I had only just taken a break from developing the illustration below for the Storage Efficiency seminar I will be delivering shortly with TechTarget — for use on a slide that lampoons what I call “the ENRON dreams” of cloud storage peddlers – when, sitting in my…eh…favorite reading chair (the porcelain throne), I came across an article in e-Week. I have since found it on line here.
ENRON Dreams in Storage as a Service
The terse article, which chronicles the efforts of Enomaly to create a service called SpotCloud to provide a way for buying cloud-based computing resources the way that ENRON sought to peddle power grid capacity, stole my thunder — and made my point. The basic idea is to gather cloud “X-as-a-service” providers into a free market, where their resources and pricing can be exposed. That way, you could buy futures contracts or something for the resources you need a day, a week or a month from now on the commodity service. Sounds interesting, right?
That’s basically what ENRON was trying to give to its corporate clients — a spot price model for sourcing electricity off the power grid. It’s the golden dream for cloud folk.
The problem is, as the article discloses, that there are no service level guarantees, no interoperability guarantees, no granularity provided to understand whether data may find a home — temporary or not — in a location where different laws and regulations apply, etc. The list of barriers goes on. If you participate in this “opaque market,” to use Enomaly’s term, they take a cut of up to 30% off the top of whatever you fork out for the services you buy.
When and if these problems are ever rectified and real enforced standards for classifying service levels, standardizing interoperability, and qualifying different providers against the tangle of laws and regulations that exist in the world today around data privacy and security, I might just believe in storage clouds. Until that happens, we are less likely to see the realization of the “ENRON-style spot pricing market” in computing than we are ENRON-style rip-offs.
Here at DrunkenData, we still aren’t sold on the cloud storage woo.
ONE LAST THING
To you cloud storage peddlers out there, tell me how your cost-per-GB rates will hold up when the next-generation high capacity drives come to market — the SATA 2.5″ perpendicular magnetic recording on Toshiba bit patterned media units with 40TB capacity that will sell on NewEgg within a year of release for something like .002 cents per GB. I really want to believe that you have a better business model than the ASPs did back in 1999.
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Jon, nice post. Funny thing is, when I was an IDC analyst back in 2000 or so, Enron called and wanted to talk about doing this with storage. Hmm, never heard back from them after that…
Doug Chandler
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