Cloudability serves up a dashboard that quickly and clearly identifies where organizations are spending money and in doing so they aim to save businesses money as they identify expenditure that is no longer justified – those orphan apps that keep ticking over on someone’s credit card every month.

Cloudability is very new – they launched only a matter of a few weeks ago – and at this stage they’re unsure about where they will take their product, be it enterprise or SMB. They’ve identified a couple of opportunities;

• Giving enterprise CFOs visibility over organizational spend and hence the ability to gain oversight as to business unit expenditure on cloud solutions
• An SMB play that monetizes via highly targeted offers (“given you industry type and use pattern, this other cloud service would save you x dollars per month”)

As I said, I was really impressed with what Cloudability is doing – they absolutely answer a pain point for cloud users. I do think they need to think long and hard about the direction they go in – I don’t really buy the enterprise play, I see them ending up butting heads with some pretty comprehensive spend management solutions from the likes of SAP and Oracle to make that viable. Secondly the logistics around integrating with all the services an enterprise might need and creating controls over all the different expenditure paths would be problematic. Part of my concerns around the enterprise play, beyond the fact that Cloudability competes with some solutions form some very big names in the industry, is he fact that Cloudability doesn’t close the loop on monitoring – I’ve reviewed a bunch of cloud monitoring products and have often commented that without the management part of the piece, it is less of a product than a feature. I put this to JR Storment from Cloudability – his answer was that by covering the entire SaaS world and offering insights into monetization across all cloud services, they offer a breadth that is valuable for customers and that deepening the offering would impact upon this ability. He also mentioned that Cloudability’s strategy focuses more on managing the messaging and notifications from discrete cloud services – all billing messages will be delivered up through the Cloudability – providing a one-stop discovery offering.

Where I totally see the potential for Cloudability however is as an SMB play. Mint.com has proven the value of a solution that delivers real value at zero cost to end users – by giving users highly contextual offers, they’ve managed to monetize their service, while providing a solution at no cost to SMBs, a sector that is loathe to actually spend money on this sort of solution. Storment identified this as a real possible area of development for Cloudability – he gave the example of offering customer who use (for example) Amazon servers the ability to tie in  monitoring service like NewRelic or Pingdom to assess the availability of those services.

Storment reports that he’s had some great feedback from enterprise CFOs who like he fact that Cloudability can give them the ability to gain visibility over “rogue IT” spending. While this may indeed be an attractive proposition for enterprise financial types – I struggle to see how they an avoid just having business units acquire cloud services outside of the Cloudability dashboard – thus rendering this opportunity somewhat moot.

Below is the video in full – excuse the poor sound quality – it was a noisy day at the Structure conference!

The service currently supports PHP, Java, Ruby on Rails, and Python, along with well known applications such as WordPress, SugarCRM and Magento. In terms of what Standing Cloud offers users, the list is extensive;

• Applications such as WordPress, Drupal and SugarCRM
• Quick deployments. Our installs are configured for quick and painless, best-practice deployment
• Portability
• Server resizing
• Backups and redundancy
• Automatic restore
• Preview and test upgrades

Standing Cloud is another play that adds an abstraction layer on top of IaaS to cater for what Dave Jilk from Standing Clouds calls “informal buyers”, those who don’t have access to systems administrator resource, but who need to stand up application on the public cloud. It’s what I would term a necessary evil – at the moment with IaaS being quite immature in terms of the amount of heavy lifting it does for it’s users, a third party that offers a managed platform is an attractive proposition.

I do feel however that as IaaS becomes ever-more commoditized, IaaS vendors will start to move further up the stack and offer more management tools and “platform-like” offerings. Recent developments by both VMware and Amazon have shown this to be the case. I put this to Jilk and suggested this was a risk to the viability of what Standing Cloud are doing – as would be expected, he disagreed saying that while there is a desire from Cloud providers to move up the stack ;

Their ability to develop that layer is not strong, they’re infrastructure people… we work at the layer above that

That kind of talk makes me nervous – it would be a brave man to suggest that organizations such as Amazon, VMware, Rackspace or Microsoft lack the ability to offer a Cloud application layer on top of their infrastructure. Recent developments such as Amazon’s Beanstalk, VMware’s CloudFoundry and other offerings have shown that they have the ability and prescience to move themselves in to the higher value layers of the stack.

That’s not to say that Stranding Cloud is a hopeless case, there’s still a need for a vendor-agnostic application layer and there are still some infrastructure providers that might see Standing Cloud as a potential partner (or acquisition target) to provide their own value-added offering. Anyway, time will tell, for know you can see my interview with Dave Jilk from Standing Cloud below;

So how to solve this conundrum? With a spot market that works as a clearing house for all that unused computing resource. This is where SpotCloud comes in – SpotCloud was set up as a clearing house to simplify the transaction between multiple parties in order to clear excess computing – their proposition offers benefits to both parties;

Consumers are able to find resource from multiple providers, select the type and price that suites their needs all from one place. They can also acquire resource from multiple parties via one billing arrangement

Utilities are able to quit excess resource without having to worry about marketing or selling. Utilities can use SpotCloud’s own packaging tools to list their service.

Bear in mind this is a low cost marketplace – as such it’s not for consumers wishing to define the service they receive to the nth degree – there are no SLAs, no support and no guarantees and buyers must have a credit balance in order to consume (much like a prepaid mobile phone).

The great thing about this initiative is that anyone with a spare 500GB of storage, 20 cores, decent connectivity and the ability to spin up Linux and Windows based VMs can play here – and this includes private data centers with excess capacity. Sellers also remain opaque – ie consumers on the platform have no knowledge of which individual provider they’re consuming from – this ensures that utilities don’t cannibalize their own existing sales. SpotCloud supports both the Enomaly (the parent company behind SpotCloud) ECP IaaS and VMware. The bonus by using ECP is that Enomaly offers this for free – so for situations where a traditional data center has excess capacity, they can simply bolt on Enomaly and start selling to the spot market – with no setup cost.

Interestingly SpotCloud can also be used as a platform for the private interchange of capacity between multiple infrastructure providers – I’d envisage  situation where large corporates set up their own exchanges to quit (and acquire) excess capacity.

SpotCloud has a variable commission model, however they guarantee that sellers will receive at least 70% of each transaction through the platform.

A cloud clearing house has been tried before, notably by Zimory. However the marketplace is much more mature now and with virtualization being far more common than even a few years ago, SpotCloud has a better chancing of gaining traction. SpotCloud is claiming that it has 10,000 physical servers on the platform – from providers across the globe.

But more than that it’s an indication of something I’ve been noticing at the lower end of the Cloud Computing stack. Notwithstanding the outlier acquisitions which are examples of large, traditional vendors trying to jump on the Cloud bandwagon, it seems to me that we are seeing an acceleration in mergers between infrasturcture offerings that provide merely a point solution. I see this as part of a wider trend which is the reducing value of core technologies as everything low in the stack becomes commoditized. Looking forwards it is worth thinking what this means for other companies at a similar level in the ecosystem.

I’ve long proclaimed the huge number of companies doing private/hybrid cloud automation services - enStratus, Netuitive, enomaly, AdaptiveComputing – how much opportunity is there really for all these individual players at what is (as I keep repeating) a highly commoditized level in the stack.

It’s important to stand back and think about what this means for the broader industry, over the next few years there is going to be a significant acceleration in two different things;

• Acquisitions by large players of these sorts of technologies (CastIron with IBM, Heroku with Salesforce, Boomi with Dell)
• More mergers by smaller players wanting to attain some level of scale and realizing they can’t do it alone

Of course all of this is fuelled by voracious VCs and angels who, realizing the opportunity is now, want to make a quick return while they still can. To do so they need to look at building scale and, more importantly, maintaining relevance. Mergers are a good way to do that. We reflected on this during a focus.com roundtable I moderated last week (see below or if the embed doesn’t work click here). During the roundtable, John Taschek from salesforce.com particularly called out this aspect when he talked about a marketplace full of;

products that are little more than features

Which is interesting since his own company, salesforce, has been snapping up many of those feature/products. So I’m seeing this trend accelerating going forwards, because of this it’s even more important that startups think seriously if they’re really creating a product or merely a feature – especially so if they play at the infrastructure end of the stack.

Focus.com Roundtable

provides an integrated portfolio of applications for cloud computing. Our products can be deployed on premises for maximum security and control, or on public clouds such as AWS. Applications developed with Intalio|Cloud are elastic and multi-tenant, automatically.

I’d not heard from Ghalimi for a couple of years, since the 2008 Office 2.0 conference (an event which is, sadly, no longer). He’s always had a very holistic vision for office 2.0 and was excited to say that the latest offering from Intalio realizes that vision. So what does this actually mean in terms of a product lineup? Ghalimi referred me to the diagram below. Now this diagram looks very much like a million other diagrams out there that explain what Cloud Computing is – separating the different levels of the stack into IaaS, PaaS and SaaS. Nothing revolutionary in that you say? That is until you realize that this isn’t an ecosystem diagram, rather this is a diagram of the breadth of offering available from Intalio themselves.

Now this would be an impressive lineup from a Microsoft, an IBM or an Amazon, but this comes from a privately held company with only 100 employees. I talked to Ghalimi about the massive challenges he’s facing when explaining his offering – sometimes breadth is a much more difficult thing to articulate than a point solution. It’s obvious from his reply that Ghalimi is nothing if not confident. In a response reminiscent of Marc Benioff, Ghalimi instructed me to:

Think of our offering as an operating system for the cloud. Much like Windows, it needs to provide some core services (compute, storage, database) and development tools. And without a killer application (Office for Windows, CRM for us), it would be kinda useless, or at the very least much harder to use.

In another stroke of confidence (confidence given the comparative size between a public cloud behemoth like Amazon and Intalio itself), Ghalimi said that:

[Intalio gives the] benefits of the cloud without the limitations of the public cloud

On the PaaS level, Intalio has been built using the same structure as Salesforce’s AppExchange. Becuase of this, AppExchange applications can be run on Intalio using whatever delivery method the customer likes – private, public or virtual cloud and single or multi tenant.

Anyway – looking more generally, Intalio’s play reminded me somewhat of what Zoho is doing. They too have a very broad product offering – covering all of the SaaS applications with a fair dose of PaaS to go with that. So how does Intalio contrast themselves with Zoho. Ghalimi articulated the difference quite simply, saying:

they focus on Public Cloud delivery. We offer Public and Private, as well as support for Hybrid Clouds:

With a caveat that, in his understanding, Zoho is available for private cloud “if the organization is big enough”. Intalio is entirely agnostic in terms of delivery method – it can be run on public, private or hybrid clouds and has the ability to be either single or multi-tenanted to meet the demands of all use cases.

It’s an interesting play and mirrors (at least to a certain extent) the direction taken by salesforce.com who started off firmly at the SaaS level (with the salesforce app) moved down to PaaS (force.com) and has recently moved further down the stack into IaaS (VMForce). The vast difference between salesforce and Intalio is that the former is a billion dollar business with thousands of employees and significant traction in the enterprise. They can leverage this traction to gain business at other levels in the stack. Intalio, by contrast, despite having been around for years is very much still in startup mode and, despite some impressive customer names on the front page of their site (Zimbra, Finnair and Facebook among others) are something of an unknown.

It’s an eminently logical approach – tie all levels of the stack into one offering and give customers the options in terms of delivery. It is however hard to see how a small player like Intalio can pull it off, and it’s unlikely that Intalio would be much of an acquisition target, there’s very few vendors out there who don’t have a serious product overlap with Intalio.

To this end we’ve been thinking about developing the CanterburyCloud. So what’s the CanterburyCloud? – well it’s a lot of things. In part it’s a network where start-ups can leverage the communal wisdom of their peers. It’s potentially a co-working space where companies can work and bounce ideas off like-businesses. It’s potentially a marketing platform – a network of businesses that can, to an extent, share marketing budgets and evangelise each other’s products. I guess at the end of the day it’s about creating a Cloud Centre of Excellence in Canterbury – taking the legacy of companies such as Tait Electronics and Jade, and mixing it with a healthy dose of agility and web savvy.

We’re keen to hold an unconference to explore this opportunity – it’s not going to be a tech event, rather it’s going to look at business models, strengths and weaknesses and the general appetite for working together. We’re going to hold the event on Friday 30 October at the Canterbury Development Corporation Training Room 1, Level Two, 193 Cashel Street Christchurch. We’ll be kicking off at 1pm. As is de rigeur for a tech event, there will be pizza and drinks afterwards and (hopefully) a general vibe of positivity and can-do throughout. Telecom New Zealand has generously come to the party and is sponsoring the event – so a big thanks to them for that. Thanks also to CDC for providing the venue.

For those of you who aren’t accustomed to the unconference format, here’s a nice definition courtesy of Wikipedia;

An unconference is a facilitated, participant-driven conference centered around a theme or purpose. The procedural framework consists of sessions proposed and scheduled each day by attendees, mostly on-site, typically using white boards or paper taped to the wall. While loosely structured, there are rules at BarCamp. All attendees are encouraged to present or facilitate a session.

The plan is to have six – eight sessions of around 20 minutes each. As is the norm for this type of event, session planning will happen on the day – come along pre-armed with ideas for topics!

So… who’s keen to come along and explore life on the edge? Feel free to register here, or email smina@memia.com your intention to attend. See you all there.