The real economic value of Cloud Computing is in its delivery model; the ability for companies to consume the resources they need while leveraging the assets of another. Assets are evil. Assets cost capital, a rare resource in companies which they protect and work to minimize the distribution of each year. Assets also require maintenance, good old tender love and care. CIO's today complain about the large percentage of their budget that just goes to the care and feeding of their IT systems. Just like a pet, a server also requires its equivalents of food, air, a litter box, and play time.
Pretending these two issues didn't exist there is a darker, more hideous side to assets; one that makes them orders of magnitude more evil than we mortals truly understood years ago. Assets create gravity. First once there is an asset it tends to attract other assets like the formation of a planet. Although the weakest force, gravity works over the longest distance pulling together other assets until soon something near the size of a real planet begins to emerge in a data center. It becomes impossible to separate the assets and the collection of assets takes on a life of its own. Soon companies are paying the legacy tax, often upwards of $1MM, just to make even the smallest change because layers and layers and layers of assets have to be fumbled through and moved out of the way over the course of any implementation.
And of course with gravity comes friction, that negative force which slows momentum eventually bringing everything to a stop. Why have companies become so bad at innovation over the past 25yrs? I argue because the weight of the things they own and thus are compelled to take advantage of keep them from doing what they should, most often leveraging things they don't own. Remember that one of the key financial indicators for a company is Return on Assets, but only if you own assets.
Public cloud, even private cloud when done right in an off-premise model, is asset free. However internal private clouds, where the Fortune 500 is clearly focused, are asset intensive. Organizations see the assets as free because the initial set are already on the books. CIO's are often blinded to the eventual reality of the albatross after a generation or two of changing out hardware. Of equal concern is the cost. Software vendors are known collectively for one thing: getting their money. The greatest concern I have for private clouds is the cost basis on which they are being built. First any proprietary elements one should assume will increase in cost as they increase in value to the company. The larger the implementation, the greater the bill. This is in contrast to existing models however once a company builds their own private cloud they will be extremely reluctant to make any changes to the core and the vendors know this well. Second the cost basis often consumes the benefits of scale making costs scale linearly when they should in fact drop as more nodes are moved into production. And third since there are no real cloud solutions in the market, the best being nothing more than hyped virtualization, what cost elements are not represented but will be required to execute native cloud applications?
There is no better application of open source than in cloud computing in all of its forms. Open Source solutions deliver:
- code level scrutiny required to meet stringent security requirements
- a common base from which everyone benefits
- innovation by encouraging contributions and participation
- customization as required by a company
- the ability to remand issues rather than waiting for a vendor
Add to the above the low/no cost and the availability of support for all the most popular tools today and the value proposition is compelling. In addition the vast majority of innovations in technology over the past decade have been created in or been ported to open source.
Although futures tend to be uncertain there is one prediction that appears sound. Assets will continue to be evil, on-premise private clouds today misrepresent their true costs looking for one of those suckers born every minute, and the lowest risk, lowest cost route to success is paved by Open Source technologies. CIO's need solutions enabling them to leverage the assets of others while maintaining all the control they need.