Wednesday, 7 July 2010

EMC Closes Cloud: Atmos'phere has changed says analyst

As they close almost without warning their Atmos storage cloud, it seems that EMC has woken to the fact that the cost of infrastructure in any telecommunications project is unbearable for a company that makes it's money from selling products. Read EMC announcement here.

The announcement is bad PR not just for EMC but for Cloud computing in general as it leaves customers in a position where they have no support, no service level agreement and no guarantees that their data will be there tomorrow!

If you have five minutes it's worth reading the critique by cloud blogger Nicole Hemsoth over at her Behind the Cloud blog where she takes to task the analyst who just a few months ago rated him seize Atmos storage cloud has one of the rising stars of Cloud Computing.

Having spent many years working for, or with, service providers of all types & sizes it's very clear to me that the financial model required to deliver Cloud computing environments runs counter to that of a hardware or software manufacturer no matter how big they are. Infrastructure is by definition “a massive upfront investment funded by debt paid back over many years that generates cash flow which is used to fund operations, pay back the debt and pay dividends to investors, which is about as far as you can get away from the model of a company that sells product.

You can't blame EMC for wanting to be at the forefront Cloud computing wave as is a defining period for the industry in which EMC is an undoubted leader, I think they have done the right thing in stepping back before it impacts their core business as I foresee that a number of other companies who have jumped too early with too little consideration of the financial model that needs to be employed following suit, or the conflicts of interest that may arise with customers who can 'do it better'.

My advice to anybody thinking of moving to cloud infrastructure is to proceed with caution:

1) Look at whether it is a core element of their business, is it what they do all day every day?
2) Look at the providers ability to sustain the business model; 'can they stand the level of long term' debt?

Do this “before” deciding who to trust your precious data to.