1. Envisioning the Cloud:
The Next Computing Paradigm and its
Implications for Technology Policy
Google DC Talks
The Newseum
555 Pennsylvania Avenue
Washington, DC
Jeffrey F. Rayport & Andrew Heyward
Marketspace LLC
A Monitor Group Company
March 20, 2009
®
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2. Overview
 Understanding the Cloud
 Benefits of the Cloud
 Enabling the Cloud
 Government and the Cloud
 Concluding Thoughts
Every dozen or so years, a revolution changes the way we use
computers. Huge mainframes in the 1960s, minicomputers in the
1970s, personal computers in the 1980s, cell phones and smartphones
in the last decade, and now the emergence of cloud computing.
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3. Seeding the Cloud
Processing Power Storage Connection Speed
Gordon E. Moore Mark Kryder Andy Grove
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4. Defining the Cloud
Cloud computing represents a new way to deploy computing technology to give users
the ability to access, work on, share, and store information using the Internet. The cloud
itself is a network of data centers – each composed of many thousands of computers
working together – that can perform the functions of software on a personal or business
computer by providing users access to powerful applications, platforms, and services
delivered over the Internet.
Online Music
Social Networks Photo Sharing
Online Video
Smartphones Web-mail
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5. Layers of the Cloud
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6. Benefits of the Cloud
Anytime
Anywhere  Founded in 1999 declaring the “end of software”
Access  Offered cloud-based version of CRM software
 Became first cloud-based service to generate $1 billion in sales
Specialization &
Customization  Sells “on demand” contract and proposal management systems
 Built a prototype in a “couple of weekends” using Salesforce’s
Force.com platform – company profitable within nine months
 Focused on customer needs, not development or infrastructure
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7. Benefits of the Cloud
Collaboration  Held InnovationJam in 2006; world’s largest online brainstorm,
designed to share IBM’s advanced research and technologies
 Included over 150,000 participants from 104 countries
 From concepts developed during sessions, IBM launched 10 new
businesses with investments totaling $100 million
Storage as
Universal
 Digitized 150 years of archives, which comprised 11 million articles
Service
representing 1.5 terabytes of memory
 Utilized Amazon’s Simple Storage Service (S3) to digitize complete
archival content page by page in under 36 hours
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8. Benefits of the Cloud
Processing
 Provides web-based software for creating presentations using
Power on photos and music uploaded to the web
Demand
 Increased traffic to 750,000 from 5,000 a day after a successful
Facebook marketing campaign
 Added capacity on Amazon Web Services infrastructure at a cost of
10 cents per server hour plus related expenses
Cost Savings  Utilized Google Apps to provide Office-type productivity software
for its workforce of over 16,000 people
 Achieved estimated savings of $80 million by not building its own
data center or hiring more engineers to manage it
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9. Enabling the Cloud
Universal Connectivity Open Access
“The point is that no one should
“There will be 499 million in-home
be denied access to [online
consumer broadband connections
resources] because of who they
worldwide by 2012 – an
are…. So this is a fairness issue
extraordinary number, but it
more than anything else.”
represents only 25% of the
world’s households.”
- Vint Cerf, Chief Internet
- Gartner Group
Evangelist, Google
 In 2007, the United States ranked15th in the  This raises complex issues that emerged in
world in broadband penetration and 13th in the debate over “net neutrality,” and
overall Internet connectivity powerful commercial interests are at stake
 If the United States falls short in universal  Any barriers that restrict access to the
access, cloud benefits will fall short, too Internet limit the potential of the cloud
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10. Enabling the Cloud
Reliability Interoperability and User Choice
“It is not just about being ‘always “If a customer doesn’t like our
on’; it is this idea of reliability. If service, they can cancel.”
this is reliable, that’s a big thing. If
it isn’t, then what do we turn to?” - Polly Sumner, President,
Platform, Alliances, and Services,
- Kevin Kelly, Founder, Executive Salesforce.com
Editor, Wired Magazine
 Even best-known providers of cloud  As of now the major players operate
services fail from time to time – stiffening proprietary cloud infrastructures, with
resistance of IT departments varying degrees of open standards
 Service that comes close to 100 percent  If large providers move to dominate with
reliability is a prerequisite for widespread proprietary clouds, it will be difficult to
adoption of cloud computing realize the full potential of cloud computing
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11. Enabling the Cloud
Security Privacy
“If we give this data to a cloud
computing company, and there is
“The best medicine is
a security breach or if that
accountability and transparency.”
company gets sold, how do we
address that? I am accountable.”
- Dan Burton, Senior Vice
President of Global Public
- Carolyn Lawson, Chief
Policy, Salesforce.com
Information Officer, California
Public Utilities Commission
 Notion of making a third party responsible  In the United States, the law treats personal
for keeping data safe continues to provoke information differently once it’s handed
debates in corporate IT departments over to a third party
 Cloud providers must demonstrate that  Cloud providers must protect user data
data is safer than in current systems from unauthorized government access and
ensure integrity of commercial use
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12. Enabling the Cloud
Economic Value Sustainability
“The classic challenge of
addressing a new market is to do
it at a lower cost, make things
In 2006, data centers consumed
available where they could not
1.5% of all electricity used in the
previously be delivered, or
United States.
remove complexity. The cloud
can address all three of those.”
- Environmental Protection
Agency
- Russ Daniels, VP and CTO of
Cloud Services Strategy, HP
 The cloud is creating new business  EPA estimates that by 2011, consolidating
opportunities and new markets by offering computing into data centers could reduce
high-end computing at lower cost carbon dioxide emissions by 47M metric tons
 The real test will be for the cloud to reduce  As enterprises come under increasing
costs, increase productivity, and enable pressure to go “green,” sustainability is
faster innovation at the enterprise level critical to the viability of cloud computing
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13. Government and the Cloud
Who Decides?
Policy Market
Cybercrime Enforcement
Institutional Adoption
Universal Connectivity
Sustainability
Privacy
Security
Interoperability
Reliability
Economic Value
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14. Cloud Ecosystem
Data Centers Media Companies ISPs Device Manufacturers
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15. Living with the Cloud
Netbooks
Retail Touchpoints
Set-top Boxes
Medical Devices
Music Players
Electronic Readers
Home Automation
Transportation Vehicles Consumer Appliances
Video Game
Systems
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16. The cloud is a reality for consumers and will become the
“new normal” in corporations and organizations
The cloud is one avenue for the United States to re-assert
economic and technology leadership on a global stage
What government can do best is clear the road for
the cloud’s expansion, not pave it
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