have now turned these precursors into the commercial practice of cloud computing.

TucKeR: A handful of companies, such as Amazon, Google, and Yahoo, demonstrated the advantage of very, very large scale by building specialized architectures just to support a single application. We have started to see the rest of the world react and say, “Why can’t we do that?”

BADRos: While I agree that the emergence of the massive scale of these companies plays a critical part, I also think that the development of client-side technology such as HTML, CSS, AJAX, and broadband connectivity is very important.

cReeGeR: What about virtualization?

It provides an encapsulation of application and operating system in a nice, neat, clean ABI (application binary interface). You could take this object and put it on your own premises-based hardware or execute it on whatever platform you choose. Virtualization makes execution platforms generic by not requiring the integration of all those horrible loose ends between the application and the operating system every time you want to move to a new machine. All that is required for a virtualized application/operating-system pair to execute on a new platform is for that platform to support the VM (virtual machine) runtime.

TucKeR: An important shift has been to use basic HTTP, in the form of REST

(representational state transfer) APIs ( http://en.wikipedia.org/wiki/Repre-sentational_State_Transfer), as an eas-ier-to-use SOA framework. Everything that made services hard before, such as CORBA ( http://www.omg.org/getting-started/ corbafaq.htm) or IDL (http:// en.wikipedia.org/wiki/Interface_de-scription_language), went away when we said, “Let’s do it all over HTTP.”

BouRne: Let’s be practical. What are the economics of clouds? What’s the CapEx (capital expenditure) and what is the OpEx (operational expenditure)? At the end of the year, did I spend more or less?

VoGeLs: CapEx forces you to make massive investments. In the past, you had some measure of control over your customers; these days your customers have control over you. They know what to choose and have perfect informa-

tion. So if you build products today as an enterprise, but also as a young business, you have no idea whether you’re going to be successful or not. The less investment you have to make upfront, the better.

oLsen: What inspired me about the cloud was that I could start a company and not buy any servers, phones, or software licenses. We were dedicated to using cloud services from day one. We started our company relying solely on services for email and the Internet and went from there to putting our source control on as a service. I wrote an article titled “Going Bedouin” where I expressed these views in more detail (http://webworkerdaily. com/2006/09/04/going-bedouin/).

BADRos: Clouds are clearly a huge win to get started with a business or product offering. At Google, we see internal people using the GAE (Google App Engine; http://code.google.com/appengine/) as a means of deploying something very quickly before they worry about scaling it on our base infrastructure. People do this because it is so much faster to get going, even inside Google where you have lots of infrastructure available.

Today’s developer has a decision to make: after I am a success, am I going to switch off of this initial platform? That’s the trade-off. Once it’s obvious that something like an Amazon S3 is able to outperform the best that the vast majority of companies can ever deploy, then it’s obvious you should just work entirely within the cloud. In this way you never have to suffer the replacement CapEx for the initial infrastructure.

VoGeLs: For many customers, using our cloud products requires new expertise. You are no longer looking for a typical system administrator. If you have a large company, you’re looking for someone with the specific expertise to support 50,000 internal customers. Using the cloud, you no longer have to deal with things at the physical level. You no longer need to have people running around the data center replacing disks all day.

RAmLeTh: You can get your smart-est guys to work on what matters most rather than having them work on mundane stuff. That’s a huge benefit.

cReeGeR: What about the people who need to run a flat-load, basic accounts receivable package? Once they get their

software and hardware in place and get their operational process down, it’s pretty straightforward and they can amortize the capital expenditure over a very long time period.

TucKeR: Every three years they’ve got to upgrade the software and the hardware.

RAmLeTh: We spent $5 million last year on an upgrade that did nothing for our business processes or end users. The software vendors told us that if we did not upgrade, they would stop supporting us.

oLsen: I always wondered why we think software is so different from anything else. If a restaurant was growing its own food, slaughtering its own animals, generating its own power, collecting rainwater, and processing its own sewage, we would all think they were idiots for not using ready-made services. For a long time people built their own stack from the ground up, or ran their own servers because they could. Viewing the state of our industry, any student of economics will tell you that you have to start layering.

VoGeLs: There are restaurants that do not buy their own herbs; they grow them on-site. They would argue that it contributes to the quality of the end product. They will never generate their own electricity, however, because that will not produce better food.

oLsen: Realistically, however, software is really extreme in terms of how many people are doing undifferentiated tasks, on their own, at all kinds of levels. Look at the auto industry: there are many tiers of subcontractors, each providing specialized services and products. We just haven’t evolved to that same level of efficiency.

RAmLeTh: We have dramatically reduced our data-center capital expenditures as a direct result of virtualization, allowing us to reuse our capital many more times than we ever could before. Before we started our effort, the average server utilization in our global server park was 2.3%. Going to virtualization has increased it to between 60% and 80%.

When we started, the core side of our central data centers, not including peripheral things, ran 35,000 square feet. Today, the equivalent of those 35,000 square feet is now operating in less than 1,000 square feet. We are utilizing