Idealization of "in the cloud" computing model
Carr's fundamentalist ambition to exterminate local datacenter infidels and establish
the dominance of "in the cloud computing" in it most "pure" form
(100% on remote datacenter) is pretty funny, but combination of this naive zeal
with good PR and excellent writing abilities is outright dangerous. In any case
vision of all powerful remote
datacenters with minimum local client functionality is misguided. There are
several important concerns that dooms Carr's simplistic vision. Here are some of
- Application performance concerns (WAN bandwidth issues; capability of
remote datacenters to provide adequate response time, etc)
- Bureaucratization problems, sweeping under the carpet mainframe-style problems with
external providers of IT services (everything becomes contract negotiation).
- Interoperability problems. Integration issues and balkanization threat
in case of multiple "in the cloud" vendors. The lock-in concerns as well as potential rip-off due to complicated
- Total cost of ownership concerns. Cloud providers are pretty greedy and the long time cost can't be assumed to be
stable, evaporating all potential savings.
- Security concerns. Those are simply huge, from that danger of government interception of all data to competitors
stealing the crown jewels of technology.
- Capabilities of application and application performance concern. Even the most powerful remote datacenter has
difficulties to compete with model 3GHz 16GB of memory and 400GB SSD laptop.
- Poor customer service and increased risk of downtime. For cloud provider you are just one of many clients and in case
of downtime you are left in the cold.
Incompetent and simplistic description by Carr of capabilities of an important
but not so new (when he wrote his paper, the technology was already more then ten years old ;-) technology, actually
(at least for professional audience) serves more to discredit the idea ("tell me who is your friend...")
then to promote it.
First of all I will be the first to admit that "in the cloud" computing is a
really interesting new development of distributed computing. It recently gained
some traction due to availability of high speed fiber WAN networks. But this
technology can be implemented in many flavors: can be a pure play (everything done
on the server; this that's the approach Carr advocates) or mixed approach with a
significant part of the processing done at the client (more common and more practical
approach). In no way it presuppose simplistic variant preached by Carr in
which the everything should be done of the server while for some strange reasons
rich client considered to be not kosher.
|In no way "in the cloud" software
services model presuppose simplistic variant preached by Carr
in which the everything should be done of the server and that rich client
is not kosher.
Actually term used by Carr is not mainstream and more appropriate technical term
for "in the cloud" software services provider model is Software as a Service
Software as a service (SaaS, typically pronounced 'Sass') is
a model of
software deployment where an application is hosted as a service provided
to customers across the
By eliminating the need to install and run the application on the customer's
own computer, SaaS alleviates the customer's burden of software maintenance,
ongoing operation, and support. Using SaaS also can reduce the up-front expense
of software purchases, through less costly,
pricing. From the software vendor's standpoint, SaaS has the attraction of providing
stronger protection of its
intellectual property and establishing an ongoing revenue stream. The SaaS
software vendor may host the application on its own web server, or this function
may be handled by a third-party
application service provider (ASP).
... ... ...
The concept of "software as a service" started to circulate prior to 1999
and was considered to be "gaining acceptance in the marketplace" in Bennett
et al., 1999 paper on "Service Based Software"
Whilst the term "software as a service" was in common use, the
acronym "SaaS" was allegedly not coined until several years later in a white
paper called "Strategic Backgrounder: Software as a Service"
by the Software & Information Industry's eBusiness Division published in Feb.
2001, but written in fall of 2000 according to internal Association records.
Webmail, web hosting and other new "groupware" technologies (blogs, wikis, web-conferencing,
etc) based on posting user-generated content that need to be distributed to the
"world" proved to be suitable for SaaS model and they are the main drivers of this
model. Web hosting providers emerged as a strong, growing industry that essentially
pioneered the commercialization of SaaS model and convincingly proved its commercial
viability. As Kismore Swaminathan aptly noted in
response to Alastair McAulay’s article
Cloud computing has received plenty of attention of late. Its colorful name
notwithstanding, it promises tangible benefits to its users such as sourcing
flexibility for hardware and software, a pay-as-you-go rather than fixed-cost
approach, continuous upgrades for mission-critical enterprise software, and
the centralized management of user software.
Yet, as presently constituted, cloud computing may not be a panacea for every
organization. The hardware, software and desktop clouds are mature enough for
early adopters. Amazon, for example, can already point to more than 10 billion
objects on its storage cloud; Salesforce.com generated more than $740 million
in revenues for its 2008 fiscal year; and Google includes General Electric and
Procter & Gamble among the users of its desktop cloud. However, several issues
must still be addressed and these involve three critical matters: where data
resides, the security of software and data against malicious attacks, and performance
I would argue that "in the cloud" paradise looks more like software demo then
reality ;-). It turns out that for the last five years there was relatively little
demand for "in the cloud" service providers and this technology competes with several
other, first of all with virtual appliances and "datacenter in the box".
Now about the joy of keeping all your data "in the cloud". From an end user perspective,
it doesn’t make a difference if a server glitch is caused by a web host or a software
service provider. Your data is in the cloud, and not on your local PC. If the cloud
evaporates you can’t get to your data. If the service or site goes down, you can’t
get to your data.
While software as a service might represent a licensing savings, there might
be a better way to achieve the middle ground and lot to lose all advantages of local
storage of data. For example by using some kind P2P infrastructure automatically
synchronized so that you can view/edit data locally. Data should not be held
hostage until the user can get back to the cloud. In this sense Microsoft's
Microsoft Live Mesh might be a step in right direction as it provides useful middle
grown by synchronizing data across multiple computers belonging to a users (home/office
or office1/office2, etc).
But the key problem with "in the cloud" delivery of services is that only some
services, for example Web and email related and those with limited I/O (both ways)
are suitable for this deployment mode. Among "limited I/O" services we can mention
payroll and enterprise benefits services -- another area where "in the cloud" computing
definitely makes sense. But most I/O intensive enterprise processing like
file sharing is more efficiently done on a local level. That includes most desktop
Office related tasks, ERP tasks to name just a few. They are more difficult
and more expensive to move into the cloud and economic justification for such a
move is open for review. So in a way it is a complementary technology to the local
datacenter not an alternative one. Moreover "in the cloud" approach can be implemented
on a local level over LAN instead of WAN ("mini cloud" or "cloud in the box").
From the historical standpoint "in the cloud" providers" represent the
return to the mainframe era on a new technology level and we all remember how much
IBM was hated in 60th and 70th and how much energy and money people have spent trying
to free themselves from this particular "central provider of services". And to what
extent rapid adoption of PC were driven by the desire to send a particular "central
service provider" to hell. That raise a legitimate question of the user resistance.
And like any new service along with solving old problems it creates new.
Proponents often exaggerate positive features and underestimate problems and
costs. Carr's vision of the IT future is based on a remote centralized and
outsourced datacenter that provides services via "cloud" using high speed fiber
links. It is very true that fiber optic lines made "in the cloud" computing
more acceptable. But that does not mean that this technology is a "universal bottle
opener". I would like to stress that this is just another example of distributed
computing model (with usage of WAN instead of LAN) and as such it has its limits.
According to Wikipedia The Fallacies of Distributed Computing are a set of common
but flawed assumptions made by programmers in development of distributed applications.
They were originated by Peter Deitch and his "eight classic fallacies"
can be summarized as following:
- The network is reliable.
- Latency is zero.
- Bandwidth is infinite.
- The network is secure.
- Topology doesn't change.
- There is one administrator.
- Transport cost is zero.
- The network is homogeneous.
Actually services itself are not that cheap so cost savings in switching to the
"in the cloud" service provider for large organizations might simply be not sufficient.
As for May, 2008 the number of providers are in dozens with only few established
vendors (WEB site providers, Amazon Web Services, Goggle App Engine and soon Microsoft
Live Mesh, which is a slightly different animal, and a more realistic "mixed" approach
). Spectrum of available services is very limited. Currently is far too limited
to replace a real datacenter except small startups. The most commercially viable
part is represented by Web hosting and rack hosting providers. For web hosting
providers the advantages are quickly diminishing with the complexity of website,
though. Among Amazon Web services only S3 storage currently can be called a successful,
viable service. Microsoft Live Mesh is mostly a data synchronization
service. It presuppose existence of local computers and initially provides
syncing files between multiple instances of local computers belonging to the same
user. This is an important service but this not a pure "in the cloud" provider model.
It is more realistic "mixed" approach.
Again, with the current prices of servers and network equipment, most existing
services are not cheap and became expensive as you scale them up. We will
discuss this issue later
All-in-all it is not very clear what market share "in the cloud" services deserve
and but it is clear that Carr hypothesis of the universal move to "in the cloud"
service providers is nothing but a modern variant of Japanese 5th generation computing.
Currently, there are a lot more places to run software than
there used to be, thanks to the proliferation of powerful laptops, mobile phones
like iPhone and other devices. Actually iPhones represent another interesting
development that runs in the direction opposite to the move to the "in the cloud"
computing. It is a powerful local device with wireless network connectivity. The
key here is substantial processing power and storage capacity available on the device
which is increasing with each new model.
From social standpoint Carr views also looks very unconvincing. Service providers
mind their own interests first. also large service provider is the same bureaucratic
monster as a typical datacenter that share with the latter all the spectrum of Dilbertalization
problems. Large customers experience "vendor lock-in" working with service providers
as it involves significant effort to adapt on both sides. So walk-out is a less
viable option that one can assume on pure theoretical backgrounds. It is also
possible that outsourcing to "software service providers" like any outsourcing can
be used as a negotiating tool (aka "method of blackmail"), to force wage concessions
from workers, tax breaks from governments, etc., even when the actual savings would
be small, or even when they are negative and moving makes no business sense
Promoting remote outsourced datacenter, Carr forgot to calculate the cost of
bandwidth. Or, more correctly, he assumes that free Internet connectivity
is adequate for all purposes. Yes, fiber-optic changed WAN landscape making
remote services more viable and Internet tremendously more powerful. But the
devil is in details. For example file sharing for a large company over WAN is still
bad idea as public bandwidth is insufficient and private is costly. Also any enterprise
making bet of 24x7 availability of public bandwidth for vital corporate services
looks slightly suicidal because of the "tragedy of commons" problem, which already
demonstrated itself in repressions against P2P enthusiasts by large ISPs.
All-in-all this "grand utility computing" vision ("bandwidth communism") is a trap
in which Nicholas Carr falls due to the lack of understanding of networking.
Fiber networks increased both Internet and LAN bandwidth substantially and revitalized
distributed computing. But there is a big difference whether you distribute over
LAN or WAN. The latter is much tougher case. With all the tremendous progress
of Internet available bandwidth does not increase as quickly as computing power.
Nowhere close, and it never has. If anything, due to increased scrutiny and "shaping"
by ISPs (they are not a charity and need to be profitable) bandwidth "per
user" might recently start decreasing as such resource hogs as YouTube and video
programming distribution services (movies on demand) are becoming more and more
prominent. Ability of video streams and P2P services to clog the Net in the most
inopportune moment now is well established fact and is a real curse
for university networks.
For i/o intensive tasks, unless you pay for the quality of service, "in
the cloud" computing model stands on a very shaky ground. Reliable 24x7 bandwidth
cannot be free for all users in all circumstances and for all protocols. Contrary
to Carr's views substantial amount of traffic with the remote datacenter is not
that easy to transmit reliably and with minimal latency via public channels in rush
hours. But buying private links to remote datacenters can be extremely expensive:
for mid-side companies it is usually as expensive as keeping everything in house.
For multinationals it is more expensive, so only "other considerations" (like "jurisdiction
over the data") can sustain the centralization wave to the large remote datacenters.
For many multinationals SOX was the last straw that made move of datacenters out
of the USA desirable, costs be damned. Cost of private high speed links limits
cost efficiency of the "in the cloud" approach to any service where disruptions
or low bandwidth in certain times of the day cannot lead to substantial monetary
losses. For critical business services such as ERP public data channel can
be too brittle.
But it is fair to state that the situation is different for different services.
For example for SMTP mail outsourcers like Google/Postini, this problem is not relevant
due to the properties of the SMTP protocol: they can communicate via regular Internet.
The same is true to DNS services providers, webmail and instant messaging. CRM is
also pretty close. But for ERP, file sharing and WAN based backup the situation
is very different: providing high speed networking services over WAN is a
very challenging engineering task to say the least. The cost of bandwidth also puts
natural limits on service providers growth as local networks are usually much cheaper
and much faster. Achieving 1Gbit/s speed on LAN is extremely cheap (even laptops
now have 1Gbit adapters) while it is quite expensive over WAN. There are also other
- The possibility of creation of local LAN backbone with speeds higher
the 1 Gbit/s. 10Gbit/s backbones are becoming more and more common.
- Limited bandwidth at the point of connection of provider to the Internet.
Every provider is connected to the Internet via a pipe and that pipe is
only so big. For example OC-1 and OC-3 have their upper limit of 51.84Mbit/s
and 155.2 Mbit/s correspondingly. Funny the upper speed of OC-3
(which is pretty expensive) is only slightly higher that 100Mbit/s which long
ago became the lowest common denominator for LANs. Large service providers
typically use OC-46 with speed up to 2488.32 Mbit/s which is similar to the
speed of gigabit Ethernet. 10 Gigabit Ethernet is the fastest commonly
available network standard for LANs. It is still emerging technology with
only 1 million ports shipped in 2007 but it is quickly growing in importance.
It might be eventually used in modified form for WANs too. Anyway
as WAN bandwidth is limited and shared between multiple customers the spike
in activity of one customer might negatively affect others. Networking
problems at the provider level affect all its customers and recovery period
might lead to additional spikes of activity.
- Local vs. remote storage of data. Recent enterprise level hardrives
have speed up to 164 MB/sec (Megabytes, not megabits). From the speed
and cost point of view the ability to keep data/programs local is a big technological
advantage. For I/O intensive applications it might be that the only viable
role for remote providers is synchronization with local data ;-). Example of
this approach is Microsoft's Live Mesh
- Interdependence of customers on the transport level. This is jut
another incarnation of "tragedy of commons" problem. Bandwidth hogs like game,
P2P, music and video enthusiasts do not care a dime about your SLA and
can easily put a company that uses public links into disadvantage any time of
the day if and when something new and exiting like a new HD movie was released.
Also providers are not willing to sacrifice their revenue to accommodate
"free-riders.": as soon as usage of bandwidth cuts into profits it is punishable
and no amount of rhetoric about "Internet freedom" and "Net neutrality"
can change that. That means that enterprise customers relying on public bandwidth
can suffer from the effort of providers to manage free-riding. That means the
corporation which moved services to the cloud competes with various bandwidth
hogs who do not want to scarifies any ground and ready to go quite far to satisfy
their real or perceived needs. My university experience suggest that corporate
users can suffer from Internet clogging in the form of sluggish download speeds,
slow response times and frustration with i/o intensive services that become
much less useful and/or enjoyable. See for example
Time Warner Cable Vs. The Horde.
- Competition for the resources at remote datacenter level. For
any successful service providing all the necessary bandwidth is costly and cuts
into margins. Recently Amazon faced the situation when bandwidth
required for its
Elastic Compute Cloud (EC2) proved to be higher then by all of Amazon.com’s
global websites combined. You can read between lines how that affect profitability:
Adoption of Amazon
Elastic Compute Cloud (EC2) and Amazon
Simple Storage Service (S3) continues to grow. As an indicator of adoption,
bandwidth utilized by these services in fourth quarter 2007
was even greater than bandwidth utilized in the same
period by all of Amazon.com’s global websites combined.
Web services providers which offer customers unlimited
bandwidth are banking on the fact that the majority of their customers will
not use much of their bandwidth. This is essentially a marketing trick.
As soon as you exceed a fraction of what is promised they may well
kick you out. People who tried to implement software , mp3 or video
sharing services on low cost ISP accounts realized that very soon. See for example
references that I collected under "Unlimited
bandwidth myth". Web neutrality does not mean the tragedy of commons
is not applicable. As
A. Huberman, Rajan M. Lukose noted:
Because the Internet is a public good and its numerous users are not
charged in proportion to their use, it appears
rational for individuals to consume bandwidth greedily while
thinking that their actions have little effect on the overall
performance of the Internet. Because every individual
can reason this way, the whole Internet's performance can degrade
considerably, which makes everyone worse off. An analysis of
the congestions created by such dilemmas predicts that they are
intermittent in nature with definite statistical properties leading
to short-lived spikes in congestion. Internet latencies were
measured over a wide range of conditions and locations and were
found to confirm these predictions, thus providing a possible
microscopic mechanism for the observed intermittent congestions
of the Internet.
So a company which will try to implement Web based streaming of say corporate
video conference via cloud is up to nasty surprises unless it paid "arm and
leg" for dedicated lines to its headquarters and other major locations
(which make the whole idea much less attractive in comparison with the local
datacenter). The ability to stream video of any considerable quality in real-time
between two (or more!) arbitrary points in the network is not really something
that can be easily done over the current Internet.
The main point to make is that a reliable WAN network connectivity cost a lot
of money is difficult to achieve. This problem is unavoidable if your major
components are "in the cloud" (in WAN). Also in the "free internet" enterprises
are starting to compete for bandwidth with streaming media (films over Internet).
The latter proved to be a huge resource hog and quality of a typical Internet connection
now fluctuates widely during the day. That means that in order to achieve respectable
quality of service for bandwidth intensive applications enterprises need to buy
dedicated WAN connections. That is a very expensive habit to say the least. In typical
for multinationals moves, say, relocation of SAP/R3 instance from USA to Europe
(just from one continent to another) to achieve reasonable latency for requests
coming from the USA is not that easy and definitely not cheap. The cost of
high bandwidth transatlantic connection is the major part of additional costs and
eats all savings from the centralization. The same effect is true about any WAN
connection: reliable high-bandwidth WAN connections are expensive. Moreover
the reliability needs to be carefully monitored and that also cost money as anybody
who was responsible for the company WAN SLA can attest.
|Centralisation, or centralization (see
spelling differences), is the
process by which the activities of an organization,
particularly those regarding decision-making, become
concentrated within a particular
location and/or group.
There is a shadow of mainframes over the whole idea of "in the cloud" software
services providers. Excessive centralization has its own perils,
perils well known from the days of IBM360/370 and "glass datacenters".
While at the beginning growth of "cloud services" providers
increase profit margins and may even increase the quality of the service
eventually each organization hits "size" wall.
That's why businesses tend to perceive such providers as inflexible,
and, due to natural pre-occupation with profit margins, hostile to their business
needs: exactly like their perceived "grass datacenter" in not so distant
past. So much for the improvement of the business model in comparison with traditional
local datacenters, as problematic as they are (and I would be the last
to deny that they have their own set of problems).
As one reader of Calculated Risk blog noted in his comments to the post
Popular Google Product Suffers Major Disruption
They started employing more MBAs at Google? Seriously, any
creative company that "grows up" and starts taking advice from
bean counters/ entrail readers and sociopaths is doomed.
Microsoft's greatest strength was that its founders never lost
control.. so even though their products were inferior (at least
initially), their competitors took advice from MBAs and f**ked
themselves up, leaving MS as the only survivor.
It's very hard to scale service-based tech firm and keep the mojo
that made the startup successful in the first place, especially via
acquisitions or employing 'professional managers' to operate the
company. Basically I think the story is simple -- Parkinson's law --
bureaucracies naturally grow without limit. That includes the management
of large "cloud-services" providers including Google. Excessive
layers of middle managers and affiliated cronies ("shadow secretaries")
count in the denominator of labor productivity.
Everyone knows that many middle managers (often called PHBs) are mainly
"inventing" work for themselves and other
middle managers writing memos and calling meetings and stuff. Middle
management is all about sustaining internal information flow; technology
makes good middle management more efficient since it enables better
information flow but it makes bad middle manager even more
they "invent" useless information flow (spam) and block useful
information in order to survive.
Issues of quality, loyalty, knowledge of the business are automatically
surfaced and as a result customers suffer. Mainframe-style utility model
encourages excessive bureaucratization with rigid procedures, stupid
customer service and power concentrated at the top. That means that the issues of sociopathic
leadership and sycophant managers replacing founders is even more acute
then in regular IT firms. Corporate predators prefer large
companies. As a result demoralization surface and IT personnel, that is
cubicle serfs, now spend a large fraction of their time in the office,
surfing the internet.
Contrary to simplistic description and assumptions
typical for writers like Carr mainframe warts are very difficult, if not impossible
to overcome. And they can be amplified by low cost of free
services with no reliability guarantee. Disappearance of
data usually is not covered. There is a danger of relying of
semi-free (advertisement supported) services too much.
For example anybody who used low cost Web-hosting provider can
attest that interests of providers run contrary to the interests of advanced users
and as such often stifle advanced technology adoption even if they are
supported by a particular provider because they, for example, might
increase the load on the server. Also provision of the adequate bandwidth
for multiple users (and decent responses times) can be a shaky area. Especially
during rush period like 8-11
EST. Typically customer service is far from being responsive to
Security is another important (and costly to resolve) challenge: break-in into
a large provider affects all its customers. There were several high profile break-ins
into large Web hosting providers during the last two years, so this is not a theoretical
threat. Claiming that Web provider are a total solution for any organization is
like saying that just because the Big 4 accounting firms (with their the army of
accountants, tax specialists and so on) exist, organizations can do away with internal
accountants altogether. The hybrid platforms, such as Saleforce.com's application
upgrades and quality of service issue still are of major concern.
Relying on advertisement is another mine field. Many people hesitate
to send anything important to a Gmail address, knowing that the mail
will be scanned (by what is an advertising company) in transit.
Still there is a lot of disappointments with this model as exemplified with the
following characterization of "cloud-based" services and outsourcing:
'We thought that we are like a farmer shooing a fat rabbit, but it
turned out that the rabbit is shooing at us."
This quote suggests that providers of such services as any outsourcers
in the future might have difficulties to shake money loose from the organizations,
as customers discover that the interests are highly divergent. IBM already
discovered that this is an inherent limit of their push to the "'service oriented
organization". Recently they even experienced a backlash.
Because we need to bridge interests of two or more different organization, there
are several significant problems in interaction with "in the cloud" providers. Among
- Problem of loyalty. It cuts both ways. First of all in case you use
external providers loyalty of staff disappears and for any complex service you
face "all or nothing situation": If service works everything is wonderful, but
if it does not troubleshooting is extremely difficult and fixing the problem
is almost impossible even if you understands what is happening -- infrastructure
belongs to other organization. Anybody who used Web hosting (the most successful
example of such services) can attest that this is a wonderful service as long
as it works. But if you have a problem you have a big problem: local staff has
no loyalty to the particular organization and competition does not work as another
provider can be as bad or even worse; so switching brings you nothing but additional
headache and losses. Even elementary problem can take several months to
be resolved and I am not joking I experience it myself. Oversubscription
which leads to highly loaded servers and insufficient network bandwidth is another
common problem. There are also problems related to the "race to the bottom"
in such services: the main differentiator becomes price and to attract new customers
Web providers often make claims that are untrue (unlimited bandwidth is one
typical example). As a result naive customers who believe in such claims are
- Forced upgrades. In case of external providers that platform is owned
by the provider and if his financial or technological interests dictate that
upgrade is necessary it will be done. That means that customers have to adapt
or leave. And upgrade for a provider with large number of customers can
be huge mess that cost clients dearly. I experienced this situation myself
and can attest that the level of frustration involved is substantial and the
mess can easily last several months.
- Compatibility problems. As provider
uses specific technology the level of interoperability of this technology with
other important for the company technologies is not under the control of the
user of such services. It can lead to significant costs due to luck of interoperability.
In the simplest example lack of interoperability with Microsoft Office is a
serious problem for Sun which uses Open Office (Star Office to be exact).
The loss of operational flexibility
When switch to "in the cloud" provider is done on cost grounds alone, that usually
creates new (and initially mostly unrecognized) dependencies that deprive
the company from much of the operational flexibility. Typically security
departments are direct beneficiary as security-related spending tend to grow
dramatically as a defensive reaction of the organism. The main consequence of
the bureaucratization is the loss of flexibility, and sooner or later this lack
of flexibility can come back and haunt the company.
In the recent interview Bill Gates noted that "The
IT systems are your brain. If you take your brain and outsource it
then any adaptability you want (becomes) a contract negotiation".
After you negotiated the contact with the "in the cloud" provider
any flexibility you used to have is lost as every change explicitly or implicitly
become a change of the contact negotiation. Moreover,
if the company lost its key IT staff and key architectural issues are
decided by outsourcers, then essentially the company becomes a hostage
of outsourcers as it no longer has brain power to access the options
and the architecture (and thus the costs) are by-and-large controlled by forces
outside your control. That is much more serious risk that many PHB assume: the
line between architectural decisions and implementation decisions is pretty
fuzzy. There is also associated brain-drain risk – if you outsource important
functions, you irrevocable erode the capabilities within your firm.
When problems arise, internal IT staff can often resolve
the problem more quickly, with less bureaucratic overhead inherent when two
corporations are involved.
The fist category of factors that lead to loss of flexibility is connected
with additional standards, policies and procedures that are usually introduced
in external service provider situation.
The other important aspect of the loss of
remnants of competitive advantage, if any, as the service provider is now the
place were the critical mass of know-how and talent pool reside. That somewhat
reverses "client-provider" relationship: it is service provider who now can
dictate the rules of the game and who is the only party who understands the
precise nature of the tasks involved and can conceal this knowledge for his
own advantage from the other party. That usually is helped by the demoralization
of the remaining staff in the company
- Amplification of the management missteps.
Their first and most important desire of service provider is to keep the
client, even if client's situation changed and no more lend itself easily to
the services provided. That can lead to huge architectural blunders. Those things
are not limited to offshoring but happened often with complex projects like
ERP were external consultants are involved, especially in case big consultant
firms are involved. Several large companies went out of business or were bought
as a result. Among example we can list FoxMeyer, AT&T Wireless. Several
companies were severely hurt (Herschel, etc). This is might actually include
As for Compaq, the story is more complex then simplistic "competition with Dell"
story which Carr tries to present in his first book. Dot-com bust hurt "value
added" companies like HP and Compaq disproportionally and increased appetite
for mergers and acquisitions activities. Dogged determination of Carly
Fiorina about the merger (which served both for self-promotion and as a smokescreen
for her own problems at struggling HP) and the ability of former Compaq boss,
a certified public accountant
to understand personal benefits from Carly Fiorina proposition proved to be
a winning combination. Capellas who proved to be a "serial CEO",
actually, was a big fan of SAP and that probably was a contributed factor is
Compaq troubles. When he was appointed, he promised to turn around struggling
Compaq in 180 days. Now we know that after just 84 he found a much better financial
solution, at least for himself, one big shortcut for a turnaround ;-).
It is interesting to note that in 2000, based on iPAQ success, he declared[
ComputerWeekly.com,Feb 2000] :
"There will be an explosion in devices, all attached
to the Web. We are going to simplify the PC radically." Capellas promises
that future desktop computers will be easier to manage than today's machines.
Large companies have become very adept at establishing remote teams in places
like India, Russia, etc. Due to their ability to offer higher wages and better environment
they are able to attract local talent and run challenging research and development
projects. Often, though, these outposts become disconnected from their parent companies
because they fail to establish rapport with key participants in the central office.
Foreign prophets are usually ignored. There is something fundamental in this
"tragedy of local talent" and communication is still a problem even in the age of
videoconferences. Without "warm-body" personal contacts it is difficult to build
long-term trust based relationships.
Many organizations who thought outsourcing IT was the key to success miserably
failed. Whose who did not failed lost competitive advantage, experienced the demoralizing
effect of vendor lockdown and QOC hokey-pokey which just simply made no sense.
Some in-sourced the IT back, some recreated it from scratch, are still in denial.
That means that client of service providers will be implicitly pushed to lowest
common denominator and cannot utilize local expertise, even if such exists. They
face "helpdesk level" people and instead of benefitting from specialized provider
are often proposed wrong solutions to misdiagnosed problems. my experience
with WEB providers suggests that trivial problems like an error in DNS record or
wrong permissions can became real production issues.
Service providers can evolve and upgrade software independently of wishes of
some or all of the customers. That means that customers who are not satisfied with
the direction taken need either to adapt or abandon the service.
At the same time Carr is a gifted writer and astute observer who in his writings
helped to reveal the level of degradation and bureaucratization (what is often called
"dilbertization of IT") that exists in current datacenters today. Here is
an apt quote from one Amazon review:
The key question is, "is it as bad as Carr reports?" I can share my experience
as a consultant who has worked some of the largest US and global corporations
by answering "unfortunately, yes". I've seen the
symptoms Carr cites in one engagement after another. It is not the fault of
technology. I've witnessed the implementation of technical solutions
that should have added value to business operations, yet were so mismanaged
by IT that the solutions never came close to the projected ROI that justified
their acquisition and implementation. Indeed, this
book is similar to a collection of anti-patterns -- common bad practices --
which, sadly, reflect a typical IT department.
Public internet is unsuitable for handling large volume of transaction with stringent
performance criteria. That means that it is dangerous to put databases at "in the
cloud providers" : the more successful "in the cloud" providers are ( or if there
just are too many P2P and or multiplayer videogames enthusiasts in the same
subnet), the slower your WAN connection will be ("tragedy of commons").
Moreover, in comparison with LAN, WAN-based provision of software services is
more complex system and as such is less reliable especially at bottlenecks (which
are service provider "entry points" and associated infrastructure (DNS, routers,
switches, etc). With WAN outage the situation can became a lot
worse then when just when spreadsheets or MS Word documents suddenly are inaccessible
on the local server due to LAN outage (but you can still download then into USB stick directly from
the server and work with the local copy until network connectivity is restored,
because your departmental file server is just several dozens of yards away and friendly
administrator probably can help you to get to the data. In case of WAN there is
no way to put a USB stick on the server or use other shortcut to avoid effects of
network downtime: if WAN connection is down you are really down. Generally
not only you can do nothing about the outage, its effects might be amplified by
the fact that there are many customers affected. All you will get is the message
The service is experiencing technical difficulties.
We apologize for the inconvenience. Please try again later .
That means that in some cases the effect on organization of external outage might
be such that the head of the person who enthusiastically recommended company to
move "into the cloud" rolls down independent of his position, real or faked IQ and
technical competence. Recently both Gmail and Amazon
services experienced multiple outages. As Brad Stone noted in NYT:
There is plenty of disappointment to go
around these days. Such technology stalwarts
Research in Motion
, the company behind
the BlackBerry, have all suffered
embarrassing technical problems in the last
About a month ago, a sudden
surge of visitors to Mr. Payne’s site began
asking about the normally impervious
Amazon. That site was ultimately down
for several hours over two business days,
and Amazon, by some estimates, lost more
than a million dollars an hour in sales.
The Web, like any technology or medium,
has always been susceptible to unforeseen
hiccups. Particularly in the early days of
the Web, sites like
Schwab.com regularly went dark.
But since fewer people used the Internet
back then, the stakes were much lower. Now
the Web is an irreplaceable part of daily
life, and Internet companies have plans to
make us even more dependent on it.
Google want us to store not just e-mail
online but also spreadsheets, photo albums,
sales data and nearly every other piece of
personal and professional information. That
data is supposed to be more accessible than
information tucked away in the office
computer or filing cabinet.
is that this ideal requires Web services to
be available around the clock — and even the
Internet’s biggest companies sometimes have
trouble making that happen.
Last holiday season, Yahoo’s system for
Internet retailers, Yahoo Merchant
Solutions, went dark for 14 hours, taking
down thousands of e-commerce companies on
one of the busiest shopping days of the
year. In February, certain Amazon services
that power the sites of many Web start-up
companies had a day of intermittent
failures, knocking many of those companies
The causes of these problems range
widely: it might be system upgrades with
unintended consequences, human error (oops,
wrong button) or even just old-fashioned
electrical failures. Last month, an
electrical explosion in a Houston data
center of the Planet, a Web hosting company,
knocked thousands of Web businesses off the
Internet for up to five days.
prolonged torture,” said Grant Burhans, a
Web entrepreneur from Florida whose
telecommunications- and real-estate-related
Web sites were down for four days, costing
him thousands of dollars in lost business.
I was actually surprised how much posts each "in the cloud"
service outage generates and how significant were losses reported by
some users; in addition to
Official Gmail Blog one of the best places to track Gmail outages
proved to be Twitter;
there is also a site
http://downforeveryoneorjustme.com/ which provides a free check for
frustrated Gmail and other "in the cloud" services users). Some
reactions are pretty funny:
- Thank you so
much for coming back. I felt lonely without your constant,
- I was so
relieved Gmail was down. I thought my employer decided to
block it on my berry.
ruined my day. Damned cloud!
- Gmail is
really pissing me off today, which doesn't happen often. S'like
having your first real fight in a relationship. Very
back, but now my IndyChristian provider is down. And
Facebook.com . Go figure.
- Thank God I
never jumped aboard the evil gmail ship!
- To all Gmail
outage whiners: if you want the right to bitch, don't use free
email. Also, look up the definition of "BETA" sometime.
- Very comforting
to know that I wasn't the only one that had no Gmail for
a bit there. I'm not alone in this world? Long but good day.
- Man, gmail
goes down for one moment and the whole world is up in arms :)
- How did I miss
the gmail outage? I feel so out of the loop!
- the weather is
hot, the a/c is b0rked, gmail was down this afternoon.
expect to see four horsemen walk by any minute...
completely missed the gmail outage because I was out
biking and enjoying the amazing evening we're having here.
- Having Gmail
down about made me bang my head on the table. Oy.
gmail and getting behind the olympics
- For Twitterers,
Gmail going down is like JFK being shot, innit?
- Ignorance IS
bliss-so busy today I did not even know about the great gmail
outage of '08.
- The cloud of
unreliability: It's not clear why anyone should be surprised
that Gmail, Amazon.com's cloud ..
- Was thinking
about going to back to Gmail from .Mac since MobileMe was
down. Now I hear Gmail was down. Thinking about envelopes
- so mad at
gmail for 502-ing her earlier today. what did we do before
- With Gmail
having gone down and me not noticing, I am undiagnosing myself
of Internet Addiction and OCD.
- Maybe gmail
is down to express solidarity with MobileMe?
As any self-respecting obsessive business e-mail checker could tell
you, each outage is a real shock and fails on the most inopportune
moment. In reality most email outages does not make users less
productive, they just deprive them from their favorite tool of wasting
own and other time and procrastination ;-)
Here is a short but pretty sobering list for 2008. It neither
complete not contains the most important posts about particular outage.
While there is nothing strange about such outages
as large distributed datacenters are notoriously difficult to operate,
please note that in case the organization uses both Amazon and
Gmail they have multiple noticeable outages during the first half of 2008.
At the same time it is impossible to deny that such outages definitely
make fragility of in the cloud model visible even for the most
"pro-clouds" observer such as Mr. Carr although I doubt that he'll
reproduce the statistics listed above in his blog.
[Jan 28, 2008]
Gmail OUTAGE, relying on Google too much -
Google services are
usually rock solid
reliable, but earlier
today some Gmail users
lost service for a
couple of hours. That
begs the question, are
we relying on Google too
last few years and
every time it creates a
flurry of activity as
individuals realize how
much they rely on a
single business and
platform for all of
their messaging needs.
The same concept is
mirrored with search
engine traffic, where
many people don’t even
realize there are search
engines out there other
[Feb 16, 2008]
Amazon explains its S3 outage Between the
Amazon has issued a
statement that adds
a little more
clarity to its Web
services outage on
wreaked havoc on
startups and other
3:30am PST, we
in one of our
ranges, we had
per call than
PST, we began to
calls. The last
of these pushed
service over its
before we could
new capacity in
caused Amazon S3
to be unable to
requests in that
4:31am PST. By
6:48am PST, we
had moved enough
to resolve the
As we said
proud of our
record over the
past two years
part of the post
mortem for this
event, we have
identified a set
actions as well
as longer term
we’ve begun work
on a service
The Amazon Web
[Jun 9, 2008]
Surviving gMail 502 outages SKFox
mint to see live
stats for the
traffic to skfox.com
and Google Analytics for
the long term
statistics. I’ve seen a
resurgence today of
traffic to my two blog
March and again in
May) about my gMail
account being down. The
most common for me is a
“Temporary Error (502)”
and it would seem to be
happening to other users
too. I hate to be the
bearer of bad news, but
there isn’t a whole lot
you can do about it. On
the short side, most of
the outages only last 30
minutes or so with the
longest being 3.5 hours.
It can be terribly
frustrating, but there
are a few things you can
do to alleviate the
- Use your email
client like Outlook
or Thunderbird to
messages to your
local machine with
keeping your gmail
That way, even if
can get to your old
email for reference.
Of course, you have
to do this once your
account is up and
- Visit the
gMail Google group
to at the least find
others in your boat
and get the latest
Some users have
reported success getting
to their mail during
outages by using any
number of alternative
links to gmail. Your
mileage may vary, but
here they are:
Today’s outage is a
known issue, and I
hope for all of your
coming here from search
engines, that it comes
back up quickly for you.
Amazon's S3 Storage Outage Busts Web Sites,
Crashes iPhone Apps
rates." A lot of
-- rely on S3 to
sheets, etc. for
their Web apps.
So when S3 goes
what the company
uses S3 for.
service bork my
on S3 for
icons. And they
must not have
included a "plan
B" in their code
to handle an
outage. So when
S3 hiccuped, and
the app crashed,
taking me back
to the iPhone
TheStar.com Business Google Gmail users
SEATTLE–Google Inc said
Monday that many users of its Gmail service
are having trouble accessing their online
e-mail accounts due to a temporary outage in
a contacts system used by Gmail.
The problems began at about
5 p.m., and a company spokesman said Google
is starting to implement a fix for the
problem right now.
"We are starting to roll out
a fix now and hope to have the problem
resolved as quickly as possible," said a
[Aug 25, 2008]
FOXNews.com - Amazon's Site Outage Raises
Scalability Questions - Science News Science
& Technology Technology News
Amazon.com has built a
reputation for being an
of company, but it
showed its more
cooperative side this
issued a report that
said many of the largest
e-commerce players will
face major load-handling
challenges for the
holidays if they don't
make big changes by the
However, after so many
years of holiday
shopping seasons, some
in the industry scoffed
that the majors could be
caught so short.
help out, Amazon (AMZN)
generously knocked out
servers for almost 2
hours on Aug. 21.
OK. Amazon probably
didn't crash just to
help Keynote make a
point. But its timing
interesting to note that
within a few days this
month, three of the
industry's most powerful
retail forces — Wal-Mart
Amazon and Google (GOOG)
— all suffered problems
that, one way or the
other, can be classified
But the most important difference between "in the cloud" services and
local services is not duration or frequency of the outages. The most
important is the level and quality of information available about the
situation. In case of local services all information about the situation
is readily available and thus some countermeasures can be taken. In
military world such difference is of paramount important. IT is not the
different in this respect from military world.
In case of "in the cloud" the amount and quality
of information about the outage are very low;
services customers are essentially in the dark. Services just abruptly seizes to exists
and then magically comes back. This lack of information has its
|The most important
difference between "in the cloud" services and local
services is not duration or frequency of the outages. The
most important is the level and quality of information
available about the situation. In case of local services all
information about the situation is readily available and
thus some countermeasures can be taken. In military world
such difference is of paramount important. IT is not the
different in this respect from military world.
Virtualization generally magnifies failures. In the physical world, a
server failure typically would mean that backup servers would step in to prevent downtime. In
the virtual world, depending on the number of virtual machines
residing on a physical box, a hardware failure could impact
multiple virtual servers and the applications they host. As a
result failures have a much larger impact, effecting multiple
applications and multiple users. Little fires turn into big
fires. Virtualization might also increase two other problems:
- Performance-related problems. Companies ensure top performance of
critical applications using powerful dedicated servers, network and storage
resources for those applications, segmenting them from other traffic to
ensure they get the resources they need. "In the cloud" provider model
of solving those problems is based on allocation of additional
resources on demand as his goal is to minimize cost of infrastructure. That
means that at any given time, performance of an application could degrade,
perhaps not to a failure, but to a crawl making users less productive or
- Troubleshooting complexity. Server problems in the past could be
limited to one box, but now the problem can be related to hypervisor, not
the server per se or move with the application instance from on virtual
machine to another. If problem existed on one server, but disappears after
application is moved to another and later reappears the question arise:
"Is the problem fixed?" Often temporary disappearance of the problem
lull the staff into a vicious activity cycle and they start to transfer the
problem around from virtual server to virtual server instead of trying to
All-in-all the more a particular company relies on "in the cloud computing",
the more severe will be effect of the outages. And in comparison with
traditional local LAN-based "physical server" deployment there
are several sources of them:
- In the cloud provider outages: upgrades, equipment replacements, DNS blunders
(a very popular type of blunder ;-), blunders of personnel, problems connected
with the personnel incompetence, etc.
- Links from in the cloud provider to ISP
- Problems in ISP (again here there are issues of upgrades, blunders of personnel,
physical damages, DNS problems, etc)
- Problems in the link from ISP to the company
- Virtualization-related problems, if it is used by "in the cloud"
The first thing you notice during large outage of "in the cloud" service provider
is that customer service is overloaded and you need to wait a long time to get to
the human voice. There are usually just too many angry and frustrated customers
before you. Also bad is that the nature of the problem and the estimate
of the time needed to resolve is usually
are not communicated, keeping you in the dark. Moreover even after you get to
a support person the information you get will be sketchy. Here is one example:
I was working on a client webinar using WebEx Event Center. I tried to log
onto our site and got a cryptic message saying the site was unavailable. Whammo.
I got on the line to technical support and waited my turn in queue, along with
what must have been quite a few other panicked or angry customers. My support
person was surprisingly calm and good natured, given the call volume they must
have been processing. He confirmed that there were network problems on their
side and said that while he didn't know details of the problem, he was certain
it would be all right soon. I had a little time before our event, so I agreed
to try again later.
Sure enough, our site came up, but on a backup network. This wasn't completely
clean, as one of our scheduled future events had disappeared from our registration
page, meaning people couldn't sign up. But at least we could carry on with today's
show. Unfortunately, performance was quite a bit below normal standards, with
slides and annotations taking inconsistent and sometimes very long time lags
to appear on participants' computers.
After the event, strange behavior continued, with an inability to access
post-event reports through the WebEx administrator interface. I called technical
support again and got agreement that it certainly was strange behavior and we
should all hope it would correct itself once the system was back to normal again.
Whenever that might be.
Now, I'm not singling out WebEx for any particular acrimonious treatment
here. I happened to be using them when this problem occurred. Any provider can
have a similar problem. At least WebEx had a backup network plan in
place and we were technically able to carry on with our scheduled event. But
it's worth noting that there is a frustrating sense of powerlessness while a
problem like this is going on. You can't prod anybody for more details, because
you don't have access to the people trying to fix the problem as you might if
a similar situation occurred with your own business network. You can't get much
in the way of progress updates. And you can't put your own backup plan into
One interesting difference in "horror stories" between
loacl and "in the cloud" datacenter was aptly outlined in the following
Just after midnight on Jan. 22, 2006, Con Edison began telling the Internet
that it was Martha Stewart. That is, Con Edison erroneously began sending out
routing information to redirect Internet traffic intended for Martha Stewart
Living Omnimedia to its own servers.
The publishing company was a Con Edison customer. So were other businesses
and Internet providers whose routing information Con Edison hijacked at the
same time. The result was a mess that wasn't completely cleared up for 18 hours
— and some businesses were offline for most of that time.
But not Martha Stewart, whose CIO, Mike Plonski, wrote to me to clarify what
happened at his company.
Plonski's secret sauce? No big secret — just network monitoring and redundancy.
Plonski said: "While one of the Internet connections at our corporate offices
was impacted by the ConEd issue you describe, we, as a company, are smart enough
to have employed redundancy, both by location and carrier, for our network operations.
As a result, during this time frame, we simply flipped all of our Internet traffic
to run over our secondary line until ConEd resolved their issue."
OK, it was a little more complicated than that. Plonski said his staff spotted
the problem through routine network monitoring. There was clearly something
wrong with network traffic coming to the corporate office over the Con Edison
line. Thanks to the monitoring, the company knew about the problem about 30
minutes after it started.
Because of the type of outage, an IT staffer had to connect and manually
switch over to a redundant line. That took another hour.
Total time for the outage: about 90 minutes in the wee hours of a Sunday
morning. Total impact: minimal.
An outage? Yes. A knockout? No way. And handling the problem didn't require
rocket science — just monitoring, redundancy and sharp IT staff work.
Repeat after me: [in case of local datacenters "handling the
problem didn't require rocket science — just monitoring, redundancy and
sharp IT staff work."
While individual "in the cloud" service provider can do a decent job in providing
the required functionality, the problem arise when you need to use several such
providers and issues of interoperability arise.
The lack of interoperability between different SaaS applications
is one of the most well known and, at the same time, largest problems with SaaS.
In a way companies who are using several different providers spending way too much
money with the side effect of creating a problematic, cumbersome IT architecture
that lack flexibility and efficiency and as such is inferior to the integrated datacenter
architecture. The focus of vendors is on the
adaptation of the SaaS model to enterprise requirements (enterprise-level integration),
but there is a growing need for vendor-to-vendor integration. How and when those
needs will be addressed remains to be seen.
In a way SaaS application emphasize too much GUI
portion of functionality of application at the expense of the ability of smoothly
exchange data with other, often similar applications.
The emergence of a several classes of enterprise SaaS (for email, CRM, supply
chain management, benefits and other HR-related applications, etc ) creates problems of similar or identical
data existing in various formats in different providers and their synchronization
and timely updates. It providers does not share common "hardware cloud" we have
a huge problems as not only protocols of data exchange, but reliability and security
issues are pretty complex.
Also the existing interoperability can be broken anytime by software updates
by one of several for existing "in the cloud" providers.
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