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Google, IBM Join Forces To Dominate 'Cloud Computing'

The companies plan to exploit their common technological world view and considerable talent to build a worldwide network of servers for consumer and business use.

With Microsoft and Yahoo in an icy stalemate over a proposed merger, rivals IBM and Google are ramping up efforts to jointly dominate what they believe will be the dominant software delivery model in the 21st century -- so called cloud computing.

Much of their work until now has taken place behind the scenes under a low profile, but the companies' close relationship was fully apparent Thursday when their CEOs made a rare joint appearance on stage at an IBM conference in Los Angeles.

Sam Palmisano of IBM and Google's Eric Schmidt in turn complimented each other on issues ranging from leadership to technological innovation. They also insisted that their companies share lots of similarities, despite obvious differences between a consumer Web giant that calls Silicon Valley home and a suburban New York-based centenarian of business computing.

"We're boring, they're exciting; we're slow, they're fast; we're fat, they're skinny," Palmisano joked. But the contrasts between IBM and Google are mostly skin deep, he said, noting that both vendors are "grounded in values" and share "a common technical alignment."

(IBM also processes accounts payables for Google, Schmidt revealed.)

IBM and Google plan to exploit their common technological world view and considerable talent to build a worldwide network, or cloud, of servers from which consumers and businesses will tap everything from online soccer schedules to advanced engineering applications.

"It's the story of our lifetime," said Schmidt.

The alliance, with its grand ambitions, started a couple of years ago with a simple phone call from Palmisano to Schmidt. "Sam called and wanted to know what we thought about distributed computing," said Schmidt.

"We weren't looking to sell them anything," said Palmisano.

The call led to whiteboarding sessions and ultimately a collaborative effort under which IBM and Google built a version of their cloud and in October gave it to several top engineering universities, including MIT, Stanford, and Carnegie Mellon, to poke away at.

The IBM-Google cloud, which to Microsoft might look more like an approaching thunderhead, runs on Linux, which has long been embraced by IBM as a non-Windows alternative. It also includes Xen systems virtualization and Apache Hadoop -- an open source implementation of the Google File System.

Google has already rolled out to consumers a number of free, cloud-based services such as e-mail and storage, but it's barely tapped the lucrative commercial market. With the exception of security requirements, "there's not that much difference between the enterprise cloud and the consumer cloud," Schmidt said at one point.

"The cloud has higher value in business, that's the secret to our collaboration" with IBM, he added at another.

Together, Google and IBM could conceivably supply computer users in the business and consumer markets with hosted offerings that range from basic productivity software like word processing and calendaring (such as Google Docs and IBM's Lotus Symphony suite) to sophisticated security and management tools (through IBM's Tivoli products and Google's Postini unit).

The partnership is solidifying at a time when Microsoft -- rivalry with which is another thing IBM and Google have in common -- is struggling to develop a coherent Web strategy of its own.

Its answer to the cloud trend is to move some applications to the Internet under a strategy it calls software plus services. But the bulk of Microsoft's profits still come from software that's either sold in boxes at retail stores or preinstalled on PCs by big manufacturers like Dell.

Microsoft is seeking to buy out Yahoo to bolster its Web presence, but CEO Steve Ballmer's aggressive tactics (he recently gave Yahoo a three-week deadline to accept the deal; it passed uneventfully last weekend) have only engendered hostility from his target. Should the merger fail to materialize, future partnerships between the two companies would seem out of the question as long as current management is in place on both sides.

Meanwhile, IBM and Google appear ready to kick their cloud out of its academic nest to start rolling out production versions.

The companies did not make specific announcements to that end on Thursday, but Schmidt and Palmisano, both dressed in LA-friendly lighter colors, left little doubt that their joint efforts are accelerating. Indeed, they might well have told their audience of several thousand IBM business partners at the Los Angeles Convention Center to "watch this space."

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