On Setting Standards for Cloud Computing

Includes: AMZN, CRM, GOOG, IBM
by: Jeffrey M. Kaplan

IBM’s attempt to initiate a set of standards for the burgeoning cloud computing services movement has been met with a mixed response that reflects the varying perspectives and suspicions which have historically plagued the IT industry.

IBM’s Open Cloud maneuver deserves some praise because it puts the resources of many of the IT industry’s top players behind an effort to bring order to the chaotic world of cloud computing.

But, IBM’s (NYSE:IBM) initiative is also an easy target for cynics who can question the motives of these vendors who appear to be just as interested in ‘co-opting’ the cloud movement to suit their proprietary purposes as seeking to establish useful rules-for-engagement that can truly safeguard users of cloud computing services.

The fact is that it is in the best long-term interests of cloud computing vendors and users alike to put standards in place which govern the fundamental architecture of these web-based services so that they can assure basic reliability, accessibility and security (RAS). The primary objectives should also include mechanisms which ease the path to portability of data from one cloud to another and interoperability between cloud-built applications.

But, there are two important caveats which vendors and users alike should know before they get too excited about IBM’s Open Cloud ideas.

First, today’s cloud computing innovators are already a step ahead of the legacy vendors who have rallied behind IBM’s Open Cloud proposal. They come from a new generation of web companies who recognized a long time ago that success on the Internet won’t come from the proprietary principles of the past, but by being as open as possible to encourage as many vendors and users to take advantage of their web-based resources. As a result, many of the Open Cloud ideas being promoted by IBM already exist via open APIs, web services and other web industry best practices which have made cloud computing attractive to many users in the first place.

Second, IT industry standard-setting initiatives historically have generally fallen short of their ideals. I first became aware of the fundamental weakness of industry standards when I was an industry analyst in the 1980s focused on the telecom market and learned that every PBX vendor had succeeded in implementing proprietary interpretations of the RS-232 interconnection standard which prevented their PBX systems from interoperating with one another.

Today’s cloud computing world—ironically using a term originated from the networking and communications industry—runs the same risk of having a group of cloud vendors producing a set of industry ‘standards’ which leave too much room for individual interpretation and fail to achieve their original objectives.

So, why are IBM and its initial set of supporters advocating this type of standard-setting exercise if it is likely to produce the same outcome?

Because they are playing catch-up in the cloud computing market, and are threatened by the ‘game-changing’ nature of this new approach to IT.

Today’s cloud computing leaders—Amazon (NASDAQ:AMZN), Google (NASDAQ:GOOG), Salesforce.com (NYSE:CRM), etc.—are winning business because they’ve given users a more flexible and cost-effective alternative to traditional computing that is satisfying customers’ rapidly changing corporate requirements.

The cloud computing leaders are concerned that IBM’s proposed standard-setting effort could slow the hyper-speed evolution of this market and give the established players time to figure out how to reconfigure their technologies and business models to respond to the cloud computing threat. It could also slowdown the market leaders and innovators with a set of duplicative and/or hollow rules that complicate cloud services rather than streamlining the interoperability of the various offerings and deployments.

In all these ways, the Open Cloud effort is a classic Machiavellian maneuver by a threatened set of industry titans watching their fiefdoms fall under attack by a new coalition of revolutionary forces.

Nonetheless, I think industry efforts to put practical standards in place should continue to be pursued. However, these should be driven by users of cloud computing services, not vendors.

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