The Public Cloud Has Won       Web-scale clouds are happening now ...             don’t be left in the coldRandy Bias     ...
MobileMatters
Mobile Apps ExplodingSources: Asymco.com, Chetan Sharma, Morgan Stanley
Mobile + Cloud
Two Sides of the Same CoinConsumption         Production
Two Sides of the Same CoinConsumption         Production
Carriers KnowMobile
Carrier Advantages
Carrier Advantages  IP backbone
Carrier Advantages IP backboneWireless network
Carrier Advantages  IP backbone Wireless networkCO & DC footprint
Carrier Advantages  IP backbone Wireless networkCO & DC footprint Mobile/IP CDN
Carrier Advantages    IP backbone  Wireless network CO & DC footprint   Mobile/IP CDNIn-country expertise
Carrier Advantages      IP backbone    Wireless network  CO & DC footprint     Mobile/IP CDN In-country expertiseBilling/m...
CarriersDon’t Know  Cloud
First Gen Carrier Clouds
First Gen Carrier Clouds“Enterprise” not “web-scale”
First Gen Carrier Clouds“Enterprise” not “web-scale”   Expensive & Complex
First Gen Carrier Clouds“Enterprise” not “web-scale”   Expensive & Complex         NOT Agile
First Gen Carrier Clouds“Enterprise” not “web-scale”   Expensive & Complex         NOT Agile     Focus on IT buyer
First Gen Carrier Clouds“Enterprise” not “web-scale”    Expensive & Complex          NOT Agile      Focus on IT buyer Virt...
First Gen Carrier Clouds“Enterprise” not “web-scale”    Expensive & Complex          NOT Agile      Focus on IT buyer Virt...
First Gen Carrier Clouds“Enterprise” not “web-scale”    Expensive & Complex          NOT Agile      Focus on IT buyer Virt...
Cloud Value   Prop
Which Value Prop Matters?Bottom line          Top line revenue               vs.cost savings           generation
Which Value Prop Matters?Bottom line          Top line revenue               vs.cost savings           generation   ASP   ...
Web-scale Clouds
Web-scale Cloud Pioneers
Web-scale vs. Legacy App Focus                vs.Greenfield &                       Legacy AppsMobile Apps
Enterprises use Web-scale Clouds for     Greenfield & Mobile Apps
Enterprise Mobile Apps
Estimated IaaS Growth Rates                Web-scale vs. Legacy Cloud                    88%90%68%45%23%                  ...
Bookseller in Top 10 IT services by 2016?      1 IBM                                                    $37,347      2 HP ...
Comparing Clouds
Capital Expense (Initial)                    Web-scale vs. Legacy Cloud                        $4,000Cost per Sellable    ...
Operational Expense (Labor)             Web-scale (1500:1) vs. Legacy (300:1)                            Servers : IT Head...
Legacy 5-yr TCO is 3-5xmore than Web-scale ...
... doesn’t provide 3-5x value for greenfield or      mobile apps
Legacy Clouds Reduce TAM   AppDevelopers                            Long Tail of                            Customers  SMB...
Legacy Clouds Reduce TAM      App   Developers                                         $                              Long...
MobileApps onClouds
250M+ Users, 25M DAUPublic AWS for launch, dev, scaling, & testPrivate web-scale “Z-Cloud” for base
Studio Model
Studio ModelNo way to predict winners
Studio ModelNo way to predict winnersBuild 10: 3 win, 3 fail, and 4 languish
Studio ModelNo way to predict winnersBuild 10: 3 win, 3 fail, and 4 languishModel: Launch,Measure,Triage
Studio ModelNo way to predict winnersBuild 10: 3 win, 3 fail, and 4 languishModel: Launch,Measure,TriageOptimize costs bef...
Own the Base, Rent the Spike                                              1                                     Launch & M...
Own the Base, Rent the Spike                  Move Base              2                  to Z-CloudApp Workload Sources: Gr...
Own the Base, Rent the Spike                                    3                          Keep Spikes                    ...
Own the Base, Rent the Spike                          4                           PROFIT!Sources: Graphics from Everest Gr...
Take Aways
Take AwaysStudio model drives cloud choice
Take AwaysStudio model drives cloud choiceCost matters & web-scale delivers
Take AwaysStudio model drives cloud choiceCost matters & web-scale delivers“Hybrid” works when clouds interop
Why DidCarriers Miss?
“It’s not our target market”
“It’s not our target market” Except that, enterprises:
“It’s not our target market” Except that, enterprises:   Use web-scale clouds
“It’s not our target market” Except that, enterprises:   Use web-scale clouds   Make mobile apps
“It’s not our target market” Except that, enterprises:   Use web-scale clouds   Make mobile apps   Host app back-ends on AWS
“The market isn’t big enough”
“The market isn’t big enough”   Except that:
“The market isn’t big enough”   Except that:    AWS will be 1B in rev in 2011
“The market isn’t big enough”   Except that:    AWS will be 1B in rev in 2011     > all global ‘legacy cloud’
“The market isn’t big enough”   Except that:    AWS will be 1B in rev in 2011     > all global ‘legacy cloud’     100% CAGR
“The market isn’t big enough”   Except that:    AWS will be 1B in rev in 2011     > all global ‘legacy cloud’     100% CAG...
Bottom Line
Bottom LineMassive Disruption
Bottom LineMassive DisruptionLegacy cloud biz model is stillborn
Bottom LineMassive DisruptionLegacy cloud biz model is stillbornCarriers have inherent advantages
Bottom LineMassive DisruptionLegacy cloud biz model is stillbornCarriers have inherent advantagesWeb-scale + Carrier advan...
Bottom LineMassive DisruptionLegacy cloud biz model is stillbornCarriers have inherent advantagesWeb-scale + Carrier advan...
Randy Bias - Presentation at Emerging Communications Conference & Awards (eComm 2011)
Randy Bias - Presentation at Emerging Communications Conference & Awards (eComm 2011)
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Randy Bias - Presentation at Emerging Communications Conference & Awards (eComm 2011)

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Randy Bias - Presentation at Emerging Communications Conference & Awards (eComm 2011)

  1. 1. The Public Cloud Has Won Web-scale clouds are happening now ... don’t be left in the coldRandy Bias @randybiasJun 27th, 2011 @cloudscalingeComm - SFO
  2. 2. MobileMatters
  3. 3. Mobile Apps ExplodingSources: Asymco.com, Chetan Sharma, Morgan Stanley
  4. 4. Mobile + Cloud
  5. 5. Two Sides of the Same CoinConsumption Production
  6. 6. Two Sides of the Same CoinConsumption Production
  7. 7. Carriers KnowMobile
  8. 8. Carrier Advantages
  9. 9. Carrier Advantages IP backbone
  10. 10. Carrier Advantages IP backboneWireless network
  11. 11. Carrier Advantages IP backbone Wireless networkCO & DC footprint
  12. 12. Carrier Advantages IP backbone Wireless networkCO & DC footprint Mobile/IP CDN
  13. 13. Carrier Advantages IP backbone Wireless network CO & DC footprint Mobile/IP CDNIn-country expertise
  14. 14. Carrier Advantages IP backbone Wireless network CO & DC footprint Mobile/IP CDN In-country expertiseBilling/micro-payments
  15. 15. CarriersDon’t Know Cloud
  16. 16. First Gen Carrier Clouds
  17. 17. First Gen Carrier Clouds“Enterprise” not “web-scale”
  18. 18. First Gen Carrier Clouds“Enterprise” not “web-scale” Expensive & Complex
  19. 19. First Gen Carrier Clouds“Enterprise” not “web-scale” Expensive & Complex NOT Agile
  20. 20. First Gen Carrier Clouds“Enterprise” not “web-scale” Expensive & Complex NOT Agile Focus on IT buyer
  21. 21. First Gen Carrier Clouds“Enterprise” not “web-scale” Expensive & Complex NOT Agile Focus on IT buyer Virtualization 2.0, not cloud
  22. 22. First Gen Carrier Clouds“Enterprise” not “web-scale” Expensive & Complex NOT Agile Focus on IT buyer Virtualization 2.0, not cloud Bottom Line Focus
  23. 23. First Gen Carrier Clouds“Enterprise” not “web-scale” Expensive & Complex NOT Agile Focus on IT buyer Virtualization 2.0, not cloud Bottom Line Focus Looking back, not forward
  24. 24. Cloud Value Prop
  25. 25. Which Value Prop Matters?Bottom line Top line revenue vs.cost savings generation
  26. 26. Which Value Prop Matters?Bottom line Top line revenue vs.cost savings generation ASP vs. SaaS
  27. 27. Web-scale Clouds
  28. 28. Web-scale Cloud Pioneers
  29. 29. Web-scale vs. Legacy App Focus vs.Greenfield & Legacy AppsMobile Apps
  30. 30. Enterprises use Web-scale Clouds for Greenfield & Mobile Apps
  31. 31. Enterprise Mobile Apps
  32. 32. Estimated IaaS Growth Rates Web-scale vs. Legacy Cloud 88%90%68%45%23% 20% 0% Web-scale LegacySource: Cloudscaling market analysis
  33. 33. Bookseller in Top 10 IT services by 2016? 1 IBM $37,347 2 HP $34,678 3 Fujitsu $26,935 4 CSC $16,281 5 Accenture $15,555 6 Capgemini $11,255 7 Hitachi $11,050 8 Ericsson $11,031 9 AWS $10,465 10 NTT Data Corporation $10,425 Source: servicestop100.org - 2010 top 100 IT services businesses by service revenue
  34. 34. Comparing Clouds
  35. 35. Capital Expense (Initial) Web-scale vs. Legacy Cloud $4,000Cost per Sellable $3,216‘VMU’ $3,000(m1.small, 1.7GB $2,000RAM, 1 vCore) $1,000 Web-scale $382 Legacy $0 Source: Cloudscaling confidential financial models for IaaS clouds
  36. 36. Operational Expense (Labor) Web-scale (1500:1) vs. Legacy (300:1) Servers : IT Headcount $150M $113M $75M $38M $0MYear 1 Year 2 Year 3 Year 4 Year 5 Web-scale Legacy Source: Cloudscaling estimates of VM:admin based on known IaaS deployments
  37. 37. Legacy 5-yr TCO is 3-5xmore than Web-scale ...
  38. 38. ... doesn’t provide 3-5x value for greenfield or mobile apps
  39. 39. Legacy Clouds Reduce TAM AppDevelopers Long Tail of Customers SMB In-country EnterprisesEnterprise In-country Global
  40. 40. Legacy Clouds Reduce TAM App Developers $ Long Tail of Customers SMB In-country Enterprises Enterprise$$$$$In-country Global
  41. 41. MobileApps onClouds
  42. 42. 250M+ Users, 25M DAUPublic AWS for launch, dev, scaling, & testPrivate web-scale “Z-Cloud” for base
  43. 43. Studio Model
  44. 44. Studio ModelNo way to predict winners
  45. 45. Studio ModelNo way to predict winnersBuild 10: 3 win, 3 fail, and 4 languish
  46. 46. Studio ModelNo way to predict winnersBuild 10: 3 win, 3 fail, and 4 languishModel: Launch,Measure,Triage
  47. 47. Studio ModelNo way to predict winnersBuild 10: 3 win, 3 fail, and 4 languishModel: Launch,Measure,TriageOptimize costs before, during, & after
  48. 48. Own the Base, Rent the Spike 1 Launch & Measure TrafficApp Workload Sources: Graphics from Everest Group, Inc.
  49. 49. Own the Base, Rent the Spike Move Base 2 to Z-CloudApp Workload Sources: Graphics from Everest Group, Inc.
  50. 50. Own the Base, Rent the Spike 3 Keep Spikes on AWSApp Workload Sources: Graphics from Everest Group, Inc.
  51. 51. Own the Base, Rent the Spike 4 PROFIT!Sources: Graphics from Everest Group, Inc.
  52. 52. Take Aways
  53. 53. Take AwaysStudio model drives cloud choice
  54. 54. Take AwaysStudio model drives cloud choiceCost matters & web-scale delivers
  55. 55. Take AwaysStudio model drives cloud choiceCost matters & web-scale delivers“Hybrid” works when clouds interop
  56. 56. Why DidCarriers Miss?
  57. 57. “It’s not our target market”
  58. 58. “It’s not our target market” Except that, enterprises:
  59. 59. “It’s not our target market” Except that, enterprises: Use web-scale clouds
  60. 60. “It’s not our target market” Except that, enterprises: Use web-scale clouds Make mobile apps
  61. 61. “It’s not our target market” Except that, enterprises: Use web-scale clouds Make mobile apps Host app back-ends on AWS
  62. 62. “The market isn’t big enough”
  63. 63. “The market isn’t big enough” Except that:
  64. 64. “The market isn’t big enough” Except that: AWS will be 1B in rev in 2011
  65. 65. “The market isn’t big enough” Except that: AWS will be 1B in rev in 2011 > all global ‘legacy cloud’
  66. 66. “The market isn’t big enough” Except that: AWS will be 1B in rev in 2011 > all global ‘legacy cloud’ 100% CAGR
  67. 67. “The market isn’t big enough” Except that: AWS will be 1B in rev in 2011 > all global ‘legacy cloud’ 100% CAGR Carriers trying web-scale now
  68. 68. Bottom Line
  69. 69. Bottom LineMassive Disruption
  70. 70. Bottom LineMassive DisruptionLegacy cloud biz model is stillborn
  71. 71. Bottom LineMassive DisruptionLegacy cloud biz model is stillbornCarriers have inherent advantages
  72. 72. Bottom LineMassive DisruptionLegacy cloud biz model is stillbornCarriers have inherent advantagesWeb-scale + Carrier advantage = Win!
  73. 73. Bottom LineMassive DisruptionLegacy cloud biz model is stillbornCarriers have inherent advantagesWeb-scale + Carrier advantage = Win!Carpe Diem

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