What is “cloud” computing, and how does it differ from “hosted?” The question emerged once again recently among the Enterprise Irregulars, as one Irregular used the terms interchangeably and another objected. Neither, however, wanted to get into semantics (that is, what the words “cloud” and “hosted” actually mean), so they agreed that the problem is knotty and went on with their lives.

These are both sensible, intelligent people who make sane decisions. But I want to point out that something has happened to both of them. Both of them, I think, have become victims of what I’ll call “smash and grab semantics,” a practice where companies will take a term that they find attractive and use it to describe something that they do. In some cases, this is pretty legitimate–I think both Salesforce and Amazon can use the word, “cloud,” without arguing about it too much–but in the case of “smash and grab semantics,” there’s a real distortion; something of value has been taken when they do it.

In other contexts, we regard smash and grab semantics as pretty reprehensible, because something quite real is at stake. I was talking last night to the editor of a newspaper in a country that calls itself “democratic,” but isn’t. He goes to court regularly and regularly ends up in jail, though not usually for too long. The last time he was hauled into court, the judge began the proceedings by asking, “Do you stand behind the lies that you just published?” As far as he’s concerned, when a regime practices smash and grab semantics on the word, “democratic,” it helps this regime get away with putting him in jail. And he should know.

So, is there a distortion in the use of the term, “cloud” vs. the term, “hosted?” And does this distortion give the people who’ve grabbed the term something they shouldn’t have? I think so. The plain fact is that cloud is a lot cheaper than hosted, a lot cheaper, because cloud applications or services have been engineered to share resources efficiently, something that hosted applications or services can’t do, because they’ve had to be rewritten from the ground up.

So when people offer something hosted and make their customers think it’s cloud, they’re giving people the idea that they’ve done the homework and were providing the advantages of efficient resource sharing when they haven’t in fact.

The details matter, of course, which is why my two very smart colleagues didn’t want to get into a complicated argument. With hosted applications there is always some resource sharing, by definition. But the plain fact is that whatever the details, something that’s engineered to be cloud is roughly ten times cheaper than hosted. So whatever the details, people who call themselves “cloud,” are doing a bit of smash and grab.

So how do you combat smash and grab semantics? Fortunately, the answer to this question has been known for a 100 years. You don’t let them get away with it. Despite the fact that they want you to use the term they’re using, you don’t go along. George Orwell put it better than anyone in “Politics and the English Language.” I am paraphrasing. If you want “language [to be] an instrument for expressing, and not just concealing or preventing though,” you must “choose…the phrases that best cover the meaning.”

Don’t get me wrong. If somebody says their offering is “cloud” or “SaaS” or “on-demand” when it is actually hosted, this is smash and grab, but only on a small scale. It is not the same as using the word “democracy” to describe a tyranny. One is good, aggressive marketing; the other is morally confused. But since the technique used–smash and grab semantics–is the same, you combat both in the same way You use the right word.

Ozymandias Crumbles

September 17, 2010

Over the past 20 years, the American Airlines nonstop between BOS and SFO has been a fixture of the software industry. Almost any time you took it, you’d see friends, and even when you didn’t, you’d be sure you hadn’t boarded the wrong plane, just because of the number of Oracle bags.

This flight is no more. A little more than a month from now, American Airlines will end non-stop service between SFO and BOS.

Why? The commuters left American for JetBlue and Virgin America, for better seats, better entertainment, fewer niggling charges, and maybe even better treatment. I saw this myself when I actually got ** an upgrade ** on American a few weeks ago, and I confirmed it by talking to a frequent commuter who had gone over to Jet Blue even though he had more than a million and a half miles on American.

I wonder. Is this how other empires crumble? In my world, you have SAP and Oracle, seemingly as unassailable as the Great Wall of China, but both offering an experience that has been compromised by excess investment in an aging infrastructure, a labor force that has been asked to shoulder most of the burden imposed by this infrastructure, and a management that grew up in the good old days and still (my guess is) secretly longs for them.

For a long time, people like myself stayed with American. And while that was happening, the management could fool itself. Leather seats? No fees? These don’t matter to our loyal customer base, so we don’t need to invest the boodle that we don’t have in matching the competition. Until, of course, the day it did matter, when there was nothing they could do.

What are the moral equivalents of leather seats and fee-less flying in the enterprise applications market? Oh, it’s any number of things. It’s the fact that search, if it’s there at all, is just about as cumbersome as search was on AltaVista. It’s the fact that doing anything, anything unfamiliar requires the equivalent of a Type III license and just about as much training. It’s the endless, endless wait for even the most trivial or needed changes in the system. It’s the fact that you can’t use them on an iPhone or an iPad or even a Mac. (It’s amazing how many enterprise application companies are IE only.)

Please feel free to add to the list. It’s kind of fun.

Oh, people can and will put up with it for a really long time. But eventually, if the competition is smooth and persistent, they can march into a market and take it from the behemoths. I think you’re seeing this today where Workday is replacing PeopleSoft 7.5, and you saw it a few years ago when Salesforce was replacing Siebel. It does happen.

Now if only I could remember my JetBlue frequent flyer number.

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