Price cuts, vendor changes top cloud computing news in 2013

From VMware splitting vCloud Director to Dell folding its public cloud offering, the cloud industry has made plenty of news so far this year.

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Though we're just moving into fall, 2013 has already been a busy year for the cloud industry. Dell moved toward private cloud and discontinued its OpenStack and VMware public cloud, and Google and Amazon Web Services (AWS) played a game of limbo to see who could go the lowest on pricing. Some of the biggest news included everything from shadow IT to good old-fashioned networking complaints.

Let's take a look back to review the top 10 cloud news stories that captured the most attention in the industry so far and how this news sets up the cloud market for the coming year.

10. SoftLayer users may end up on OpenStack following IBM's acquisition (June 4)

IBM's acquisition of Infrastructure as a Service (IaaS) provider SoftLayer left many wondering how it would integrate its OpenStack product into the CloudStack-based service. As of September, SoftLayer customers have not yet been integrated onto OpenStack. SoftLayer was the latest in a string of acquisitions by IBM since 2007, including UrbanCode, Cast Iron Systems, Kenexa, Green Hat, DemandTec and Platform Computing. The trend of larger companies buying up the smaller, innovative ones continues -- but is it for the better or the worse of the cloud industry?

9. GE, Pivotal and Amazon collaborate on the 'Internet of Things' (June 20)

The "Internet of Things" is not a new concept, but it's one the cloud industry hasn't had the ability to truly accomplish -- until now. With the triumvirate of GE, the Pivotal Initiative and AWS collaborating on the Internet of Things, the potential exists for machines to communicate not just within, but among organizations. "The sky's the limit with this stuff," said David Linthicum, senior vice president of Boston-based cloud consultancy Cloud Technology Partners; we'll continue to see its potential as we move into the coming year.

8. Verizon Terremark confronts AWS IaaS with new cloud instances (January 15)

Verizon Terremark updated its VMware-based Enterprise Cloud Infrastructure as a Service offering to allow its customers to pay per hour and spin customized cloud instances up or down as needed. Previously, customers would provision a resource pool of compute, network and storage instances and pay a monthly fee, even if it was not fully consumed. Whether these updates were successful for Verizon Terremark remains unclear. Sources say the company might have a new cloud offering in the works this fall.

7. Networking, security issues still irk large AWS shops (August 22)

AWS customers have plenty to be happy about, yet networking and security remain two challenges they say Amazon must improve, according to panelists at a Boston-area AWS meet-up in August. The complexities of ensuring that security group rules are correctly assigned and running Amazon's Virtual Private Cloud were both cited as features AWS customers find to be overly difficult. Amazon would also be wise to open up a bit. "The biggest thing we asked them for is not technical; it's cultural," said Barry Jaspan, senior architect for Acquia. "Amazon has a culture of secrecy." And while these issues still bother its customers, are they enough to topple AWS from the top of the cloud market?

6. Buyer beware: Cloud washing rampant among tech vendors (April 17)

To capitalize on the buzz of cloud computing in the IT industry, some vendors will label a product with "cloud" to lure prospective customers. High-profile vendors accused of cloud washing include HP, IBM and Oracle Corp., but this type of cloud washing is going on all over the tech industry. Companies looking to adopt cloud services must consider options with a discerning eye, said David Linthicum of Cloud Technology Partners. The U.S. Securities and Exchange Commission recently got involved in rooting out misrepresentation by investigating how IBM is reporting its income -- showing that this cloud washing trend may come under closer scrutiny as the market is maturing.

5. Amazon Web Services cuts dedicated-instance pricing for market grab (July 12)

In July, AWS cut up to 80% of its dedicated instances on its Elastic Compute Cloud. Just a few months after Google approached Amazon's pricing level, AWS pricing went even further down. As pricing continues to drop, competition stiffens in the IaaS market space to capture enterprise attention -- but Amazon won't let up its throne that easily. "Amazon doesn't want to be caught in a position where they're charging the most," said Carl Brooks, research analyst for Boston-based 451 Research. "They want to be known as the industry standard. They want to maintain the competitive edge."

4. Google Compute Engine prices on par with AWS -- for now (May 16)

In May, Google disclosed its Compute Engine pricing to be similar to that of AWS, and customers took note. But those expecting an all-out price war between the two cloud giants were disappointed, as AWS remains the most affordable cloud in many cases. Google argues that when cloud prices drop low enough across the market, better performance and features will attract customers -- not price. But time will tell if that points to Google.

3. NASA's shadow IT issues with cloud computing all too common (August 6)

Shadow IT is a growing concern for cloud customers -- and if NASA struggles to find a way to prevent it, how will the average enterprise? "It happens every single day, to everybody," said Kent Langley, CEO of Ekho Inc. "I've found servers that were costing me $700 a month in one of my deployments -- someone had launched a bunch of large instances for test and never turned them off." By following the money, companies can scout out rogue cloud deployments and potentially work to minimize the risk.

2. VMware charges into public cloud IaaS fray as Dell exits (May 21)

Dell's decision to discontinue its OpenStack and VMware vCloud public cloud in favor of focusing on multicloud management after its Enstratius acquisition surprised a lot of folks, particularly those who figured Dell going private would help it develop a stronger cloud strategy. Dell's tale is a cautionary one, as VMware and other providers must continue to innovate or risk getting left behind in a packed cloud vendor market.

1. VMware splits vCloud Director into vCenter, vCloud Automation Center (August 29)

Coming on the heels of VMworld 2013, VMware announced plans to split intellectual property currently in vCloud Director into new integrations with vCenter and vCloud Automation Center. Attendees at VMworld worried about the potential headache of a conversion process, signaling a questionable response from the VMware faithful on its decision. "There better be a pretty seamless path to implement whatever version is coming out without causing us to have to rework everything," said Kirk Bellmore, VMware systems engineer for a higher education institution in San Diego. "VCloud Director does not have a history of being one of those tools that's easy to either implement or upgrade."

This was first published in September 2013

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