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Cloud Computing - Year In Review

A Contributed Article Written By Joe Kinsella, CTO and Founder of CloudHealth Technologies

It's hard to believe the changes that have happened in the last twelve months of cloud computing. Who could have imagined on New Year's Day 2015 that the upcoming year would reveal AWS profitability, a Microsoft corporate resurgence, Dell acquiring a controlling interest in VMware (oh, and I think they might have bought EMC too), and perhaps the most staggering of all...Larry Ellison in the cloud? So as we ring in 2016, let's take a moment to reflect on the important events from the previous year.


January 2015 started as it usually does: with quarterly earnings instigating companies to start bragging about whose cloud is bigger. IBM opened the contest by measuring its cloud at $7B, with a growth of 60%. Not to be outdone, Microsoft also announced it too had a big cloud, with revenue up 114%, driven by the large growth in Office 365 (Microsoft doesn't let industry standard definitions of cloud confuse its financials). Amazon was the only cloud not to follow suit, acting disinterested and committing only to talk about how big its cloud would be next quarter. The winner? Only a really big cloud would have the confidence to not talk about how big it really was.


IBM held its InterConnect conference in Las Vegas in February, resulting in the obligatory container announcements we would come to expect from all conferences in 2015. The container craze would only increase as the year went on, with many companies deciding they no longer needed data centers, clouds or applications - just some really awesome containers. Need greater compute density? Use containers. Need faster application launch times? Containers to the rescue. Need to migrate to the cloud? Containers can do that. Athlete's foot? Yup, sprinkle a little container on it.


In March we learned Alibaba, the world's largest e-commerce company and competitor to, was entering the U.S. public cloud market. For all the U.S. companies waiting for a Chinese-based public cloud provider to host their critical business applications, sensitive data and intellectual property, this was exciting news. The real winner though might be the U.S. government, who won't need to move their data to the Alibaba cloud since much of it already resides in China.


In April we learned Amazon Web Services was a profitable $4.6B business with a 46% growth rate. Wall Street, like a neglected spouse, responded with: "You had me at ‘profitable'." Microsoft followed suit by announcing its revenue beat forecast, driven in a large part by its cloud. And HP found itself embroiled in controversy over rumors they were giving up on their public cloud offering. The confusion appeared to have started when HP's VP of cloud product management said something to the effect of (paraphrased): we're giving up on our public cloud. This was misinterpreted by the press as meaning: HP is giving up on their public cloud.


EMC, who had been struggling to remain relevant in the post-cloud world, surprised everyone with the $1.2B acquisition of Virtustream in May. Google kept its promise to unleash Moore's Law on cloud costs with another price drop. And IBM decided Amazon was getting too much market cap love for its recent revenue announcement and proceeded to tell the world how much bigger its cloud was than Amazon's (like Microsoft, IBM never lets a strict definition of the word "cloud" confuse their financials).


Deciding that the cloud was no longer like a fashion fad, Larry Ellison told the world that Oracle was all in on the cloud. With declining license revenue and years of being beat up by its twin nemeses, SaaS and cloud, Ellison revealed a "one ring to rule them all" strategy that included IaaS, PaaS and SaaS. Larry then promptly retreated to his new yacht, Mordor, from which he could await world domination. June also brought Cisco to the cloud stage for a brief cameo, with another of its "Interconnect is coming soon" announcements. Using a form of the Potter Imperius curse, Cisco said to its Cisco Live attendees: "Docker."


Alibaba announced a $1B investment in its cloud business, intended to accelerate its Great Firewall and monitoring services (pun intended). Chicago announced a plan to tax the cloud, then quickly decided that was not such a great idea after all. Apparently the citizens of Illinois will let politicians sell their Senate seats, but put their foot down when it comes to messing with Netflix. In between all this summer news, Google provided its security conscious customers the powerful new feature of bringing their own encryption keys to the cloud.


August was a tough month for cloud reliability, with both Google and Amazon experiencing outages. Amazon shared something in common with Kim Kardashian for a brief period of time, with their outage actually bringing down the internet (well, at least the important parts). It appeared the Amazon status page experienced an outage too, quickly returning to green with a popup note that said (paraphrased): "Yup, still not working." Google's outage taught us that the cloud is not immune to lightning, and that Google runs a better status page than Amazon. Meanwhile Intel shouted loudly that it still mattered in the cloud, even though most cloud users no longer know what a processor does.


Amazon and Microsoft kicked off their month right by announcing a $108M deal with the FAA. VMware's CEO announced the company had a plan to differentiate itself in the cloud. He was quoted as saying "it's not like we have our heads in the sand", as reporters watched grains of sand fall from his face. Amazon continued to disrupt the storage market with infrequently accessed (IA) storage. And of course, the pre-re:Invent buzz increased as everyone in the cloud started planning their trip to Vegas.


Michael Dell shocked the world in October by deciding to go plunk down all of Silver Lake's money at the roulette wheel and call for the color "EMC". This was Dell's biggest move in the cloud since the 2008 attempt to trademark "cloud computing" (Michael Dell to the trademark office: "And I would have gotten away with it too if it weren't for you meddling kids"). This was followed by news that HP was finally shutting down its public cloud, bringing to an end one of the last major public clouds built on OpenStack. IBM decided to corner the real cloud market with its acquisition of The Weather Company. No news yet on whether this acquisition might impact the Weather Company CIO returning to the re:Invent stage to tout the power of AWS. But none of this could take away from the really big event of the month: 18K cloud professionals converging in Vegas for AWS re:Invent 2015. Amazon's message to the enterprise: "Come on in, the water is great. Just drop your data poolside (in our AWS Snowball of course)."


After two years of telling the world it was still "really early" in the cloud, Google decided it might be getting a little late and appointed Diane Green as head of their cloud. As former CEO and founder of VMware, she brings some serious gravitas to the Google Cloud. Microsoft continued to give more open source love with its RedHat partnership, making the world ask: "Who are you and what did you do with Microsoft?" Google had another outage in November, this time caused by a bad DNS change. The bad news for Google: you had an outage. The good news for Google: we now care when you have an outage. And finally, the new HP Enterprise (HPE), recently freed from its sucky bits, tried to rebuild its cloud mojo by announcing a strategic partnership with Microsoft Azure.


As the year skidded toward its end, Microsoft continued to show external signs of its corporate resurgence in December, VMware deftly exited the "Joe Tucci cloud", and Oracle's disappointment to the Street was quickly followed by its first cloud acquisition (Oracle to Wall Street: "Docker"). To finish the year, Wired released a great article reviewing the ten year history of the disruption in the cloud, detailing its surprising evolution and winners / losers.


Thanks for joining me in the review. Let's raise a glass to toast to all of you who were part of making 2015 a great year in the cloud. Cheers! Now let's make 2016 an even greater year for cloud computing.

Happy New Year!


About the Author

Joe Kinsella is CTO and Founder of CloudHealth Technologies, one of the fastest growing companies in the emerging Cloud Service Management field. Joe is focused on helping organizations realize the full potential of the cloud, without having to sacrifice cost, performance, availability, or service level. With 20+ years of experience delivering software for companies of all sizes, Joe sees CloudHealth bringing the cloud to the enterprise by enabling the next generation of IT service management for the cloud.
Published Thursday, December 31, 2015 10:52 AM by David Marshall
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