Engine Yard’s Dillon: “a private cloud is an oxymoron”

eye-largeAs I was in San Francisco today, I managed to squeeze into a meeting with some of my former partners of the IT press tour organised by my friend Philippe Nicolas. Today we visited Engine Yard, a new player at the forefront of the implementation of platforms as a service (PaaS, i.e. the infrastructure side of cloud computing) for start-ups and Fortune 500 companies. Engine Yard’s CEO, John Dillon (our photo), shared his thoughts with us on the future of cloud computing with a panel of international journalists.

“The most important change in IT since the invention of the PC!”

John Dillon started his visionary presentation with a very straightforward statement: image“Cloud’s the most important change to the way we do computing since the invention of the PC” which address the points made by many of the detractors of cloud technology in the past few years. “All revolutions in IT start with listening to the user and what works is what starts small, in a trial and error sort of way, and then deciding what really works” he went on. “The cloud is scary is disruptive” he said but “it has the possibility to change the landscape for ever, and we are part of that change”

Describing himself lucky, Dillon said they had built a marketplace for the cloud and that they have two kinds of customers:

  • on the one hand, 2.0 start-ups who are looking to be the next Facebook. Dillon went on saying Engine Yard has 2,500 customers in 58 countries although they barely leave San Francisco. They can help our clients with the technology, but not with their business models.
  • Engine Yard’s other clients are Fortune 500 customers but it’s not about core IT, it’s about experimentation and innovation: and it’s working.

“We are very early with the cloud” John Dillon added, but “Corp IT are still trying to figure out what it means but most of the innovation is happening at the fringe, with systems that couldn’t be done 5-10 years ago” and “if it doesn’t work you can throw it away because it doesn’t cost much money” he commented. Most business executives who want to innovate turn to IT and that’s because of  the cloud. the impact will be profound and substantial. The pattern that the cloud is following is similar to past successful innovations I have witnessed in the past. “Big IT shops are nervous about the future” he said provocatively and with passion, “but the change will come and we’ll have to be smart and not tear up the current systems that work”. CIOs beware, “the tsunami is coming” he even added. Not surprising they are reluctant to jump on the bandwagon …

evolution or revolution

It is often asked whether cloud computing is an evolution or a revolution. Dillon’s answer is loud and clear: “If it’s evolution and it’s very fast, sometimes it means that things get broken. The consumerisation of the cloud is happening everywhere and some will see it as revolution, others as evolution. Some IT executives are very positive and embrace the change rather than fight it. A whole bunch of customers 1 mile from here are doing very crazy things [by that he meant Silicon Valley start-ups] but “most of the business done with cloud will eventually come from big businesses”.

IT departments are not liked

But there is one think anyone who has worked more than one week for a large company knows, and that’s the fact that “everybody hates the IT department” and Engine Yard’s CEO thinks that this is also the reason behind this (r)evolution: “users are fed up of asking for new things and IT departments answering either that you can’t have it or that you will have it next year” he added.

To him, a good IT department should say: “we should do something about it and use the new tools”. “A powerful IT department is one that is at the service of their users and shift more investment into innovation from 20% to 30% or even more” he concluded.

A statement no IT user would disagree with.

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a private cloud is an oxymoron

But the other problem with cloud computing is the “old sheep in new clothes” syndrome, which we described lately in an interview with a Sugar CRM executive.

“If you a re building a private cloud, you are just shifting the budget from one department to another and it’s only a way for the IT department to survive”. he bluntly described.

However, Dillon is no IT department hater, he is merely trying to wake them up to innovation. “We are planning to become a very strong partner of IT departments in large enterprises” he said, “but they won’t buy anything now, it’s too soon; within 5 years from now, they will!”

The cloud is a paradigm shift

“When there’s a paradigm shift, legacy start denying it, then they try to highjack the idea (stating things like ‘the cloud is just like it used to look’) and eventually, changes will come”. “Some big IT vendors will make the transition, but the sales model familiar to big IT vendors in which you sell very expensive proprietary products, very complex and with add-on prices so high that the sales person can buy a new BMW will go!

This is the same thing that Dillon experienced whilst he was working with Salesforce. “10 years ago he said, CIOs wouldn’t want to talk to us, now they all do!” Having said that, cloud computing will not solve integration issues, and this is where IT departments will have an important role to play.

[photos, cc, 2012 by Yann Gourvennec http://bit.ly/picasayann]

4 thoughts on “Engine Yard’s Dillon: “a private cloud is an oxymoron”

  1. While I agree with John Dillon’s pronouncement that ““Cloud’s the most important change to the way we do computing since the invention of the PC” – I’d have to disagree with the comment that IT departments that are deploying Private Clouds are “just shifting the budget from one department to another”.
    Private Clouds have been and are being deployed in many F500 corporation already. By leveraging IaaS layers like OpenStack, CloudStack, Eucalyptus, and VMWare along with Private PaaS layer like ActiveState’s Stackato or Cloud Foundry, enterprises gain all the elastic computing functionality of a Public PaaS like EngineYard without the security risks. There’s nothing “oxymoronic” about ROI and security.

    To learn more about why , check out ActiveState’s CEO Bart Copeland’s blog post here http://bit.ly/whyprivate

    • Thanks Diane for your comment. What I understand from John Dillon’s pitch is that public cloud technology is aimed at a) moving faster b) be vendor agnostic c) work by trial and error d) outsource the infrastructure. Now I understand your point that you could have the best of both worlds, and this is what private cloud offerers like you are arguing, and that you could have the beauties of cloud technology while being more secure. We could go on debating endlessly about that subject I believe … What John is hinting at here I think it’s that IT revolutions of the past have not taken place around security but openness. And here I would have to agree. I used to work for Unisys for whom I worked on the creation of the Internet banking practice in the 1990s. At that time we were working with an Atlanta-based company which was proposing an unbeatable concept for banks entitled: “the vault”. What “the vault” was doing was basically to create a risk-free environment for banks to do business online. That’s was unbeatable – given banks’ aversion to risk – yet it didn’t work out. Consumers and bankers started experimenting with basic SSL encryption and that was that. Obviously, it’s difficult to tell whether it will also happen with cloud technology – and I hope you sell lots of private PaaS services – but at least he is making a good point.

  2. Here again, I’d agree with you and with John that “that IT revolutions of the past have not taken place around security but openness”.

    While the cloud’s promise of elastic computing resources at scale, availability and lower cost are game-changers, it’s “openness” that will spark the revolution. An Open Cloud will revolutionize the way we think about and utilize computing resources.

    “Openness” in the cloud depends on being able to move from one cloud provider to another without re-engineering or being locked into to a single provider.

    Being Open is about choice, and private PaaS is about providing that choice – whether you are hosting on your internal Private Cloud, a 3rd Party Cloud Hosting provider or bursting into the Public Cloud.

    Adding a private PaaS layer that runs on any cloud hosting provider or IaaS or hypervisor allows organizations to move their applications and resources to any cloud hosting provider they choose, rather than be locked into a single Public PaaS providers’ IaaS choice, deployment & pricing model and services framework.

    The Open Cloud revolution is here and it’s Private.

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