Congratulations! You have seen the writing on the wall, a view of the approaching horizon just around the corner, and many other various metaphors for visualizing the future, and decided Jeff Bezos shouldn't have all the fun in running a global-dominating juggernaut of IT services accessible at the swipe of a credit card. You want to become some form of a Cloud Service Provider (CSP) and sell your customers various

One question to ask yourself...TRULY sit in a room with a mirror on the wall with no distractions, and contemplate what one of my favorite philosophers said about building and reselling Cloud services:

"Und wenn du lange in einen Abgrund blickst, blickt der Abgrund auch in dich hinein."

OOPS! I gotta run that through Google Translate...give me a second:

"And if you gaze long into an abyss, the abyss also gazes into you."
                                                                             - Friedrich Nietzsche

Seriously - building a SUCCESSFUL and PROFITABLE CSP is not for the faint of heart. Mountains of money will be spent, tears will be shed, and maybe a little blood will even spill - all in the name of capturing razor thin profit margins dribbling in from multi-year, painfully drafted contracts.

Still with me? Wow...OK. Let's take a look at the financial construct and boundaries that set the stage for success. 

IMPORTANT DISCLAIMER. Before we get into breaking down the construct of my rule, we have to agree on one thing - anything and everything in the business world should start with the economic rationalization of what is wanting to be built and sold. Cloud services and enablement technologies are no different, yet I have worked with MANY organizations who oversimplify things by declaring, "We have some technology and some smart people. How hard could it be to build a Cloud business?" It turns out to be pretty hard if you want things to be profitable and successful - I wrote about this mistake in a blog post here SIX YEARS AGO, and nothing has changed. Anyway, bear this in mind as we roll on...

The Poorman Rule of 30 | 30 | 30 for CSPs states:

For any product in a CSP service catalog to be successfully sold and delivered, a monetary distribution burden for that service must be established:

• 30% for hardware and software licensing
• 30% for ping, power, pipe, and people
• 30% for profit margin

There is a 10% buffer built into the rule that allows for some flexibility between the categories, since nothing is ever exact. With these in mind, let's break down what each means.

Hardware and Software Licensing. This is probably the easiest to calculate of all three elements. To provide consumable services to end users, you need hardware and software. And, as a shard of the Poorman Rule of 30 | 30 | 30 - your economic choices will ALWAYS drive a balance point that will affect where your money is spent:

Leaning towards commercial off the shelf solutions (COTS) will require a higher CAPEX number for licensing and a lower OPEX cost for people needed for its care and feeding. Conversely, using open source because it's FREE (!!!) may carry a lower CAPEX outlay, but a higher OPEX for all of the speciality people you will need in the mix to keep things running. Don't believe me? Just ask anybody who has tried to implement this :-).

Ping, Power, Pipe, People, Place (P5). This part of my rule that is the most precarious of the financial modeling - mainly because slicing and parsing the various P5 elements to a granular level can be challenging. How much does a network port cost? How much does a rack U of space from a real estate perspective cost? How much power does a server draw? All of these elements may require some fuzzy math to calculate, but you'll need to do the best you can. And always...ALWAYS...assume nothing and calculate on the high side; the last thing you want to have happen is underestimate a P5 element after customers have started to consume your services and you need to make heavy pricing adjustments that will have a direct bearing on the last 30 | 30 | 30 element...

Profit Margin. This is why we do all of this CSP stuff in the first place - to make money. And, without properly planning the above variables, margins could be greatly affected. Why 30%? Because the offerings are services, which are judged on quality versus quantity like a commoditized product. Plus, 30% gives ample maneuvering space for a CSP to allow channel partners to scale and leverage its salesforce, and even distributors to get involved...if they really need to (a VERY debatable point for another time).

And there you have it - the big secret none pf the FAT CAT CSPs want you to know. Armed with this and a few million dollars' worth of capital investments from friends and well wishers, even YOU could be the next Jeff Bezos! Good luck!

Yes - you are reading the date of this post correctly. I am writing my first post after letting almost FOUR years of time flow under the bridge. In the technology world, that is almost an eternity. But, one thing that has not changed much in the 22+ years I've been a technologist are the people in the field.

Of those 22-ish years, 20 of them have been in a presales engineering capacity - I and many of my colleagues are the folks who attempt to educate the customer on the technical merits of what our companies sell, manage their expectations, and keep the account reps who make money on what they sell somewhat grounded on things they say and do. It's a balancing act I relish, because it requires me to not just stay on top of my technical game, but also be deft when it comes to working with all of the people and emotions involved in the design and selling of a solution.

The blend of people and technology in a sales capacity is an interesting one. As a technologist, you are expected to not just be a deep thinker about the pieces that exist in your solution, but also be somewhat of a fortune teller to understanding and expressing what the solution means and how it may be relevant as the IT world continues to transform and evolve to a Consumption Economics, OPEX, "Cloud" (!!!) type of ecosystem.

This general expectation to predict the future has the biggest impact on how technologists choose to act. It is a natural draw to want to be the smartest person in the room, and while nobody - I mean NOBODY - has a true handle on how the IT field will evolve, we do find ourselves being a part of the progression and often choosing to align to connect with people of similar mindsets in driving progression into our field.

And this brings me to the point of this post. When people gather together in the interest of a greater cause like driving the future of IT usage, it is one thing to encourage a CULTURE dedicated to collective progression in the field, versus a CULT that feigns belief in the same progression, but prioritizes on a private agenda of personality affinity and popularity. The latter is usually guided by a strong single person or an oligarchy of trusted acolytes who feign belief in a cause to take advantage of the unsuspecting, while the former is accomplished through more of a "groupthink" approach, with leadership intertwined with the collective to mutually benefit from progress.

Think about that for a second - a difference of THREE letters separates a utopian way of doing things with a dystopian method of accomplishing goals.

Naturally, most people should naturally align with the CULTURE approach to technology evolution, but unfortunately, they have to navigate a virutal minefield of CULTISH behavior that also is pretty prevalent. Don't believe me? Just look at the CULTISH battles that exist right now between Uber and Lyft...each company believes they have the zero sum path to victory in the shared services space, and emply the occasional dirty trick to make the other look bad, rather than innovate to drive the car ride-as-a-service ecosystem better.

The same could be said for the rest of the technology world? Virtualization, enterprise storage, commoditization of infrastructure - cultish behavior exists in all of these camps to trick others into believing their religious zealotry is the right one. In the end, a culture of collective technical progression needs to trump all of that.

And all because of three letters.

Two years ago I wrote a post here that gave some insight and perspective into the Open Compute Project. In case you were too lazy to click either of those links, the project was created by Facebook as a way to create an open source community around the hardware design that initially was only associated with their servers. See, Facebook is a lot like Google in that it uses huge, HUGE wads (a technical term) of commodity-type hardware in its datacenters to manage their ecosystem of "Likes", Farmville farms, and updates confirming that your friend's kid finally learned to poop in the potty. Except Facebook's idea of "commodity" was a lot different than we what we IT commoners might think of. Their concept included paring down anything unnecessary on the motherboard to lower power consumption and increase their overall operational efficiency. And, once they felt they had the perfect recipe for their needs, they offered up the design to the open source community to tweak it even more.

And man, what a difference two years makes. Not only have there been a slew of improvements, tweaks, and mods to the original server design, other elements have been added to the project's open source ecosystem. The project now includes democratized, crowd-sourced designs and guidance for:

• Data Storage
  
• Data Center Design
  
• Virtual IO - Deployed Asset Reallocation
  
• Hardware Management
  

Granted, some of the facets are in more of a "conceptual" phase than others, but I love the fact the project's scope is expanding into other areas of the data center that are just as important as the compute resources. I have a particular interest to see what comes of the Virtual IO component...I have always dreamt of a datacenter where I could turn a magical, virtual knob to see compute and storage resources get shared and reallocated on the fly based on the needs of the day.

So what's my take on what has happened with the Open Compute Project now that it's two years old? I think there is a TON of opportunity and technical potential in where it can head. There's only one thing missing...

In case you missed my last rant - which, judging by my web stats, most of you did (sniff) - I expressed my excitement over Dell pursuing the possibility of reverting to a privately owned corporation. My reasoning for this was that if they were out from under the microscopic scrutiny of shareholders, they could embrace risk a little more to drive some awesome technical innovation out of their R&D efforts. One of the examples I mentioned that I felt was a pretty neat start was their Project Copper - their blade server chassis-based, ARM processor solution. Without being hounded for constant growth by shareholders and the market, Dell could quickly become a leader in an emerging market for solid, low power compute requirements.

Take my innovation idea one step further. One of the things the Open Compute Project could use is the backing of one of the "Holy Trinity" of server manufacturers (Dell, HP, IBM) to take its adoption to the next level. Currently, it is tough for an IT commoner like me to go anywhere and purchase an Open Compute-compliant piece of equipment - servers OR storage. Sure, I could wrestle one out of some distributors who are surrounding the ecosystem like Hyve or a boutique reseller like Penguin, but I would bet that any mainstream IT operation wanting to dip their toe in the Open Compute pool will want to leverage a large scale vendor to make that happen. The easier it is to procure Open Compute components, the faster it will be adopted...

C'mon, Dell - go private already and roll the dice with Open Compute!

Here's an interesting one! There has been a lot of buzz surrounding the concept that the rootin'-tootin' cowboys of Round Rock, Texas fame are pondering a move to buy back their stock and take the company private. I am, of course, talking about Dell - the company that has so many different tech fingers in so many different tech pies, Little Jack Horner would stand in awe of them.

And, while most consumers and other customers could probably care less on whether this even happens or not, I will be watching with big, dripping wads of excitement to see if other tech companies follow a similar path. My hope is that Dell starts a trend, because I have ALWAYS believed that 99% of the information technology companies out there should be privately held.

I can hear all three of my blog readers right now - "WHAT?? ARE YOU SOME KIND OF NON-CAPITALIST, SOCIALIST SCUMBAG??? It's every company's RIGHT to offer up publicly traded pieces for the COMMON MAN to invest his or her hard earned money and potentially reap the benefits of the company's growth! As a matter of fact, if they DON'T go public, the terrorists win!"

Ok, ok...maybe the terrorists thing was overkill, but you're right - every company should have the right to go public, but hear me out here...even a writer over at Inc. magazine thinks it's not such a bad idea...

Let's forget for a second the fact that I have a constant, skeptical eye cast towards the concept that the modern day stock market is based on anything but the utopian concept of supply and demand. You can read about what I feel is really skewing the markets here and here...I won't get into that topic for now.

No - I want to consider Dell's move to return to private ownership as a good thing because it allows them the flexibility and opportunity to get a little risky with what they do with their business. See, the information technology world is one whose fire is stoked and grown through constant innovation. And "innovation" as I define it, means, "...trying some pretty crazy things that take time to determine whether they are a success or failure." Tech companies who don't innovate and subsequently rest on their laurels are doomed to be stuck behind as the IT field evolves. Don't believe me? Just ask this company or this company if they would agree with my hypothesis.

Anyway, back to the concept of innovation. The main variable behind innovation for any company is the concept of risk - the risk of money and manpower spent pursuing a concept, the risk of time it takes for that concept to come to fruition, the risk of the industry's acceptance of the innovation and willingness to pay for it, etc. And risk is something most modern companies have trouble balancing while also being slaves to share prices, market valuations, and other financial variables that investors demand to stay forever healthy and growing over 90 day stints of time.

This brings me back to what Dell's potential might be if they are able to become a private company. If they are smart, they will use the "going private" opportunity to trim the fat on past acquisitions that were head scratchers (remember Force10 or Perot Systems, anybody?), and spend the time wisely to refine some pretty awesome things that seem to go unnoticed. Take Project Copper for example - it's their project to develop an EXTREMELY low power blade server solution based on ARM processors. As we all know, electrical power is king in the datacenter, and if a company can save some of it by using different equipment to get the same results, maybe THEIR stock price will go up :-).

Other tech companies should watch what happens if Dell goes private and consider following the same suit. After all, survival in the Kingdom of IT is boiled down to one, simple statement:

Innovate or die.

Well, the Mayans were wrong with that whole end-of-the-world thing, and we are now forced to face another year circling the sun with 2013's arrival. And, in typical fashion, many tech rag hacks and self-professed visionaries of the IT industry have offered up the usual best/worst of 2012 and subsequent drum-beating over what HOT trends will befall us in the coming months. I'm sure you will find it no more surprising than I that 2013 will be the year that EVERYBODY FINALLY gets BIG DATA. Of course, we were supposed to get it last year, and the year before, but these thing take time...

My blood boils and I want to punch a unicorn any time I hear the moniker "BIG DATA"...especially when I am at a trade show where some 26-year old decked out in a snazzy company polo shirt tries to spout out how important it is. Not just because "BIG DATA" is some made-up, buzzy phrase that marketing folks invented to generate a bunch of foggy-type of hype, but it's also like the phrase "CLOUD", in that nobody really knows what the heck it means. Everybody WANTS to know what "BIG DATA" is all about, but nobody is brave enough to admit they might be sketchy on it and appear like they just fell off the turnip truck.

Don't believe me? Try this the next time you're struggling to win friends and influence people at a career mixer - "The promise for BIG DATA to revolutionize the human social and demographic dynamic is the future of how we'll interact with people of similar ideals and values." Despite the fact this sentence is stupid and laden with more psychobabble than a college philosophy student's term paper, listeners will stroke their chins and nod pensively because you used the "BIG DATA" phrase. Heck, you may even get a study grant or spare Nobel Prize if one is lying around with no takers...

Anyway, back to my belief that the phrase "BIG DATA" is terrible. What does the phrase really mean? Well, it could be any or all of these:

• A large amount of data (duh)
  
• A big storage ecosystem dedicated to storing data (this is predominantly what my company wants it to be)
  
• Data that is BIG. You know - like videos, satellite images, or Lindsay Lohan's rap sheet
  
• The IMDB page dedicated to the movie Big (awesome flick, BTW)
  
• A manageable data warehouse populated from disparate sources that can be combed with with "Data Scientist" eggheads armed with business intelligence software to glean abstract analytical trends
  
  

If I were a betting man, I would say most tech nerds would like to think it's the last definition, but I am not sure if that represents a true consensus since some of the other ideas are possible as well. Seriously - when I worked at Sun Microsystems in the beginning part of 2001, "Big Data" would have been large, multimedia files associated with video processing operations for companies like Pixar or Industrial Light and Magic.

Anyway, back to today's inferred understanding of "Big Data". While I think I sort of understand what it is as well as what its benefits could be, I also believe the technology vendors who surround the concept may be a little pushy on something that could still be construed as a solution looking for a problem. I don't think there's enough maturity to the concept just yet that allows these big tech companies to hype the idea they have all of the answers, fancy technical bits, and people to help guide business decision makers to a Utopia of better decisions through analytics.

Don't believe me? Take a look at this article from The Register. Basically, it says that as data continues to grow at an exponential rate, it will continually grow tougher to separate the "signal from the noise"; thus constantly making it harder to capture any real information the data can represent. Wait a minute...that argument sounds familiar. OH WAIT - I wrote about that earlier in this post. Turning DATA into INFORMATION that drives KNOWLEDGE is a very, very complicated process that cannot be fixed by simply throwing a burlap bag full of technologies at it.

Adding "Data Scientists" into the mix isn't going to help grow the concept out, either. In case you didn't understand their role in all of this, these big-brained folks are mathematicians who live and breathe statistical analysis, and can model the data with stuff like business intelligence software to produce "big picture" results a mouth breathing commoner like myself can understand. And, according to this article, adding these folks to the mix is simply throwing more ingredients into an ecosystem that has yet to figure out what it wants to be when it grows up.

So, take caution gentle readers. If somebody tries to corner you and open your mind to the wonders of "Big Data", they may just be using a little too much hype to sell you on something that's not quite there yet.

Not that ANYBODY would do that, right?