What's this 'pay as you go' cloud crap? Dunno about you, but my apps don't work that way

Why you pay for what you provision

Different clouds for different folks

This isn't to say that one should consider a hybrid IaaS cloud like vCloud Air the solution to all ills. If I was at a point that I could throw away my application and rework it from the ground up, I'd be a fool to code it for vCloud Air.

If I was American, I'd develop it for Amazon. It's cheaper on average than Microsoft Azure, and Amazon is ever so vaguely less creepy than Google. If I was not American, I'd code it for OpenStack. I might write it for Docker, once Docker has things like FT, HA and vMotion, but I'm honestly not sure why I'd bother, since Docker seems like more work than AWS and doesn't offer a fraction of the flexibility you get when using a proper hypervisor.

So from one angle, VMware, and to a lesser extent Microsoft, have the best tech to solve the "moving legacy workloads into the cloud and back out again on a whim" problem. What both companies need now is a licensing (and marketing) scheme that is less "cloud hippie" and more "acknowledging the harsh realities of how applications are utilized in the real world by real companies."

Fighting the old guard

If they don't, they will be eaten alive by OpenStack, which absolutely doesn't have bizarre licensing constraints. Contrary to popular boardroom belief, OpenStack is taking off. Every single enterprise – and most small to medium businesses above 500 seats – that I talk to are running proof-of-concept setups right now. They're learning the tech, and regionalized cloud providers are springing up like weeds.

That last bit is important. American companies cannot get it through their heads how deep the distrust is of American cloud providers, and how much that distrust is growing. There is a market opportunity to be had here, and companies around the world are seizing upon it.

Before you make the mistake of writing off regional OpenStack vendors as irrelevant startups, I should point out that some of the biggest OpenStack cloud providers around the world are telecommunications companies. They have been looking for a new revenue stream for ages, and they've finally found it.

The telcos can stand up an OpenStack cloud quickly and easily. They have resources, they have the financing, they have a long history of finding the sweet spot in subscription revenues that people are willing to pay … and they own the pipes.

Let's say my telco says to me: "I have a cloud. Put your workloads into it and you won't pay for bandwidth that is between your corporate and home connections that are on our network and your systems in our cloud. You'll only pay for 'off network' traffic such as connectivity to the greater internet."

That's a hell of a deal, and suddenly a lot of the unpredictable costs of cloud computing evaporate.

The right cloud for the job

In the real world, real companies have applications that can't burst, won't be rewritten to do so, and need to sit idle for 16 or more hours of the day, but still be ready to serve their workloads at an instant's notice. If VMware is to succeed with vCloud Air's – or Microsoft with Azure – they will have to figure out a way to allow those sorts of workloads to exist on their infrastructure and still be affordable.

If they want hybrid cloud setups to be a success outside of the US then they'll need service provider licensing that allows third-party companies (ie: companies with zero US legal attack surface) to stand up compatible clouds at prices that don't terrorize the customer – and still leave margin for the cloud provider.

They will also have to put aside the notion that they can simply throw marketing at the problem, and have customers believe that the cloud is actually "pay for what you use." It's pay for what you provision, and the winning hybrid cloud vendor will be the one that acknowledges that first. ®

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