­tion and inter­pre­ta­tion before being imple­mented as sys­tems. This con­cep­tual com­plex­ity cre­ates a sig­nif­i­cant bar­rier between busi­ness and IT lead­er­ship. But there’s a big­ger prob­lem: The most com­plex issue fac­ing IT today is tech­nol­ogy itself.

The IT infra­struc­ture of most rea­son­ably sized busi­nesses is a hor­ren­dous cats cra­dle of inter­con­nec­tion and infor­ma­tion flow between mul­ti­ple aging sys­tems that were never designed to work together and yet the emer­gence of hor­i­zon­tally inte­grated — and increas­ingly glob­ally dis­trib­uted - busi­ness processes demands and depends on the fric­tion free flow of information.

Time-to-Value  is per­haps the most impor­tant met­ric in today’s dynamic, com­pet­i­tive service-led econ­omy but against this mea­sure most cor­po­rate IT orga­ni­za­tions fail mis­er­ably. The require­ment for IT to keep pace with the speed of busi­ness has never been greater but the ugly real­ity for most CIOs is that the com­plex­ity of their IT infra­struc­tures is over­whelm­ing and an increas­ing per­cent­age of IT bud­gets is now spent on main­tain­ing and inte­grat­ing aging legacy sys­tems rather than deliv­er­ing new value to the business.

No won­der most CEOs are skep­ti­cal about the strate­gic value of IT. Con­tinue Read­ing

Why There’s No Future in Cloud Futures

An inter­est­ing debate took place at last week’s Cloud2020 gath­er­ing regard­ing the via­bil­ity of futures mar­kets for cloud com­put­ing capac­ity. I’m firmly at the skep­ti­cal end of the spec­trum as the title of this post will attest. How­ever, I had not given enough thought as to the rea­sons for my skep­ti­cism. Hav­ing reflected on it a lit­tle I’m more con­vinced than ever that any attempt to cre­ate either pri­mary or sec­ondary mar­kets in cloud com­modi­ties is doomed. In short the lack of fric­tion and a lack of volatil­ity in match­ing cloud com­put­ing sup­ply and demand means there is likely no win­dow for 3rd party mar­ket mak­ers to insert them­selves into this value net­work. Con­tinue Read­ing

The Composable Enterprise

iStock_000016759536LargeWe have wit­nessed a major shift over recent decades towards a dig­i­tal ser­vices based econ­omy[1]. Expo­nen­tial growth in the power of infor­ma­tion tech­nol­ogy enhanced by Inter­net dri­ven net­work effects mean that even the most mun­dane man­u­fac­tured prod­ucts are seen as just one com­po­nent of a broader dig­i­tal ser­vices based value chain.

The shift to dig­i­tal ser­vices has trans­formed the global com­pet­i­tive land­scape. Main­tain­ing com­pet­i­tive dif­fer­en­ti­a­tion requires con­tin­u­ous inno­va­tion – and life­cy­cles are con­tract­ing. In other words change is a constant.

The dynam­ics of a hyper-competitive global mar­ket mean that sta­tic and long-lived mod­els of com­pany struc­ture, oper­a­tions and infor­ma­tion tech­nol­ogy ser­vices are no longer fit for pur­pose. We need a new oper­at­ing model for the enterprise.

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The Laws of Platform Economics

The eco­nomic evo­lu­tion of com­put­ing plat­forms appears to be guided by a num­ber of ‘Laws’ that are inde­pen­dent of any spe­cific under­ly­ing tech­nol­ogy. These ‘Laws’ help explain the evo­lu­tion­ary tra­jec­tory of mature plat­forms and can act as a pre­dic­tor for the tra­jec­tory of emerg­ing plat­forms and behav­iors of those that con­trol them.

The first three laws of plat­form eco­nom­ics are: Value always migrates up the stack, Value gets inte­grated over time, Those that con­trol plat­form evo­lu­tion get to define how value is extracted. A def­i­n­i­tion of each of the ‘Laws’ is pro­vided below: Con­tinue Read­ing

Cloud Computing: A Short Guide For The Perplexed

Over the last cou­ple of years the term cloud com­put­ing has become become pub­lic rela­tions short­hand for “Look, look, we’re also cool.” The expres­sion is now so overused and is applied so widely that it has become almost mean­ing­less. That’s a prob­lem. Senior busi­ness deci­sion mak­ers have been set a drift in a sea of PR and mar­ket­ing con­fu­sion just at a time when they need to be mak­ing strate­gic tech­nol­ogy choices that may directly impact the future of their firms. I offer this brief guide to cloud com­put­ing in an effort to help cut through the fog cur­rently envelop­ing this impor­tant topic.

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Economics and Platform Architecture (Part 3)

Part 2 of this series of arti­cles looked at how tran­si­tion­ing from scarcity to an abun­dance of fun­da­men­tal com­put­ing resources enabled the his­toric one-to-one rela­tion­ship between oper­at­ing sys­tems, appli­ca­tions and under­ly­ing hard­ware to be bro­ken. Part 3 will exam­ine how the abil­ity to decou­ple hard­ware and soft­ware evolved into a new strat­egy for man­ag­ing IT sys­tems — sav­ing company’s mil­lions of dol­lars in the process — and laid the foun­da­tion for today’s cloud com­put­ing archi­tec­tures. Con­tinue Read­ing

Economics and Platform Architecture (Part 2)

Part I in this series of arti­cles out­lined the impact that the eco­nom­ics of scarcity has had on both soft­ware archi­tec­tures and the struc­ture of the com­puter indus­try over the last forty years. Part II of the arti­cle will dis­cuss the tran­si­tion from the eco­nom­ics of scarcity to the eco­nom­ics of abun­dance and how pro­foundly that has altered — and con­tin­ues to alter — the com­put­ing land­scape. Con­tinue Read­ing

Economics and Platform Architecture (Part 1)

The under­ly­ing eco­nom­ics of com­put­ing resources have always had a pro­found impact on devel­op­ment of com­put­ing archi­tec­ture and in-turn the struc­ture of the com­puter indus­try. In this regard the emer­gence of cloud com­put­ing is no dif­fer­ent. Cloud com­put­ing has emerges as the prod­uct of a fun­da­men­tal tran­si­tion in the under­ly­ing eco­nom­ics of com­put­ing resources and — as in the past — this eco­nomic tran­si­tion will drive pro­found changes in the struc­ture of the com­put­ing indus­try. The nature of this change can best be described as a tran­si­tion from the eco­nom­ics of scarcity to the eco­nom­ics of abun­dance. Con­tinue Read­ing

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