Every cloud application has a silver lining

Every cloud application has a silver lining

Scottish businesses need to grab the opportunities posed by the next stage of the digital revolution – or they will simply be left behind. BQ Editor Kenny Kemp talks to Martin Brown and Phil Smith about the shape of things to come.

There is heated debate over the origins of the term ‘cloud computing’. Some say it was a marketing exec at Compaq in the mid-1990s. But I first heard the term in the preposterously massive Orange County Conference Centre in Orlando in July 2001 at a major shindig for 20,000 staff, customers and media organised by Computer Associates, then run by Sanjay Kumar, who subsequently went to jail.

It was a heady time with numerous guest speakers: Mike Lazaridis, the founder of the BlackBerry, showing off his first handheld computer which he said would ‘become a management tool to check out stock and inventories while you are on the move.’ And then Joe Tucci, then the chief executive of EMC Corporation, the world’s leading firm in the sphere of digital data storage, announced a deal with Computer Associates with its back-up and data retrieval system called Brightstor.

I can’t recall if Joe actually used the term ‘cloud computing’, but what the application did was allow high volumes of mission-critical data to be continuously and reliably stored outside of a business’s in-house mainframes systems. It might not have been the cloud, more like Glencoe mist. Fast forward 13 years, and EMC’s points man in Scotland, Martin Brown, is able to take Joe Tucci’s story of the cloud into the business troposphere.

“The opportunities are endless: there is going to be so much more data that can be measured and analysed and useful to business. But it is up to organisations to understand that this is the case – and to embrace the opportunities,” he says as we meet in Edinburgh’s Huxley Hotel.

Software applications will become the defining aspect of almost every business. That will be the DNA of every kind of company, no matter what sector. So big organisations, like EMC, using their platform as a service, will allow companies to piggyback on its digital infrastructure when developing their unique business applications, and then provide the analytics to scrutinise and assess this monster volume of teratoid data.

“We did a survey and we found that chief executive officers said it was difficult to continually innovate. But there were stark examples of what would happen if they didn’t innovative. The quicker you can get your head around these applications and innovate, the more likely your business will stay ahead of the curve,” he says.

That’s a pretty blunt warning to Scottish businesses of all shapes and sizes. Yet the magnitude of all this data is too terrifying for many businesses to properly contemplate. And the big computer giants can smell the opportunity. After a period of consolidation and belt-tightening, many of the global computer players, such as Cisco, IBM and Microsoft, are again marketing their wares – and they have compelling reasons to do so.

Recently Phil Smith, chief executive of Cisco UK, is one who has been future gazing. Speaking to BQ in London, the Glasgow University graduate said: “We stand at the cusp of an era in which everything from cars, trees, street-lights and even cows can be given an internet address and connected to an ever-expanding network. With personal, ever-changing, mobile and wearable technology, this really is a hyper-connected world.”

A report entitled The Internet of Everything: Bringing the Future to Life, has examined
the situation in the UK today and how it will fuel the British economy for years to come.

While sensors have been in use for decades, now they can be harnessed in massive numbers to check and regulate every kind of activity, and this Himalayan mountain of information can be viewed on a dashboard set up on a standard lap-top. Phil, one the most influential people in UK IT, is the chairman of the UK Technology Strategy Board and Chair of e-Skills UK. He is also the co-chair of the Future Technologies and Infrastructure Working Group for the Information Economy Council, so he knows what we should expect.

“The Internet of Everything provides the platform from which an ever-increasing number of connections will ‘wake-up’ the world around us,” he says.

With just 1% of the physical world connected, he says this is just the beginning of an amazing future. As connections become smarter, faster and more insightful, we will only see more imaginative and ambitious applications of the IoE which will change the world. In this era when it is possible for everything to be connected to the network, it is estimated 50 billion ‘things’ will be connected globally by 2020, creating £11.5 trillion worth of value.

Cisco has a new range of unified next generation servers to create data centres on a single platform. Its CRS-X is the epicentre of the internet with speeds of 400gigabits per second, double the present capacity. A single CRS-X rack is able to stream high-definition video to every home in Scotland simultaneously. A rack slaved together like a rock band’s amplifiers can download the whole British Library printed collection in a split second. EMC, who employ 60 in Livingston and 3,000 in manufacturing in Cork, are doing their own promotional work.

In July EMC will be unveiling their latest mega applications at the Old Billingsgate Market in London. David Goulden, the chief executive of EMC Information Infrastructure, who took over from Joe Tucci earlier this year, is pitching to a listening audience. It will be worth hearing what Goulden, a EMC veteran who was chief financial officer for seven years, has to say too. After all, it is finance directors, rather than the IT boffins, who need to hear how harnessing big data and using the cloud will make money for investors and shareholders.

Goulden has also been instrumental in making mergers and acquisitions a core competency for EMC by playing a leading role in more than 70 acquisitions since 2003. One of the EMC companies is Vmware with its product vCloud Hybrid Service (vCHS).

Back in Edinburgh, Martin Brown talks about what the cloud and vCHS can do, helping businesses become more efficient and agile enough to change. He talks about Blockbuster, the retail video and DVD chain unable to repulse the arrival of digital downloading of film and fell victim to the success of Lovefilm, Redbox and then NetFlix. That’s a warning. He cites Airbnb, set up by Nathan Blecharczyk, Brian Chesky and Joe Gebbia, where people can rent their spare rooms or houses for people to come on holiday in over 30,000 cities. That’s the future.

“I like the idea of Airbnb. It’s an application and a technology that has allowed people
to get access to rooms and it is changing the game.”

One of the early successes for Big Data was the Tesco Clubcard which provided the supermarket giant with masses of customer information.

“They were able to use the data on the customer to differentiate the service. It is about understanding your consumer better by analysing the data, whatever that data is. That is the opportunity. The technology allows you to do that today. The insights you now get allow you to change products,” he says.

Yet the recent poor showing of Tesco shows that the innovation of Clubcard, which made the name for ex chief executive Terry Leahy, has not been keeping pace. Clubcard is now having to find fresh ways to excite Tesco customers. Martin Brown says that everywhere you look there are defining changes to each industry sector.

“In huge industries, such as aviation, a small percentage reduction in operations can make a big difference. Globally, airlines spend $200bn a year on aviation fuel, so a 2% saving in fuel is $4bn. GE is spending $1.5bn to develop new services and sensor technology.”

The 20 sensors in an Airbus A380 gas turbine engine generate a massive amount of data. Each blade generates 520GB per day. The detection of a fracture or a change in temperature can allow earlier replacement or prevent malfunction. The savings are vast and why Rolls-Royce make more money on servicing the on-going assets, rather than
on the outright sale. It is the same on oil and gas platforms where low-cost sensors embedded in sub-sea systems in gas, oil pipelines and umbilicals can prevent danger to valves once too difficult to reach. In Big Pharma, drug testing time is now being dramatically cut back, which means new products will come to market more quickly.

Previously, companies had to scale up to meet their testing milestones. Now new cloud-based applications can crunch data in days rather than months.

Brown Extra

“For EMC’s point of view, it’s the pivotal part of helping companies develop these applications much more quickly. We’ve also got the people to help develop this.”

Brown says companies are ‘virtualising’ their IT infrastructure which is now being placed on the cloud, making it easier to manage, then it is ‘standardising’ by using more automation, which allows companies to manage more with fewer resources. This is the golden goose. Studies show that 73% of IT budgets are spent on keeping the lights on in a business. “That’s not where companies want to be spending their money. If start-ups with no legacy systems are innovating then the established businesses needs to take this on too.

As much as possible need to be spent on innovation, which allows you to get new products to market sooner.”

The beauty is firms don’t need to invest massively in new racks of technology. This is a made-to-measure solution for off-the-shelf pricing. The buzz word here is resilience.
“We have our own cloud, Vmware’s vCHS which has a big part of this market. We’ve got a public cloud offering alongside something similar to what you can get from Amazon or Google. It is easy for them to integrate back and forward. For example, a finance team in a bank might require more computing power at the end of a quarter when they are doing their results. You simply burst out and use what you need on the cloud.”

Martin admits this comes with security and regulatory issues, so the ‘plumbing’ technology is more robust and hyper encrypted. In Scotland, Registers of Scotland have been digitising all the land registry information about the nation, and they have used EMC technology to sit behind this, archiving and retrieving information when necessary.

The data is replicated in real-time, so that it should never get lost. Companies, such as Glasgow-based Iomart, who are delivering great financial results as a ’cloud computing company’, uses EMC kit in its data centres.

“We have been speaking to many finance directors and managing directors who are asking us: ‘Where is this all going?’. I see our job as trying to help them understand what is going on and the opportunities.” In Scotland, companies, whether they like it or not, will become data-intensive. What is clear is that there are now opportunities and it would be a dereliction of duties if businesses did not explore how to use the cloud more effectively.

A BQ technology primer

App or application: An application is a computer programme designed to help people perform a task beyond the running of the computer itself. A specific instance of such software is called a software application, application programme, application or app. The term app is generally used for applications that are used on a smartphone or tablet.
Big Data: A term used to describe a massive volume of both structured and unstructured data that is so large that it’s difficult to process using traditional database and software techniques. The challenges include capture, storage, search, sharing, transfer, analysis and visualisation.

Cloud: This includes public, private and hybrid cloud. Cloud computing is a general term for anything that involves delivering hosted services over the Internet. A cloud service has three distinct characteristics that differentiate it from traditional hosting: it is sold on demand, typically by the minute or the hour; it is elastic – a user can have as much or as little of a service as they want at any given time; and the service is fully managed by the provider (the consumer needs nothing but a personal computer and Internet access).
A cloud can be private, public or hybrid. A public cloud sells services to anyone on the Internet.

A private cloud is a proprietary network or a data centre that supplies hosted services to a
limited number of people. Hybrid is a mixture of public and private cloud in which an
organisation provides and manages some resources in-house (private) and has others provided externally (public).

IT-as-a-Service (ITaaS): This is a service where a customer purchases computing power and IT resources in a similar manner to a utility and instead of buying or leasing products and services to then address their IT needs, it is purchased as a service. As a result a customer is able to only pay for what they need and during peak times have scope to secure additional resources.

Software defined: An emerging approach to using significant IT resources. Through this approach changes in IT resource such as storage capacity can be specified through using software and at no time is there a need to make any physical adjustments to the hardware being used.

Analytics: The discovery and communication of meaningful patterns in data. Organisations may commonly apply analytics to business data, to describe, predict, and improve business performance.

Open source technology: A program where intellectual property is released to the public by the ‘inventor’ and as a result the technology can be used for no charge. Open source code is typically created as a collaborative effort in which programmers improve upon the code and share the changes within the community.

Business continuity: The processes and procedures an organisation puts in place to ensure that essential functions can continue during and after a disaster. Business continuity planning seeks to prevent interruption of mission-critical services, and to re-establish full functioning as swiftly and smoothly as possible.

Shadow IT:  This describes IT systems and IT solutions built and used inside organisations without an explicit approval. Shadow IT solutions are not often in line with the organisation’s requirements for control, documentation, security and reliability.