The Cloud: Massively Scaled SaaS and PC App Migration
There’s a certain amount of Google envy in a number of cloud conversations I’ve had. CIOs and aspiring CIOs would just love to be able to run highly efficient dynamic data centers with small numbers of support staff, wall-to-wall commodity server blades all neatly arranged in server cabinets and cooled incredibly efficiently, the data center located right next a power station that is almost giving its electricity away and so on. If you’re going to dream, you may as well dream big.
Nevertheless, the fact is that the vast majority of data centers run very mixed workloads and could never achieve the economies of scale that Google gets. Google is, by any reasonable definition, a “Software as a Service” business. But it is not typical one and its data centers do not constitute a reasonable model for other data centers to follow. Not even other SaaS vendors.
Massively Scaled Software as a Service
All “as a Service” businesses are based on the reality that the service provider can provide the computer service at much lower expense than it would be if you provided it for yourself. If the price difference is large enough then, assuming there are no other complications, it’s a win-win; the provider grows a thriving business and the customers pay less to run their the applications.
But there are some applications that can be run really really inexpensively if they are run “in the cloud.” Consider, for example, that the Yahoo and Hotmail email services are and always were free, and so, for that matter is Google’s Gmail. Corporations spend tens of thousands of dollars running email systems driven by software from IBM, Microsoft and others and yet Yahoo Mail has 260 million users and the vast majority of them enjoy a completely free service.
Admittedly, Yahoo displays adverts to its email users and this helps to pay for it. But a hosted Microsoft Exchange email service will (at current rates) cost a minimum of $10 per user per month and if it cost Yahoo anything close to that to run its email service its enmail service would have withered on the vine.
Operations like Yahoo Mail are SaaS of a kind, but they are massively scaled – because they can be. When you have millions of users doing exactly the same thing – and I mean exactly the same thing, not similar things – you have the possibility of cutting the cost per user to a very very low rate. You can set up a data center and make all the architectural decisions about how the software is going to run, and which hardware it is going to run on, and how the communications are going to work, and many other things, with only one or two transactions in mind.
Internet email systems are like that. They can be built for massive scalability and when they are, the cost per user ends up close to zero. There are many services on the Internet built that way; Facebook, MySpace, Twitter, Linked-In, Zoho, Google Apps, Skype and so on
The New PC Business
What we are witnessing now is the emergence of a new market that will be surprisingly similar to the PC market as it grew through the 1980s and 1990s. The PC application is gradually dying and being reborn as a cloud application. The economics of massive scalability is driving this. Many of the services mentioned (Facebook, Twitter, Google Apps, Zoho & Skype) are being used regularly by SoHo operations and small businesses as business applications, because it makes business sense.
Some of these are “new apps for the new era” – the PC world didn’t have telephony, but most of them are makeovers of PC applications. Not just word the usual office apps, but also vector drawing, photo apps, music and even video. You see many of these applications can all be delivered as MSSaaS – especially if you put an RIA interface on the front-end
You can read the future in these tea leaves, and they indicate quite clearly that the PC apps are heading for the cloud.
The MSSaaS companies dont offer guaranteed service levels or availability or security. Nevertheless the well established ones seem to deliver acceptable service levels, availability and security anyway. Some of them have introduced subscription schemes (as Yahoo did) where you pay a small but regular fee for a slightly superior service which is advert free.
There’s a big business in the making here. The PC is heading into the cloud.
You may also be interested in these articles:
The PC, The Cloud, RIA and the Future
What is Cloud Computing? 10 Defining Points
What Is Cloud Computing Exactly?
How Open Source Will Prosper in the Cloud
Why Corporate Computing is Destined for the Cloud
Microsoft: Following Google Into The Cloud