MOBILE DISRUPTS THE CLOUD

Cloud Computing Primer

Eric Rubin

Founder, DreamFactory Software

www.dreamfactory.com

ABSTRACT: THE IMPACT OF SMART DEVICES ON THE CLOUDIf mobile devices were merely used to browse web pages, then they would not be very disruptive. But mobile is all about apps, and mobile apps have veered away from legacy browser technology. As a result a paradigm shift is emerging in the host platforms that support mobile.

This presentation looks at the impact of mobile on the cloud, from a technology and business model perspective.

TECHNOLOGY Paradigm Shift

CLIENTS PROPEL PLATFORM SHIFTS

Mainframe

Client-Server(e.g. Oracle/SUN)

Web Servers(e.g IBM,BEA)

Web APIs(e.g Amazon)

PC’s

Browsers

Smart Devices

SMART DEVICES DRIVE CHANGE IN WEB ARCHITECTURE Macro computing trends…

rapid move of s/w applications to the cloud proliferation of devices (phones, tablets, sensors, wearables)

connecting to the web apps usurping browsing as the primary web activity

…drive requirements for a smart client architecture legacy web technology is inadequate

LEGACY WEB TECHNOLOGY

The first generation of the web was primarily dumb clients (underutilized PC’s) connected to the web by browsers

Browsers communicate with servers via page generation, where the server does all computation and then ships an HTML page to be rendered on the PC’s browser. When your input something new in the browser, a new page is generated on the server and shipped back.

In the modern web a client is increasingly a smart device- tablet, phone, meter, sensor, wrist band, glasses…. These devices have unique local services (e.g. GPS location, Capture, Voice) that modern apps require

Legacy HTML Page generation approaches are unaware of client capabilities, each is treated as one uniform dumb browser client

New service based approaches emerge to fully exploit client capabilities

PARADIGM SHIFT: CLOUD API’S

Smart devices are causing a similar disruption to the cloud as PC’s did to mainframe computing

Mobile is to browsers as PC’s were to VT100’s, driving a paradigm shift Client-Server computing evolves to Client-Service

The new paradigm is n-tier and web service based Applications blend services from servers and clients

A new category of cloud middleware emerges to support mobile Backend As A Service or (mobile) mBaaS REST APIs enable client-service architecture for smart device applications Supporting rich client app delivery: HTML5, native IOS (Apple), native

Android (Google) and Windows 8 (Microsoft)

THE MODERN CLOUD: CBE

Cloud Back-ends (BaaS, mBaaS) are the newest generation of cloud middleware. CBE is purpose built for the modern web where smart devices need to connect to the cloud

CBE offers a set of APIs that enable rich clients to have cloud back ends for storage, collaboration, app administration, tracking stats, and a host of other capabilities

CBE developers use a service based programming model, based on REST APIs, versus page generation approach.

Examples of CBE vendors include DreamFactory, Kinvey, and FaceBook Parse

SMART DEVICES DRIVE SHIFT TO SERVICES

7/10/13 9

HTML Page Generation

REST WebServices

SaaS

IaaS

PaaS

Sites

(m)BaaS, CBE

PC’s

Smart Devices

PARADIGM SHIFTS FOSTER DISRUPTIVE INNOVATION Legacy vendors architected for browsers have to re-

architect for this new paradigm At the same time they have to preserve their investment

in page generation architecture, often creating conflicting incentives

White space opportunities unfold for a new generation of disruptive innovators

Setting the stage for disruptive innovators to blindside competitors in core adjacent markets in the future E.g. Google dominates search and then core adjacent markets like

email

BUSINESS MODEL DISRUPTION

The power of App Stores

PARADIGM SHIFTS & BUSINESS MODELS

Micro-purchases App Stores

Sell H/W & S/W

Sell Subscriptions or Ads

Sell services & Usage

Client Server

Web apps

Web services

Oracle/SunGoogle, Salesforce.com Amazon

Mobile apps

Apple, Google

APP STORES

App stores are a disruptive business model They dramatically lower customer acquisition costs while

dramatically increasing exposure Populating the market with far more competition than would

otherwise be possible Apple’s App Store has over 1M apps.

Combined with BYOD (bring your own device) App Stores are changing the way business adopt applications Grass roots, direct access to the pro-sumer (professional/consumer) Roll up to enterprise deals Versus mandated top down purchases through IT

APP STORES + BAAS= ENTERPRISE Most applications are local to the device BaaS cloud-enables mobile apps BaaS enables powerful features critical to the enterprise

Group collaboration Shared database Adminstration & tracking Provisioning (and de-provisioning)

Fosters a land and expand strategy Individual contributors expand to departmental teams expand to

enterprise roll-outs

SELLING API’S VS SOFTWARE

There is also a shift on server side business models In the last paradigm shift Software and H/W systems started

moving from capital expenditures to operational expense From outright purchases to subscriptions

The newest generation of cloud products are being sold on usage e.g. Amazon Web Services are pay as you go

This has a dramatic impact on bookings and is a major disruptor Subscriptions amortize revenue over 12-24 months, so at best they are worth

1/12 of a purchased booking. How would it look to your shareholders if you were to recommend cutting your bookings by a magnitude?

Usage is even worse, as there is no committed booking

RISK FACTORS TO LEGACY WEB

Web ISVs don’t fully exploit mobile e.g. local services, in-app purchases, actionable data, land and expand Enabling new mobile apps to grab beach-heads

Web ISVs lose touch with the end customer Who are spending more of their cycles on mobile devices Initial risk is the “long tail”, SMB customers

Web ISVs miss the boat on enterprise app stores and BYOD App stores empower individual consumers, and expand to groups though ad hoc

collaboration. DropBox and Evernote are great examples of individual productivity tools that have gone viral by making sharing simple

Monolithic and policy driven clouds (most enterprise s/w) can’t exploit app stores as a new business channel as the don’t offer the one-two punch of individual productivity that easily expands to group productivity

Strangely, the compounding effect of BYOD and App Stores provide a channel advantage to start-ups

ENTERPRISE DISRUPTION: WHAT KEEPS CIO’S AWAKE AT NIGHT? Fueled by mobile, BYOD requirements are elevated to C level. CEO’s like BYOD’s employee satisfaction and immersion

qualities CIOs must contend with:

Architectural issues. e.g How do we redesign all of our browser based apps?

Security issues of non-issue devices. e.g. How do we protect the company jewels?

Management issues of non-issue devices. e.g How do we disable devices for terminated employees?

These issues must be dealt with in primary application areas: Business to employee systems (B2E)

Business to consumers systems (B2C)

Business to business systems (B2B)

This creates an enormous white space for partners to help “mobilize” their infrastructure