There is more to being a Cloud infrastructure provider than having a large datacentre and the management tools needed to run and provision customers with resources.
Increasingly, if IaaS players want to stay in business they will need to become incubators of the new businesses they want to see running on their services. Not only that, but they will also need to incubate the businesses – or new divisions of existing businesses - that will support them, such as professional services companies.
This is the view of Satoru Hayashi, Executive Vice Chairman of Fujitsu Technology Solutions. Speaking in an exclusive interview with Business Cloud 9 at the company’s recent VISIT 2010 event in Munich , he presented strong evidence to suggest that the divide some vendors want to create between Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) is fast disappearing already, if it ever actually existed. Now, more than ever, in Satoru’s view, IaaS is about much more than large amounts of compute resource and network connectivity. It is not about the excellence of the technology stack, it is the expertise in exploiting it that is important.
His views emerged in a discussion about the human-centric approach to service provision Fujitsu is now adopting as a core approach to the marketplace. “We do see that the role of ICT over the years used to be that the computer was the master and the human was the slave,” he said. “The humans had to adept themselves to use the computer – with punch cards and the rest.”
Some would of course argue that, with the majority of on premise applications, that still seems to be the case, Users still have to adapt themselves to what the applications can provide. “That is what the human centric approach is aiming to counter. Humans should be the master and the computer and infrastructure technology should be the slave.”
This, he suggested, can be achieved by leveraging all the technologies available today to achieve many new capabilities. For example, sensor-based technologies, mobile phone devices and cameras are capturing what is going on in the real world and trying to collect all that information, through the network, into information pools.
“I think this is already taking place even though we may not be aware of it. All that information is already coming available in the virtual world, and though that does create other problems such as privacy and security issues, the reality is that lots of human activities happening in this world are already in the virtual world, and the question is how we can use this information captured in the virtual world for the good of human kind. If it is misused that would be very scary, but human beings are intelligent enough to use the information for something better.”
At the moment the company’s favourite example is agriculture. One of the concerning issues around most of the developed world is that the average age of farmers is over 60. So there is a definable challenge to be addressed - how to capture the knowledge of those old farmers.
“So, working with farmers we sent an engineer to the farm fields to keep track of the farmer’s activities,” he said. “We placed sensor on the ground to sense the nutritional requirements, and also monitor the growth of the plants. All this information is stored and is now being analysed so that we can determine which fields need more water or more fertilizer. We are also monitoring the behaviour of the farmers, and we are working with them to optimize their ways of working. This is how we try and capture the working practices of the farmers.”
This may sound straight forward but in Satoru’s view it opens up new and uncharted waters to be explored. For example, it begs the question that, if Fujitsu can use that information to automate large areas of farming is this a market Fujitsu is considering? His answer shows the overlap that now has to exist between Cloud service users and the service providers.
“This could be an opportunity for Fujitsu, but it is also an opportunity for our customers. I don’t think we will be targeting farming as part of our core business, our business is more helping our customers. But if a supermarket or others in that supply chain are interested I think we now have the technology that can help them to run this kind of new business,” he said. “So I think technology helps to open up this kind of business, not necessarily for us but for our customers, and we can help them to succeed in these new areas.”
This promptly begs a second question, at what point does Fujitsu stop developing tools? Some will be horizontal across many market domains, but at some point they risk becoming too verticalized, in their chosen example they become farming specific. How does an IaaS provider manage that?
“At this point we don’t have a process for that, we are still experimenting with this type of technology,” he candidly admitted. “For the farmer’s case, the engineer stayed at the farm for 12 months, and at some point it will require that depth of knowledge. We have one manufacturing customer which makes very complex machinery, and the issue they had was how to effectively maintain the components of the machines while in store. We attached RFID tags to the components and tried to keep track of how the parts are stored in the warehouse. This did require some domain knowledge, but the base technology is common and is now being used in other industries.
“But once we get into a specific area we also need somebody who understands the business of the customer. That does not mean we will be running the business ourselves, but we have to know enough to help the customer at the proper level so they can run their business using these new technologies.”
This, however, raises some important financial issues, such as the potential for a significant investment requirement in professional services in order to have sufficient resources and diversified expertise. The obvious route is to partner with specialist professional services companies, though this approach just raises more problems, at least in the short term, in Satoru’s view.
“Yes, that is a fair assessment,” he acknowledged. “But in terms of what we’re talking about it is something very new. The technology is new and business model itself is somewhat new. It’s not that we won’t use third parties to help us but unfortunately the third parties are not ready yet. So we’re doing pilot tests and we will come up with the scenario for support that points to the way we meet the customers’ aims. Then will can bring in the third parties and try to introduce the solutions to companies B, C, D and E.
“Once we create the business model scenario it stops being our business any more. But to create the scenario it has so far needed to be our staff. For now it requires professional support that understands the technology and is willing to learn the customer’s application requirements. We believe this is what we have to do as no one else will do it.”
In essence therefore, He sees Fujitsu’s job as not only acting as an incubator for the customers that will take on applying new services to new markets, but also as an incubator for the professional services businesses that have domain knowledge, but no experience of Cloud-based technologies or how they can be applied.
Satoru’s justification is quite clear, and arguably something of an object lesson for other vendors. “So long as we just offer IaaS or PaaS – and we will do this of course – there are limitations. We want to go up the value chain and find how the infrastructure can bring more opportunities. We aim to provide real value for our customers but that does mean we have to work closely with the customers to come up with real, meaningful cases where we never thought of applying these technologies.”
The alternative in his view is to be in a market driven solely by volume and price. This is a market model where, by definition, the majority of vendors fail, as history shows happening time and again in every market sector – including IT. He readily acknowledged that Fujitsu would probably struggle in such a market environment.
“That is why we have this vision, and if we can combine all these technologies available today, we can find how we help the customer or society and create a means to generate new business. This is a journey that has just started.”
