Of cloud and factories

The most common metaphor for cloud computing is that it’s like your electric power company. Flick the switch on, log in to your cloud service, pay for what you use, log out, flick the switch off, go to sleep. Well, it’s a bit more complicated that that.

Power companies offer a single product: Electric Power. How many variations are there? Compare them to the myriad cloud offerings: Infrastructure as a service (virtual machines, Windows or Linux), Storage as a service (online, backup, archiving), Software (everything). To me, it looks more like manufacturing and selaling cars. And the cloud business has striking similarities to car manufacturing: Just assume that every car manufactured and sold is a month of a cloud service – any kind cloud service. What are the analogies?

  1. The infrastructure that powers a cloud service is like a car factory. There is an assembly line, pumping out a particular car model/cloud service. In both cases, the product is as good as the materials it’s made of and the quality of the manufacturing process. Also, the pricing catalog varies accordingly.
  2. Cars shipped out of the factory need an extended and reliable transport network, like rail, ports, RORO ships and so on. The same is true with cloud services: Since they are delivered over the Internet, cloud providers need multihoming (peering with at least two Tier-1 or Tier-2 providers), low latency and high bandwidth.
  3. Economies of scale and just in time production: The more cars you build and sell, the cheaper they are. Same thing with cloud services (Amazon Web Services). Also, adding more capacity as you grow is the only sustainable model for cloud providers – the analogy in the car industry is just in time production.
  4. Go to market: Building a cloud service is one thing, selling it is another. All car brands have an extensive network of resellers and dealers, cloud service providers rely also on partners and heavy Internet advertising and market awareness to bring in the sales volume to sustain their business. And volume is key to cloud services, just as it is in the car industry.
  5. Product qualities: Cars come in all sizes, shapes, colours, equipment. The same applies to cloud services. They all look alike (for example, all cloud service providers offer Windows servers), they do the same job, but what really matters is performance, capacity and reliability. What qualities would you look for if you were on the market for a new car?
  6. Common technology: Have you opened the hood of an Audi, Skoda, VW and Seat? The mechanics are the same, but the badges are different. Moreover, three technologies (soon to be four) power all cars on the globe: Gasoline, Diesel, hybrid (and electric in a few years from now). Guess what, it’s the same with cloud computing. There are only a handful of hypervisors and automation platforms that power most cloud service providers, yet, every provider has their own look and feel.

The perfect analogy would be the factory this gentleman used to run:

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3 responses to “Of cloud and factories

  1. The analogy about the cloud and public utility services is not new. It dates as back as the days of the ARPANET when McKenzie was the first to talk about making the network a utility. Given the different versions of “clouds” you can still hold the analogy for many cloud utilities instead of just one.

    Also note that since the whole can be more (or less) than the sum of the parts due to emergence the quality of the final product may not be dependent on the quality of the parts themselves.

  2. From the provider point of view (like mine), the model that suits best is the factory. I have a factory, cutting out VMs and ships them to consumers. To make money out of it I have to market it, build the channel, get the price right and mobilize an organization to support me. Wholesale, retail, business partners, promotion, engineering, devops, it’s a big boiling soup!

  3. I used to think along the same lines until red-tape made me get over it. You see, a virtual machine is considered a service for purchasing purposes (at least when having to do with ΕΣΠΑ euros) and not an actual machine. This in turn means that I cannot draw such funds for virtual machines in the same way that I can for actual big irons 😦

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