Cloudy With a Chance of …

Posted by Pete Isaksson on Jan 13, 2014, 5:01:21 PM


… You were thinking meatballs, right?

If you weren’t thinking meatballs, it refers to a children’s tale about a fictional character, Flint Lockwood, who invents a machine that transforms water into food, called the "Flint Lockwood Diatonic Super Mutating Dynamic Food Replicator" - FLDSMDFR for short.   I first thought FLDSMDFR was an IBM system command but it’s actually an imaginary food cloud that rains flavorful things.  The FLDSMDFR eventually runs amok, as many well intentioned creations do, but we’re not going to address that here.

I recently read in Bloomberg Business Week that the cloud file storage firm Dropbox is looking to raise an additional $250 million at a valuation of around $8 billion.  This comes on top of the news that personal information storage provider Pinterest recently raised $225 million on its valuation of $3.8 billion, and a 23 year old kid unbelievably turned down $3 BILLION and then $ 4 BILLION for Snapchat.  These phenomenal valuations were all labelled as cloud providers and that set me to wondering what this cloud mania was all about.

My prior notions of the cloud, based on my relationship with software development, had nothing to do with storing personal data or sharing embarrassing photos.  I’m still asking myself how these cloud providers make any money giving away free storage.  I guess you could say my perspective on the subject was a bit, um, cloudy so I thought I’d investigate a little on just what and where the cloud is and who owns it?

After a bit of headshaking and some light discussion over a very small glass of wine or two, I was able to sort out that there are various answers.  I found that examining the various techno-clouds was indeed similar to looking at real clouds in the sky.  The different vapor formations and their various weather meanings are as different as the types of clouds permeating the private and business worlds.  Even Wikipedia, the greatest source of unverified information in the cloud, is full of confounding pieces of information regarding the cloud.  It seems there are nearly as many flavors as Baskin Robbins. Here’s a sample:

In my quest for cloud knowledge the term virtual kept popping up. Virtual is defined by Merriam-Webster as, “very close to being something without actually being it”. It occurred to me that I may be virtually sexy.

Based on the enormous variations described above, it appears that the providers of “real” cloud solutions are justified in their expectation that people will swallow nearly anything. Considering that most descriptions of the cloud make reference to virtual storage, there is an incredible amount of trust being placed in something very close to being something without actually being it.  To be fair, Webster also defines virtual as “existing or occurring on computers or on the Internet” but that description doesn’t fit this narrative as well.  I’m old school and although I do find the media sharing aspect of things like Instagram to be clever and even useful, I like the security of having boxes of old photographs in my closet and a copy of my will in a lockbox.  I guess I’m just entrenched in that old touchy feely kind of reality. Virtual storage makes me nervous when it comes to my private stuff.

I have been in the information technology business all my adult life and I just KNOW that digital data has to be physically recorded somewhere.   Is there some massive data warehouse hidden inside a mountain somewhere, or on a giant barge in the San Francisco Bay?  According to my observations, private individuals don’t generally concern themselves with where the cloud actually is.  I don’t fully understand why that’s not important to the general public but apparently neither is the subject of who owns or has access to the stuff once it is committed to the cloud.  It’s free storage and it’s all private and secure, trust me.   That Software License Agreement that you clicked Accept for lays it all out in simple terms, right?

For what it’s worth, we use Dropbox for sharing business content here at work, and it is fairly cheap and reasonably secure.  Of course for business use we subscribe to a premium version and it isn’t completely free.

There is a larger aspect to business in the cloud that transcends a glorified FTP server.  According to Forbes, “The Cloud is a distributed computing architecture, meaning running virtual machines over the internet… The Cloud can mean any software or service run outside the enterprise firewall…”

From a practical standpoint, the attraction of business applications in the cloud is to divest oneself of troublesome stuff like the cost and responsibilities of hardware management, data storage and backup, software management, network management and information security among other things. 

That troublesome stuff can be remediated to a large degree by moving to a cloud based business model. The cloud solution providers take on those responsibilities.  There is no free lunch and the contracts between consumers and providers are normally quite thorough and explicit in terms of functionality, reliability, privacy, ownership, and mysterious stuff like indemnification.  Business in the cloud is much more than information and image sharing. It encompasses the entire gamut of IT; software applications and updates, data storage and retrieval, information security, privacy and the regulations relating to it like HIPAA and Sarbanes-Oxley. The benefits of cloud based solutions are that consumers can dispense with the overhead and headaches of information technology’s core requirements; platform, development and support staff, and application compliance.  It is thought to be easier and sometimes cheaper than the old DIY approach to data processing.

cloud-images-looksoftware-blogThere are whole IT service industries built around the cloud approach to business; Software as a Service (SaaS), Platform as a Service (PaaS), Infrastructure as a Service (IaaS), Hardware as a Service (HaaS) and even EaaS – Everything as a Service.  It is not uncommon for Software as Service providers to collaborate with Platform, Hardware, or Infrastructure providers in delivering a packaged solution.  The answers to the questions of where the cloud is and who owns it can become a little convoluted, but in the business world, you can usually derive where the mountain hideaway or data barge is and gain some assurances and a comfort level that the entire solution is stable, reliable, and secure.  It may be virtual to the ultimate end user but it is very concrete to the CIO or CTO responsible for the business’s IT needs.

Cloud solutions often claim a reduction in business computing costs.  Depending on the situation, there is a lot of validity in that claim. A cloud-based business model shifts capital expenditures to operational expenditures.  This may reduce startup costs as infrastructure is typically provided by a third-party and does not need to be purchased up front. Total cost of ownership can be a crapshoot however.  For the consuming enterprise, capitalizing computing assets and depreciating those assets goes up in vapor in a cloud model.  Cloud based business applications are often priced on a utility basis. This could be by periodic subscription or a pay as you play model.   Costs and potential savings depend on the type of computing activities supported and the type of infrastructure available in-house or not.

The bottom line is that the cloud is not as vaporous as its moniker implies.

What is it? 

It may simply be a facility for storing and sharing information and media.  It may be as complex as an ERP or CRM system.  It could be construed as the Internet itself. In a nutshell, for me, it is any information and information management that is physically outside the enterprise or end user’s immediate sphere of responsibility.

Where is it? 

It may be in a data center somewhere or it may be spread across the planet in networked servers. Where it isn’t is an easier question to answer.  For me, the cloud is simply a convenient term for “somewhere other than in my own back yard”.

Who owns it? 

We all own it from a content standpoint.  Without the willingness to put our information and business processes into the information mainstream via cloud providers, there would be no cloud.  From a physical standpoint, the owners are the businesses, investors, and entrepreneurs who offer cloud based storage, sharing and any business processes.  They also own the responsibilities of hardware management, data storage and backup, software management, network management and information security among other things. 

As mentioned above, there is a huge amount of trust and dependence wrapped up in the cloud. Whether or not the cloud is volatile, and whether that trust and dependence are at risk remain to be seen. Barring a worldwide calamity, the cloud seems to be quite stable from a technology standpoint. However, the NSA and groups like Anonymous, Wiki-Leaks, or another Edward Snowden certainly bring the issues of privacy and security into question.   Just saying…

One thing for sure is that the cloud is a very lucrative concept.  The FLDSMDFR cloud transformed water into food.  Judging from the valuations of Dropbox, Pinterest, Snapchat, and others, clouds can also transform information management into money – lots of money.

With that in mind, cloudy with a chance of profits seems to be the right forecast.

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Pete Isaksson

Blog Author
Pete Isaksson  -  A.K.A: Dr. Strangetech
Business Development Manager, looksoftware

Topics: Mobile, cloud