I once bought a car so I could drive to work every day.
Not exactly a crazy thing to do as most people own cars for one reason or another. Getting to work each day is as good a reason as any other. I had a specific set of requirements (to get myself to work) and owning a car met those requirements.
Let’s say that the requirements were more broad, something like “travel between two points on Earth” and I felt an automobile was the method that would best meet these requirements. How many options do I have with regards to utilizing an automobile?
Let’s consider a few:
- I could purchase all of the necessary parts and assemble the car myself.
- I could purchase or lease a car that was already made (this is the typical option most of us choose).
- I could rent or borrow a car (or hitchhike, I suppose).
All of the above options are viable as they will all allow for me to travel between two places. Some options will be easier than others. For example renting a car is a lot easier than assembling a car myself, piece by agonizing piece. None of the options mentioned include maintenance and repair, either. I could choose to be my own mechanic, or I could find my own mechanic, or I could bring it to a designated dealer.
No matter who I decide will perform maintenance and repair on my car these additional costs are often not considered when trying to find a solution that meets the original requirements. This can be fixed in the simple example above by modifying the requirements to include the phrase “for the lowest annual cost”. We would then need to consider things like gas prices, driving habits, etc. And yes, I do want you to hear the words “scope creep” in your head right now.
Now imagine, if you will, the very thought that you would buy all of the pieces to a car, build it yourself, and be your own mechanic afterwards just in an effort to get from one place to another.
Crazy, right?
Yeah. Crazy.
Your Company Owns Everything
Let’s talk hardware and software.
If I want to use an instance of SQL Server today I have three main options:
- I could purchase all of the parts and assemble the instance myself (typically referred to as on-premises installations).
- I could build a virtual machine using a service such as Windows Azure (this is IaaS – Infrastructure-as-a-Service).
- I could use a hosted database such as Windows Azure SQL Database (this is PaaS – Platform-as-a-Service, and also called DBaaS or Database-as-a-Service).
Option 1 is essentially the same thing as buying the parts for a car and assembling it yourself. As crazy as that may sound, somehow this is the default for how business is done today. We purchase all the parts, as well as the mechanics! We hire a DBA, a developer, an architect, etc.
Ideally the model we would want is similar to where we purchase something already made, like an appliance of sorts. In this case that would be the use of a virtual machine hosted by a provider such as Windows Azure. In fact, I can spin up a Windows Azure virtual machine in less than five minutes running Windows 2012 with SQL 2014 CTP2, 7GB RAM, and 4 cores. How fast can your company make that happen with a physical server?
And by using this method I will save a lot of money. Not just on hardware, but time spent installing and configuration of servers, software, and licensing. Don’t forget any disaster recovery or high availability solutions, as those add costs also.
What about renting? Renting a car would make more sense than buying one. In fact, Zip cars are becoming common, used by people who only need the benefits of a car without the hassles of ownership. In fact, when the Holidays are here and you need to move 39 family members from around the globe, renting (planes, trains, automobiles) wins out over buying.
But can I rent a database?
Turns out the answer is yes. With platforms such as Windows Azure SQL Database I don’t need to own anything, I just pay for a service, like I would for a utility. I don’t own the electricity, I pay for what I use.
And that’s the key point here. Ownership isn’t as important as you might think.
Access Trumps Ownership
Having access to a car is more important than owning a car. Likewise, having access to a database is often more important than owning one. I would also suggest that having access to a data architect is more important than owning one, since data architects usually just sit around inside of a country club drawing boxes and lines in between glasses of Scotch anyway.
My colleague at SolarWinds, Jerry Eshbaugh (@Eshbaugh), used the example of Spotify when he told me the phrase “access trumps ownership”. With Spotify you pay a flat fee each month for access to an entire library of songs. You don’t own the songs. Most people don’t care to own the songs anyway, they just want access to them.
Starving people don’t need to own food, they need access to food. I hear about how important it is for people to have access to clean drinking water, I never hear about how they need to *own* clean drinking water.
Our world of IT is just now starting to understand how much value there is in being able to access what they need as opposed to owning it all.
We don’t need to buy, build, and play mechanic anymore. We now have the option to lease/rent/borrow what we need.
Access trumps ownership, for many things, on many levels.
UPDATED: I’ve been told that the phrase “access trumps ownership” is from Lisa Ganskey (blog | @instigating) and can be found in her book: The Mesh: Why the Future of Business Is Sharing, you can read more about it here. It’s a great phrase and one I believe is quite applicable to the world of data.
Hmmm … for the small guys, maybe. But there’s some real hurdles to overcome. First is data throughput and the cost-efficiency of this. Ever tried uploading just 1GB over a standard ISP to a cloud server? Even with a leased line, moving ‘big’ data is hardly going to be efficient. I find it ironic that AWS employ FedEx services to move data between regions and customers – a man in a van, in 2014, still has better bandwidth.
Secondly, it’s kinda like comparing rental with owning your own home. Yes, a mortgage/outright cash purchase is expensive, very much so. But you have all the benefits of home ownership – complete customisation, responsibility for your environment, control particularly. What happens if AWS decide to up their prices by 10% tomorrow? How many small businesses would that affect?
Add this in to AWS (and others’) less-than-four-nines uptime in the last year or two (Google alone suffered a 25-minute outage resulting in a *61% drop* in Internet traffic!) and while cloud services might be okay for some, for most enterprise-level businesses, ownership is the most stable way forward.
Then there’s compliance, data security, etc etc.
Derek,
I don’t believe the size of the company matters, it’s all about the data.
I believe throughput will continue to advance in the next 18 months as the major providers (Verizon, AT&T, etc.) enhance their offerings to cater to those that are using Cloud services. Will it ever be as good as something local? No, there is a speed of light factor in play, of course. But the key is “will it be good enough”, and I believe it will.
Yes, ownership has advantages, but that doesn’t mean it’s the right decision. For example, I am now the proud owner of a 2001 Hyundai Elantra. (Make me an offer, please.) Ownership does offer stability, and if that is your requirement than that’s what you should choose. But not everyone has the same requirements and that’s why it’s good to have options.
Tom
I was thinking the same thing about data security/compliance. On-site is a must for compliance for a lot of companies. Bandwidth can be a consideration depending on the workload. We’re now accessing our databases hosted on the other side of the country and the latency is noticeable. (The apps consuming them are co-located so that’s not bad for customer impact, but ad-hoc queries can be painful now.)
Overall, I’ll agree that access is key for the smaller companies or ones who know exactly what they’re doing w/ the hosted data platforms, but it’s not for everyone. I heard of one example at PASS this year where a company used Azure to host SSIS for a monthly process. They would spin up that instance with lots of processing power, import/process/export the data, then shut the instance down. That seems like a good use of their resources as long as they’re in compliance for that data. They pay just for that time the machine is running (and whatever storage is used ongoing) and don’t have to buy a powerful machine that just sits there most of the time.
Peter,
I believe that bandwidth is only an issue for us that have become used to such fast speeds locally. I believe that in time the bandwidth speeds for Cloud services will catch up and, in some cases, I also believe they are already as fast as what local access was just a few years ago.
I don’t believe the size of the company matters here, it has to do with the data. Not all data needs to be owned, secured, and marked as compliant.
Tom
Back when Al Gore was just an internet founder and fighting disconnected people before he moved on to putting ice back at the poles – the internet was started by universities, government labs, etc. creating a wide area network… Well today the government is working on a high speed network linking these same type of installations and their super computers.. A bit 10Gbps WAN.. I imagine by the time my kids are college aged there will be a lot more of this in the public domain.. Neat project – http://en.wikipedia.org/wiki/Defense_Research_and_Engineering_Network
I definitely agree that not all data needs to be hosted on site. My main point there was about data that needs to be compliant (and probably data that works with that compliant data) will likely need local hosting or better security options than are currently available in the Cloud.
Being a U-Verse user, bandwidth is definitely a concern for me as I gaze longingly at the FIOS speeds that are forever out of reach unless I move. However, latency does play into some of my concerns. We’re going across a pretty fat pipe to our data center, but it’s across the country so latency is high. With SQL being very chatty, it means my local tools are less useful than tools hosted in that data center. I think that will get better with time as well, but right now it _could_ be another consideration.
Overall, I’m in agreement with you about using those cloud services. If I were just starting up, I’d likely move that way because I wouldn’t have to buy a ton of hardware to get things started. Virtualize, deploy, publish, and hopefully profit. 🙂
When I joined Confio 3.7 years ago I was the only remote employee. I can count on one hand the number of times I have used VPN to get back into the network. Everything we do is cloud based.
In my BI projects, We use Servers with 96 GB, Terabytes of data and a lot of ETL processing power. I still can’t figure out how I would adopt Windows Azure for this kind of projects. (small) OLTP can be a application but large datawarehouses with a lot of processing power is still not possible. So my concerns are:
* Security.
* Compliance.
* Privacy.
* Bandwidth (full loads for delete detection?) with the corresponding costs
* Capacity (Processor, memory, disk) with the corresponding costs.
So how am going to create a Business Case for a datawarehouse in the cloud? For as I can see now this isn’t going to happen.
One presenter said to me that you have to put everything in the cloud… Rightfully for a small company but for a large company this isn’t going to work…
These concerns are not going away (perhap the technical ones).
I’m curieus about the reactions..
Greetz,
Hennie de Nooijer
Hennie,
Yes, it would seem your requirements don’t point to a Cloud solution. However, there are solutions for data warehousing (such as Parallel Data Warehouse) where you would purchase an appliance. For folks that have gone down that route, they are already using a Cloud solution of sorts.
I don’t agree that you have to put everything in the Cloud. What I am saying here is that we have options, which is a good thing. Having options allows for me to evaluate the costs, benefits, and risks of each in order to see which one best matches with my requirements.
Tom
I put a 2TB hard disk in my computer a few months back and then I posted on my Facebook page reminding my cousin of his famous words in 1996. He asked my dad “Uncle, how are we going to fill up this brand new 2GB hard drive you just bought?”
My point is, speed and capacity today are different than 10,15,20 years ago. Things will change in the near future. There maybe a solution that can scale in the cloud for those speeds and capacities. My personal belief is that the reason why everything is in house is due to transmission speeds being so slow. Doesn’t make sense to host something externally when LAN speeds are 10GB/s and Internet speeds are 1MB/s. Now we’re at the time of 1 GB/s site to site links (maybe even faster). So the possibility becomes more probable.
Again, this might not be the right solution or the right tool. That’s why experts like yourself are tasked with making these crucial decisions. The cloud could one day be faster and cheaper than an onsite solution, and that could be the tipping point. Should be an interesting decade ahead of us.
Yes, agreed, exciting times are ahead!
Interesting article. Ownership tends to include depreciation so lack of it could save money. However, there are times where ownership have benefits over just access. For example, you mention having access to water without ownership. If you ever live in a 3rd World (Developing Country) you might follow my opinion in that ownership of that vital resource is equally as important as access. With ownership you can charge more and take advantage of people; I have so many recent examples of this with water (man I’m loving water today). There is always a perceived notion of someone else “wearing the pants” in the relationship where you have access only but not ownership.
In some companies, there is a need for ownership, and just like my water counter example, it is usually politically motivated. There is a power that comes with ownership that allows certain departments to have more weight than others due to that. I’m not disagreeing with the fact that products like Azure are great because ownership does have a high cost, especially for entrance with smaller companies. Just putting my two cents in, and I have always worked for companies that own their own hardware so obviously I’m biased.
I think in a world clear of office politics and where access costs are significantly lower than access+ownership, models like Windows Azure or AWS would become the default. I believe we’re going to approach that soon once our mentalities start to change about the cost of ownership and how much more you can get with just access.
Ayman,
Wow, I had not thought about ownership as a means to use power and influence. You are right about that, of course. And I also didn’t think about the politics involved in such things. I think I have another post to write on this.
Tom
Saw a great presentation by Dean Kaman (Segue fame… but he does so much more and his biggest passions are STEMI involvement for kids and helping those who need help) live at Relativity Fest – he was the keynote. He talked about his water machine and his power generation machine that he uses for the water machine..He partnered with Coke and is putting these machines in Coca-Cola red colored freight car sized containers, supplying WiFi, water purification technology, and ways to capitalize and help local business owners make money while giving free water (Cell phone charging, WiFi access, selling Coca-Cola products, etc.)
He is working with satellite internet providers and other companies to set up monitoring at these stations also so the world can see what happens at them.. Sadly, if you just provide access to a much needed resource it becomes a terrible tool of power in the hands of weak cowards who rule by fear and “nana boo boo .. I have something you can’t survive without, so you’ll give me whatever I/we want to get it”… Sad..
All that said – great post.
Those people always get what’s coming to them one way or another, but it is sad. Agreed, great post, very interesting discussions coming from it. Great way to get our brains back in action early on this year.
You haven’t spent enough time in a country under a dictatorship! LOL.