Cloud strategies plodding along

From a 451 report on outsourcing in cloud-land:

From our Voice of the Enterprise research, we can see that about two-thirds of organizations are operating with moderate transformation, while a fifth describe themselves as undertaking significant transformation.

And what do these new projects look like?

In the manufacturing sector and in transaction-heavy back-office process areas, automation continues to improve the top line for businesses. In banking, financial services and insurance, the main challenge is how to manage compliance cost-effectively so that productivity is not impacted.

Source: “The curious case of cloud services and the demise of multi-sourcing.”

Retail: tech slow to enable omni-channel, Amazon is far ahead as a threat

…a survey of the top retailers in the US and Europe. About 75 percent of them said that despite all the unprecedented investments they’ve made in retail over the last several years, they feel ill-prepared to handle and provide omni-channel capabilities.

Meanwhile, it’s clear that you need so look at online as the starting point of most purchases: “60 percent or more of in-store purchases start online ‘through digital engagement.’”

Amazon is quick to enter new retail markets:

Amazon reports e-commerce growth of 30 percent, whereas core retail is growing at only 2 percent. Amazon Fashion launched in a “very nascent way” in 2002 – it’s now the biggest fashion player in the U.S. Amazon has spent about $17 billion dollars on R&D around e-commerce. Walmart has spent under a billion. If Walmart cannot spend the money necessary to stay with Amazon, how will other retailers keep pace?

All of this was from a SFDC retail-focused person, no details on the survey.

Source: Salesforce Commerce Cloud CEO at NRF – 75 percent of retailers are “ill-prepared” for the omni-channel

One in three tech IPOs now trading below their starting price

Around 33 per cent of the technology companies to enter the market in the last ten years are currently valued at a price lower than their IPO mark.

This according to researchers with analytics house Geckoboard, who studied 100 software, hardware, and social networking companies that have undertaken IPOs since 2006. Of those 100 companies, 67 are trading above their IPO valuation and 33 are below.

Link

$44bn of cloud hardware in 2017, IDC

According to the IDC report, total spending on IT infrastructure products—including server, enterprise storage and Ethernet switches—for use in cloud environments will grow a healthy 18 percent this year [2017] to top $44 billion. Meanwhile, IDC said, investment in old-school non-cloud architecture equipment will actually decline by more than 3 percent in 2017.

Public vs. private:

idc-worldwide-cloud-it-infrastructure-100704641-large

Some 61 percent of cloud infrastructure spending is going into public cloud data centers, while off-premise private cloud environments will garner just under 15 percent of total cloud spending.

Link

It takes more than one factory

[Michael Dell] said that production plants in foreign countries are largely there because that’s where plants have been developed and have ready access to computer device components, including batteries, semiconductors and other supplies. “Building a final assembly plant in the United States is actually quite easy. But that’s not really the point,” he said. “The point is that without the feedstock industries… the components… that plant would be uncompetitive. So we need to have a thoughtful approach to those feedstock industries.”

Link

Another crack at “being digital”

Reda Hmeid over at InfoQ does a good job at trying to define “digital”:

Being Digital is the re-imagining of business processes to be by default a fully online, fully automated process from end user interaction to back office processing, with no need for human intervention.

…down to several characteristics of such an approach like immediate process loops for end-users (“real time”), automating most everything, being online, and well designed.

Source: What Does “Being Digital” Actually Mean?

Oracle acquiring Apiary, API design for the $660m (in 2020) API market

As for Oracle, the enterprise software vendor wants to use Apiary’s technology set to make its existing API Integration Cloud more robust. Oracle’s API product focuses primarily on services that help companies monetize and analyze APIs. Apiary provides more of a front-end platform for designing, creating and governing APIs. From Natalie Gagliordi f at ZDnet

From CrunchBase:

  • $8.55M in funding, over three rounds
  • Founded April, 2011.

Apigee was acquired, by Google, last year for $625m. Of course, they were public with (let’s hazard a guess) many, many more customers and revenue: $92.03m in FY2016, to be exact.

Back in September 2015, Carl Lehmann at 451 Research said they had 33 employees (up from 22 in Dec 2014) and estimated their revenue at $2-3m. Carl says, now, it’s “likely below $5m in annual revenue.”

What Apiary does

Apiary’s promise is to be quick and easy when it comes to managing the full life-cycle of API design. As their CEO, Jakub Nesetril, put it when I interviewed him in 2015:

It all starts with that first meeting when you’re thinking about building an API and you’re either kind of, you know, you’re inside meeting room ideating on a white board and then taking a photo of it and sending it to a co-worker, or summarizing it down into an email and sending it down to somebody else, saying hey, I just thought would could build something like this. That white board should be. And, if you do that it becomes, you know, we do a lot to try to make it super simple. We have a language that is like really, really simple for developers to write and we can write down a quick API in five minutes. It’s marked down, it’s like very organic, it’s very simple for developers.

What it creates for you, is creates this kind of common space, common language kind of when you talk about it that’s machine readable, human writable so it’s super simple but it’s also machine writable, and machine readable. The important aspect of it is that we take your white board, we take your … we build a language that we have API blue prints. It’s a… We take that API blueprint and we immediately create a API prototype, the moment you hit your first button. So, from day one when you’ve proposed your first API idea, your first resource you know, your first data structure. You have an API that’s sitting out there on the internet, somebody can query it and guess what, if they decide that the API is broken, that they would like to have a different resource, they would like to change the of a certain data structure, they would like add to it, whatever. They can go in, edit that out, click the save button and boom the API prototype is updated immediately.

Load in some enterprise governance and access controls, and you have something nice and useful. See him explaining more in this 2013 InfoQ interview.

Carl at 451 summarized the meat of what they do back in that 2015 report:

Apiary structures its API lifecycle management platform into five phases. The design phase includes the means to ensure API design consistency using a style guide, a collaborative editor and an approval process. The prototype phase includes productivity capabilities such as auto-generated code and a feedback loop for quality assurance. The implementation phase enables agile-inspired and test-driven development practices, helps deploy server code, and provides for framework integration. The delivery phase includes tools for automated documentation, offers code samples, guides the release of final client code, and offers SDKs. The feedback phase includes debugging, support and usage metrics.

The Money – grabbing part of the $3bn pie

Forrester threw out some API management market-sizing back in June of 2015 (there’s likely something more up-to-date behind their paywall):

We predict US companies alone will spend nearly $3 billion on API management over the next five years. Annual spend will quadruple by the end of the decade, from $140 million in 2014 to $660 million in 2020. International sales will take the global market over the billion dollar mark.

With Oracle’s foot-print in all of enterprise applications and IT (they own Java and share much of the JEE market with IBM), there’s likely some genuine synergies to be had. That is, Oracle could be in a position to boost Apiary sales way above what the tiny company could do on its own.

To be clear, as pointed out above, Apiary doesn’t do all that Apigee does. Apiary is just for the development/design time part of APIs, also providing documentation.

That’s helpful for sure, but I’d guess most of Forrester’s $3bn estimation is likely in actually running and managing APIs. And, in fact, it’s probably more realistic to put Apiary in the development tools/ALM TAM, which is probably in the low, single digit billions. That said, I’m guessing Forrester would put Apiary in their API management bucket; after all, it has “API” in it!

As more background, we talked about the API management market back back when the Apigee acquisition was announced both on Software Defined Talk and Pivotal Conversations.

Link

“the obsolescence of Java EE” – Notebook

Bottom line: Java EE is not an appropriate framework for building cloud-native applications.

In preparation for this week’s Pivotal Conversations, I re-read the Gartner write-up on the decline of traditional JEE and the flurry of responses to it. Here’s a “notebook” entry for all that.

From Gartner’s “Market Guide for Application Platforms”

This is the original report from Anne Thomas and Aashish Gupta, Nov 2016. Pivotal has it for free in exchange for leag-gen’ing yourself.
What is an “application platform” vs. aPaaS, etc.?

Application platforms provide runtime environments for application logic. They manage the life cycle of an application or application component, and ensure the availability, reliability, scalability, security and monitoring of application logic. They typically support distributed application deployments across multiple nodes. Some also support cloud-style operations (elasticity, multitenancy and selfservice).

An “aPaaS,” is a public cloud hosted PaaS, of which they say: “By 2021, new aPaaS deployments will exceed new on-premises deployments. By 2023, aPaaS revenue will exceed that of application platform software.”

On the revenue situation:

platforms-and-paas-revenue

Commercial Java Platform, Enterprise Edition (Java EE) platforms’ revenue declined in 2015, indicating a clear shift in the application platform market…. Application platform as a service (aPaaS) revenue is currently less than half of application platform software revenue, but aPaaS is growing at an annual rate of 18.5%, and aPaaS sales will supersede platform software sales by 2023.

And:

Currently, the lion’s share of application platform software revenue comes from license sales of Java EE application servers. From a revenue perspective, the application platform software market is dominated by just two vendors: Oracle and IBM. Their combined revenues account for more than three-quarters of the market.

Decline in revenue for current market leaders IBM and Oracle over last three years (4.5% and 9.5% respectively), meanwhile uptick from Red Hat, AWS, and Pivotal (33.3%, 50.6% and 22.7% respectively).
Decline/shifting is driven by:

given the high cost of operation, the diminishing skill pool and the very slow pace of adoption of new technologies, a growing number of organizations — especially at the low end of the market — are migrating these workloads to application servers or cloud platforms, or replacing them with packaged or SaaS applications.

And:

Java EE has not kept pace with modern architectural trends. Oracle is leading an effort to produce a new version of Java EE (version 8), which is slated to add a host of long-overdue features; however, Oracle announced at Oracle OpenWorld 2016 that Java EE 8 has been delayed until the end of 2017.3 By the time Java EE catches up with basic features required for today’s applications, it will be at least two or three years behind the times again.

Target for cloud native:

Design all new applications to be cloud-native, irrespective of whether or not you plan to deploy them in the cloud…. If business drivers warrant the investment, rearchitect existing applications to be cloud-native and move them to aPaaS.

Vendor selection:

Give preference to vendors that articulate a platform strategy that supports modern application requirements, such as public, private and hybrid cloud deployment, in-memory computing, multichannel clients, microservices, event processing, continuous delivery, Internet of Things (IoT) support and API management.

Responses

Oracle and Java: confusing

Oracle’s stewardship of Java has been weird of late:

It’s all about WebLogic and WebSphere

I think this best sums it all up, the comments from Ryan Cuprak: “What this report is trying to do is attack Oracle/IBM via Java EE.”

I wouldn’t say “attack,” but rather show that their app servers are in decline, as well as TP processing things. The report is trying to call the shift to both a new way of development (cloud native) and the resulting shifts in product marketshare, including new entrants like Pivotal.

I can’t speak to how JEE is changing itself, but given past performance, I’d assume it’ll be a sauntering-follower to adapting technologies; the variable this time is Oracle’s proven ambivalence about Java and JEE, and, thus, funding problems to fuel the change fast enough to keep apace with other things.

The undying death of JEE – Gartner, app servers, and cloud native – Pivotal Conversation

One of your favorite technologies is on the death wagon, again. Gartner recently recommended avoiding JEE for new, cloud native application development. This predictably kicked up all sorts of push-back from the JEE stalwarts. In this episode we discuss the report, the responses, and all the context to figure out what to make of all this. Spoiler: JEE isn’t dead, as ever, it’s just a part of the ongoing gumbo that is a Java application.

 

Subscribe, follow, feedback

News Links

Gartner on JEE for Cloud Native

Distracting people is a better way to “win” arguments

Distraction is a clever and useful strategy in information control in that an argument in almost any human discussion is rarely an effective way to put an end to an opposing argument. Letting an argument die, or changing the subject, usually works much better than picking an argument and getting someone’s back up…

From a summary of a study that looked into how China tries to control news flow on the web.

Link