Being the repository of the majority of company business data, Finance is becoming one of two de facto “data centers” for most companies in the 21st century (the other “data center” being Marketing). The use of Cloud-based systems by and for Finance will have – is having – the effect of making more business data available to more entities and will therefore engender more business change, and therefore cost, than has previously been expected or experienced. As they become more complex and costly, and as they affect more aspects of companies, Cloud-based solutions and services increasingly require solid business cases to support their acquisition. A new Strategic Perspective for subscribers of Saugatuck Technology’s Continuous Research Service offers six key questions that successful CFOs ask and answer as they begin to build bullet-proof Cloud acquisition business cases. Continue reading
What is Happening?
Yesterday, Saugatuck attended the AWS Summit 2015 in San Francisco, where Amazon gave an update on their business, and released several new products to the nearly 10,000 attendees at the Moscone Center and the 7,000 who watched the livestream. Andy Jassy, SVP of Web Services at Amazon kicked off the keynote by highlighting some key statistics about the business: from 4Q13 to 4Q14 they experienced 103 percent year-over-year growth in the amount of Data transferred into and out of S3 (Simple Storage Service) and 93 percent growth in the use of their compute service EC2. They now have over 1 million active users who have used the service in the last month.
Jassy brought several companies out to discuss the value of the AWS Cloud infrastructure. Jason Kilar, the founding CEO of Hulu, and now CEO of Vessel, a startup focused on video sharing and consumption, highlighted the ability to keep his team small, and focus on the business without having to build infrastructure. Wilf Russel, VP of Digital Technology Development at Nike described how the Cloud has fundamentally changed their application architecture and described their shift toward DevOps and Microservices. Valentini Volonghi, CTO at AdRoll discussed how the Cloud gave their business the reach to reduce latency by distributing their app around the globe. And Colin Bodell, CTO & EVP at Time Inc. who is migrating all of Time’s datacenters to AWS, citing that in the UK, they took their datacenter monthly run rate from $70,000 to $17,000.
Finally, Jassy used the opportunity to make several product announcements:
- Amazon Elastic File System (EFS) – a fully managed filesystem that can span multiple EC2 instances to enable multiple concurrent and scalable connections to a single file directory.
- Amazon Machine Learning Service – A one-size-fits all service that enables non-experts to implement Machine Learning algorithms on their data sets, or within their applications. This offers a simple API for training and modeling calculations which can then be called to perform specific machine learning tasks.
- Amazon Workspaces and AWS Marketplace for Desktop Apps – an Amazon VDI product to enable companies to create virtual desktops, as well as purchase, manage and provision the software for those desktop applications.
- The GA release of the Amazon EC2 Container Service – The Amazon tool for deploying, managing, updating, and running Docker clusters.
- The GA release of AWS Lambda – a Service designed to perform trigger / event driven compute in small doses. Provides a way to perform small, scripted tasks in real-time when triggers are initiated. Amazon highlighted its use in sending notifications, indexing, IoT, and as a serverless mobile backend. At present, Lambda only supports Node.js, but is adding support for Java in the coming weeks.
What is Happening?
Earlier this month in a Wired article, the chairman of the Federal Communications Commission (FCC) proposed stronger government regulation of the Internet. Chairman Tom Wheeler suggested that Internet service providers (ISPs) should not give preferential treatment to some users by blocking content or creating “fast lanes.” Wheeler suggested regulating the ISPs by changing their status to be under Title II of the Telecommunications Act. Title II status means the government would regulate the Internet as a public utility.
President Obama had already chimed in, asserting that it’s essential to the economy to “keep the Internet free and open” by protecting net neutrality for everyone. He says there should be “no gatekeepers of content” and that we need to make net neutrality a “legal obligation” for ISPs. He goes on to ask the FCC to reclassify the Internet as Title II. The Internet, he says, is “an essential part of everyday communication and everyday life.” Consumers, not the ISPs, should decide what Web sites they want to access. Obama’s statement lists four main categories of rules:
- No blocking,
- No throttling,
- Increased transparency, and,
- No paid prioritization.
The five-person FCC panel will vote on the 332-page proposal for the order on Thursday, February 26. The FCC will not release the plan to public before the vote. According to those who have seen it, eight of the pages are regulations, 79 pages are details of the provisions, and the rest are references and comments. The expectation is for the FCC to adopt the proposal.
FCC commissioner Ajit Pai, made a statement on Feb. 10 saying that, “the American people are being misled.” In a counter to President Obama’s and Chairman Wheeler’s assertions, Pai sees “adverse consequences to the entire Internet economy” should the rules become law. He says these are “vast, yet vague regulations” with “exogenous political influences.” Pai emphasizes that the plan:
- Regulates rates,
- Claims no competition exists for the majority of Americans,
- Scrutinizes all options but unlimited,
- Tolerates the FCC micromanaging the Internet,
- Allows class action lawsuits against providers,
- Regulates ISPs utility-style, and,
- Opens door to billions in new taxes on Internet.
As a result of ongoing discussions with users and providers of Cloud infrastructure, Saugatuck has identified that Cloud infrastructures are not immune to the fundamental characteristic of any shared resource: resource sharing can result in variable service levels.
In a recently published Strategic Perspective, Saugatuck explains why Cloud infrastructures deliver inconsistent service. Saugatuck urges Cloud users to perform ongoing monitoring of performance of key Cloud-based workloads and offers some possible approaches for dealing with inconsistent service, including: Continue reading
With the continuing shift toward boundary-free business, and the attendant shift toward creating and including more digital business, how are the roles, the influence, and the value of the CFO to the enterprise changing? A new Strategic Perspective from Saugatuck Technology examines how the scope of CFO involvement, influence, and value is not only changing, but expanding radically, and relatively quickly, into new areas – typically without adequate management resources. Continue reading
What is Happening?
Earlier today, Saugatuck published its executive leadership report summarizing the key takeaways from its recent 2014 Cloud Business Summit, held in New York City on Nov. 12. As detailed in a previous Research Alert (entitled “Trip Report: Key Highlights from 2014 Cloud Business Summit”), more than 100 large enterprise CIOs / CTOs, CFOs and CMOs participated in the day-long, peer-level forum.
In this Research Alert, we highlight some of the key insights and best practice takeways from the report to help these executives develop, refine, and optimize new and better ways of doing business in the Cloud-first, Digital Business era. The 42-page report, entitled “2014 Cloud Business Summit Leadership Report: The Digital Business Era” is available via Saugatuck’s web site. Current subscription research clients may access the report by clicking here.
Sessions and discussions during the Summit centered on ways that Cloud and its related capabilities (e.g., Mobility, Social IT, Advanced Analytics/Big Data) are enabling significant innovation and improvement in how business is created, accomplished, and managed, as well as how these capabilities and innovations are secured and governed.
The bottom line? Rethinking and reinventing business and IT strategy, operations, management, engagement, and investment to enable digital business strategies has never been more advantageous to the enterprise – but it’s only a matter of time before that advantage turns to necessity. Continue reading
On November 12th, 2014, Saugatuck Technology held its 4th annual Cloud Business Summit at the Yale Club of New York City. As with prior Summits, our event brought together more than 100 large-enterprise CIOs, CTOs and senior business and finance leaders – to explore how they can and are realizing value from the Cloud.
The key focus this year was the significant impact that Cloud is having in shaping core business strategy, as we evolve into the era of Digital Business.
In this Fireside chat, Saugatuck Research Fellow Bruce Guptill sits down with Tim Minahan, CMO SAP Cloud. Minahan discusses the impact that Cloud has had, not just on the cost profile of IT, but also in how it has drastically reshaped the agility that businesses are capable of achieving. Guptill and Minahan go on to talk about how businesses are opening new doors by harvesting data at scale, and using this to help them move beyond traditional TCO models to look instead the opportunities Cloud can create for their businesses. Continue reading
What is Happening?
Over the last several months, Saugatuck has been looking into phenomena increasingly (and commonly) referred to as “Hyperscale”. Hyperscale appears to be entering common parlance just as Cloud became increasingly well-understood and then mainstream over the past five plus years. Common definitions of Hyperscale focus on two major factors: the speed of scaling resources allocated to a task; and the extent of the resources available in the infrastructure.
However, just as Cloud offerings today don’t look like the Cloud offerings of 3 years ago, the requirements and usage of infrastructures that can be termed Hyperscale are evolving rapidly. Not too long ago, a primary value proposition for Cloud infrastructure adoption was economic, due to improved hardware utilization through automation of resource provisioning / allocation to individual workloads. This same automated provisioning is now viewed as a significant boon to IT and Business agility, not just a means to save money.
Similarly, Hyperscale has been viewed as a requirement for some types of workloads and as a foundation for some Cloud providers. However, Saugatuck projects that Hyperscale will increasingly become recognized as a key enabler of new types of application design, and broadly deployed among a much larger pool of Cloud infrastructures. Continue reading
As part of Saugatuck’s “Finance in the Cloud” Series, we have conferenced with executives from over a dozen providers of Financial Management Solutions to learn more about the their solutions, their market reception, their future plans for enhancement and how they view “Finance in the Cloud.” We have also conducted an in-depth survey of over 300 buyers of Cloud Finance solutions, both CFOs and CIOs at midsize to very large organizations (See 1492SSR, Cloud Financials – The Third Wave Emerges, 17 December 2014, also summarized in LENS360, Financials in the Cloud – New Survey Insights, 18 December 2014).
We have posed a number of scenarios to our survey respondents and analyzed their responses regarding how their organizations view “Finance in the Cloud (See Figure 1).”
Figure 1: Five Scenarios for Cloud Finance Migration
Source: Saugatuck Technology Inc.
One of the leading current preferences, Remain On-Premises, though it shrinks in our respondents plans and preferences over the next five years, still remains a significant option for those CFOs, especially very large enterprise CFOs, reluctant to trust their Finance solutions to the Cloud for any number of reasons. Continue reading
Adoption of Cloud-based solutions is expanding across enterprises and across business departments within enterprises. Saugatuck’s on-going surveys and discussions with IT executives indicate that significant expansion of Cloud usage will continue over the next two years. However, as experience grows, IT management teams are learning the “realities” of Cloud IT. In a recently published Strategic Perspective, Saugatuck reviews four reality areas discussed by an expert panel and audience of IT executives at Saugatuck’s recent Cloud Business Summit (CBS2014) conference in New York City. The four reality areas are characterized by the following questions posed to initiate the panel discussions: Continue reading