Stop Amazon: A New Era Of Cloud Co-opetition

A recent pact between Google and VMware reflects a new air of co-opetition among major cloud computing service suppliers, as companies try to keep Amazon from running away with the market.

Ray Noorda, the late founder of Novell, popularized the term co-opetition, meant to convey how competitors will cooperate where their interests overlap in one narrow sphere, while continuing to compete on many other fronts.

Amazon's continued ability to innovate and create new on-demand computing services around its online retailing base of operations has made it a formidable competitor. As enterprise IT shops experiment with and embrace cloud services, rivals including VMware, Google, Microsoft, Rackspace, and IBM SoftLayer have reason to worry that Amazon will win today's cloud-services land grab before they can bring forth a full suite of competing services.

That's why this new sense of co-opetition is no longer about cooperating on a narrow front, as Noorda envisioned. It means cooperating wherever you can to prevent a potential cloud user from becoming the next Amazon convert.

VMware recently announced vCloud Air, its public cloud computing service, would offer Google's Cloud Storage, BigQuery analytics, NoSQL Cloud Datastore, and Google Cloud DNS. For VMware, it let the company very quickly come up with low-cost object storage, a big data analytical service, a NoSQL database service, and a domain name system service for URL conversion to IP addresses.

Google and VMware are both aspiring cloud suppliers, but they have widely different strengths and weaknesses. Google shows off fast, efficient cloud services, modeled on Google Search infrastructure, but it's only lately exhibited much understanding of how to connect those services to enterprise users.

[Amazon's expansion into email may have put Microsoft and Google into a more cooperative mood. See Amazon Workmail A Challenger To Google.]

VMware, on the other hand, has a fine grasp of what the enterprise needs next, but it doesn't have Google's global chain of data centers, speed of operations, or cloud services savvy. In this new era of co-opetition, VMware has opened the door to its enterprise chicken house and invited in the Google fox. If VMware customers haven't tried Google cloud services before, they now have their chance.

Partnering looks better than watching potential customers move to Amazon Web Services and get entrenched in its ecosystem. Amazon runs its business right around the break-even point as it pours investment into new Amazon Web Services data centers, Amazon.com retail distribution centers, and new product segments. Amazon Studios just announced it was remaking the '70s children's TV show Sigmund and the Sea Monsters, and in January said it would start by mid-year offering a business-focused email and calendar app WorkMail, with enterprise-friendly hooks like Microsoft Active Directory integration. Is there no corner of digital services that Amazon's ambition will leave untouched?

Anything that slows Amazon's ability to grow buys time for Google, Microsoft, and VMware to build up more competitive services.

Microsoft also has joined the co-opetition against Amazon's sprawl. Microsoft and VMware are fierce rivals to provide the software to virtualize enterprise data centers, but Microsoft Azure cloud infrastructure welcomes VMware-based workloads. VMware's vSphere recognizes and manages Microsoft Hyper-V workloads.

But the VMware-Google alliance is the clearest example of how much the atmosphere among the cloud competitors has changed. Napoleon once sparked a Grand Alliance against France by conquering his neighbors. Amazon is the Napoleon of cloud computing, with its only weakness its own relentless need to keep expanding.

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