Wake-Up Call For Cloud Vendors And Customers

Amazon and Sony's recent problems highlight the vulnerability of doing business in the cloud but may end up helping improve cloud services.
The Amazon Web Services disruption has led some analysts to question whether cloud computing is a viable business model. Is this the beginning of the (premature) end of cloud computing? My answer: No. I believe that cloud computing in fact will emerge much stronger for the experience, but there's no doubt that cloud computing vendors--and more importantly, their leaders--must head to the classroom for more learning.

The outage centered around the Amazon Elastic Compute Cloud (EC2)--specifically, Amazon Elastic Block Storage (EBS), which provides distributed and replicated data storage services for EC2 applications. Naturally, this outage impacted a number of businesses, some better known than others. And by impact, I don't mean a bit of a performance slowdown and a few unexpected page errors. I mean a debilitating business interruption for four days straight.

Amazon provided regular updates on its Web services status page, but if Amazon chairman and CEO Jeff Bezos stepped up early to take responsibility and assure his customers, I must have missed that. Amazon has posted a fairly detailed explanation of the outage which, incidentally, provides a fascinating look into the brave new world of single-vendor, distributed, highly-available storage architectures, a fundamental building block of cloud computing and of the corresponding business model.

However, there are some astonishing other lacunae on the corporate website. For example, there's no mention of the outage in the online Media Room; no news release about the outage (04/26/11: " Announces First Quarter Sales up 38% to $9.86 Billion"; 05/03/11: "Amazon Announces MYHABIT.COM, a New Private Sale Site Featuring Hand-Picked Styles from Top Designer and Boutique Brands"); no letters from Jeff Bezos to Amazon customers (the last one is dated November 2007, introducing the Amazon Kindle); and no notices to Amazon shareholders. In other words, essentially a big yawwwwn from Amazon--the sort of lack-luster customer orientation that makes you wonder how they'd feel if Oracle went AWOL for days after a major Oracle technology failure at Amazon. (By the way, in an ironic twist, it appears that the outage was essentially caused by human error!)

Unfortunately, Amazon being the new technology bellwether that it is, the outage has shaken confidence in cloud computing in a customer base that already was skeptical about the paradigm. In a survey of 247 Fortune 1000 companies conducted by the 451 Group's TheInfoPro division and recently reported in, 87% of respondents had no plans to use cloud storage as an archive or lower tier … about the lowest rung in the storage ladder from a business perspective. In fact, even small and midsize businesses weren't interested in cloud-based storage, with about 90% "feeling apathy toward the technology".

The recent Sony PlayStation Network security breach has done nothing to restore business confidence in cloud computing. Internet bandits carried away personal details on more than 100 million customers in two separate intrusions over just days--that's one in every 70 people in the world, and includes names, addresses, birth dates and possibly more than 12 million credit cards. To make things work, Sony executives followed the new Executive Playbook for serious Internet gaffes: trivialize the incident with superficialities and shrug off responsibility. (Really, what are these guys thinking?)

Analyst and observer response to these incidents, as reported by Reuters, is less than encouraging. "Nobody is secure. Sony is just the tip of this thing," said Eric Johnson, a professor at Dartmouth University. "If you're doing anything that is critical to your business, you need contingency plans," says Gartner cloud security analyst Jay Heiser. "The marketing messages of some cloud computing companies have urged people to gloss over this need for contingency plans."

Forrester Research analyst Vanessa Alvarez is downright scathing: "The outage is evidence that companies can't wholly rely on cloud services to handle important functions. Customers need to start asking tough questions and not assume everything will be taken care of in the cloud, because it will not. They shouldn't be counting on a cloud service provider like Amazon to provide disaster recovery."

These are harsh words (and unfortunately, justifiably so). However, the truth is that there's too much momentum for cloud computing. It's an unstoppable force with no immovable object in sight. As the aphorism goes, that which does not kill you makes you stronger. I believe it's apt for the current crisis in cloud computing.

Rajan Chandras has more than 20 years of experience advising and leading business technology initiatives, with a focus on strategy and information management. Write him at rchandras at gmail dot com.

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