IaaS Analysis


While the article below never explicitly mentions IaaS (Infrastructure-as-a-Service), and rather just vaguely refers to ‘cloud services’ or ‘cloud providers, the companies mentioned are all fierce competitors in the IaaS market.  Therefore, we would to highlight some interesting facts, figures and predictions for this $10 Billion dollar Amazon Web Services ‘Fad’ called IaaS. http://finance.yahoo.com/news/amazon-s-cloud-success-stokes-fears-of-old-tech-failures-163810909.html Amazon’s cloud success stokes fears of old tech failures We have summarized some of the highlights below: Since Amazon (AMZN) started disclosing the results of its cloud service business back in April, the stock is up 68%, representing a $124 billion increase in stock market value …the industrial giant [GE] could slash the cost of running an important oil and gas application over 90% by shifting to the cloud Application updates that once took 20 days can now be implemented in two minutes [Coca-Cola’s CTO] said “Our data centers have always had lots of servers, lots of cost, using a lot of energy, and this is not going to get us to the future,” Amazon’s web services unit has already reported revenue of $5.4 billion for the first three quarters of the year, an increase of 70% over the same period a year ago. Sales should exceed $10 billion next year and $16 billion in 2017 Cloud Winners, so far as of 2015, according to this article are AMZN, GOOGL and MSFT: And the not-so-winners, so far as of 2015, according to this article are IBM, HPQ and EMC: One of the really interesting points from an IaaS perspective is that Infrastructure is the foundation for ‘Cloud’ applications.  So it’s our predication that after the foundation is built then the acceleration with the number, variety and revenue for SaaS (Software-as-a-Service) applications will be even more explosive than IaaS, which should be a logical conclusion. We are in the midst of amazing technological times and it affords great opportunities for those with vision.   Share...

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Oracle announced their Q4 Fiscal 2014 Financial Results this morning and the results were less than expected.  Oracle attributes these results to the transition to cloud. Sales Transition This article (http://www.bloomberg.com/news/2014-06-20/oracle-sales-profit-miss-estimates-amid-cloud-transition.html?cmpid=yhoo) has a quote from Oracle’s CFO on this transition. “[Oracle Chief Financial Officer Safra Catz]… attributed lower revenue to the transition to cloud software, products for which the company recognizes revenue over the term of a subscription. With traditional software, Oracle recognizes revenue up front when it makes a sale.” It is fairly clear that Oracle knows that cloud subscription services is the future and this is not a question of “if cloud will be a viable financial business model?” but rather “when will cloud be a viable business model?”.  For Oracle, specifically, they clearly continue to struggle with this transition.  However, companies such as Salesforce and Amazon who absolutely embraced cloud from the inception are reaping the huge rewards of their once not-so-popular ‘faddish’ thought-leadership positions. Cloud Platform Another interesting part of this article is the publicly available facts that Oracle has started to clearly break out their financial results into several ‘cloud’ categories including infrastructure-as-a-service (IaaS), software-as-a-service (SaaS) and platform-as-a-service (PaaS). “As part of Oracle’s shift to selling more cloud software, the company broke out revenue for its cloud infrastructure-as-a-service products, which allow companies to store and run applications on the Internet. The company said it had $128 million of sales in that category. In two other cloud categories combined, software-as-a-service and platform-as-a-service, the company said sales rose 25 percent to $322 million.” Transition is hard, due respect to Oracle Without a doubt changing corporate DNA is extremely challenging.  We have previously shared our thoughts on  the difficulty of this change, as well as the financial implications, and even poked a little fun at Larry Ellison on ‘Subscriptions – Adobe and Oracle’ (http://saasisafad.com/subscriptions_adobe_oracle/), ‘Amazon Web Services (AWS) leading IaaS providers’ (http://iaasisafad.com/amazon-web-services-aws-leading-iaas-providers/) and ‘Software Subscriptions welcomes Oracle to the party’ (http://saasisafad.com/software-subscriptions-welcomes-oracle-to-the-party/). Cloud Is A Fad? As Oracle now tracks these categories of IaaS, SaaS and PaaS in their financial results we’ll monitor the outcomes and comment on the trends.  However we are very interested in your opinion.  What do you think?  Is IaaS a Fad?  Is SaaS a Fad?  Is PaaS a Fad?  Is BigData, Mobile or Cloud a Fad?  Please comment below. Share...

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