Tag: cloud computing

Software’s mini revolutions

How the CIA are driving a business revolution

The CIA’s ‘revolutionary’ announcement of their changes to the way they buy software shows just how the relationship between software vendors and businesses is evolving as cloud computing methods become widely adopted.

For businesses it means more flexibility and efficiency while for software companies the new marketplace is requiring them to be more flexible and responsive. Those changes will challenge some vendors.

What’s driving these changes is ‘big data’ – the explosion of data being collected and stored – and the move to cloud based computer systems.

The CIA, like most businesses or home computer users, used to buy software by the license. For small businesses and homes this was by buying a box of disks from the local computer shop while for big organisations there were volume licenses where they bought the right to use tens of thousands of copies of the one program.

Box licensing was never satisfactory, it was difficult for users to know what exactly they bought and customers were always a year or more behind the trend.

Keeping up with Technology

One of the big pluses with cloud based systems is you don’t have to wait a year or two for a new release incorporating the latest technology. It’s rolled out as it becomes available without any work by the user.

With the old box software model you had to wait for the latest release and even then the features you were waiting for could still be missing.

As technology is moving fast online, organisations like the CIA can’t afford to wait.

Pay as you go

Another problem with the old software model was that big and small organisations found they were buying things they didn’t need.

This is particularly true with licensing agreements where a company might have 100,000 licenses when they only needed 15,000.

Pay as you go billing, which is the standard model for cloud computing services, means a lot more flexibility and a much more efficient way of managing software spend.

Closer relationships

In his speech describing the changes, the CIA’s top technology officer Ira Hunt said the agency is prepared to give vendors a “peek under the covers”.

This sort of closer relationship between suppliers and customers is one of the biggest attractions of the cloud computing model. It means both users and suppliers are more closely aligned.

For software vendors that close alignment is where the opportunities lie; the old days of flogging fat, expensive licenses are over and the successful sellers of computer programs will be quicker and nimbler.

The CIA has been accused of formenting many revolutions around the world, this is one most business owners should be happy about them leading.

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On becoming a Captive Business

On being trapped by your suppliers or customers

I’ve been writing a lot recently about the risks of businesses aligning their interests too closely with one or another platform, last weekend The China Law Blog discussed the opposite – being a captive customer.

The term “captive customer” is new to me but it’s a familiar concept; in the IT industry most of us found ourselves hostage to Microsoft’s whims at one time or another and it wasn’t a good place to be.

Many smaller businesses and consultants fall for the trap of having just one big customer which their income becomes dependent upon.

While Dan’s point on The China Law Blog is about manufacturing, this risk is becoming even more pressing on the web where there’s a tendency to be captured by one platform or another.

Sometimes entire industries are captured – the Search Engine Optimisation sector is wholly dependent upon whatever Google chooses to with their search algorithm. To make things worse, no SEO expert knows exactly how Google’s equations actually work.

We’re seeing the mass media being captured in a number of ways – by granting licenses to Facebook, one suspects unwittingly, or developing content for Apple’s iPad.

For startups depending upon cloud services or single payment platforms like PayPal there are serious risks as we saw with the co-ordinated takedown of Wikileaks.

In nature, the animal or plant that depends on one source of food or habitat is at risk from even small changes in their environment. Be careful you aren’t a business dodo.

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The Internet Kool-Aide Machine

Don’t buy the hype when you read about the hot new product

Every few months, the web lights up with hype about the latest technology or website. For a few weeks, every tech conversation mentions this hot new product.

Almost always this hype is driven by the company in question duchessing a few key “opinion leaders” in the tech, social media or other circles. These folk start writing up this product and, if they are lucky, the stories get picked up by the broader media and the product becomes “hot.”

The aim is to find the greater fools, for the investors and founders of these business they want to cash out by selling the operation to a bigger entity.

When you read the hype about the latest user generated, online sharing social media service that’s growing at a remarkable rate be aware you’re actually seeing a pitch to a big company being framed along the lines that “you can’t afford to miss out.”

By all means sign up to the service to have a look but don’t buy the hype and remember you’re not the customer – the gullible big business manager looking for the next big thing is.

Image courtesy of Blary54 through sxh.hu

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Confidence in the cloud

Cloud computing services need open data to succeed, vendor lock in will stunt the growth of online markets.

Will the cloud ‘hit the wall’ without good integration? asks Ross Mason in GigaOm – that question is a good one.

In many ways we’re no better than we were twenty years ago with some business – particularly big corporations like banks or telcos – plugging the same information into four or five different databases or software packages with all the subsequent mistakes, lost data and double handling.

The old business model for software companies was to lock customers into a proprietary format and and make it as difficult as possible to move the information to a competitor. Those days are now over.

Business – and increasingly consumers – expect their data to open, accessible and easily moved between different programs, if somebody wants to connect their customer database to their accounting package, or project management software to their word processor they don’t see why they shouldn’t be able to.

Confidence is also the greatest key to success in cloud computing; customers need to know that if a service fails or they decide to take their business elsewhere then their data will be able to move with them. The prospect of losing years of customer records or accounting records is untenable.

A few years back the early cloud based accounting programs tried to tie people onto their platforms by making data almost impossible to retrieve, those businesses failed badly.

One of the promises of business technology is that it will increase productivity and reduce errors; sharing one set of data across the organisation goes a long way towards delivering on that promise.

Today software has to compete on features, not vendor lock-in. Trying to trap customers into using your products is an old business model that no longer works.

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So you thought you quit working for a boss

Have you traded one set of rules for another?

One of the weirdest things about the Internet’s free culture is how services that make money out of reselling people’s donated labour tie their contributors up with rules.

Many of the people contributing for free have given up their day jobs to do so. If you asked them why, I’m sure many would say they were sick of restrictive rules, anal retentive bosses and generally feeling suffocated by a big organisation.

Yet now they are subject to a bunch of rules arbitrarily enforced by anonymous and unaccountable bureaucrats running social media or cloud computing services.

So why on Earth are you doing the same thing for free? At least when you’re in a cubicle you’re getting paid for dealing with idiots.

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The importance of logging off

It’s the simple things that bring us unstuck in the online world.

English Labour MP Tom Watson today learned why logging off your computer is important when his office intern cracked what she thought a joke on his behalf.

What appeared to be a mis-step by the Member of Parliament bought predictable criticism from his enemies in politics and media, particularly given his role as a critic of News International.

The biggest risk in computer security are your staff and co-workers; they have access to your systems and the data saved on them.

In Tom’s case – like most business security breaches – the intern wasn’t being malicious, she was making a very valid point about a serious topic, it was her unfortunate choice of words that caused a problem.

Luckily for her, the boss has taken a mature attitude towards the problem – there’s many bosses who wouldn’t. So the intern seems safe unless the media can beat the story up further.

The moral for all of us is to log off or shut down our computers whenever we step away from them.

If we’re using public terminals in flight lounges, Internet cafes or hotels, then we should make sure we’ve logged out of our email, social media or banking services before the session ends.

Should someone leap on your system when you turn your back, you could find anything from your social media or email account used to send out fake messages about you being robbed through to your online bank balance being pillaged.

We often worry about evil, sophisticated hackers breaking into our accounts but often it’s these simple mistakes that let opportunistic thieves get our details.

Often it’s the simple things that bring us unstuck, so logging off is a good habit to get into. Tom’s intern is right.

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The Internet’s cold war

Should we align our businesses with the online empires?

“We’re designing exclusively for Android devices,” the software developer confided over a beer, “we don’t like the idea of giving Apple 30% of our income.”

That one business owner is making a choice that software developers, newpaper chains, school text book publishers and many other fields are going to have to make in the next year – which camp are they going to join in the Internet’s cold war.

As the web matures, we’re seeing four big empires develop – Google, Apple, Facebook and Amazon which are going to demand organisations and consumers make a choice on who they will align with.

That decision is going to be painful for a lot of business; each empire is going to take a cut in one way or another with Apple’s iStore charges being the most obvious.

For those who choose to go the non-aligned path – develop in HTML5 and other open web standards things will be rocky and sometimes tough. At least those on the open net won’t have to contend with a “business partner” whose objectives may often be different to their own.

Over time, we’ll see the winners and losers but for the moment businesses, particularly big corporations and publishers should have no doubt that the choices they make today on things as seemingly trivial things like reader comments may have serious ramifications in a few years time.

Consumers aren’t immune from this either; those purchases through iTunes, Amazon or Google are often locked to that service for a reason.

Probably the development that we should watch closest right now is Apple’s push into education publishing; those governments, universities and schools that lock into the iPad platform are making a commitment on behalf of tax payers, faculty and students that will affect all of them for many years.

For many, it might be worthwhile hedging the bets and sticking to open standards. A decision to join one or two of the big Internet empires is something that shouldn’t be made lightly.

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