Cloud 2014: Top 10 Trends to Watch in The Year Ahead

Two Models of Brokerages, One Winner: Cloud Federation

Last year, one of the predictions was that cloud brokerages would appear. While that began to happen, there’s two vastly different models emerging. The first is a traditional brokerage, with very little difference compared to a stock brokerage, for example. The second is Cloud Federation, where clouds are still aggregated, however the aggregator provides value. Dell’s recent cloud ecosystem is one example, as well as what OnApp has done well with CDN, with success in compute likely to follow.

“There’s two different types of models, one with very little chance,” said Miggins. “There are those that are strictly brokers. I don’t believe that that’s going to happen. None of them know how to create demand. They can get every cloud provider in the world to plug in APIs but they can’t generate demand. OnApp has IP; they actually create value. The company is trying to have a common orchestration platform and helping you manage your infrastructure. If they can help facilitate worldwide, federation will take off.”

I’m Not Getting “Nirvanixed”

Nirvanix, an oft touted public cloud provider, made its exit in 2013. Shutting its doors had several implications.

“Following the initial enthusiasm surrounding public cloud’s potential, it was perhaps inevitable that issues such as security and availability would attract more scrutiny, and the collapse of Nirvanix is giving some of those issues greater urgency,” said Lee of Quantum.  “Companies will be more careful about weighing the cost savings benefits of public cloud backup against the slower recovery speeds, as well as concerns for their data’s security in multi-tenant clouds. Hybrid approaches that offer the best aspects of public and private clouds will have increasing appeal – particularly the benefits inherent in keeping a local copy on premise for quick recovery and assured availability.”

Cloud and “The Internet of Things”

“The Internet of Things” was perhaps 2013’s most overused buzz-term. Behind the term, there is an actual phenomenon occurring where everything is becoming connected, and the cloud is the technology behind this movement.  Robert Scoble calls it “the age of context”

“TheInternet Of Things: a happy little buzz phrase,” said Basho’s Hannan. “It’s about connected devices driving growth of data. A good example is the wireless water meter company for Ireland. They collect data and stream into Riak to generate bills. To be able to have a solution as connected devices and end points scale. It will drive a new explosion in stored, monitored, processed, and analyzed data. Commodity storage and scale software technologies means companies will change their approach to data retention and create new data rather than updating or deleting historical information.”

The Specialized Cloud

This prediction is in line with last year’s “Community Cloud” prediction. While the giants like Amazon Web Services (AWS) will focus on providing commodity cloud, others getting into cloud will target specific verticals or needs in order to differentiate. We saw some examples of this in 2013, with companies like Veevo who target healthcare. This sort of specialization will continue en masse in 2014.

“Up until recently, most of the cloud technology out there has been general-purpose platforms,” said Engates, the Rackspace CTO. “The question is how do we make the cloud better for certain types of activities? Databases? Low latency for gaming or financial services? A highly secure cloud Rackspace took a stab with the high performance servers, high bandwidth and high IOPS. This is going to be similar to the way that car companies tailor their offerings. It can’t go on forever that everyone builds general-purpose cloud. Another idea that comes to mind is higher processing capabilities, really thinking about the user and the use case.”

Amazon Web Services is fantastic for certain things. It’s why they’re the clear front-runner in the cloud space; they have that “general” appeal. However, some companies continue to “graduate” from Amazon Web Services, perhaps because of their need for more specialized services.

“We’re very enthusiastic about customers who outgrow AWS,” said Miggins of Peer 1. “We found that they’re overpaying, and getting very little tech support or service. When we come across somebody spending 10k or more, we can have a very interesting conversation.”

IT no Longer a Department, but a Business Driver

“Information Transformation,” said Engates. “People are going to have to transform the way their IT is structured, even what IT even means. IT used to be where all the computers sat, all the technology. Now the business is leading with the technology – just like the wearable technology. Some examples are GE, with engines dumping massive amounts of data into the cloud. Cotton is harvested by tractors that drive themselves that use GPS in the cloud. It’s no longer the case that you can look at the IT department.”

“IT needs to become enabler rather than slowing things down,” continues Engates. “The companies that we’ve seen leading the way, using a private cloud, they’re usually doing a pilot within the organization where none of the rules applied. It’s a bubble, sponsored by the CIO and CTO and people have a license to try something new. Be like a startup, or an innovation team. It’s a great experiment that every IT shop should be running. Like Facebook says, you need to be able to iterate very quickly. OpenStack has been a big to us for customers who want to set up an innovation lab. Every company needs to start thinking this way very soon.”

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About the Author

Jason Verge is an Editor/Industry Analyst on the Data Center Knowledge team with a strong background in the data center and Web hosting industries. In the past he’s covered all things Internet Infrastructure, including cloud (IaaS, PaaS and SaaS), mass market hosting, managed hosting, enterprise IT spending trends and M&A. He writes about a range of topics at DCK, with an emphasis on cloud hosting.

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