July 9-10, 2013
San Francisco, CA

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Back in 2009, Apptio was famed venture capital firm Andreessen Horowitz’s first investment. Today Apptio announced closing a $45 million fifth round of funding, bringing the company’s total to $136 million.

Apptio’s software is used by businesses to manage their IT systems and services. Its Technology Business Management (TBM) solutions monitor financial and operational data about IT and technical customer support to provide added transparency and cost-efficiency.

IT systems are complicated and expensive. Developments in computing, such as the migration to the cloud, have changed the way businesses structure their IT systems. With these shifts comes the need to gain an understanding of how the various products, services, resources, and assets are being used. Apptio gathers and analyzes data about IT system performance so businesses can make data-driven decisions and get the most out their IT investments.

Apptio has subscriptions from 29 of the Fortune 100 companies and has more than 125 global enterprise customers, including Boeing, Royal Bank of Scotland, Safeway, Target, and Xerox. This financing will support Apptio’s accelerating growth and expand its international presence. New investors Janus Capital and the Hillman Company led this round, with participation from existing investors Andreessen Horowtiz, Grelock Partners, Madrona Venture Group, Shasta Ventures, and accounts managed by T.Rowe Price Associates. The company closed its $50 million Series D last March.

“Apptio has everything we like to see in investments — a big market with a significant problem,” Ben Horowitz said to VentureBeat about the 2009 investment. “The way companies get information about modern IT is extremely broken, and they’ve built a terrific product to address that.

Apptio was founded in 2007 and is based in Bellevue, Washington.

Sept. 9 - 10, 2013 San Francisco, CA

Early Bird Tickets on Sale

Cameron Peron is VP Marketing at Newvem, a cloud operations optimization service.

Amazon has launched a series of local Amazon Web Services summits across in key cities across the world. Capitalizing on the re:Invent conference in November of last year, the AWS summits are a great forum for local AWS users to learn about featured AWS services and meet partners exhibiting at the event itself.

The AWS Summit in San Francisco a number of days ago lived up to this expectation. Here are 5 insights from Amazon senior VP of web services Andy Jassy’s keynote, and the exhibition itself.

It’s all about the enterprise

Adoption of the public cloud by the enterprise was a key message through the introductory keynote.  In sharp contrast to the keynotes delivered in re:Invent in November, Andy Jassy emphasized the public cloud as part of an enterprise’s IT and cloud strategy as opposed to a complete alternative to on-premise and virtual private cloud.

Andy highlighted use cases of AWS services that the enterprise can use to both move workloads to the AWS cloud as well cooperate between on-premise and AWS environments.

Security = priority #1

Jassy stated that AWS is committed to providing a secure public cloud, highlighting the addition of advanced security controls, certifications and accreditations.

No doubt this was a direct message to enterprise level CIOs that are considering moving small variable workloads to the public cloud, but need to deal with security and compliance risks that run deep into their respective organizations.

Redshift, redshift, redshift

The keynote contained many use cases and examples of using AWS RedShift, a data warehousing and data analysis solution.

Based on an hourly pricing model, RedShift enables AWS customers to analyze large volumes of data with their existing business intelligence tools.  The RedShift use case was a common theme throughout Andy Jassy’s address, use cases delivered throughout the keynote, and breakout sessions. RedShift follows in the footsteps of enriched AWS services such as OpsWorks and Trusted Advisor.

Cost is still the driver for onboarding new business

Throughout the keynote Jassy championed many organic AWS services, as well as solutions provided through the AWS Partnership Network that enable companies to scale once on the AWS cloud.  Despite this, low cost is still king.

Just as Werner Vogel discussed cost savings in the beginning of the New York City keynote, Jassy emphasized that AWS lowered prices 31 times in the absence of competitive pressure to do so.  In line with the success of the Amazon.com model, Jassy implied that that AWS will continue to reduce prices.

Jassy also offered examples of customers reducing costs by using solutions beyond EC2, highlighting that Foursquare reduced their analytical cost by 50 percent with AWS.

Launch of the AWS Certification Program

Jassy also shared the launch of an AWS program that certifies solutions architects, SysOps Admin, and developers.

To qualify, applicants must complete an exam that covers both proficiency in AWS as well as general IT knowledge and experience.  The program should complement and reward AWS users who have championed both onboarding and scaling AWS within their organizations by mandating and regulating their skill sets throughout the career.

In other words DevOps and other AWS users can add AWS certification alongside experience and proficiency in code, such as Ruby and Python.

Cameron Peron is VP Marketing at Newvem, a cloud operations optimization service designed for cloud users. Offering a business view into a company’s public cloud operations, Newvem actively tracks cloud health in order to help reveal and solve cloud irregularities related to cost, security, utilization and availability.  Follow Cameron at @cameronperon

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

Update: This story has been updated with the correct funding amount. It was $1.8 million, not $18 million.

What do Crossfit and RackWare have in common? They both aim to make their customers flexible and agile and get them running at optimal performance.

RackWare is a cloud startup that has raised $1.8 million in its first round of funding.

RackWare has developed a series of enterprise solutions to bring “intelligence and automation to the cloud.” The RackWare Management Module (RMM) helps businesses scale across private, public, or hybrid cloud environments, without changing applications.

As businesses migrate their operations to the cloud, there is a greater need for tools to help manage this infrastructure. RackWare launched in September 2012 with its management software that helps IT teams get the “highest performing” cloud throughout their applications’ lifecycle. The company touts the “mobility” and “elasticity” that RMM brings. The technology makes it easy to scale up or down, depending on demand, as well as disaster recovery.

“Today’s enterprise IT organizations need solutions that allow them to immediately benefit from deploying applications in the cloud within their current environment,” said founder and CEO Sash Sunkara in a statement at the time. “With RackWare Management Module, users can take full advantage of the cloud without comprising their current investment in infrastructure and applications. And once RMM is in place, it is easy to expand use of the cloud to increase cost savings to the business through greater availability and flexibility for application developers and users.”

Sunkara was one of the cofounders of 3Leaf Systems and served as VP of marketing at QLogic’s Network Solutions Division. Her cofounder, Todd Matters, worked on networking at Unisys and IBM and founded SilverSteam. They founded RackWare in 2009 and at the time raised a small amount of angel funding. This $1.8 million is part of an intended $2.67 million, according to an SEC filing. The investors are undisclosed, although VentureBeat has reached out to RackWare for comment.

RackWare is based in Santa Clara, California. Read the filing.

Photo Credit: CrossFit Kandahar/Flickr

Sept. 9 - 10, 2013 San Francisco, CA

Early Bird Tickets on Sale

In February, we reported that Dropbox was stepped up its enterprise sales push, and had amped up its security.

Since then, the cloud storage company has received innumerable requests from IT admins for an integration with Active Directory. Created by Microsoft, Active Directory enables IT teams to assign and enforce security protocols for every computer in the network.

So today, the company announced on its blog that it will introduce single sign on (SSO). The benefit for business users is that once they’re signed in with Active Directory, they can automatically access Dropbox. It’s one less password to remember.

“With this new feature, we are centralizing around the industry standard,” said Tido Carriero, the lead engineer for Dropbox’s business service, by phone. ”It’s a big security improvement and means no additional work for IT admins.”

IT can more easily control access to Dropbox — they just need to update the Active Directory with information about new hires or recently departed employees.

Dropbox also announced an integration with a number of other cloud-based identity management companies, such as Ping Identity and Okta, so it can introduce SSO within a month. These companies also use Active Directory under the hood.

Dropbox has moved away from calling its business service “Dropbox for teams” so it can continue to sell to large companies. The company has rebranded to “Dropbox for businesses.” Dropbox claims it has secured accounts with two million businesses, but still faces strong competition from Box and Egnyte, cloud-based storage providers that also sell to large enterprises.

Kevin Egan, the company’s new vice president of sales (poached from Salesforce), said that Dropbox is eager to push into the enterprise. “Customer requests are being heard and we’re iterating fast,” he said. “We are getting the engines fired on all systems.”

Developed by Flickr to enable up to 10 code releases each and every day, DevOps is a continuous deployment methodology that uses high levels of automation to bring development — coding engineers — closer to operations, the team that builds and runs the servers that deliver the software to users.

According to a new report by IT automation provider Puppet Labs, 63 percent of companies are now using at least some DevOps methodology. Companies that do, ship code a staggering 30 times more often than companies that don’t and accomplish that rapid turnover with 50 percent fewer errors.

Not surprisingly, the deploy rate — how often companies actually update live production code — increases as the length of time of DevOps implementation increases, and the change lead time decreases. In addition, the change failure rate decreases.

How?

Puppet Labs’ report says that version control, which allows instant rollback and quick pinpointing of changes that could have adverse effects, and automation, which helps companies create and run a set of repeated and automatic steps for each and every code deployment, result in the achievement of what might be seen as two diametrically-opposed goals: quick reaction time and lower error rate.

More details, visually, in the infographic:

photo credit: Leonardo Rizzi via photopin cc

July 9-10, 2013
San Francisco, CA

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In a new illustration of the vibrant activity of the Moscow venture scene, Maxim Shekhovtsov and Alexander Zhurba – founders of TexDrive, one of the city’s largest startup accelerators – announced last week the creation of a fund dedicated primarily to IT projects in Russia and around the world.

Christened Genezis Capital, the fund actually launched and made its first investment in late 2012 – but the official announcement was delayed to take advantage of the most suitable moment for it, Zhurba said in an exchange with East-West Digital News.

Genezis was put together by a group of more than 30 limited partners, representing investment banking, PE funds, large-scale multinationals and just “wealthy people.”

The amount of the fund – which is still open to new LPs – has not been disclosed. But Genezis sources have stated that it has raised enough money to invest in three to five seed or early-stage companies every year, with each receiving from $25,000 to $1 million, and in two more mature startups for as much $20 million apiece – and this for at least two years running.

IT projects are expected to account for up to 70% of the fund’s investments, with the rest allotted to beefing up players in biotech, clean tech, energy saving, alternative energy and robotics.

A global focus

In Russia, Genezis works as an extension of TexDrive, managing the accelerator’s assets. Its playing field has been rather narrow, with no more than 70 investment-grade startups in the country, the fund has estimated.

But Genezis – which was registered in an as-yet unspecified foreign country – seeks investment opportunities across markets as diverse as the U.S., Europe, Russia and Asia. “We consider Russian and foreign startups under identical criteria,” Zhurba told EWDN.

The ‘invest abroad’ trend among Russian funds started in 2009, when Yuri Milner’s Digital Sky Technologies invested in Facebook. Since then, a bevy of Moscow-based VCs, including Bright Capital, Phenomen Ventures, Runa Capital and Ru-Net, have been chasing opportunities around the world, while DST’s cash has fueled Airbnb, Alibaba, Spotify, Twitter and several other top Internet companies.

Genezis Capital’s first investment – more than $10 million – went to an undisclosed company operating in the U.S. and Western European markets. Its Russian portfolio includes B-152, an Internet service that helps businesses comply with the demanding requirements of Russia’s personal data legislation; Martmania, a Novosibirsk, Siberia-based online retailer; and Fleecs, a startup developing a payment solution for fuel stations.

Photo Credit: John Leach/Flickr

Sept. 9 - 10, 2013 San Francisco, CA

Early Bird Tickets on Sale

This is a guest post by technology executive Roman Stanek 

Despite all the inroads cloud computing has made among business users, it still hasn’t broken through the enterprise IT logjam. I see it as a cultural issue: IT organizations love control and complexity. They love being able to code, flip switches and grab control of their systems. And they love complexity because, frankly, they think it saves their jobs.

Unable to free themselves of this anachronistic mindset, IT departments live in the land of the “no.” That’s “no,” as in: “No, you can’t bring in your own device,” and “no, we can’t build this new function you need because we’re too busy just keeping the lights on.”

So while business people are bypassing IT and subscribing to cloud-based apps that help them manage customer relationship management (CRM) functions with Salesforce.com, connect with customers using Zendesk, and collaborate with Box, most IT organizations remain focused on the mundane. And the irony? By embracing control and complexity, IT organizations have effectively isolated themselves within a technology ghetto. They are the opposite of strategic. And that means they aren’t protecting their jobs — they have become expendable.

I believe it’s imperative for SaaS providers to help IT people accept a new mindset and help them make the transition to what I like to call the age of IT enlightenment. Instead of owning the infrastructure — and spending 90 percent of their time just to “keep the lights on” — they need to assume new responsibilities related to governance, capacity planning, security, workflow across apps, and the rise of BYOD.

How we as an industry handle this challenge — in essence, how we help IT folks into the age of IT enlightenment — could reshape the entire market. Some IT organizations have already begun this transition, and are seeing the rewards. But for the rest…..

It starts with psychology: convincing IT folks that that they are not abdicating responsibility. They are delegating it. This will be easier said than done, since IT craves control especially when something goes wrong, as it inevitably will. The solution?

Deliver excellent SLA: Google Gmail, the world’s biggest cloud-based e-mail system, has an average uptime of 99.99 percent. Amazon targets 99.95 percent uptime for AWS. I challenge any IT organization to come close to those levels of reliability. Even so, we as SaaS providers need to show customers that our levels of reliability are at least the match of their legacy systems. Statistics like these are our friends.

Be as secure as a bank: Make sure you’ve checked off all the legal, security and governance requirements: SOC2, ISO/IEC 27000, PCI. Certificates like these are the best way to clear away the misperception that cloud computing isn’t secure. People put their money in a bank and not under their mattress because they trust a bank’s security system. As an industry, we have to show we’re just as trustworthy when safeguarding customers’ data.

Show IT how cloud computing can make them heroes: The days of touting cloud computing as the way to save money or increase flexibility are behind us. Cloud computing will replace legacy systems because it can transform IT into a strategic arm of business. The successful SaaS companies are fluent in explaining how that can happen. And that fluency can help bring more IT organizations out of the land of “no” and into the promise land of cloud computing.

My hope is that SaaS providers will be able to more easily sell to IT; as they’ll both be speaking the same language: the language of business.

Roman Stanek is the founder and CEO of GoodData, a company that offers a range of business intelligence software and reporting tools to help companies monetize big data. Prior to this, he was the founder of NetBeans.org, sold to Sun Microsystems, and Systinet, which was acquired by HP.

Follow him on Twitter @RomanStanek

Top image via © grafvision, Shutterstock

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

Perhaps I have seen too many episodes of The Wire, but my associations with pagers are not exactly positive. Andreessen Horowitz does not share this concern and has led a $10.7 million investment in PagerDuty.

PagerDuty provides IT alerting and incident tracking software. In this era of cloud computing, sites need to be fully functional at all times. Issues can arise at any time of the day or night, leaving IT teams scrambling to respond to the problem.

A number of companies provide monitoring tools, such as Nagios, Zenoss, Pingdom, monit, Munin, Splunk, and BasicState, which send out notifications when something is going wrong. Many of these services focus on just one part of IT infrastructure.  As a result, companies have to cobble together monitoring systems that can be disorganized and generate too much noise.

PagerDuty integrates with these systems and aggregates the alerts. When an incident is triggered, notifications are sent via email, SMS, and phone. PagerDuty has developed a unique set of tools to ensure that the right person receives the right notifications (database administrators don’t get pinged about application problems), and 4 am alerts are only sent when absolutely urgent. IT teams can use the software to set up escalation systems, meaning that if one person doesn’t respond, someone else is notified until there is a response. This prevents problems from slipping through the cracks. Scheduling features make it easier to divvy up on-call responsibilities, which also prevents lapses.

“Today, we are the “9-1-1 dispatch” system for IT,” said CEO Alex Solomon in a blog post about the funding. “The next major step in the vision is to expand beyond just the critical incidents. We ultimately will become the central nervous system of IT: we’ll provide the interconnecting fabric between your systems and the people responsible for managing them. Our big audacious goal is to reduce the noise. In other words, only the critical issues should wake you up at 4am, false alerts should be automatically filtered out, and low priority incidents should be surfaced in aggregate in summary reports.”

Clients include high-profile customers like Microsoft, Adobe, EA, Square, Github, Pinterest, Braintree, Heroku, Intuit, 37signals, and Etsy. This first round of investment will go towards hiring more “crazy-smart engineers” for product development and fuel global expansion. In addition to Andreessen Horowitz, the Webb Investment Network, Opscore founder Jesse Robbins, and existing seed investors Harrison Metal, Baseline Ventures, and Ignition Partners contributed.

PagerDuty was founded in 2009 and is based in San Francisco. Read the press release

Sept. 9 - 10, 2013 San Francisco, CA

Early Bird Tickets on Sale

In Silicon Valley, a growing number of venture capitalists are breaking away from the larger firms to form smaller, highly specialized funds.

Sunil Dhaliwal, managing partner of Amplify Partners.

The newest is Amplify Partners; its managing partner Sunil Dhaliwal is formerly of Battery Ventures, where he invested in hot enterprise companies like Splunk and Netezza (acquired by IBM). Dhaliwal has succeeded in raising a $40 million fund to invest solely in emerging IT infrastructure companies.

“Technical founders working on IT infrastructure startups have far fewer options for funding compared to digital media, consumer Internet, or even application software startups,” said Dhaliwal in an interview. He was inspired to start the firm after meeting entrepreneurs in this space who felt that angel investors and larger firms didn’t have the time to provide “senior level attention.”

Dhaliwal believes that incumbent IT infrastructure vendors are “vulnerable” in a way the industry hasn’t seen for 25 years. And with hundreds of billions of dollars to be made, “it was pretty clear that I should fill that gap,” he said.

Amplify’s startups are all led by “technical founders who would rather write code than PowerPoint.” The three key themes the firm is looking for are scale-out architectures, data growth, and real-time infrastructure. The entrepreneurs tackling these problems must be focused on efficient business models from day one.

Dhaliwal revealed that Amplify Partners will make initial investments ranging from $50,000 to $1.5 million, and retains the necessary capital to fund its entrepreneurs through several rounds. Current portfolio companies include AppNeta, Continuuity, Datadog, Fastly, Wibidata, and several startups in stealth mode. Amplify Partners has offices in Cambridge and at Sand Hill Road in Palo Alto.

SevOne, the Deleware-based startup that is growing rapidly in a market of IT giants, is proving that tools to monitor the health of a network are big business.

Formed in 2005, the company provides a suite of IT monitoring and reporting tools to its customers — primarily large enterprises. Today, it has pulled in an impressive $150 million in funding from Bain Capital Ventures.

Ben Nye, managing director of Bain Capital Ventures, the firm that led the round, said in a statement that this is the “only solution that enables its customers to see all services in real-time within global distributed networks of any scale.” The firm sees an opportunity for SevOne to tap a growing market of mid-size companies.

As with any business software release, SevOne references “big data” in its positioning, and claims to scale to address this level of network growth.

According to the company’s CEO, Mike Phelan, bookings have doubled year over year, and the customer base has doubled. SevOne competes with legacy players like EMC, BMC and IBM, but Phelan claims its ability to get up and running in seconds is unique. “What SevOne can achieve in 1 second, takes legacy solutions 6.3 hours,” he told us. “SevOne is capable of monitoring our customers’ networks within minutes of installation.”

Analysts and the media have been impressed by the technology, which was developed by a group of network architects that worked at major financial institutions. As Alex Williams over at TechCrunch put it, this “is the new face of the cloud.” The SevOne technology is able to predict if there will be problems on the network by monitoring the data from thousands of points. For big-name companies like Thompson Reuters, SevOne can deliver financial information in seconds to a variety of financial services firms.

Prior to raising funding from Bain capital, the company pulled in $3.5 million to build-out its product.

Road infrastructure image // Shutterstock 

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

BetterCloud may not be as tasty as a buttercream cloud, or as moisturizing as a whipped shea butter cloud, but it is extremely useful for organizations that run on Google Apps.

BetterCloud announced this morning that it raised $5 million in its first round of financing from Flybridge Capital Partners, Greycroft Partners, and TriBeCa Venture Partners. BetterCloud provides cloud management tools specifically for Google Apps.

Many businesses these days use Google Apps to manage operations, collaborate, store data, and more. BetterCloud’s flagship product FlashPanel gives administrators better knowledge, control and security of their apps to help them work as efficiently as possible. There is also the “Google Gooru” that can answer specific questions and provide training on topics like “how to create a mail merge” and “how to use animations in Google presentations.”

As cloud computing becomes the norm for IT operations, it will be increasingly important for businesses using legacy systems to migrate to the cloud. BetterCloud serves over 15,000 organizations of all sizes, with over 5.5 million users and is growing quickly. With this funding, it will expand its products to cover more of the Google Enterprise Cloud. This brings its total capital raised to $7.25 million, following a $2.2 million angel round in May of 2012.

BetterCloud is based in New York. Read the press release.

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

Mark Twain said “It’s not the size of the dog in the fight, it’s the size of the fight in the dog.” The same principle applies to small businesses owners. But regardless of spirit and dedication, they won’t get through too many rounds without a strong online presence.

Infusionsoft has raised $54 million from Goldman Sachs to help small businesses succeed. It does this by building custom, all-in-one systems that combine CRM, email, and social marketing, and sales tools. From this platform, small business owners can more effectively attract new customers, wage automated marketing campaigns, engage existing customers, and drive sales.

Infusionsoft started out as a custom software shop in 2001. The founders quickly realized that companies sought this type of comprehensive product. Its target customers are businesses with two to 25 employees that are “owner-operated, lack IT support, follow their buyers online and desperately need effective sales and marketing tools to succeed.” While Marketo, Hubspot, and Salesforce offer comparable solutions, they do not cater specifically to this segment.

“The small business market is underserved by software companies,” said CEO Clate Mask in an email interview. “Most vendors in the sales and marketing SaaS industry are gunning for the enterprise clients and their products show it. Mid-market software and IT support is too expensive and complicated, but simple marketing and sales tools can’t effectively manage their growing businesses. True small businesses are left having to figure out how to make these systems work for their needs and it usually fails.”

Customers include wedding videographers, kickboxing gyms, and animal clinics as well as internet startups. Infusionsoft has over 12,000 customers around the world and grew by more than 50 percent last year. This third round investment will contribute to developing the product and accelerating its own marketing and sales efforts.

“The news of this deal might shock some people due to the size of the round and the fact that it’s coming from a company outside of Silicon Valley,” said Mask. “But anyone who’s been following Infusionsoft knows that this makes perfect sense. We’ve had a vision for a long time and we stuck to it like glue. Every decision made — from hiring to product development — reflects that vision and now we’re ready to go big.  The sales and marketing SaaS market is blowing up, the small businesses market is blowing up, and we have the most perfect launch pad.”

This brings Infusionsoft’s total raised capital to $71 million. Previous investors include Mohr Davidow Ventures and vSpring Capital. The headquarters are in Chandler, Ari. (or Silicon Desert). It currently has 350 employees.

Sept. 9 - 10, 2013 San Francisco, CA

Early Bird Tickets on Sale

Ofir Nachmani is Chief Evangelist at Newvem

I believe that this is the year when the enterprise will find its way to the cloud.

The mega Internet sites and applications are the new era enterprises. These will become the role models for the traditional enterprise. IT needs remain the same with regards to scale, security, SLA, etc. However, the traditional enterprise CIO has already set the goal for next year: 100% efficiency.

The traditional CIO understands that in order to achieve that goal, IT will need to start and do cloud, make sure that IT resources are utilized right, and that his teams move fast.

1. Enterprise will move to the public cloud

The enterprise has already moved and started its proof-of-concept.

Those who have realized the option to reduce cost, increase agility, and enjoy the real benefits of the cloud will continue migrating the resources of their non-critical services. Internalizing the public cloud (specifically AWS cloud) will inspire the enterprise to learn how to maintain a robust, highly available and secured service on the public cloud. That will put the hybrid environment in the front, supporting bursting and load migrations.

The traditional enterprise follows the new era one, making sure to transition and acquire only online and mobile services. The SaaS market will continue to grow and be the premier source for the enterprise new online services.

2. Slow adoption of Openstack

OpenStack is one of the candidates to compete with AWS.

This open source platform is being led by heavy traditional industry, such as HP. These traditional vendors don’t have the Internet company culture of moving fast, supported by fast cycles of refinement. In 2012 Amazon released a huge number of new features to support the enterprise cloud, following great agile product management. By contrast HP, which leads the OpenStack community, is still dragging its feet while trying to copy the AWS base offering.

However, it is important to mention that a new trend is emerging in which enterprises are moving to deploy OpenStack instead of renewing VMware licenses.

3. Private cloud is still an option (at least for another year)

Although I am a public cloud “believer,” adoption takes time and the enterprise IT will not shut down its on-premises resources on the spot.

The hype supports the penetration of the cloud to every IT team, including the enterprise … but traditional enterprises want risk free migrations. The basic recommendation is to move on with a quick proof-of-concept to taste and test the actual benefits.

The next move comes when a need for additional resources arises, such as an upgrade, new application, or load growth. Once a real need for additional resources arises, IT managers will then decide whether to purchase new on-premises technologies or cloud resources. And the innovative IT leaders will choose the latter.

Another option is that the enterprise experiments on the public cloud, and only then purchases dedicated resources due to high lease costs. But once a real price war takes place, I believe that the preferred option will be the public cloud, although I’m not sure that this will happen in 2013.

For these reasons, the hybrid cloud model is still valid (unfortunately).

4. Cloud brokers and managed service providers will flourish

Thanks to the knowledge gap, the simple reality is that IT can’t meet the demand for cloud skills. In fact, according to an IDC study, the demand for cloud computing will grow at six times the rate of IT skills overall.

The re:Invent APN summit for partners and the IDC study strengthen the position of cloud managed services. It is obvious that Amazon loves its MSPs because these vendors are growing like crazy. I follow at least five different MSPs whose business as integrators of AWS has grown to 80-90 percent of their whole business, and these are growing amazingly fast.

Amazon also invests in these vendors as it knows that the way enterprise deals with time-to-market issues is by outsourcing, and it will continue to do the same in the future.

5. Transparency is a Key value

One of the most important things I have learned from HP Discover was that the enterprise wants and will be happy to pay to maintain control.

The cloud puts control and transparency at risk due to the fact that traditional enterprise leaders and users are used to having great control of IT resources, and the concept of not having the “irons” intimidates them. The cloud vendors and developers will have to make sure they report back to leaders on the adoption progress, making sure that these new IT resources generate the expected business benefits without harming services, compliance, SLAs, and so on.

Organizations that run to deploy without planning and control will put their cloud adoption and innovation at great risk. Choosing to run a business on a cloud is a strategic move, and picking the right way to manage your new cloud resource is part of this strategy.

And one wish for 2013 …

I wish that public cloud competition would become a reality very soon, that it would generate great price reductions, and that it would enable adoption. I hope that Amazon’s cloud will continue to strike and overwhelm everyone with its enterprise penetration, bringing that future even closer. And I hope that the traditional enterprise will be able to adopt “continuous integration” and “cycles of refinement” while removing constraints and presenting the great innovation that the cloud enables.

Ofir Nachmani is Chief Evangelist at Newvem, a web-based cloud usage analytics service that enables CIOs, CTOs, IT managers, Developers and Operators to capture and improve the effectiveness of their public cloud operations and ensure their cloud infrastructure is in sync with business performance. Follow him at @iamondemand.

Image credit: Google

July 9-10, 2013
San Francisco, CA

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In the eternal words of Z-Ro, “life is a battlefield.” Love, politics, war, religion, and even information technology all have a unique sets of challenges to conquer.

VictorOps is a platform to help teams of developers “be victorious” when managing their software systems. This Boulder, Colo.-based startup emerged from stealth mode today and revealed $1.58 million in financial backing from Foundry Group, Tango, and the founders.

CEO Todd Vernon previously founded Lijit, an advertising platform for publishers that was acquired by Federated Media last year, and Raindance Communications, a web conferencing company that sold for over $170 million in 2006. His latest endeavor strives to tackle some of the pain points he encountered while running those software-as-a-service businesses.

“We are building the worlds first vertical alerting and collaboration platform for Ops, DevOps, TechOps teams,” he said in an email. “The platform is design to help these teams solve problems faster. Remediation of the platform is a constant in [SaaS] companies. Salesforce.com is for sales teams. Rally is for dev teams. There is no platform currently to help Ops teams.”

This “Vertical Collaboration Platform” will enable these teams to address issues regardless of physical location, connected device, or time of day. Advancements in technology mean that customers expect businesses to be up and running 24/7. In response, businesses set up complicated and large infrastructure that need constant monitoring. VictorOps is a support system for the teams working behind-the-scenes to keep it all functioning smoothly.

Vernon founded VictorOps with COO Bryce Ambraziunasis and CTO Dan Jones, fellow members of the “band of brothers” and veterans of Raindance Communications. These three steely eyed men (view photo above) are forging ahead in the fight against system outages from their mountain base camp. They may look more like former Marines than technology startup guys, but they are armed with years of experience, fierce battle glares, and warm winter clothing. Oh, and venture capital. That helps too.

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

Venture capital, like baseball, is a numbers game. .

406 Ventures, whose name derives from Boston Red Sox player Ted Williams impressive batting average, pooled together a new $175 investment fund to invest in enterprise startups.

.406 is based in Boston and provides support for early stage companies, primarily on the East coast.  It compares its investment strategy to successful batting technique, which involves being a “selective hitter” and “only swinging at pitches within the specific areas of the strike zone he knew he could hit best.”

This is .406 Ventures’ second fund and will focus specifically on IT security, healthcare IT, and web infrastructure companies. Existing portfolio companies include Adtuititve, ambient, Bit9, Chosen Security, Mashery and Veracode. Read the press release.

Sept. 9 - 10, 2013 San Francisco, CA

Early Bird Tickets on Sale

Whether you’re a baby boomer in your fourth decade of IT work, or a Gen-Y newbie know-it all, the cloud is either impacting your career now … or soon will be.

What do you need to know — or do — to make that impact a good one?

Cloud services company Bluelock put together an infographic for IT professionals. That’s timely, because in my experience hard-core developers (particularly those in mobile and web services) are often fairly knowledgeable about cloud offerings … but a significant chunk of the more IT-focused technology workers are not.

They’re often too busy keeping the lights on and the gravity working — focused on today, not tomorrow.

But with 48 percent greater cloud adoption just in the last six months, and a projected three-quarters of companies on the cloud by 2020, cloud savvy is not optional anymore. With the promised cost savings come new investments … and privacy concerns, and SLAs, and access controls, and APIs, and new management requirements, all of which have to be accounted for.

Here’s all the data, in visual form:

photo credit: Dell’s Official Flickr Page via photopin cc

Workday, the human resources software maker that defied expectations with its initial public offering, unveiled its strategy today at its annual user conference, Workday Rising.

In short, the Pleasanton, Calif.-based company is committed to building a recruiting mobile app for hiring teams, as well as a big data analytics toolset. With these technological advancements, it is better positioned to compete with giants in the space, Oracle-owned Taleo and SAP’s SuccessFactors.

The idea for the big data tool originated when AIG, a large insurance company, requested an analytic capability to better understand the profitability of each employee. Workday combined data from its internal HR systems with finance and external claims information. It processed and stored the data using Datameer’s Hadoop-driven analytics tool.

As is the case with the majority of big data solutions, it will incorporate social data from Facebook, Twitter, and LinkedIn, along with the most relevant public information that pertains to salary and employment. All the data will be presented on a spreadsheet-like interface so analysts can make changes, and any user can play with the reports — all without the involvement of IT.

The analytics solution is still under development and is expected to ship to the first pool of customers in the spring of 2013.

“We are combining Workday data and any type of third-party data into our unified platform to create the analytics and dashboards in the intuitive Workday user experience our customers have come to expect,” said Aneel Bhusri, chairman, co-founder, and co-chief executive officer of Workday in a statement. “With Workday Big Data Analytics we are re-thinking how insights that lead to better decisions should be delivered to businesses.”

In addition, the company has announced its new recruiting platform, which is intended to be useful throughout the sourcing and signing process. Of course, the solution is described as “mobile first” and “collaborative” (more buzzwords). Specifically, customers can expect an application that can assist with headcount planning, social sourcing, background checks, job requisition, and pipeline management.

The company is also in the process of building a UI tool for Windows 8 mobile devices — although it’s still in the idea stages at this point. Read more about unexpectedly cool features for the Windows 8 phone here.

Sept. 9 - 10, 2013 San Francisco, CA

Early Bird Tickets on Sale

You’ll often hear “big data” startups promising to help companies unlock the true value of their data, but are they delivering?

GoodData, a startup with some heavy-duty venture capital investment, announced a new strategy to take big data out of the hands of IT and into the purview of sales, marketing, and business users.

The cloud-based analytics service brings operational dashboards, metrics and performance reports, data storage, analytics, and collaboration tools to business users. Unlike big-name competitors like Oracle and SAP, it emphasizes user experience — CEO, Roman Stanek calls it the “LinkedIn of Business Intelligence.”

Roman Stanek, CEO of GoodData.

“You shouldn’t need a Ph.D to use big data,” said Stanek in an interview with VentureBeat. Stanek explained that business users increasingly have sizable budgets to spend on analytics and reporting tools. “The data isn’t in the hands of IT — it’s with Salesforce, Google Analytics, and Marketo,” he said.

With this new direction, GoodData will deliberately circumvent IT. “The only way that innovation gets into the enterprise is through business users,” said Stanek.

The company markets to mid-sized Software as a Service (Saas) vendors, who integrate the technology in their own platforms. The other sweet spot for GoodData is high-tech companies — its customers include Living Social, Groupon, Zendesk, and Pandora. Since the San Francisco-based startup was founded in 2007, over 6,000 customers have signed-on, and it has seen revenue growth of 500 percent year-over-year.

At this point, GoodData’s “BizData Monetization,” as it refers to it, is mainly smoke and mirrors. But with this announcement, the company is rolling out its new “marketplace” product — a library of prebuilt business analytics mashups for sales and marketing teams to create fancy looking, analytics-filled reports.

When the company raised a substantial third funding round in July, it announced it would invest in sales and marketing. It’s paying off. This is a clever marketing move, considering that companies are still in the dark about how to derive dollars from their data. Research firms predict that big data will increasingly be marketing’s problem. According to Gartner, by 2017, a CMO will spend more on IT than the CIO.

GoodData’s recent $25 million round was led by Tenaya Capital, with participation from new investor Next World Capital and existing investors Andreessen Horowitz, General Catalyst Partners, Fidelity Growth Partners, and Windcrest Partners.

CloudBeat 2012 is assembling the biggest names in the cloud’s evolving story to learn about real cases of revolutionary cloud adoption. Unlike other cloud events, customers — the users of cloud technologies — will be front and center. Their discussions with vendors and other experts will give you rare insights into what really works, who’s buying what, and where the industry is going. Register now and save 25 percent! The early-bird discount ends September 14.

Stanek Image via CrunchBase

That’s why AppFirst has built the DevOps Dashboard.

Launching today, DevOps Dashboard combines in one view data from your web applications, your corporate database, and all your internal applications. I spoke with AppFirst chief marketing officer Pamela Roussos to learn more.

“The problem is that most data is in different silos,” Roussos says. “That contributes to IT often being the last ones to know about a problem.”

A DevOps dashboard showing data for an e-commerce vendor.

AppFirst’s solution is to install a little piece of software on every piece of a company’s computing stack. The lightweight sentinels collect data continuously and stream it to AppFirst every 20 seconds, creating a single repository of performance data for you in the cloud. Then AppFirst “dashboards” the data, showing you in one screen what previously you might have needed to check for in 10 or more places.

And it’s not just about server uptime.

Plenty of solutions are out there to tell businesses how their applications are running or what their network utilization is or how hard servers are working. One of the new things AppFirst is doing is connecting application and services data with business data.

That enables the company to display metrics such as return on investment, cost per customer, time on site, and a vast array of financial and profitability data — in conjunction with, and relationship to hardware and applications performance.

“One e-commerce customer of ours was looking at 14 different monitoring solutions,” Roussos told me. “They thought they could narrow it down to four, and ended with just one [AppFirst].”

Now, she says, the company displays the dashboard on  50-inch monitors for everyone in the company to see all their core indicators.

Another DevOps Dashboard view.

Having all their data in multiple places can make it difficult for businesses to correlate information and detect relationships and trends, says Roussos. Seeing critical metrics connected surfaces those relationships and enables quick response — and initiative.

For example, a company might see how better website speed impacts sales. Or how greater reliability of internal application delivery impacts customer response times and, ultimately, ROI.

One key benefit of the company’s cloud-based approach, according to AppFirst, is the incredible speed of implementation. Enterprise customers, of course, are familiar with implementation and integration periods calculated in weeks and months and “don’t believe” Roussos sometimes when she tells them that AppFirst can be up and running hours or days.

“As quickly as you can install the apps and authenticate them,” says Roussos, “you’re up and running.”

Those apps are MSIs on Windows servers and RPMs on Linux servers. One a collector is installed, it starts collecting data instantly, sending it up to the cloud. Within minutes a client’s metrics are being populated, and as soon as enough data is collected to provide meaningful reports, the results are visible online. According to AppFirst, running the DevOpps Dashboard apps incurs a performance penalty of only 1 percent or less.

The DevOps Dashboard is new, as is an enhanced capability to auto-detect the app stack running within a company’s production environment. Two other new announcements today include auto-configuration of data sources and the addition of business metrics data.

Pricing starts at free and ends up at only $25 per server for up to 2,000 business metrics.

That may be where the sports stats analogy breaks down — A-Rod doesn’t even tie his shoes for $25.

photo credit: laffy4k via photo pin cc

Surveying more than 600 IT and security pros with an average 11 years of experience, the study found that 90 percent of organizations have leaked data or documents in the last 12 months. Almost 80 percent of organizations do not provide secure file sharing technologies for employees. And well over half of organizations believe that mobile access equals massive security risk.

With no secure file sharing technologies provided by the enterprise, staff unsurprisingly turn to readily available methods: Dropbox, USB drives, or that trusty old standby, email.

Unfortunately, those are three of the four most common methods of data loss.

The survey did turn up some good news, if you’re a chief financial officer. Even though customer and consumer data are at the most risk — 25 percent of IT pros were worried about them — sales, finance, and accounting information is much better protected.

That good news only lasts, unfortunately, until you notice that under Sarbanes/Oxley and other regulations, corporations are legally liable for data security.

Oops.

Here’s the infographic:

Image credit: Warren Goldswain/ShutterStock

For most technology executives, the question of outsourcing is not whether projects will be outsourced, but which projects will be outsourced. Budget limitations prevent hiring the staff required for every project, particularly when employees are only needed on a temporary basis.

As some IT executives find, the right resources for a project may not be available for hire in their area. Even if the team is qualified and available, a project might not be the best use of their time. When should a project stay in-house and when should you outsource? Here’s a checklist to help make the right decision.

Is the project strategic to the core mission of the company?

While IT projects come from all directions, they can usually be looked at in one of two ways. Either the project is core to the strategic goals of the company, or it’s more of a tactical solution that solves an immediate need. Tactical projects are easier to outsource, because they are typically short-term in scope, may supply a small immediate need, and tend to have a closely-defined end goal.

Strategic projects feed the core mission of the company. While they can often be broken into small, manageable chunks, strategic projects often have a life that extends well beyond the push to production and may go through multiple iterations.

Does your existing team have the necessary skills to complete the project?

One of the more exciting aspects of IT is that the resources you have today may not be the resources you need for tomorrow’s project. Any time you are looking at in-house vs. outsourcing, it’s important to examine the project goal in the context of the resources on hand.

One key place where I’ve personally encountered a resource limitation was in scaling systems. I had a great team of engineers who were capable of supporting and fine-tuning the existing IT infrastructure, but they weren’t the team I would choose to re-architect the infrastructure from the ground up. Hiring experts at scalability was my solution: They helped to plan and execute the migration, and that in turn helped mitigate the risk of magnifying a problem of scale.

What is the workload of your existing team?

If your current team is already handling as many projects as they can manage, outsourcing is the only viable way to add more projects to a full schedule. This keeps your team focused on the big picture, while allowing more projects to move forward. Conversely, if you have a lull (as if that happens) it can be a great opportunity to examine the projects that were shelved due to lack of resources.

Even if you have the necessary team, is the project the best use of their time?

This could also be characterized by asking if your team will dread coming to work if they have to do the project. Many IT projects are necessary for meeting business objectives, but aren’t the best allocation of your limited resources. By keeping your team focused on projects that keep them excited to come to work, you retain great employees longer and meet the big goals. Outsourcing the “boring” stuff keeps your team from feeling like they are being punished.

Is the project a one-off or part of a bigger mission?

In other words, is it something that needs attention now, but may never be needed again?

Data migrations are something that fall into the one-off category. If you need to migrate data between database structures or get data into a format that matches your existing schema, an outside team can be ideal. Typically, once the data migration is complete, the work is done, so you only need to outsource for a limited time. Your core team may write specifications for the migration and then hand off to external team who can complete the heavy lifting.

How well will your team work with an outside contractor?

The only time I’ve ever found a challenge in integrating outside contractors with the in-house team is when the team is fearful they will be replaced. As a manager, convincing the team that the contractors are being used for a specific project on a limited term, so that the team can focus on other projects, is important to maintaining harmony among the team. Sometimes this means including the team in the process to the point where they understand what the contractors are working on and how it fits into the overall picture.

These are by no means the only scenarios where you may consider outsourcing as an option, but by running down the list of options above, you can arrive fairly quickly at whether you should be looking for an outsourcing team or completing the project in house.

Sick keyboard image via Shutterstock

In its latest bid to convince organizations to upgrade from Windows XP, a Microsoft-sponsored report claims that companies end up paying more than five times in support costs by refusing to upgrade to Windows 7.

The report from IDC points to rising annual costs in hardware and software support that ultimately makes the 11-year-old Windows XP a huge time sink for IT staff. While the results obviously sound very self-serving for Microsoft, they could serve as a kick in the pants to organizations that have delayed Windows 7 deployments for too long.

Shockingly, IDC found that 42 percent of the commercial Windows install base is currently running Windows XP. With Microsoft set to kill all support for Windows XP in April 2014, many of those companies will be forced to upgrade within the next few years anyway — there won’t be anymore Windows updates or security fixes, after all.

“The bottom line: IDC’s research finds businesses that migrate from Windows XP to Windows 7 will see significant return on investment over 130 percent over a three-year period,” writes Erwin Visser, a senior director for Windows, in a blog post on Thursday.  “Moreover, Windows 7 gives businesses back hours of user productivity. Additionally, migrating now to Windows 7 will set businesses up well to embrace Windows 8 in the future, as IDC found that all indications at this time are that the move from Windows 7 to Windows 8 will be seamless for applications and non-impactful to existing hardware.”

As someone who used to work in IT, I can understand why organizations would be hesitant to upgrade. Many companies skipped over Windows Vista completely (a wise decision), and instead waited for Windows 7 to become stable enough to deploy company-wide. By now, Windows 7 has proven itself as the fastest and most stable version of Microsoft’s OS yet, so it’s about time Windows XP-powered firms decided to upgrade.

Via Computerworld

July 9-10, 2013
San Francisco, CA

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Until recently, talk about BYOD (bring-your-own-device) policies has centered on managing the juggernaut of employee smartphones in the workplace. But with tablet sales skyrocketing, a new trend is weaving itself into workplace mobility conversations: BYOT (bring-your-own-tablet).

The BYOT concept poses significant challenges to IT departments. Tablet devices are popular workplace productivity tools, especially in enterprise environments. In fact, many newly released tablet devices and software updates (e.g. Android’s Ice Cream Sandwich update, BlackBerry Playbook 2.0 update, and the new iPad) include enterprise-friendly features, making it relatively easy for employees to leverage personal devices for business functions.

So as scores of employees head off to work with an increasingly diverse array of tablet gadgetry, IT departments have to be prepared to manage the full scope of BYOT devices on the market – effectively safeguarding the enterprise environment from malicious applications and the unauthorized use of company data.

Developing an Enterprise BYOT Strategy

The proliferation of tablets in enterprise environments makes the development of a BYOT strategy a fundamental part of a proactive and robust IT agenda. Companies that delay implementing a BYOT strategy place their organizations at significant risk, so it’s important to adopt a company-wide standard policy that guides tablet use.

1. Identify the Tablet Use Case: An effective BYOT strategy begins with the identification of the use case, i.e. determining why employees are bringing their tablets into the enterprise. Tablets and other mobile devices aren’t mutually exclusive. In most instances, employees who use tablets also use smartphones for email, contacts and other business functions. But when it comes to apps, tablets rule the corporate roost. So instead of being tied to an email use case, tablets are tied to an app use case (data only) – a focus for IT departments and other stakeholders who are responsible for developing the organization’s BYOT policy.

2. Determine the Scope of Tablet-Based Data Access: It is critical for IT departments to know what is running on the corporate network or risk serious problems down the road. IT departments need to carefully evaluate the types of data employees are accessing via their tablets, and whether the data can be accessed outside of the company network. Since many consumers purchase tablet devices that are Wi-Fi only because they are cheaper and generally as internet accessible, it is very likely this is the case.

3. Prioritize User Security: At the very least, require tablet passwords. But companies should also go beyond that and encrypt data in the event that tablet passwords are compromised. That’ll help prevent a scenario where unauthorized users access and distribute sensitive corporate information. In the same way that the company’s laptop users leverage VPN (Virtual Private Network) access, BYOT users should leverage a VPN or a secure network that allows for secure, remote access to the company’s central network.

4. Standardize Company Application Policies: Since tablets are used primarily for applications, employee use of personal tablets dramatically increases the company’s exposure to rogue apps capable of compromising the security of company data and other IT assets. One of the smartest ways to manage the applications that BYOT devices introduce to the company network is to maintain a company app store – a central, virtual location that serves as the only place employees can download apps that are deployed on the company network. Although employees can suggest apps for inclusion in the company store, applications are strictly prohibited from the company network until they have successfully navigated the approval process.

5. Implement a Device Management Solution: Enterprise Device Management solutions like MobileIron, Boxtone, or BlackBerry give companies and IT departments the ability to manage their BYOT strategy over the long-term. Featuring powerful capabilities designed specifically for enterprise mobility environments, today’s leading Device Management solutions can support both tablets and smartphones, offering corporations a cost-efficient way to manage email and data use cases. When you determine the scope of tablet use, a DM solution also gives IT the ability to exert greater control to monitor and manage the tablets on the corporate network.

Corporate employers shouldn’t expect the BYOT trend to diminish anytime soon. If anything, tablet devices will become even more ubiquitous in the workplace as manufacturers offer higher quality devices across a wider range of price points.

To ensure the proper utilization of employee-owned tablets in enterprise network environments, IT departments need to emphasize the development of a comprehensive BYOT strategy and policies now, since it’s likely that a significant number of employees are already deploying their personal tablets as workplace productivity tools.

Don Grons is VP of Technology with Mission Critical Wireless, a leading global enterprise mobility management services provider.

Top photo via Devindra Hardawar/VentureBeat

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

Cloud service consulting company Appirio announced today it has raised $60 million in its fourth round of institutional funding.

“We are seeing more companies going cloud first, saying they’re not ever going to buy another server,” said Chris Barbin, Appirio chief executive, “We’re also seeing companies making the migration to 100% cloud to reduce costs and help them scale faster.”

The five-year-old company started out helping big companies adopt cloud services such as Google Apps, Salesforce, and Workday. It then turned its attention to cloud app development, creating apps that tie together multiple cloud services and social networks. For example, it developed an app that integrates Google Calendar and contacts with Salesforce calendar and contact lists.

Appirio’s current offerings run the gamut of cloud services. The company will help you decide which cloud service is right for your company, build custom apps to work with the cloud, move your data to the cloud, and manage the cloud services it’s set up for your business. Essentially, it hopes to move your business away from in-house IT departments and run it solely in the cloud.

“Customers are driving us to go bigger faster, and we will continue to drive the cloud community,” said Barbin, “We are finding that companies don’t want a large $100 million project from Accenture. Our customers are seeing value in weeks and months, not years.”

Appirio’s competitors are other technology and cloud service consulting firms, including Bluewolf, Accenture, Cloud Sherpas, and Cloud Technology Partners. Appirio focuses more on large corporations that spend millions on IT and cloud services each year. The company even issued a guarantee that it would save large companies $1 million if they used its service, but your company would have to spend at least $5 million to see that kind of savings.

Appirio’s funding is reflective of the steadfast adoption of cloud services among large businesses. Joyent, another cloud service provider that builds private clouds and applications, received a whopping $85 million in funding in January 2012, a further indication of the cloud industry’s traction.

“Global IT is a $300 billion industry and there haven’t been many changes in the industry since companies began outsourcing IT jobs to Indian in the 90s. Appirio said lets disrupt the IT industry,” said Jeff Richards, partner at GGV Capital, a venture capital firm that participated in this round, “The company has grown the business 10 times since we first invested in 09, which impressed us.”

General Atlantic led this round for Appirio. Existing investors Sequoia Capital and GGV Capital also participated. Appirio intends to use the money to develop its technology and support Cloudspokes, its crowdsourced cloud app development service that hosts hackathons for developers. The company previously raised $10 million in 2009. This latest round brings Appirio’s total funding to more than $76 million.

Appriro is based in San Mateo, Calif. and has 400 employees.

July 9-10, 2013
San Francisco, CA

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Companies know mobile is invaluable and inevitable. But despite 41 percent of IT professionals fearing external handheld devices, they are moving forward into the mobile enterprise.

According to a survey by Symantec, enterprises officially understand that “application culture” isn’t going away, and in order to succeed they need to be competitive both online and in the App Store. Both the iPhone and Android have significantly altered a phone’s function, making it a productivity tool, as opposed to a simple mode of communication. Currently, 71 percent of enterprises are either looking to, or are actively deploying their own mobile applications.

The expectation is that this kind of technology in the workplace will, in fact, increase productivity — every company’s desire. But Symantec makes the point that most technology implementations don’t get the return on investment they’re hoping for. That is, the cost of implementing outweighs the resulting benefits. But for mobile devices, where 70 percent of companies hope to see more employee productivity, 77 percent actually do see it. The use has become so sticky in the workplace that 59 percent of employees are now reliant on their phones for industry-specific applications.

While mobile may be warming up on IT executives, and presenting itself a new and necessary component for working, 41 percent of survey takers see mobile as a top three IT risk. These professionals are constantly concerned with lost or stolen devices, data breaches, misuse of proprietary information, malware, and a number of other issues. Indeed, the annual cost to an enterprise-level company for mobile “incidents” and upkeep is $429,000. For small businesses, that number exists around $126,000. For small companies that aren’t even profitable yet, that may be a big chunk of change.

“Mobile devices are legitimate endpoints that require the same attention given to traditional PCs,” Symantec’s report states.

For this reason and others, 48 percent of companies say integrating mobile is “extremely challenging.” Symantec suggests that this high percentage of those experiencing extreme challenge is due to wider-spread deployments. Where mobile was once used on a departmental basis, more companies are swinging toward blanket-mobile-policies and are distributing devices or accepting personal devices in workforces as a whole.

Symantec surveyed 6,275 companies in 43 countries for this report, touching North America, Asia, Latin America, Europe, Africa and the Middle East. IT and c-level employees were contacted specifically.

VentureBeat is holding its second annual Mobile Summit this April 2-3 in Sausalito, Calif. The invitation-only event will debate the five key business and technology challenges facing the mobile industry today, and participants — 180 mobile executives, investors, and policymakers — will develop concrete, actionable solutions that will shape the future of the mobile industry. You can find out more at our Mobile Summit site.

Businessman image via Shutterstock

However, as the cloud emerges as a truly viable alternative to IT, it has become clear that the transformative CIO must rethink the entire IT paradigm and evolve his or her organization into one that delivers competitive services to the business.

This new strategy requires not only a very different approach, but also quite literally a different mindset. In my current role at technology business management provider Apptio, we’re seeing an increasing number of women taking the helm of IT organizations, which makes me wonder whether women possess certain qualities that make them particularly well suited to this role of services transformation.

One of the reasons for this shift is that the very nature of IT has undergone its own evolution. No longer is IT focused on managing and delivering a portfolio of IT products. Rather, the advent of providing services has translated into a demand for IT to speak the language of the business.

Consequently, collaboration, communication, and the ability to manage change are now the vital skills for IT leadership.

Women are more inclined to work collaboratively with others rather than implementing changes with an iron fist approach. In a 2008 survey of female IT leaders by the CIO Executive Council, women were reported to take a more cooperative team approach than their male counterparts. The female survey respondents said they try to listen, empathize, and build connections with employees and stakeholders.

Rebecca Jacoby, CIO for Cisco, has proven particularly skilled in managing and communicating with her staff during efforts to re-organize the company four years ago.

As Cisco made structural changes to re-orient their organization into the role of service provider, Jacoby armed employees with the ability to speak their mind and give input on the changes. To do this, Jacoby and other senior management set up “cohorts” comprised of 12 to 15 people and one leader, bringing together employees from various teams from within the organization and enabling them to share their ideas about leadership.

The cohorts at Cisco now meet eight times a year. Each session revolves around a topic picked by senior staff, with at least four related to Cisco’s transformation into a services organization. By implementing cohorts, Jacoby fosters open and ongoing cross-functional communication between IT stakeholders and the business.

In addition to working collaboratively, women CIOs are particularly effective at incorporating in-depth knowledge of the business in decision-making. In 2005, research conducted by the University of New Mexico and University of California-Irvine showed that females have more white matter in their brains than do their male counterparts. Since white matter works to network various parts of the brain, this might explain why women are often more effective than men in integrating and assimilating information from distributed regions.

This might also explain why women CIOs are more effective at assimilating data from across the business into something meaningful that leadership can act upon.

Debbie Gash is another IT leader who effectively applied her understanding of multiple parts of a business to make complex decisions. Gash is the longtime vice president and CIO of Saint Luke’s Health System, a network of 11 hospitals in Missouri. By surveying the various hospital departments and ongoing technology projects, Gash was able to determine that Saint Luke’s needed a new system for tracking the IT budget. Once the new program launched, Gash used her institutional knowledge to determine what problems to tackle first. Gash juggled the needs of distinct hospital groups, employees, and vendors to create a smooth, company-wide system.

A final area in which female CIOs prove particularly effective is their ability to embrace change and guide organizations through periods of major overhaul. CIOs need to influence others who may be resistant of change, and women often bring the flexibility and tact required for such maneuvers.

One female leader who demonstrated grace during major change is Debbie Guild, CTO of Bank of America. When her bank merged with Merrill Lynch, Guild needed to create a unified financial transparency program.

At the time, Bank of America and Merrill Lynch were each using their own applications. Guild needed to assess the existing systems and also consider the complexity of the organization’s financials. At the time, Bank of America had 100,000 servers, product costs that changed monthly, and outdated cost forecasts. To top it off, employees within the financial transparency team weren’t convinced that they needed major change.

To begin the overhaul process, Guild called a meeting with her team and hashed out the problems. They eventually reached what she terms a “come to Jesus” moment. The team agreed to launch a new project — and made an important decision to brand the project to galvanize the various stakeholders — in order to improve organizational financial transparency.

With her employees, Guild worked to establish guiding principles for the program and develop a new system to bill the actual usage of Bank of America’s products. She made sure that the company’s head of finance and head of enterprise CTO were on board with what she was doing, and insisted that both verbally agree that they were going down the correct path. Then, Guild recruited people who were enthusiastic about the project and eager for results to move the project forward.

The new program is now producing real results and an improvement in financial transparency. By using both communication and diplomacy skills, Guild effectively steered the company in a new direction and was able to marshal widespread employee support.

In today’s service-oriented IT world, the ability to work effectively with others has become critical. Likewise, the role of the CIO continues to evolve from a purveyor of technology to one who delivers capabilities to their business users. Female leaders such as Jacoby, Gash, and Guild represent just a few examples of this changing mindset, one which puts a premium on communication, collaboration, and consensus building.

Chris Pick is chief marketing officer at Apptio, a Seattle-based provider of technology business management solutions. Apptio is focused on changing the world by giving IT and finance leaders the insight they need to minimize IT cost, make ROI-optimized decisions, align IT resources around services that align with business strategic needs, and ensure that business leaders clearly understand the value of IT.

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

Apple said in October that 93 percent of Fortune 500 companies have deployed or are testing iPads, an incredible feat considering that big businesses generally take forever to incorporate new technology into their workflows.

Enterprises deploy technology slowly because they tend to plan methodically and for the long term. In most situations, the IT departments and managers are the ones calling the shots. They think they know what’s best when it comes to incorporating tech and they want control over how that tech works.

But the iPad is different for some reason. Many organizations are seeing employees rebel and bring iPads into the fold without IT approval. It’s often a situation of “it’s easier to ask forgiveness than to ask permission.”

At VentureBeat’s recent CloudBeat 2011 conference, LiveOffice CEO Nick Mehta even said, in many cases, it’s the CEOs who bring in iPads from home and force the IT department to step in line. You could argue, as Forbes contributor Tom Taulli has, that the iPad is “corporate bling for executives.” The execs and their underlings go around IT because the iPad is just so cool.

Aaron Freimark, IT director at Tekserve, one of the oldest companies providing support for consumers and businesses using Apple products, agreed to walk me through the challenges that IT departments and executives are currently grappling with when it comes to the iPad.

I sought out an IT expert to walk me through the challenges that IT departments and executives face regarding the iPad. Aaron Freimark, IT director at Tekserve, agreed to help me out. Tekserve is one of the oldest companies providing support for consumers and businesses using Apple products, and it’s equipping many businesses in New York City with iPads. Freimark offers a unique perspective, as he is only one of a handful of people certified by Apple with Mobility Technical Competency (MTC), a title conferred to members of the Apple’s Consultants Network who are qualified to deploy iPads and iPhones on enterprise networks.

Setup and limitations

The biggest issue for IT managers when it comes to deploying the iPad, according to Freimark, is ceding control. With Windows and Mac desktops and laptops, the operating system itself provides a wealth of ways to control what employees can do. Modern Windows and Mac OSes and apps that have been created for those OSes can allow IT to wipe the machines, log in remotely, push software patches, and update software while retaining data contained inside that software.

But iOS, which runs the iPad and iPad 2, doesn’t work like other OSes. It’s still relatively young, with Apple only releasing the first version of iOS on the iPhone in June 2007. iOS is made to be more simple and it’s designed for multi-touch devices, not for standard desktops and laptops. While it offers some tools for IT control, it’s not as complete as most tech managers want. Whether Apple just hasn’t caught up to what IT managers want or control is given up by design, it’s easy to argue that there are gaping flaws.

“The IT people responsible for compliance don’t see it easy to use for their purposes, including security and control,” Freimark said. “IT workers have been trained to want to control systems. There is a limited amount of control you can have on the iPad.”

In its current state, an iPad running iOS 5 (the latest version) cannot be issued software patches, cannot prevent users from updating software to the newest releases, cannot provide direct screen-sharing for troubleshooting issues. Maybe most importantly, IT can’t push a pre-set “image” of configured apps with pre-installed data. All of these factors make for a somewhat scary proposition when it comes to deployment.

“With this setup, you’re not running an IT department that is updating en masse,” Freimark said. “You’re becoming more of a support organization.”

However, when you go into the nitty-gritty of actually setting up an iPad for the enterprise, there is a surprising amount you can do without putting in much effort. For example, when you connect an iPad to a Microsoft Exchange server account and ActiveSync, an IT manager can remotely wipe the device, enforce passcode policies to add security and turn off the camera. Those important basics, which have been available since the iPad’s debut, help managers sleep easier. If a work-issued iPad full of sensitive data goes missing, the IT department can at least completely erase the thing.

There are also many companies that specialize in the area of mobile device management that give the iPad more IT options, including Sybase, SOTI, MaaS360, BoxTone, AirWatch, Mformation and Zenprise. These companies can add additional layers of control for the iPad when it comes to things like app management, scalability and data export.

Use cases and apps

OK, so the iPad is frustrating for the IT department and they have to give up the level of control they normally have. It is worth the caveats? It’s a resounding yes, says Freimark, who uses an iPad to help run intensive parts of his own company. He says the simplified applications and touch display make work fun while also maintaining strong productivity.

There are more than 7,300 business-focused applications currently available for the iPad, and many of them are good-to-excellent touch-based versions of their desktop counterparts. High-quality applications for business include:

•Dropbox and Box for file management
•Adobe Reader and GoodReader for PDF viewing
•GoToMeeting, WebEx and Polycom for digitally attending corporate meetings
•Yammer, Salesforce Chatter and IBM Connections for business social networking
•VMWare View for iPad and Jump Desktop for virtualization
•Workday and Sovanta iPeople for HR management
•OmniGraffle and SyncSpace for diagramming
•SharePlus for Microsoft SharePoint access
•Roambi for very-cool data visualizations (seen in the photo above)

Microsoft is reportedly working on official Microsoft Office applications for iPad for 2012. That said, Quickoffice, Documents to Go and Apple’s own iWork already offer document, spreadsheet and presentation editing functions that vary from mediocre to great.

Some companies are also using internally made applications on the iPad. One company making those internal iPad apps secure is Sunnyvale, Calif.-based startup Bitzer Mobile, which offers what it calls a “secure container” to run native and HTML5 apps. Bitzer’s software handily allows for the isolation of enterprise apps so parent companies can remote wipe or change data inside the apps without affecting any personal assets on the iPad.

Cultural shifts and what’s next for the iPad at work

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Sept. 9 - 10, 2013 San Francisco, CA

Early Bird Tickets on Sale

Companies love to use the term “cloud” when hyping their internet-based services. But what do technology executives really think about the cloud?

With our exclusive conference on cloud computing, CloudBeat 2011, starting today, we decided to ask.

VentureBeat commissioned an exclusive survey of technology executives at companies of at least 250 employees. The results show that, yes, the push to cloud services is gaining momentum: It’s already playing a significant role in IT executives’ decisions about what technologies to deploy, and many large companies are already embracing cloud services to a significant degree.

The main reasons for embracing the cloud are cost reduction, cost control and agility of deployment.

However, companies are holding back on hosting their most critical business applications in the cloud. Concerns over security, regulatory compliance and the difficulty of integrating complex apps into a new, internet-based infrastructure are the big concerns. There’s also some reluctance to commit business applications to a cloud provider that might suffer from occasional outages or that could be affected if legal actions target another one of the provider’s clients.

What cloud providers need to do to win over the next wave of customers seems clear: Ensure the security and reliability of services, facilitate integration and migration of existing apps, and provide assurances that customers will be able to move their apps and data elsewhere if need be.

We created a simple questionnaire with free-form answers to three key questions: Why are you using (or considering) cloud services, in what cases aren’t you considering using it, and what needs to change in the next year to speed adoption of cloud services.

We used Maven, a network of qualified domain experts that are available for “micro-consulting” (basically answering questions like these) in exchange for fees. Maven directed our questionnaire to a set of IT executives working at companies of 250 employees or more.

Of the 25 respondents, 64% were chief information officers, vice presidents or a similar executive title, while the remainder were senior managers or IT directors. 40 percent were at companies of 250-1,000 employees, and 28 percent were at companies with more than 10,000 employees. All have had decision-making responsibilities for choosing cloud-based technologies within the past 6 months.

Here are the specific questions we asked, along with a sampling of answers to each.

Why cloud?

Please describe in 3-4 sentences your organization’s primary motivation for evaluating and/or using the cloud.

Many respondents cited cost as the primary factor, with rapid implementation or simplification showing up in many other responses. Variability of cost, flexibility of deployment and “agility” were other reasons for considering cloud services.

Some pointed to specific accounting reasons: The desire to avoid capital expenditures (CapEx) and move costs to operating expenses (OpEx) or, perhaps, bury them in employee expense reports — a trick I’ve used at previous jobs to get needed services that IT wouldn’t approve.

Specific responses included:

“Cost reduction and simplification of support and maintenance.”

“Managing IT services infrastructure and owning it is not core to our business — in addition we cannot ever hope to stay up to date with technology without funding which would have to be taken from elsewhere in our business.”

“Major shift from CapEx to expense budget.”

“A tablet approach allows the use of a pdf annotation application and eliminates paper for this and board report documents as examples. Cloud storage, such as DropBox or Box can be used to upload the weekly files to the tablet. … [Bring Your Own Device] is another driver — the cloud delivery methods can eliminate the need to manage a user’s device directly and instead deliver PIM, email and other data to a secure canister on the device.”

Why not cloud?

Please name a process, workflow, application, or data set that your organization has deliberately decided NOT to move to the cloud. Please explain why you made this decision.

Keeping control of mission-critical business processes, ensuring security and maintaining lower costs on certain services were the main reasons cited for not using the cloud. For example, one respondent noted that large files were simply cheaper to store on local file servers at this point. Similarly, one company kept its own Exchange servers, noting that with a really large installation (over 1,500 seats) it was cheaper to maintain in-house.

Applications that have been carefully woven into a company’s business processes, integrated with a host of other software, is also difficult to move to the cloud.

In some cases, security concerns are particularly pressing, such as with medical records governed by HIPAA.

Specific responses included:

“We would like to cut costs and simplify the support and maintenance efforts involved in storing [large] files. But, to date, it is much more economical to maintain that storage in-house.”

“Core policy administration systems: these are largely back office systems, they are large-scale legacy systems with a great deal of intellectual capital as well as containing our customers’ and agents’ personally identifiable information (PII), so any kind of security breach, or outage, would pose a significant business risk.”

“Clinical applications. Not quite sure of the HIPAA complications of storing Patient Data in a public cloud.”

“The bank’s core applications are considered too sensitive to move to a cloud model. Cloud vendor security cannot be reliably assessed or guaranteed, a big concern for heavily regulated industries. Application availability cannot be reasonably assured as well and there are several cases that can be pointed to in this area. A vendor’s environment being seized by the FBI has also affected some companies using these services. Having an internal cloud delivery model that leverages two internal datacenters is what we have implemented to address this concern.”

What’s next?

Please describe at least three key pain points (e.g. governance, spend management, multiple languages/frameworks, open standards, interop, etc.) that you believe will be solved in the next year to make cloud adoption easier. Why do you choose these items?

Management of the environment in the cloud was a concern of several respondents. How do you maintain your software, enforce service-level agreements, and make sure you’re not completely locked into any one vendor?

The answers here also hearkened back to the concerns over regulatory compliance with, say, banking regulations or HIPAA. Trusting data to a cloud provider is a whole different ballgame when that trust puts you at risk of very severe regulatory penalties.

Specific responses included:

“Comfort with the term cloud and education to understand that it’s not an either/or decision, the cloud can be private, hybrid or public depending on needs.”

“Support for multiple Hypervisors, especially HyperV, because customers are demanding it and most cloud providers are mature enough with their first VMWare support…but recognize they need to support others in the event of hybrid cloud setups.”

“Bandwidth, spend management, and open standards are current pain points that I expect to be resolved in the next year.”

“Data residency: complexity/variability of global compliance rules makes it hard to adopt cloud for certain types of data.”

“Mobile access: HTML5 based access via mobile devices makes usage more ubiquitous.”

“Ability to manage the dynamic environment that results from cloud adoption, the ability to manage SLA’s, performance, availability and reliability across multi-vendor cloud solutions, ability to maintain portability so one can still have strength negotiating contract renewals.”

For the entire survey results, check out the embedded PDF below.

July 9-10, 2013
San Francisco, CA

Tickets On Sale Now

In yet another blow for BlackBerry loyalists, Research in Motion announced BlackBerry Mobile Fusion today, a tool that will allow businesses to make employee iOS and Android devices just as secure as RIM’s own smartphones.

The announcement likely comes as a relief to IT managers, who have had to juggle multiple security solutions for corporate and personally owned mobile devices. RIM’s BlackBerry is far from its heyday as the only worthwhile enterprise mobile device — now employees are bringing their personal iPhones, iPads, and Android phones to work, as well as demanding more choices with IT-provided devices.

With its stock and market share tanking, RIM has to adapt to the changing mobile landscape to survive. The new software is the result of RIM’s acquisition of the mobile device management company Ubitexx in May. At the time, RIM said that it was acquiring the company to bring features of its BlackBerry Enterprise Server (BES) to the iPhone and Android.

Mobile Fusion will grant corporate IT workers useful security features, like the ability to lock or remotely wipe lost or stolen devices, reports Reuters. IT departments will also be able to set rules for things like passwords and apps. Mobile Fusion will work alongside existing BES implementations — which may convince some companies to hold on to their BES setups for a bit longer.

RIM says that the software is expected to launch in late March 2012. The company isn’t discussing pricing yet, but it says that it will be competitive with smaller mobile device management solutions like MobileIron and BoxTone.

Sept. 9 - 10, 2013 San Francisco, CA

Early Bird Tickets on Sale

Everyone is talking about the “cloud,” but is there anything new here? How is the “cloud” different from “internet” or “web?”

There is something new — and it’s a big deal — but it’s not what everyone usually talks about.

A few years ago, when someone would store his photos on Picasa, he would say, “I am using this website to store my photos” or “I put my photos on the Internet.” Now he would say, “I store my photos in the cloud.” What’s the difference ? In most cases, none. In consumer language, the word “cloud” has replaced “Internet” or “web” — it is just more trendy!

And yet, something real is happening.

In the business-to-business world, the word “cloud” is just as pervasive as it is in the consumer world. The National Institute of Standards and Technology has even attempted to define it, although the definition is incredibly complex:

Cloud computing is a model for enabling ubiquitous, convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction.

This is actually accurate. But what is revolutionary and new here? Based on this description, the cloud is an evolution, not a revolution. It is the continuation of a series of changes initiated in the nineties with the advent of the commercial Internet, but its roots go back even further.

The first network-accessible “cloud” computing resources were already coming online some 50 years ago when American Airline launched SABRE in the early sixties.

In the eighties, bulletin board systems (BBSes) and Minitel were full of applications that were used through a network. The leading applications were yellow pages (search), travel reservations, order input systems and online dating.

In the late nineties, online services all converted to the Internet to benefit from lower costs and larger audience. Shortly after, a new concept appeared: “SaaS” or Software-as-a-Service. Some innovative software vendors realized that the Internet had become reliable enough for corporations to depend on it. We all know the success of Salesforce.com, essentially continuing and enhancing the order input systems from the BBS era.

A decade later, bandwidth has become so ubiquitous that it is in the air, and it is now common to access the Internet using smartphones. Most users have multiple devices from which they want to access their service, to the point that location has become nearly irrelevant.

With decades of improvement in available bandwidth and reliability, it is increasingly possible to rely on systems that are not on the same premises as the end user of the system. An innovative vendor, Amazon.com, saw that not only software but the computing infrastructure itself could be offered as a service. And thus the cloud was born. But fundamentally, there is not much difference between provisioning an instance on Amazon Web Services (AWS) and using a distant computer on a BBS 30 years ago.

And yet, a revolution is happening, but it is elsewhere. It is the consumerization of IT.

How consumerization has driven infrastructure

For decades, innovation in information technology has been driven by enterprises, government, and military needs. With the cloud wave, the place for innovation has changed, and it is now the consumer which is the driving force in IT.

Serving consumers at the scale of the Internet is mind-boggling. The service has to be on, all the time, for everyone, despite the variety of situations, devices, time zones, character sets…. When you address such a large population, there are no ‘safe’ maintenance windows. You can be almost certain that someone is using your service at any weird hour of the day or night, even on Christmas eve! Not only do you need to deliver 24×7, ubiquitous, highly reliable computing, but you need to do it cheaply, so cheaply that you can sell it for pennies or make money from advertising.

Large web sites such as Amazon, Google and Facebook have faced these challenges since the mid-2000s. They have independently found the same solution: distributing IT over many generic servers in a completely distributed architecture, where components can fail and be upgraded or changed individually without material impact on the whole system, thus reducing manual operations to a fraction of those required with traditional IT systems. This approach is now the foundation for the cloud wave.

Amazon founder and chief executive Jeff Bezos documented through many interviews the process by which Amazon became the leader of public cloud services. Here is an excerpt of an interview with Bezos in Wired:

Approximately nine years ago we were wasting a lot of time internally because, to do their jobs, our applications engineers had to have daily detailed conversations with our networking infrastructure engineers. Instead of having this fine-grained coordination about every detail, we wanted the data-center guys to give the apps guys a set of dependable tools, a reliable infrastructure that they could build products on top of. The problem was obvious. We didn’t have that infrastructure. So we started building it for our own internal use. Then we realized, “Whoa, everybody who wants to build web-scale applications is going to need this.”

Google and Facebook had to build similar technology; they just took different business routes to get there. Google kept everything in-house powering its multiple applications, simply publishing a few white papers on what it had created (notably MapReduce, which is the foundation to Hadoop). For its part, Facebook contributed much of its infrastructure work to the open-source community (including projects like Cassandra and OpenCompute.org).

This kind of infrastructure has revolutionized software development. Now instead of having to deal with infrastructure as a hindrance (because it is too slow or too expensive) developers can program the infrastructure to deliver exactly the amount of computing power, network resources or storage capacity that is required.

A new kind of developer

I am too old to talk about this revolution with any level of detail. However, I can notice that the kids developing applications today use completely different languages and paradigms than what I was using twenty years ago. Their approach to development is completely focused on what they want the application to do. They do not have to manage the hardware in any way.

Typically these applications leverage a “web service” type of software architecture, making it extremely easy to link applications together. Look at how easy it is to have your Twitter feed show on Facebook and LinkedIn at the same time, or how you can easily log in to a site using your Facebook credentials. This is the result of a web service architecture.

Furthermore, since the infrastructure is programmable, these developers can treat the infrastructure itself as just another service. Now, an application can request 1,000 servers but only for the time it needs to get your result, and then free up these 1,000 servers for some other task, all without any manual intervention. That’s the cloud!

In fact, the NIST definition with “with minimal management effort or service provider interaction” is really a understatement. If an application becomes popular and requires more resources, it will simply request those resources from the Infrastructure-as-a-Service. This is what has made Amazon Web Services so popular with start-ups. Now developers can program the infrastructure and operations as part of their software development. That’s led to a new term, “devops,” that makes explicit the merger of what used to be completely different skill sets, software development and IT operations.

This new style of application development results in applications which are more fun, easier to use, more practical, and more reliably scalable, both in terms of functionality and capacity. All of this can be achieved with a higher productivity in the development process.

The old man’s initial reaction is to dismiss the young kids’ approach. But when you see the success and stability of applications that have been built this way, such as Facebook, SmugMug or Dropbox, to name a few, I am willing to bet the opposite. Within ten years, this style of development will have become standard in the enterprise.

On the hardware side also, innovation is also driven by consumer technology. The cost of silicon-based components is mostly capital cost: the cost of R&D plus the cost of building a fab. Consequently, the cost of silicon based components is inversely proportional to the number of components sold. This is how solid state drives, which were originally used for digital cameras, smartphones and USB keys, got down to a cost point where they are now competitive with hard drives for certain business applications. Without the billions of SSDs sold to the mass market, there would be no way for startups to use SSDs as a viable storage alternative today.

Employees seizing control

Finally, there is yet another way in which consumer technology is driving innovation. Until recently, employees had to make do with what was supplied by their IT department. They would sometimes complain that an application was slow, or a process not practical, but at the end of the day, they would use the tools they were given.

With so many applications and business processes now available through the web, this has changed. How many times have I tried to send a large attachment to someone, and after it was rejected by the corporate mailbox, the person recommended I use their private Gmail account? Actually, the more senior the person and the more confidential the document, the more likely it is to happen!

The tables are turning. Employees are savvy users of IT at home. Devices such as the iPad, Kindle, and Android smartphones, websites such as Facebook or Netflix, applications such as Xfinity, Skype or Evernote have become part of daily life. People can easily listen to the same music at home, in their car, or on vacation. With Xfinity, they can select a movie on their iPad and launch it on their home HDTV. They can share pictures and videos of their last party with all their friends, or with only some of them at the touch of a button.

And then they arrive at work, only to discover that it is impossible to validate a purchase order from their corporate enterprise resource planning (ERP) system from their smartphone. The gap between the amazing technologies they have at home and the lame ones they have at work is widening, and it is becoming intolerable for employees. Intolerable situations cause revolutions.

The consumerization of IT is the real revolution. It is the wind pushing the cloud. The real debate is not about public or private cloud. The real challenge for corporate IT is to embrace this revolution, and accept the fact that an IT made of many simple web processes and many generic servers actually delivers better applications, more functionality, more agility and more reliability, at a fraction of the cost of the big iron.

It is counterintuitive, but it is real. This is what the cloud is about.

Jérôme Lecat is the chief executive of Scality, a large-scale storage management startup. He is a serial entrepreneur and business angel with 15 years of internet start-up experience.

Top image credit: Alexander Kirch/Shutterstock

CloudBeat 2011 takes place Nov 30 – Dec 1 at the Hotel Sofitel in Redwood City, CA. Unlike any other cloud events, we’ll be focusing on 12 case studies where we’ll dissect the most disruptive instances of enterprise adoption of the cloud. Speakers include: Aaron Levie, Co-Founder & CEO of Box.net; Amit Singh VP of Enterprise at Google; Adrian Cockcroft, Director of Cloud Architecture at Netflix; Byron Sebastian, Senior VP of Platforms at Salesforce; Lew Tucker, VP & CTO of Cloud Computing at Cisco, and many more. Join 500 executives for two days packed with actionable lessons and networking opportunities as we define the key processes and architectures that companies must put in place in order to survive and prosper. Register here. Spaces are very limited!