The panelists were:
William P. Crowell – former Deputy Director of the National Security Agency
Michael P. Jackson – Deputy Secretary, Department of Homeland Security
Jose A. Rodriguez, Jr. – former Director CIA, National Clandestine Service & CIA, DCI Counterterrorist Center

Overall, it was a very nicely arranged event on a brisk fall evening with about 100 CXO attendees; mostly large but some small government contractors and a few product companies like ScienceLogic that conduct business with military, intelligence and the public sector.

No surprise, given the financial crisis the economy is suffering from that the panelists said we also have a crisis coming on the Federal budget front. This will put enormous pressure on the way Administration thinks, and how and where to spend the $$.

Obama’s tone regarding the issues he will be confronting in the world during the election was encouraging. Make the world more non-partisan and take on the threats that we have in front of us head-on!

The panel was very upfront about current threats. William Crowell said,

“It is highly imprudent to believe that there will not be another 9-11. We have to fund and support the work to stop other attacks. We can only mitigate risk but we can’t eliminate risk. We have to try to absorb the sense of urgency and wake up every day looking at the intelligence screens as if 9-11 happened within the last couple of months.”

He added,

“They (the intelligence community) need the innovation, sense of commitment and urgency that comes from the private sector – a sense of mutual commitment to that mission.”

Predicted Priorities for investment for DHS:

1. Cyber attack as the top issue
2. Nuclear threats including dirty bomb
3. Chemical and biological attacks
4. Explosive attacks against critical infrastructure with maximum # of lives and or financial disruption / loss.
5. Large scale natural disasters – hurricane + earthquakes
6. Border penetration - identity management and border management issues

An Obama administration will spend dollars around these threat vectors. They will want to spend $$ to help state and local governments. Grants to state and local governments should significantly increase with the Obama administration, so think about how you will increase your focus on the state and local government spending initiatives.

Secure border investments – the panelists believe that the new administration will feel compelled to invest here. Michael P. Jackson bluntly said, “You have to make investments in border tools to get meaningful immigration reform.”

Panelists agreed that the 1^st year will be an intense period of scrutiny about fundamental directions. We can’t afford it all at DHS; it is dramatically under budgeted. At TSA/DOT and then at DHS, we spent about $4 Billion on technology investments since 9-11; those investments are now reaching the end of the original service life.

One gripe from the panel that I found humorous: “We don’t have a group of people who think like entrepreneurs.” It is insane how long things last when you buy things in the government. As an example, we are still replacing vacuum tubes in some of the very old FAA gear… this is well beyond what any reasonable person would think these initial investments should/would last.

Final Thoughts:
I actually think that the Obama Administration will be quite favorable to COTS software products, SaaS offerings, and creative financing initiatives from the private sector. The government just won’t have the capital budget to do everything it wants to accomplish. I would say if you look at how intelligently and aggressively Obama used technology to assist his campaign, the odds are good that this new breed of IT talent (which is already really comfortable with SaaS products, blogs, wiki’s, hosted/outsourced Cloud solutions… this team really understands the latest technology trends) will quickly work to bring these new IT paradigms to the Federal marketplace. Clearly the private sector can help the Government achieve more with lower capital budgets – beginning to provide services rather than transaction-based selling. Another clear idea is to think about leasing as a better way to work with the government which going forward will have increased budgets restrictions.

They will likely be in confrontation with members of Congress that won’t change fast enough, however the future of our nation’s ability to fight terror lies in becoming more efficient and effective. It requires the government be flexible enough to figure out what jobs and IT functions to outsource in a nimble and smart way. My prediction: this is great news for Service Providers. Overall the next 4 years should be great for our business as well as the Managed Service Provider/SaaS industry!

The sky is falling! Trip Chowdhry, the analyst with Global Equities Research who claimed Red Hat was ‘rubbish and the entire LAMP stack is potty, too’ published some eye-opening predictions, predominantly negative, about tech business in Silicon Valley. Now Chowdhry claims that “almost every VC funded open-source company is struggling and will run out of money within the next six months.” (Probably not the most unbiased guy about open source) Matt Asay argues that organizations in general are struggling, but open-source companies are not that high on the list. (But are they high on the VC “axe” list??) He notes Alfresco, Pentaho and JasperSoft are some of the players with ‘millions in the bank and growing revenue.’ Asay also says Chowdhry has a responsibility to do real due diligence and not create myths. Take that, Chicken Little! (img from Disney-Clipart)

We’re not as far behind as we thought we were. Google presented the results of a study they conducted about how IPv6- capable “ordinary users” are at the RIPE meeting in Dubai a few weeks ago. Turns out Apple Macs drive IPv6 penetration in the US. Fifty-two percent of all IPv6 users in the U.S. own a Mac and use 6to4 (creating IPv6 addresses from an IPv4 address and tunneling packets) – making the US fifth in the list of countries using IPv6. Russia and France took first and second place with .76 and .65 percent IPv6-enabled traffic . The US is at .45 percent. Worldwide, 0.238 percent of Google users’ systems are IPv6-enabled and prefer to use IPv6 over IPv4.

Obama’s win = Google’s win? Apparently Google CEO Eric Schmidt and President-Elect Obama are very good buddies and “this terrifies Microsoft”. Now competitors are more on guard against Google’s growing empire and popularity. Although Schmidt was mentioned as a possible candidate for the country’s new national CTO position, he said he would not accept the post if asked. I guess that’s one less thing Microsoft has to worry about.

After Interop Las Vegas you may have seen our analysis of the data that we collected and delivered in our NOC view.  I thought I’d recreate the same data for NY and do a short comparison.

1) Like in Vegas, uptime for the network 100%.  This is no small feat considering that we introduced a new wrinkle in NY, taking down the primary NOC while the education portion of the show was still going on.  This was a forced failover to the backup systems, and it went flawlessly.  I’d like to give a little credit to EM7 on the 100% uptime as it caught a failover to battery power that allowed AC to be restored before a series of critical equipment would have gone down.

2) Again like Vegas, the average monitored device in the show network didn’t even hit 10% CPU utilization.  Still lots of computing overhead availabe in the show network.

3) The NY show network wasn’t nearly as busy as in Las Vegas, sustaining an average of only 27Mbps of usage (versus 56 Mbps) in Vegas.

4) Power consumption for the network and NOC in NY clocked in at 445kwh per day, about 25% less than the Las Vegas show.  This wasn’t because the equipment was any more power efficient, but instead because the show was smaller and therefore there was less network gear.

5) Finally, a stat we didn’t track too carefully in Las Vegas, but that I find interesting.  During show hours the wireless network average 1,100 users attached.  That’s a lot of people and a lot of wireless devices.

The good news is there was nothing too unexpected in the data, overall the smaller show led to a smaller number of tickets and smaller consumption of resources across the board.  We hope to have the opportunity to work with the InteropNet team again next year and take a look at this data year-over-year for each show.

The analysts paired up today:
Antonio Piraino (Tier1 Research)
William Fellows (The 451 Group)

My usual disclaimers on live-blogging: doesn’t include everything covered (just what was most interesting to me) and had to paraphrase some answers because I simply cannot type that fast.

Quick definition of Cloud Computing
WF: The cloud is a continuum of grid, virtualization and utility done right. It is about provisioning services instead of servers; flexible computing instead of fixed assets. Done right, the cloud abstracts users from the complexity of grid. Cloud computing is IT as a service. Cloud computing is the Third Way – not entirely in-house or outsourced, but an optimized hybridized version of both. In light of the Goldman Sachs report out resetting IT spending forecast from up 6% to down 1%, don’t underestimate the ability for enterprises to move from capex to opex by buying cloud computing instead of building it themselves.

The 451 Group conducted a survey on cloud computing in March, and then revisited it a month ago. Some interesting results:

• 84% have no plans to develop an internal cloud. 5% had no answer to this question. And for the 10% who did answer – the uses for a private/internal cloud were the same as those for a public cloud.
• Top 6 vendors they look to help them develop an internal cloud: Microsoft, IBM, Cisco, HP, Oracle, VMware

Is it all “upside” when it comes to cloud computing?

WF: Watch out for the Trojan horse, the red flag. What about the software needed to manage all this stuff? Any management software needs to take a holistic approach to solve the problem.

AP: Increased management requirements and capability – this is actually a great story for managed hosters who can hold your hand while getting you up into the cloud. Hosters alleviate the pain points, and this is why we’re going to see continued growth and focus in the managed hosting sector.

WF: I would argue that they’re too expensive. Look at Amazon – 10 cents a hit adds up.

AP: It’s almost impossible to do an apples-to-apples comparison between cloud providers. One reason is that they charge differently. I’d say that when you’re talking about the big cloud providers, you are right – that they are expensive over the long-term, but for use in the short-term, they can be optimal.

WF: The cloud is setting big expectations. Can IT deliver? It’s nice to talk about “shared resources for the greater good” but in any organization, you will still run into issues of power and control! Plus it’s still early days for resolution of regulatory issues and compliance around the cloud.

Final Thoughts

AP: Think of the opportunities of using cloud computing resources in the areas of testing and pre-production – short-term use/environment (quick up/quick down), inexpensive, opex not capex. We’re already seeing the cloud fostering much innovation.

WF: “It’s okay to fall in love with the term.” It is real but keep the expectations lower and realistic.

AP: I agree with you. The reality is that the cloud is driving a very fundamental underlying platform change. This is not just a term or something that will fall out of fashion. There’s a real need to build trust in the cloud and leveraging shared resources in this way – so use the cloud computing term cautiously; don’t abuse it and make the cloud seem like IT’s new toy.

After meetings and calls, I was finally able to slip into a conference session – just in time to catch uber-smart analysts Rachel Chalmers (The 451 Group) and Dan Golding (Tier1 Research) engage in a lively and not-so-mock debate on “Hosting Meets the Cloud”.

Now this doesn’t cover the entire debate – and part II is coming tomorrow. But what it does cover is the most interesting questions (to me) and paraphrase the points made by the analysts. I thought they both had very interesting points and more similarities than differences in the end; the real difference is how they thought about the issues and through what lens – for Rachel it was the enterprise and for Dan it was managed hosting providers. (image from inmagine)

Question: What is a cloud and why?

Dan: Shared infrastructure leveraged/run by third parties for the benefit of enterprises, developers, etc. This is not a new idea – just recently “rebranded.” Given all the discussion and disagreement over this now, what will the cloud end up looking like?

Rachel: The cloud is “IT infrastructure as a service” down to the level of a server operating system. Take the example of Amazon web services – in this case it’s not just the infrastructure but also the internal processes built around service delivery, e.g., provisioning, that are being exposed as a commodity to external customers.

Dan’s Question for Rachel: In your opinion, how much is the cloud a fad versus CIOs really trying to solve a problem?

Rachel: For the practical, roll-up-your-sleeves types of CIOs – those coming up from the engineering ranks – that I talk to, the cloud is real, as opposed to SOA and middleware.

What about “internal” cloud computing – built and maintained by an enterprise versus a third-party provider?

Dan: Cloud computing is done by providers for customers. Certainly there are enterprises that have made internal computing investments, e.g., for publishing, large-scale phone systems, etc - but they were stupid ideas made by companies that have too much money. A better question here is does it make any sense for an enterprise to create their own cloud? While an enterprise can play at it, they can’t do it cost-effectively, not in a way that a third party provider can do it.

Rachel: Many CIOs have “managed-hoster” envy – for things like chargeback and billing that hosters understand a do better. Of course there has been a rise in automation and virtualization tools in the enterprise which may not be as efficient and built for scalability as a hoster can achieve, but what is important is that they are customized/specialized for that business.

Dan: Can you give a specific example of optimization to make it worthwhile for enterprises to do it themselves?

Rachel: One example is sovereignty. The privacy laws around financial and healthcare information are not the same everywhere. Clouds and their geographically-dispersed data centers don’t necessarily have “national” borders. This is definitely a concern for the CIO that has to comply with regulations in their industry around privacy protection, for instance. Another example is security. Dow Chemical does a lot of work via joint ventures and has a need to provide but lock down desktops given to contractors as corporate workspaces. For their level of security, they need to “own” their computing resources.

Dan: But why can’t someone like SunGard provide that as they do for many other large companies?

Rachel: It comes down to a question of trust.

Do people trust their hosting providers?

Dan: Yes. Whether it’s for a content delivery network or collocation, hosting the customers of hosting providers are some of the largest companies in the world in industries like energy and financial services. Give me a case when there was a major security issue with a hosting company. In fact, managed hosting providers usually provide better security than enterprises are capable of.

And a question provided by an attendee from EMC: A few years ago, this would have been a grid discussion. How is the cloud different?

Rachel: Grid computing ended up being applicable only for niches – which I predicted. The real opportunity for everyone else with the cloud only comes up when you combine the kinds of automation tools (originally developed for grid computing) with x86 virtualization.

Dan: I agree. Grid was a niche play. There were very few orgs that needed it and that the economics worked for. There were very few enterprises for whom it made sense to build their own for. The cloud is shared/leveraged versus grid computing. It economically makes sense in a way grid never did.

Due to the slow economy, most tech companies are being cautious and ratcheting back sales forecasts for software and hardware. The exception: Infra-Strategy, a company that operates a group of Web sites that help people find a lawyer and info to deal with bankruptcies, divorces and DUI cases. Visits to the sites are booming – with visits to totaldivorce.com, for example, up 112% in October 2008 (I found the picture on the website particularly compelling). Apparently, in bad times, divorce rates go up. Who knew?

Is it always a recession when it comes to IT Operations? Companies are constantly trying to find ways to do more with less in IT – reducing costs but keeping the same or even adding functionality – deploying technologies that drive IT consolidation such as mobile and remote access, unified communications and virtualization. Chris Silva of The Forrester Blog for IT Infrastructure & Operations Professionals is looking for a research panel to find out what fellow IT companies are doing to keep their IT budgets in check. To join the research panel visit: http://itpanel.forrester.com/.

The Cloud Computing Monopoly debate continues. O’Reilly Media founder Tim O’Reilly and technology writer Nicholas Carr (of “IT Doesn’t Matter” fame/infamy) have been discussing the ‘potential for a single company to achieve monopoly control of the world of cloud computing.’ But what’s even more interesting is the “who will make a lot of money” in cloud computing question.

Of course, virtualization can do its bit to help companies save on hardware, power and cooling costs. We have this straight from a customer’s mouth – see the video here. And having your data center be 100% wind-powered certainly does its bit as well.

But the winner – according to eWeek and and an EMA study in September – is to turn equipment off when they’re not in use. I would say this is a no-brainer, but apparently we all need to be reminded…

Who remembers that line from the Schoolhouse Rock video on Energy? “So don’t get cross, when momma says turn that extra light off.” The full video for your viewing pleasure here.

(image from freedomroadproject)

Salesforce.com’s Dreamforce conference takes place this week in SF. Billed as “The Cloud Computing Event of the Year”, the conference kicked off with a keynote by Benioff while people wearing puffy-white jackets and holding giant helium-filled cloud balloons stood outside.

Benioff announced partnerships with Facebook and Amazon.

Part 1: Force.com apps will be able to run on Facebook and leverage the Facebook users’ social network. An example shown was integrating “My Starbucks Idea” into Facebook. If a user submits an idea through Facebook, their friends can see it, comment or be prompted to submit their own.

Part 2: Force.com applications can now use Amazon’s cloud hosting services in addition to the public Force.com sites.

This is smart and a surprisingly non-megalomaniac way of doing things. Instead of trying to own the entire cloud stack (hmmm – someone just made a very different announcement), Salesforce looks like it’s focusing on what it does best – enabling application development in a hosted model. And letting Amazon take at least some of the future blame for any outages/interruptions in service (anyone who has Salesforce can say amen to that). That is smart.

What an interesting time to hold a technology conference. The DLA Piper Global Technology Leaders Summit last week brought together CXOs from Amazon, Walmart.com, Stanford, Safeway, Microsoft, Sun, Cisco and others to discuss the state of IT in general and how the economy is impacting it. Some highlights:

“Cloud computing for large enterprises is a dead duck, in the opinion of several venture capital firms.”

“The current slowdown in the U.S. macroeconomy is definitely going to hurt the IT industry, as it will most of the nation’s businesses, for at least the next year and most likely into the next two years.”

NetApp cancelled its first user conference slated for 2009 citing economy-driven restrictions on business travel.

We recently wrote about the possible upside for MSPs in this economic downtown. A survey from EquaTerra of more than 200 outsourcing service suppliers announced that “more than 40 percent of those polled had seen increased demand levels, despite the economic downturn.” The survey suggests that outsourcing projects are changing, with a strong focus on quick return on investment replacing longer-term initiatives to improve end-to-end business processes, according to InfoWorld. So as we saw during our own surveys this year, it looks like IT will spend time and money against the practical projects that should and could get done and not taking on ITIL and CMDB projects.

Jonathan Schwartz as a puppet talking about open source and his ponytail. The driest Sesame Street take-off you’ll ever see. Check out the video here. For those of you playing a drinking game at home, “ponytail”.

Denise Dubie posted a follow up to her article Novell’s Managed Objects buy, and shared insights from different commenters, including yours truly.

One of our favorites, the IT Skeptic was featured on John Willis’ blog this week, answering some questions about CMDB, ITSMF and more. He also provided his insight into IBM Tivoli, although he “tries to stay non-partisan”.

Inexplicable. HP posted Halloween-themed videos about datacenters on YouTube this week. Unlike the great IBM videos about the mainframe, these videos speak techno-babble without tempering the lingo with being funny or tongue-in-cheek. Various frightening creatures share information on service management processes and discuss virtualization techniques to help consolidate hardware. Scary.

The Azure announcement is the culmination of years of planning for Microsoft’s “software-plus-services approach to computing.” According to Debra Chrapaty, the woman who runs Microsoft’s data center infrastructure, plans started about four to five years ago to build out data center capacity for the new initiatives. The best place to build a new data center: Quincy, Washington – whose hydroelectric power and commitment to fiber made it a winner. (Click here for Mayor Hernberry’s update on the impact of the new data centers and apparently new wineries popping up in Quincy.)

Thank goodness for Microsoft. In this economy, we should all be grateful to companies that can still spend between $300 million to $700 million to build just one data center.