Enjoyment: Structure News: Has Google done enough to impress cloud buyers?

Where It's Not Easy Being Greene

March 25th, 2016 / by Tom Krazit

This week, we'll talk about a big mess at Nest, a big round of funding for Mesosphere, and whether big talk from Google can make a dent in a big gap between it and other cloud players.

STRUCTURE NEWS

HOW TECH COMPANIES AND UNIVERSITIES FORMED A ONCE-UNLIKELY FRATERNITY AROUND OPEN SOURCE

Back in the 1990s, open-source software was just getting off the ground from its research-oriented roots, but more than 20 years later, an awful lot has changed. Two excellent Structure Data 2016 speakers -- MIchael Franklin of UC Berkeley’s AMPLab and Raghu Ramakrishnan of Microsoft (pictured, with Andrew Brust of Datameer) -- discussed how much they have in common these days, and how the corporation/university dynamic will evolve.

WHY 40 PETABYTES IS PROBABLY ENOUGH DATA FOR NETFLIX, FOR NOW

We talked a lot at Structure Data 2016 about how “big data” isn’t really the right way to think about data science any more; data efficiency is what’s important now at big companies like Netflix. “We’re not trying to add more petabytes and brag about it, we want to get the most out of it,” said Eva Tse of Netflix.

INDUSTRY NEWS

INSIDE TONY FADELL’S STRUGGLE TO BUILD NEST

We haven’t heard a lot out of Nest lately, and The Information (subscription required; The Verge, um, aggregated it) had a big report Thursday that might explain why. Among other things, Nest has struggled to integrate Dropcam and get new products to market that meet the demands of CEO Tony Fadell, according to the rather remarkable story.

MICROSOFT SILENCES ITS NEW AI BOT TAY, AFTER TWITTER USERS TEACH IT RACISM

This is probably not what Microsoft researchers had in mind when they unleashed Tay, an AI-driven chatting bot, on the general public. Techcrunch reports that Microsoft pulled the bot after a bunch of Twitter users figured out how to make it repeat racial slurs on Twitter, and they’ll go back to the drawing board to find ways to train AI bots on the nuances of conversational racism.

MESOSPHERE RAISES $73.5 MILLION WITH MICROSOFT PARTICIPATING, LAUNCHES VELOCITY TOOL

Container-management software is likely going to be a lucrative market as more and more companies start putting containers in production, and Mesosphere (C EO Florian Liebert spoke at Structure 2015) showed this week that you can still achieve (likely) unicorn status in an uncertain fund-raising market. Venturebeat notes that the company raised $73.5 million, led by Hewlett-Packard Enterprise and helped by Microsoft, which once took a gander at buying the whole company.

AMAZON’S LOFTY PROFITS OPEN CLOUD TO RIVALS

Amazon is not known for profit-seeking, but that mentality hasn’t applied to its cloud unit Amazon Web Services. Bloomberg has a nice analysis of AWS’ profit margins and how that might present some opportunity for rivals Microsoft and Google (more on that in a bit) to compete on price.

APPLE POLICY ON BUGS MAY EXPLAIN WHY HACKERS WOULD HELP THE FBI

Apple has always liked to do things its own way. Its lack of interest in setting up a bug bounty program -- standard fare at many of its tech rivals -- may have prevented it from learning about a possible method to unlock the San Bernadino iPhone before that method was presented to the FBI, according to The New York Times.

THE CEO OF $2 BILLION STARTUP DOMO: “WEVE BEEN LYING TO PEOPLE” SO WE COULD SURPRISE THEM WITH OUR MASTER PLAN

Josh James must have a very understanding board of directors. In an interview with Business Insider as Domo launched a new version of its data analytics app for business management, James revealed that Domo deliberately mislead customers and even investors about its true product roadmap plans to keep those plans a secret.

BIG PICTURE

Ever since Google hired VMware founder Diane Greene (above, speaking at GCP Next 2016) to run its cloud business last year (the same week as Structure 2015), we’ve written a lot about whether or not that re-organization was enough to make Google more competitive in the public cloud market. A series of events this week showed that Google’s charm offensive is still very much on the march, but it is starting to land some bigger names for its cloud service.

During its cloud conference this week, Google announced that Home Depot and Disney have agreed to put some of their workloads on Google Cloud Platform, as reported by Fortune. It also introduced a machine-learning API that developers can use to add Google’s machine-learning technology to their products, and Greene sat down for lengthy interviews with several publications (I enjoyed Wired’s).

As we noted last week, however, the lack of transparency around cloud pricing and revenue makes it difficult to understand how much of this business Google is practically giving away in order to get some big names on its customer list. That information will come out over time, but as Fortune noted, companies in the financial and insurance fields are still conspicuously absent from that list. “You don’t get fired for going with AWS” is the new “you don’t get fired for going with IBM.”

At the heart of the question around Google’s cloud efforts is whether or not an advertising company can be a true enterprise computing player. It’s kind of a silly question, given that a book seller practically invented the public cloud infrastructure market and Google's infrastructure set the tone for world-class computing buildouts. But former Google CEO Eric Schmidt always seemed much more enthusiastic about making Google an enterprise player than current Alphabet CEO (and Google co-founder) Larry Page, and corporate culture is a funny thing.

By the time Structure 2016 rolls around this November, Google will be under more pressure to show broader customer adoption of its cloud services. Microsoft has made no secret of the fact that it wants to be a world-class cloud company and already has the enterprise sales force to match that ambition.

At some point Google will have to stop talking about its cloud ambitions and start talking about its cloud successes if it is to be taken seriously as a public cloud power. “We’re Number 3” worked really well for Snapple, but I doubt that’s what Greene was brought into Google to accomplish.