Live from the Summit: Why mobile, DevOps, & cloud trends matter

IT transformations are pervading the sessions and discussions at Red Hat Summit 2014. But why does it matter to the typical enterprise? It matters because enterprises are, more and more, becoming technology companies. According to Michael Coté, Research Director for Infrastructure Software at 451 Research:

cote-analyst-session“Increasingly companies like Nike and Starbucks that are relying on in-house software development for new products such as the Fuelband and mobile payments. Starbucks, for example, is estimated to have pulled in $1bn in sales from its mobile app.” For another example, from 451 Yankee Group’s “2013 US Mobile Applications and Cloud Survey (IT Decision-Maker) December,” 61 percent of respondents said that mobile app platforms had a “high” impact on their organizations’ profits. For still another, consider how entire businesses such as Uber simply wouldn’t be possible without mobile application development.

In other words, by taking advantage of cloud capabilities—such as improved developer productivity and faster application creation—top companies are making lots of money. Across verticals, there’s a pull to instrument businesses. Coté notes that “’Cloud’ is opening a new way of delivering software: DevOps. Cloud, in this context (applications-cum-business services) is the enabler, the platform, the underlying physics and grammar that enables good poetry and lyrics.”

So how to get started? According to Coté, start out with planning and segmenting out your applications and workloads. Consider what’s differentiating and custom from the tactical (which will increasingly shift toward SaaS). Get first-hand experience and do proofs-of-concept. Do small things while plodding through big problems as you start your proofs-of-concept. And consider culture and people.

Coté then discussed how there are two ways to think about the size of the cloud market. The first is the infrastructure public cloud which takes out SaaS and counts everything else. We already have a $5.7 billion market and it’s growing to about $20 billion by 2016. The other way to think about the market is cloud enablement technologies—i.e. the software used to run cloud “things” like OpenStack or cloud management software. This has been an equally great market, starting at about $10.6 billion in 2012 growing to over $22 billion in 2016.

What workloads are running on-premise versus public clouds? The applications that tilt furthest towards on-premise infrastructure (and private hosted) are customer-facing and back-office enterprise applications. Coté noted that, while ERP applications aren’t likely to move to more dynamic cloud environments, it is possible to wrap APIs around them and otherwise access them from cloud-enabled workloads.

Recently, 451 also started doing some research on the mainstream (i.e. not Netflix or Etsy) DevOps market. The first question asked was where their production apps reside. Few are running purely on a public cloud. So you’re not “doing it wrong” if you run it in other environments.

What’s the maturity of being able to deploy into production? Coté calls the overall result very encouraging. Almost all deploy more frequently than 30 days. Furthermore, about half still want to drive their deployment cycles down further—an encouraging aspirational trend. (Of course, many of the big-name web firms deploy to production multiple times per day, but this is not really a reasonable near-term goal for mainstream companies that are simply not organized around this sort of pace.)

These mainstream DevOps companies are mostly using testing, performance monitoring and log management, release management, and configuration management tooling. You’re still not seeing a lot of the new “utopic” startup toolchains that are most associated with DevOps. And only about 16 percent are using automation tools compared to using “older ways” of doing builds such as customer-written build tools and golden images. (Among those using automation, continuous integration tools such as Jenkins and Bamboo are the most common but there’s a lot of DIY tools out there too.)

The bottom line? “There’s strong business demand, work to be done as far as the eye can see, and lots of maturing ahead of us.”


More information


Event: Red Hat Summit 2014
Date: Tues, April 15, 2014
Type: Session
Title: What cloud trends mean for you: An analyst's view
Speaker: Michael Coté (451 Research)