June 25, 2012
Volume XXXIX, Issue 12
CLOUD COMPUTING WEST 2012 Offers Three Co-Located Conferences
The DCIA and CCA this week announced that the inaugural CLOUD COMPUTING WEST 2012 (CCW:2012) summit taking place November 8th-9th in Santa Monica, CA will bring together three co-located conferences.
The inter-related subjects to be covered in these seminal events represent three of the most rapidly expanding and strategically important areas in the cloud computing industry today: ENTERTAINMENT CONTENT DELIVERY, NETWORK INFRASTRUCTURE, and INVESTING IN THE CLOUD.
Major topics will range from latest trends in cloud solutions for high-value content production and distribution to pitfalls to avoid in adopting cloud solutions for content development/delivery; from how cloud migration is positively impacting broadband network operations and businesses to the drawbacks of cloud deployments from broadband network operators' perspectives; and from new updates on venture capital and M&A activity in the cloud computing space to liabilities that need to concern investors regarding cloud-based businesses.
There will also be analyses of newest cloud offerings for entertainment and industry's direction, and problem areas affecting cloud adoption in the entertainment sector; network resource usage by data centers and new ISP cloud services, and challenges for ISPs created by proliferation of cloud computing; and capital structuring and strategic alliances for cloud computing firms, and problem areas affecting investments/mergers of cloud services.
In addition, special sessions will explore in-depth file-based production workflow leveraging cloud computing for collaboration, dailies, editing, metadata, and pilots; the implications on network infrastructure of third-party SaaS, PaaS, and IaaS deployments, effects of various data centers, interconnection issues, and types of architectures; and the differing investment implications public clouds, private clouds, hybrid clouds, virtual private clouds, and community clouds.
And finally, panels will examine the entertainment distribution side: cloud transcoding, storage, delivery, data, and analytics; cloud mobility, virtualization, interoperability, and scalability; as well as green computing, big data, and open source as these topical considerations impact financing, VC criteria, and exit strategies.
Registration enables delegates to also participate in any session at the three conferences being presented at CCW:2012 on ENTERTAINMENT CONTENT DELIVERY, NETWORK INFRASTRUCTURE, and INVESTING IN THE CLOUD.
CCW:2012 features one common exhibit hall. and all networking functions (e.g., luncheon, refreshment breaks, evening cocktail reception, etc.) are open to all attendees at no additional cost.
Cloud Computing: Raining Down Profits
Excerpted from The Motley Fool Report by George Liu
Cloud computing is a type of technology that has become increasingly prevalent in businesses everywhere. It allows businesses to use applications without actually installing them, which helps companies reduce operating costs.
Recently, a study sponsored by enterprise software giant SAP showed that cloud-computing could save U.S. businesses as much as $625 billion over five years. Moreover, this study also showed that existing cloud-computing companies such as Salesforce, Fusion-IO, and F5 Networks are projected to grow revenues by an average of $20 billion per year for the next five years.
There are significant opportunities in the cloud-computing business, a business which is still relatively untapped, and one company is in a prime position to gain from these opportunities: NetSuite.
NetSuite is a cloud computing company that targets small- and medium-sized companies. It has seen its stock increase 21.8% YTD and has been a hit among mutual funds: NetSuite has experienced 8 consecutive quarters of increasing mutual fund ownership and a 9% YOY increase in mutual fund ownership this first quarter of 2012. There are significant positives contributing to NetSuite's appeal as an investment, but there is also a large negative that can potentially affect NetSuite's future growth.
NetSuite is the cloud computing industry's leading provider of cloud-based financials and its enterprise resource planning (ERP) solution is the world's most deployed. NetSuite has already established its niche within the cloud computing industry, and it is also succeeding in gaining market share. NetSuite has been the leader in the professional services automation market for three consecutive years; according to SPI Research, NetSuite owns 20 percent of the professional services automation market.
Moreover, NetSuite's products are also gaining traction outside of its target range of mid-sized companies as larger companies realize the potential of utilizing cloud computing. Large organizations such as Procter & Gamble, Land O'Lakes, and the Girl Scouts of the USA have started to move their infrastructure to NetSuite. NetSuite also has a very positive relationship with Oracle. This is in part due to the fact that Larry Ellison, Co-Founder of Oracle, was a major financier of NetSuite when it was starting up. Currently, Larry Ellison is the majority owner of NetSuite. NetSuite's relationship with Oracle has resulted in very little direct competition between the two in cloud-computing. Oracle is geared toward catering to extremely large organizations with its cloud software while NetSuite is geared toward the mid-market. As NetSuite CEO Zach Nelson notes, "In the mid-market, it is unusual for us to run into Oracle."
Netsuite recently unveiled its new product, one which could provide NetSuite with strong revenue growth in the near future. On Thursday, May 15th, NetSuite introduced its SuiteCommerce platform, which enables businesses to manage their interactions with other businesses and directly with consumers via a cloud platform. This product is the central element to NetSuite's focus over the next decade: transforming how businesses operate with other businesses and with their customers.
Moreover, Square, the mobile-payments company, has teamed up with NetSuite to integrate Square Register with SuiteCommerce to give merchants "complete cloud financial and CRM capabilities." This partnership, which will compete with e-commerce infrastructure offerings from companies such as Demandware, has great appeal to merchants and, if successful, will generate significant profit for NetSuite.
NetSuite's success in becoming one of the leaders of the cloud-computing industry is reflected in its financials. For the first quarter of 2012, sales rose 30% YOY, the best showing since 2008. In the same quarter, NetSuite also reported earnings growth of 100%; the average earnings growth of NetSuite's last 3 quarters is a solid 50%. Moreover, NetSuite has no debt and its healthy financial state will allow it to expand its operations and continue to dominate its market niche.
The cloud-computing industry is growing increasingly crowded as both new and old competitors seek a slice of the profits. According to study mentioned earlier, venture capital investments in cloud opportunities are projected to top $30 billion over the next five years. Although NetSuite's friendly relations with Cisco should keep Cisco from entering the mid-market, other established cloud and software giants, most notably SAP, have tried to penetrate the cloud market for small- to mid-sized companies. Although NetSuite has a huge market lead right now, the competitive saturation of the field could ultimately hurt NetSuite's bottom-line in the future.
Overall, NetSuite is one of the better companies currently dominating the cloud-computing market. With cloud-computing as an entire industry growing significantly and new products such as SuiteCommerce, NetSuite holds significant promise for investors.
Report from CEO Marty Lafferty
 The DCIA commends the US House Energy & Commerce Committee's leadership and bipartisan approval this week of a resolution opposing the United Nations' and its International Telecommunications Union's (ITU) attempt to assert and impose unprecedented governmental regulation over the Internet.
The Internet'ss current multi-stakeholder governance model fosters continuing investment and innovation absent heavy-handed regulatory controls.
Beyond the substantial growth that the Internet and related distributed computing technologies are contributing to the global economy, unprecedented advances in political freedom can also be attributed to the current model.
Congresswoman Mary Bono Mack's leadership of this initiative has been particularly laudable: "In many ways, we're facing a referendum on the future of the Internet. A vote for my resolution is a vote to keep the Internet free from government control and to prevent giving the UN unprecedented power over Web content and infrastructure. That's the quickest way for the Internet to one day become a wasteland of unfilled hopes, dreams, and opportunities."
We strongly urge the timely support of this resolution by the full US House of Representatives and similar actions by other responsible legislative bodies around the world in advance of the upcoming World Conference on International Telecommunications (WCIT) in Dubai with 190 nations expected to participate this December.
At WCIT, the International Telecommunications Regulations, comprising an international treaty developed nearly 25 years ago to deal with global telephone and telegraph systems at the time, will be opened for revisions.
And while any amended treaty would only be binding in the US if ratified by the Senate, the implications of currently proposed changes, if adopted elsewhere around the world, would have profoundly damaging effects on the operation of the Internet everywhere.
The secret drafting of ITU proposals in preparation for WCIT has been widely and rightly criticized by public interest groups for a serious lack of transparency. But our concerns go deeper than that.
If the ITU is successful in taking power over the Internet with the proposed amendments, such technologically valuable activities as the current flexibility of Internet-connected devices to perform as both clients and servers would be jeopardized.
Certain communications among devices would be hampered based on jurisdictional considerations and governmental security intervention measures, including repressive surveillance of Internet users and sanctioned censorship of the Internet.
Eli Dourado, a researcher at George Mason University, articulated this aspect of the looming battle well:
"It's really one between Internet users worldwide and their governments. Who benefits from increased ITU oversight of the Internet? Certainly not ordinary users in foreign countries, who would then be censored and spied upon by their governments with full international approval. The winners would be autocratic regimes, not their subjects."
In addition, a sending-party tax to be paid by content providers, would upend longstanding principles of Internet architecture and take us back to the days of the extortionary taxes that were once imposed on long-distance phone-calls. Some of the most promising cloud-based content delivery applications and systems would be made economically unfeasible.
The ongoing and smoothly proceeding transition to IPv6 would come to a grinding halt.
We join the Internet Society, representing engineering groups that develop and maintain core Internet technologies, in objecting to these proposals on principle and as a practical matter.
Independent organizations including the Society, as well as the Internet Corporation for Assigned Names and Numbers, and the Worldwide Web Consortium, already deal much more effectively than the ITU possibly could with such fundamental tasks as network and domain name registrations, allowing the Internet to develop and evolve with relatively fast responses to changes in technology, business practices, and consumer behavior.
We also agree with Philip Verveer, Deputy Assistant Secretary of State and US Coordinator for International Communications and Information Policy, who said, "It is important that when we have values, as we do in the area of free speech and the free flow of information, that we do everything that we can to articulate and sustain those values."
And the negative economic impacts of the proposed treaty changes on expansion of Internet-based services as well as job creation would be devastating.
Verveer called the proposals unworkable and said they would have unintended consequences that would seriously harm the Internet. We concur, and urge DCINFO readers everywhere to join us in their opposition. Share wisely, and take care.
Cloud Computing World Forum Highlights Increased Interest in Cloud
Over 4,500 IT professionals flocked to London this week for one of Europe's leading enterprise technology events, the Cloud Computing World Forum (CCWF) co-sponsored by the DCIA.
The event showcased the growing business and consumer interest in cloud computing across the globe, hosting some of the biggest names and organizations from the IT industry, including over 100 global exhibitors and 200 expert speakers.
Among the highlights were Apple's former CEO, John Sculley, who delivered a talk on how cloud computing is enhancing the telemedicine industry, and Amazon's CTO, Werner Vogels, who spoke about the meteoric rise of Amazon Web Services (AWS) and its role in the industry's development.
The event was a great success. The marketplace has clearly developed from 2011 and this was reflected by a growing number of attendees and exhibitors.
The 5th Annual CCWF will be held in Olympia National Hall on June 18thâ€"19th, 2013. For more information, please click here.
How Cloud Computing is Driving Success for Europe's Small Businesses
Excerpted from The Guardian Report by Daniel Saks
It's no secret that these are tough economic times, but on-demand software is helping lift small and midsize enterprises (SMEs) out of the doldrums.
The economic news making headlines across Europe is enough to keep any entrepreneur up at night. Despite this, SMEs have been remarkably resilient and recent research from Microsoft found that a quarter of SMEs in Europe plan to hire new staff in 2012, while a large portion (up to 40% in some countries) expect to be more successful this year than last.
With only a few bright spots on the horizon, why do SMEs have such a sunny outlook? The Microsoft report provides another interesting clue: 18% of SMEs also plan to invest in new technology in the next year. That number may not seem like a blockbuster statistic, but it points to a key factor driving the success of small businesses, both in Europe and around the globe--cloud computing.
Small businesses are the lifeblood of Europe's economic engine. Recent estimates put the number of European SMEs at more than 23m, a number that represents two-thirds of Europe's private sector jobs, and they have sparked 80% of job creation over the past five years. Can cloud really underpin the success of such a large sector?
The cloud has faced its fair share of skeptics, but it has already transformed the way that billions of people around the world work, play and communicate. At a basic level, cloud computing is simply a way to manage data and use applications over the Internet, often as a service that you subscribe to, rather than software that you buy and install. Consumers use the cloud every day when they upload pictures, send e-mail, listen to music, or conduct dozens of other routine online activities.
Companies, on the other hand, can use cloud computing to manage a range of front- and back-end office functions. Cloud-based solutions for businesses, often called "software as a service" (SaaS), run the gamut from accounting and human resources, to marketing and social media, and just about everything in between.
Cloud-based software is often easier to use, faster to deploy and provides far greater flexibility than on-premise solutions that need to be installed and maintained, especially for SMEs that are too small for a dedicated IT staff.
Beyond that, cloud-based software can also help small businesses lower costs, often by a significant amount. A recent survey by IDC found that almost every SME that uses cloud services saves money, with most lowering costs between 10% and 20%.
Despite these benefits, the path to the cloud has been bumpy, particularly in Europe. Due to a convoluted web of privacy laws and other governmental regulations, as well as concerns about data security, analysts estimate that business cloud adoption in Europe lags behind the US by about two years.
The numbers are even worse in the UK, where 20% fewer companies use the cloud than their counterparts on mainland Europe.
Even if European companies are generally cautious about moving to the cloud, the fact remains that a large number of small businesses are already there. According to IDC, 64% of SMEs use at least one cloud-based service. That number is poised to skyrocket, especially when you consider the additional 25% of small businesses that have a concrete plan to use the cloud, or are at least thinking about it.
As more small businesses use the cloud, they stand to make big gains. With cloud-based solutions, SMEs can reinvest their time and resources into product, sales, marketing, and other revenue-generating areas. This not only makes businesses easier to manage, but makes them more efficient as well. IDC predicts that this increased efficiency will translate into global revenue increases totalling $1.1 trillion a year by 2015.
Europe as a whole also stands to gain from the widespread adoption of cloud computing. Along with increased revenue, IDC estimates that over the next three years the cloud could generate up to 14 million new jobs around the world, with 1.2 million of those positions located in Europe. It's clear that when it comes to the cloud, what's good for SMEs is good for Europe as a whole.
The future of the cloud looks bright, but it's important to remember that cloud computing isn't a miracle technology that will save any business that uses it. However, cloud-based software and services can be powerful solutions that offer fantastic benefits to companies--both large and small--that use them wisely. If SMEs are looking for a way to thrive in the trying economic times we're facing, the cloud may just be their best bet.
The Future of Cloud Computing: 9 Trends for 2012
Excerpted from ZDNet Report by Andrew Nusca
North Bridge Venture Partners released a survey this week on the future of cloud computing. The firm polled 785 people at 39 high-profile enterprise technology companies--Akamai, AWS, Citrix, Microsoft, Red Hat, SAP and VMware among them--to see where their respective heads are with regard to cloud computing.
Since North Bridge is in the business of putting its money where its mouth is, the details matter.
Here's what it found:
- The cloud is mature--for some. Half of all respondents said they were confident that cloud solutions are viable for mission critical business applications.
- Scalability is driving adoption. Fifty-seven percent of companies said it was the top reason that they switched to the cloud. (Business agility was a close second.)
- Security remains the main hurdle. The cloud may be maturing, but security anxiety is the top reason companies don't make the switch--55 percent of respondents expressed concern about it. (Rounding out the top three: regulatory compliance and vendor lock-in.)
- SaaS leads in dollars spent. A whopping 82 percent of respondents said they use software-as-a-service offerings today. An additional six percent said they'd use it within five years.
- But PaaS and IaaS aren't far behind. There's a lot of interest in platform-as-a-service and infrastructure-as-a-service offerings. Forty percent of respondents use PaaS today but 72 percent said they'd adopt it in the next five years; IaaS, 51 percent to 66 percent.
- Efficiency is the name of the game. At 43 percent, backup and archiving was the number one use case, followed by business continuity (25 percent), collaboration tools (22 percent) and big data processing (19 percent).
- But the savings picture is fuzzy. Fifty-three percent of respondents said that the cloud leads to a lower total cost of ownership, or TCO, and a less complex IT workflow.
- Public or private clouds? Both, actually. Forty percent of respondents said they are deploying public clouds; 36 percent said they're going with a hybrid approach. But 52 percent said they'd be using a hybrid approach within five years.
- Big data is the elephant in the room. Eighty percent of respondents deemed it the area most likely to be disrupted by cloud computing. Analytics, too.
North Bridge partner Michael Skok has more in a blog post announcing the results.
"As the business-driven equivalent of weather patterns play out," he writes, "we'll see a few early rainmakers that emerge as key enablers of these trends."
Big Data and Your Network
Excerpted from Network World Report by Dave Greenfield
With all the talk about big data, we hear comparatively little about the challenges it'll pose for the WAN. So it was particularly interesting to hear what one university learned when they ran Hadoop over their WAN.
For the most part, Hadoop implementations tend to run within a single site and for good reason. The Hadoop Distributed File System (HDFS) assumes uniformity in terms of latency and bandwidth among the nodes that will be scheduling the jobs, Joey Jablonski explained to me the other day.
Jablonski is the principle analytics architect at Data Direct Networks (DDN), a data storage infrastructure provider. WANs are hardly predictable and while Hadoop can be tuned for WAN's longer delays, said Jablonski, it'll lower the performance of the Hadoop cluster.
Often, though, organizations need secondary repositories of the data for big data implementations. These repoitories are used to break up workloads on the primary database, particularly the tasks that can work with slightly older data or which only need access to a subset of the data. Analytics, for example, are often run outside of the main tier.
Such was the case with the researchers at the University of California, San Diego (UCSD). They represent one of several organizations that participated in the analysis of data from the Large Hadron Collider experiment. The experiment generates petabytes of data used by researchers from all over the world. While the primary data is kept on site, copies of the data are kept at various locations for the use of researchers. The UCSD team is one such location, running a Hadoop storage node, which is connected back to Switzerland with dual 10-Gbps links, using GridFTP to move up to 15 Gbps of data at any one time.
The paper looks at Hadoop performance across some 2000 WAN links and in particular the links run by the UCSD.
Some of the findings reported were: optimize individual data transfers - HDFS cannot support asynchronous writes so a single-session stream per GridFTP transfer is the best solution; Out of Order Packets (OOPs) are a big issue - organizations that use multiple GridFTP streams per transfer will require large buffers to keep all the out-of-order packets and this increases the cost of the hosts as they need more system memory; Watch that buffering - the use of local buffer will introduce significant overhead in the system I/O before the data is written to HDFS, which has negative impact on the sustainable throughput.
For complete results, read the paper here.
BitTorrent Speaks: The Future of Marketing & Monetizing Content Distribution
Excerpted from Forbes Report by Ryan Holliday
In 2008, in his bestselling book The Pirate's Dilemma, Matt Mason argued that the tech-savvy, remix mindset was (and eventually would) dominating popular culture. The people in these communities weren't thieving pirates, he felt; they were digital entrepreneurs who would remake our media institutions in their image, and everything from sneakers to music would feel their impact.
With studies now showing the piracy not only doesn't hurt box office or album sales but actually boosts them, and people like Sean Parker became billionaires, Mason's prophecy has mostly come true. And fittingly, Mason himself now holds a position that couldn't have existed too long ago. He's the Executive Director of Marketing for BitTorrent, a company that now has more than 160 million users and raised more than $40 million in funding. The BitTorrent protocol is used by companies as diverse as Wikipedia, Twitter, and Facebook.
The technology was once almost exclusively used by consumers to share copyrighted materials. But BitTorrent Inc. (the company that owns the protocol) never endorsed piracy and is now becoming the new best friend of the record labels, studios, and game developers with its moves to put legitimate content in front of consumers and by adding ways to monetize that content. So I asked Matt about the monetizing content distribution and the future of peer-to-peer (P2P) content.
His answer is worth reposting in full, because it shows what he and other such advocates have always believed: file sharing was driven underground because of bad laws, poor understanding, and greedy companies. Today, now that culture is catching up, the technology is being put to good use--just as the pirates had always advocated it could be. In his own words:
"For the last 18 months or so at BitTorrent we've been working with a hand-picked selection of artists, filmmakers, TV producers, DJs, game developers, and authors to put their work in front of our users to see if we could generate positive returns. Overall, the results have been staggering. For years academic institutions and even industry organizations like the International Federation of the Phonographic Industry (IFPI) have been publishing studies showing that file-sharers spend more money on content and engage with it at a deeper level. After nearly two years of experiments with content, we now know that to be true.
"We helped Pioneer One, a TV show pilot, reach enough people and generate enough money in donations that the producers were able to fund the entire first season of the show. We distributed a bundle of music for Pretty Lights, a DJ from Colorado, last December. That bundle was downloaded over 6 million times and generated 100,000 new opt-in email sign-ups on Pretty Lights' website.
"That's 100,000 real fans he can engage with and earn income from for the rest of his career. Last month we released a BitTorrent Bundle of new music from Counting Crows, who had asked us to help generate word of mouth to promote their new album. Before working with BitTorrent, they were being mentioned in social media channels once every eight hours. After we launched the BitTorrent Bundle, they were being mentioned once every two minutes.
"The point of all this is to examine the new business models content creators can build using the BitTorrent ecosystem, and use the results of these experiments to create the tools creators will need to do this better. The internet's potential as a place where content can thrive has not been delivered on yet. Creators are struggling to release media online in ways that make sense. It's still hard to build a direct connection to a fan base.
"We make more giant media files than ever before but it's still hard to share large files over the Internet using anything other than the BitTorrent protocol. It's still hard to find the content you want in the format you want it in, and it's hard for artists to deliver that to their fans. It's still hard to monetize content in meaningful ways and keep all your data. We hope to change that by using the insights gleaned from these experiments to create the ecosystem creators deserve.
"Peer-accelerated technology is an idea that's time has come. The BitTorrent protocol has always been the fastest way to move large files. The technology currently moves between 20% and 40% of global web traffic every day, and among other things BitTorrent Inc. is busy working on new ways to monetize content distribution, new uses for peer-accelerated technology and a new live-streaming protocol that has the potential to be as world-changing as the original BitTorrent technology."
I'll leave you with one more thought from Mason that he gave to Forbes earlier this year. I think it expresses the "pirate's dilemma" quite well.
Twitter's Move to TV Could Face Overload Challenges
Excerpted from Online Media Daily Report by Laurie Sullivan
Every image tells a story on television, but not a complete picture without real-time tweets connecting TV with online, says Twitter CEO Dick Costolo, speaking at Cannes Lions.
The biggest challenge, it seems, is that broadcast TV needs a dependable partner--but by Thursday the added tweet volume from the ad festival appears to have sent the site offline.
Earlier in the week, the site boasted that there were more than 15,000 online posts across social media referencing Cannes Lions, with 95% coming from Twitter. On Thursday, as of 12:40 EST, the site went offline. Remember failwhale? Broadcast TV needs a reliable social media partner.
While it all began with lower thirds serving up at the bottom of TV screens during broadcasts, Twitter pushed the concept of using the site to bring TV viewers online and connect them with other socialites to create a community in real-time. A producer's guide explaining best practices for connecting TV audience through tweets went up on the Twitter's site in early June.
TV shows have tapped the social site to raise ratings. The company developed an analytics package to track the continuous tweets during television broadcasts. The sharp spikes correspond to major moments in a show.
Last year, Twitter and technology partners stepped up following tweets to TV, bringing real-time content to TV shows. But the interaction between viewers and TV content presents another dynamic that makes the big screen more relevant to marketers.
Costolo also said Twitter would begin offering promoted advertising in 50 additional markets this year, reducing its reliance on revenue from the US.
Twitter's worldwide ad revenue should rise 86.3% to nearly $260 million--up from $139 million in 2011--and $45 million in 2010, eMarketer estimates. About 90% of Twitter's revenue comes from the United States, but this year, $26 million in ad revenue could come from overseas, the research firm said.
Earlier this week, Twitter introduced Cards, making it possible to attach media to tweets that link to content through a few lines of HTML code on the Web site. A "Card" is added when site visitors tweet links to the content. It automatically attributes content to the site. There are three types of Cards: summary, photo and player.
Digital TV subs to reach nearly 129 Million by 2016
Excerpted from CED Magazine Report by Mike Robuck
According to recent research, digital TV subscribers in North America will increase from 114 million last year to 129 million in 2016. There's no doubt that cord-cutting is taking place to some degree, but while video providers are losing basic subscribers, their digital TV customers continue to grow. A study by Strategy Analytics found that while the cable TV market sector will see a decline in overall subscribers, which is borne out in recent earnings reports, digital cable TV subscribers will increase from 49 million last year to nearly 54 million in four years. Digital satellite and IPTV services will continue to reap the benefits of a changing marketplace, with the latter growing from 8 million subscribers in 2011 to 20 million in 2016. "Cord-cutting could still have an impact on the pay-TV market, so we keep a close eye on the trends and activities of pay-TV consumers," said Jason Blackwell, Director of Service Provider strategies at Strategy Analytics. "However, without a competitive level of content, alternative services have yet to offer a compelling alternative to the traditional pay-TV channel lineup." Cable operators and other video providers have been working to keep or win back customers through their TV Everywhere initiatives across multi-screens. "Cable has been weakening for several quarters, with most operators losing subscribers," said Richard Fontes, an analyst in the Service Provider Strategies (SPS) Group at Strategy Analytics. "Second screen, TV Everywhere and other new services from cable operators will help slow these losses and keep higher-value--meaning higher average revenue per user (ARPU)--digital subscribers in place."
Small Telco Consortiums Offer Data Center Services Edge
Excerpted from Telecompetitor Report by Joan Engebretson
A couple of recent developments illustrate the different ways rural telco consortiums are pursuing new revenue opportunities in the burgeoning data center market. One example involves South Dakota Network and the other comes from Montana-based Vision Net.
A new data center project on the outskirts of Sioux Falls, SD illustrates how network operators can simultaneously enhance the reliability of their network and create a new revenue stream.
The new data center, which completed construction last month, is owned and operated by South Dakota Network (SDN), a group of 17 independent telcos in the state that also owns and operates a statewide fiber network that reaches into seven other states.
SDN has numerous customers such as enterprises, banks, healthcare institutions, state government, and educational facilities that rely on the network for mission critical connectivity. And as SDN Marketing & Community Relations Director Vernon Brown explained in a recent interview, "Customers were asking us, 'What is your plan if something happens to your main building? What happens to your network?'"
The new data center was built primarily to provide backup for SDN's own network. But SDN also has found substantial demand from other organizations seeking to house their own data. The first phase of the data center, measuring 10,000 square feet, has only about 2,000 square feet still available and SDN already is talking to potential customers about a second and third phase.
A key customer is CoSentry, a company that focuses on hosting data for organizations requiring a high level of data security.
"They sublease rack space to other companies looking to secure data offsite," explained Brown.
While SDN is focused on organizations looking for at least 1,000 square feet of data center space, Brown said CoSentry will serve small to medium size businesses looking to "put a server or two in a rack."
SDN also has had discussions with major national companies looking for data center space in South Dakota--a location that is attractive to companies headquartered in distant areas seeking distant locations to support disaster recovery plans.
The new data center is "tucked down in the geography," explained Brown. "There are no windows and it has an extremely tight security system." In addition it can withstand an EF4 tornado, he said.
"People like the idea of being in the Midwest," said Brown. "They like connectivity to a vast network reaching into eight states. They like the climate. Cooling costs for six months out of the year are not a big deal. They also like the affordable electric power and the lack of flooding and the hurricane protection."
The SDN raised money for data center construction, in part, through a bond offering. Normally the company would not have qualified for bonds but Brown said the company was able to use that option because the area qualified as a recovery zone and SDN was able to use the county as the bonding authority. Montana-based Vision Net is a similar organization to SDN in that it is owned by nine rural telcos and operates a statewide fiber network. In addition, Vision Net has had a lot of success offering customer support and network troubleshooting on a wholesale basis to ISPs as far away as Maine.
As Vision Net CEO Rob Ferris explained, the company's customer support service is offered on a white label basis. ISP customers like the fact that Vision Net personnel appear to be part of the ISP's own operations by, for example, answering the phone with the ISP's name.
For a number of years, the Vision Net network has been anchored by two geographically disperse data centers that also support services such as server hosting--and the company's customer support resources have been a key differentiator in that market as well.
"Some data centers are very automated and there's no one you can talk to at three in the morning," observed Ferris.
RecentlyVision Net expanded its data centers to support a new infrastructure-as-a-service (IaaS) offering based on Cisco's CloudVerse platform announced this week.
The IaaS offering will enable end user organizations to minimize their investment in computing resources by using virtualized equipment housed in Vision Net's data centers. But for many clients, cost savings will not be the key motivator for using an IaaS approach, said Ferris.
"What they're interested in is getting applications off their site," he said.
For that reason, Vision Net--like SDN--sees its location as a key selling point for end user organizations based in metro areas in more populous areas of the U.S.
A key reason for using the Cisco solution is that it supports "the ability to silo customers in a multi-tenant fashion so they can be white labeled," Ferris said.
Ferris expects that Vision Net's nine rural telco owners will resell the IaaS service. Vision Net also may offer that capability to ISP customers and others, but Ferris said the company will be "very selective" about who it works with on that basis. In addition, Vision Net expects to deal directly with large enterprise clients based outside of Montana.
The Cisco CloudVerse solution will replace a previous IaaS platform and Vision Net Network Operations Manager Ed Hassell said the Cisco solution will have a key advantage over the previous offering.
"What Cisco brings to the table is automated high-speed fiber optic backup capability that's all automated in the background," explained Hassell. Previously that task, which enables the two data centers to back each other up, was completed manually.
"We were at about a two-hour turnaround on the old system," said Hassell. "That will be less than a minute now."
Vision Net enlisted the help of data center specialist Datalink with the conversion of its IaaS platform to the Cisco CloudVerse solution. Moving forward, Vision Net also may use the Cisco platform to support software-as-a-service offerings tailored for specific markets.
Huawei has High Hopes in Managed Services
Excerpted from Channelnomics Report by Larry Walsh
To Huawei Technologies, managed services is more than just a market segment, it's an opportunity to accelerate sales and market share, and it wants a bigger share of that growing and lucrative market.
Around the world, Huawei is snapping up major managed services contracts with telecommunications companies and service providers. The foundation of these engagements is the technology has become too complicated for these companies to manage on their own. Outsourcing management and administration to Huawei frees the subscriber to focus on core business development and innovation.
Already, Huawei has more than 240 major managed services contracts in 60 countries. Most recently, Huawei capture contracts with Sunrise, Telefonica UK and SingTel. According to the China-based company, its managed services growth is 70 percent over the last six years.
The strategy and value proposition is essentially the same as Cisco's Smart Net Total Care, which aims to provide Cisco and partner-led technology implementaion and managed services support to telecom companies and service providers. Cisco is already generating more than $8.7 billion a year, and sees even greater room for expansion.
While many question the viability of managed services in the cloud era, companies like Cisco and Huawei are seeing tremendous opportunity in moving beyond offloading to true business augmentation. And they're not the only ones. Numerous solution provider and systems integrators, such as Dimension Data are making similar moves.
Even though the Chinese company is one of the world's largest equipment manufacturers, it remains mostly a fabrication provider to other tech vendors rather than a fulfillment company. It wants to break out of white box manufacturing model and become a true IT vendor on the global stage. Managed services on the service provider level is seen as an accelerator to that goal.
What Huawei lacks is a true managed services strategy to enable partners down the channel stack to deliver services to midmarket and SMB accounts. Cisco has been doing managed services enablement for years, providing MSPs access to its technology stack and granting price protection to MSPs that standardize on their equipment.
As Huawei dives deeper into managed services it may find the lure of the midmarket channel too tempting to resist, and could develop programs that enable others to provide managed services on its platform.
Joyent Offers Free Cloud Infrastructure Software for Self-Service Clouds
Joyent, the cloud infrastructure performance company, this week announced free access to its private cloud infrastructure software, SmartDataCenter. Enterprise customers can quickly stand up a high-performance private cloud with a production license of Joyent SmartDataCenter, the modern infrastructure software that powers Joyent Cloud. The license offer provides companies the ability to stand up a fully functional cloud in their data center in a single afternoon.
"For the first time, enterprises can run a true public cloud inside their data center, providing the kind of functionality that developers demand while maintaining full control over their infrastructure and applications," said Steve Tuck, SVP and General Manager of Joyent. "This allows corporate IT to be a better service provider than AWS."
Joyent SmartDataCenter is the only cloud infrastructure software designed and tested at scale in a public cloud: Joyent Cloud, the high-performance, mission-critical environment that powers mobile applications, e-commerce sites, social networks and online games for customers like LinkedIn, Voxer, and ModCloth. SmartDataCenter is also the only industrial-strength cloud infrastructure that offers a single cloud stack, built from the ground up to power today's data intensive real time (DIRTy) web and mobile applications.
Customers who have moved to the Joyent Cloud from conventional cloud infrastructures such as Amazon Web Services, Softlayer or Rackspace have reported significant performance gains since making the switch.
"We tested the Joyent Cloud when we were using other public cloud services, and we could immediately see how much faster Joyent's infrastructure was running. That's important for a rapidly growing online retail company like ours, where every millisecond of wait time impacts our customers' shopping experience," said Blake Irvin, Systems Engineering Manager at ModCloth, the popular clothing site.
For over 20,000 global customers, Joyent has developed its cloud infrastructure based on a singular vision of creating a highly scalable and cost effective platform for the next generation of web and mobile applications where downtime thresholds are measured in seconds, not days.
Joyent's Better Way Initiative provides customers with an instant download of Joyent SmartDataCenter for a period of one year.
Joyent SmartDataCenter cloud infrastructure software stands apart from any other infrastructure software by offering these unique advantages: world's most modern, efficient architecture, which uses 30% less hardware compared to any other cloud software, and means sharply reduced hardware and capital costs combined with superior performance; unmatched performance that is 3 to 14 times faster than standard operating systems
Joyent also offers infinite scalability without loss in efficiency, which means doubling the number of servers delivers more than double the performance, compared to other virtualization solutions that erode performance gains from additional hardware.
In addition, it provides superior security that surpasses other multi-tenant virtualization solution by providing the only double-hulled virtualization infrastructure software available.
Joyent SmartDataCenter "containers" protect each customer's data in their own exclusive container and offer unmatched performance visibility through Cloud Analytics that measure latency at every level of the software stack, from kernel through to the application serving the end user.
Eurovision Selects Octoshape for Streaming to EU Audiences
Octoshape, an industry leader in cloud-based streaming technologies, was selected for the 7th consecutive year to stream the 2012 Eurovision Song Contest, this year in Baku, Azerbaijan, which took place May 22nd-26th.
"The Eurovision Song Contest is an excellent showcase of our technologies"
Using Octoshape's Infinite HD technologies, fans from all over the world viewed the event live and on demand on the Internet in TV quality, with instant on, and no buffering.
A global fan base follows the Eurovision Song Contest events very closely. To meet the demand and scale requirements, the event was broadcast over the Internet using the Octoshape Infinite HD-M federated broadband TV platform. Infinite HD-M allows broadband providers that belong to the federation to be able to manage the load on their broadband infrastructure using native or AMT multicast over their unmanaged Internet networks. This technology brings the quality, scale and economics of traditional broadcast TV to the Internet.
"Using Octoshape's suite of technologies, we ensured a great online experience for viewers all over the world," said Sietse Bakker, Event Supervisor for the Eurovision Song Contest.
"The Eurovision Song Contest is an excellent showcase of our technologies," said Michael Koehn Milland, CEO of Octoshape. "We were proud to deliver this popular event to fans around the world, maintaining TV-like quality without any buffering."
Big TV Manufacturers Debut Platform-Independent Alliance
Excerpted from Media Daily News Report by Wayne Friedman
Too many smart TV manufacturers going in different directions has at least two TV makers thinking of a more streamlined approach to development. Big TV companies LG Electronics and TP Vision (which manufactures Philips-branded TV sets in many territories) have started the Smart TV Alliance, intent on creating a "non-proprietary ecosystem for application developers to create attractive, platform-independent services." The two companies believe this will save on time and money in creating new systems/services. "Before today, the Smart TV industry was a very difficult market for both application developers and TV manufacturers and as TVs, from different brands using different platforms and technologies," stated Bong-seok Kwon of LG Electronics, President of Smart TV Alliance. Alain Perrot, a TP Vision senior executive, says: "Instead of spending valuable time on porting and testing on different platforms, developers can focus their creativity solely on realizing apps that consumers will enjoy." TP Vision is 70% owned by TPV and 30% by Royal Philips Electronics. It is headquartered in the Netherlands. Smart TV Alliance is making the first version of its software development kit available on its website, where developers can download at no cost to develop applications. Web technologies, such as HTML5, will allow Web applications to run on Smart TV's from participating members, regardless of the underlying platform.
Coming Events of Interest
IEEE Cloud 2012 - June 25th-29th in Honolulu, HI. "Change We are Leading" is the theme of the IEEE's fifth annual conference on cloud computing. Extended versions of selected research presentations will be selected for publication.
2012 Creative Storage Conference - June 26th in Culver City. CA. In association with key industry sponsors, CS2012 is finalizing a series of technology, application, and trend sessions that will feature distinguished experts from the professional media and entertainment industries.
Conference on Advances in Cloud Computing - July 26th-28th in Bangalore. India. This two-day conference will examine the latest trends in cloud computing and how organizations are increasingly adopting them.
CLOUD COMPUTING WEST 2012 - November 8th-9th in Santa Monica. CA. CCW:2012 will zero in on the latest advances in applying cloud-based solutions to all aspects of high-value entertainment content production, storage, and delivery; the impact of cloud services on broadband network management and economics; and evaluating and investing in cloud computing services providers.
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