John Steensen’s Blog

Cloud Computing 1.0 = Utility Computing 2.0 May 18, 2009

Cloud computing is everywhere – and nowhere. I say that because it seems that no two vendors/academics/professional associations/standards groups (pick 1) can agree on what the term “cloud computing” means. The concept of cloud computing is simple enough – you can have as little or as much computing related “stuff” as you are able to pay for. That stuff can be processing cycles, storage, data transfer, load balancing or whatever a vendor offers as a discrete billable service.

In Dot.Com Era 1 there was the concept of utility computing that offered the same type of services being offered today by cloud computing – reliability, availability and scalability (a phrase made famous by IBM and dating back over 30 years) but without the encumberment of long term contracts and massive infrastructure investment. The datacenter and personnel costs of Dot.Com Era 1 made true utility computing cost-prohibitive.

Now, in Dot.Com Era 2 we are able to materialize the promise of utility computing by riding on the back of the bankrupted network investors of Dot.Com Era 1 coupled with lowering operational and capital costs by offshoring a vast portion of our intellectual and manufacturing base. We now have enough infrastructure to create a computing utility.

I prefer the term utility computing because it more closely parallels the experience we will expect from such services. By comparing cloud or utility computing to an electric utility I believe we could make the average Joe (or Josephine) understand how it works. For example:

1. You house or business is connected through a metered device (electric breakers and a meter) to recieve electricity. Your house or business is also connected through a metered device (bandwidth-limited routers) to connect to the cloud.
2. You have little of no idea where the eletricity coming into your house or business is being generated (coal, nuclear, hydro, etc.). You also have little or no idea where the data being served up to you is coming from (data centers, governments, businesses, etc.).
3. You have no idea what to do when the electricity quits flowing into your home or business other than call your utility provider and wait to have it fixed (a very common occurrence in California). You also have no idea what to do when the data packets quit flowing into your home or business other than call your ISP and wait for them to fix it.
4. If you want to guarantee that you have electricity 24×7 for your home or business then you have to invest in an expensive UPS and generators. If you also want to guarantee that you have data processing capabilities 24×7 for your home or business then you have to invest in the servers, data storage, and software / people to make that happen.

So, in almost every way, cloud computing is more like the promise of utility computing than any other computing paradigm. But, lest we forget, ”Cloud Computing” is about selling a billable service and I am sure most people would agree that your average gas and electric utility isn’t very sexy.

In my next posting I’ll continue to follow a few of what I believe are the more pertinent parallels between cloud computing and the traditional utility business model.