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News

Deloitte Acquires Day 1 Solutions

Deloitte announced on Monday that it has acquired all the assets of a cloud consulting company called Day 1 Solutions. Terms of the deal were not disclosed.

Day 1 Solutions is a consulting firm based in McLean, Virginia. This company specializes in providing consulting services to government and commercial organizations that are looking to migrate some or all of their operations to the cloud. Specifically, it consults in the areas of systems integration, managed services and AWS products. In fact, Day 1 Solutions is a certified AWS partner and its customer base extends across a range of different sectors in both the governmental and commercial sphere.

With this acquisition, Deloitte has further strengthened itself as a cloud consulting provider. Since 2015, this company wants to establish itself as a leading provider of cloud consulting services as it believes that the cloud ecosystem is the backbone of innovation. The company strongly believes that a good cloud system can help a business to reach new heights, and it wants to provide the right suggestions that can help its clients achieve this pinnacle of success.

By adding these companies like Day 1 Solutions, Deloitte is getting closer to achieving its objectives in the world of cloud consulting. The knowledge and expertise of Day 1 Solutions can go a long way in helping Deloitte to provide a much deeper cloud expertise in a fast-moving digital environment.

In addition to expertise and capabilities, this acquisition also brings a GSA Schedule 70 contracting positions on many government organizations like NASA, Air Force’s Netcents 2 and Army’s Information technology Services. This contract can give Deloitte a better foothold into the government cloud consulting market – an area that it has been looking to capture over the last couple of years.

To make the most of this acquisition and also to expand its own offering, Deloitte is planning to hire 3,000 new engineers who’ll focus on providing cloud technology integration services in the areas of analytics and cognitive offerings. Most of these engineers will work out of its new centers in the cities of Washington DC, Orlando and New York City. The three new studios will come up to facilitate interaction between its employees and customers, and will also facilitate new cloud tool development. With these three new data centers, the total number of Deloitte digital studios will be 44.

This acquisition, once again, is expected to give immense benefits to everyone involved. Of course, the major beneficiary is Deloitte, as it gets a prime government contract for providing cloud consulting services, in addition to the expertise, customer base and experience of Day 1 Solutions.

As for Day 1 Solutions, this was the expected result as most smaller companies end up being acquired by larger companies for a substantial amount, though in this case, the exact financial details are not known.

For the cloud market and its many players, this acquisition represents one more step towards a unified cloud system. It also means a more streamlined and probably, even a better cloud consulting service.

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Technology

Estonia becomes the first “cloud country”

Estonia is a country known for its digital way of life, and its latest program that is likely to make it the first “cloud country” is another feather on its cap. If you’re wondering where in the world is Estonia, well, it’s a small country in the Baltic region of North Europe.

Looking back a few decades, Estonia got its independence from the from USSR in 1991. Since then, it began pushing into the digital world in a big way. For example, it created an online voting system in 2007 to make it easy for its residents to vote from any part of the world. Other programs include providing government services online, including medical records and prescriptions, so almost what everyone wants can be accessed online.

To take this digital adoption to the next level, Estonia has established something called e-residency. Under this program, people from any part of the world can apply to become virtual residents of this country. Once approved, they can start business, run a company or do anything else that other residents Estonians can do.

This program has attracted thousands of people world over. Why? For its simplicity.

Any person who wants to become a virtual resident has to fill an application form online, upload a copy of passport and pay a fee of 100 Euros. It takes four weeks for the application to be processed and during this time, a background check including a police verification is done. After the application is approved, the applicant has to visit a check point, usually the nearest Estonian embassy, and collect a digital certificate with a digital identity. Each approved applicant is given a smart card and an email ID, using which they can open bank accounts or start a company. However, most banks insist that the applicant should visit the branch in person to open the account.

So far, more than 17000 people have used this program. Bulk of the applications have come from countries like Finland, Russia, the USA, and of late, the UK. This attraction is mainly because Estonia has no corporate tax on the balances left within the company. Since this tax advantage is not available in most countries, people are looking to make the most of this opportunity and setup a business here.

With such a residency model, Estonia has created what is called a “cloud country”, akin to cloud computing. This was probably a natural extension for a country like Estonia – a place that combines a digital economy with a fairly stagnant population and economy. To give you a perspective, Estonia ahs about 1.3 million residents and a GDP of $23 billion, which is less than 10% of Apple Inc’s company value. With such a program, Estonia aims to boost its population as well as its economy in a big way, and this strategy is paying off as well.

Also, this idea of a “cloud country” is unique simply because it erases the physical boundaries of a country, which is true in the world of cloud storage and computing. This step can be the first major change that can bring us together in a “cloud world.”

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Computing

Positive Outlook for Alibaba

Alibaba is in the news again, and this time too, for the right reasons. Analysts world-over are painting an optimistic picture of its cloud business.

This technology giant has been making rapid expansion to its cloud business, as it has added new centers in Australia, Dubai, Japan and London over the last year. Within the next few years, it plans to tighten the competition for global cloud services – a market that is being dominated by companies like AWS and Microsoft.

If you’re wondering why there is so much talk about Alibaba’s cloud business, it’s simply because of its potential to become a big player in the coming years.

Already, it is the leading cloud services provider in China. It is estimated that the Chinese market has huge potential, and currently only a small piece of the cake is covered. Imagine the growth potential of Alibaba just within China when it’s cloud industry matures?  To give you a perspective, the Chinese cloud market was worth $1.5 billion in 2013, accounting for only three percent of China’s enterprise market. According to Bain and Company, this is expected to grow to $20 billion by 2020, signaling a growth rate of almost $1 billion per year.

And that’s not the end because the Chinese government has made cloud computing a priority. In its 13th five year plan that spans from 2016 to 2020, this government wants to give a big impetus to cloud, and to achieve this, it’s willing to offer support to cloud service providers as well as those that want to embrace cloud for their operations. Big tax incentives are being offered to lure more companies to move to the cloud, and all this means, the Chinese market is a huge potential waiting to be explored.

Many companies like IBM are partnering with local Chinese companies like 21ViaNet and Wanda Group to get a strong foothold in the Chinese market, simply because of the huge opportunity it offers. For Alibaba, this is not an issue as it is the most-established and leading cloud services provider in this region.

In addition to China, Alibaba is also rapidly expanding to other parts of the world in a bid to increase its customer base and service coverage levels. This could be a reality soon as this company is sitting on a decent pile of cash generated by many of its popular technology businesses within and outside of China. Also, investors feel confident about this company, so funding is never an issue. Since this is an important part of expansion, we can expect Alibaba to have a smooth transition from a Chinese cloud provider to a global cloud provider.

Alibaba has already started taking steps towards this transition by opening data centers in different parts of the world and entering into partnership with companies in the field of advanced technologies such as artificial intelligence, machine-to-machine learning, deep learning, virtual reality, augmented reality and more. With these partnerships, Alibaba plans to offer world-class products and cloud services to its customers.

The future is sure going to be interesting!

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Microsoft

Microsoft and Publicis get into a partnership

The cloud industry is being driven by acquisitions and partnerships, as companies are looking to leverage the strengths and advances made by other companies in the same field. In a way, every company is also extending its own technology and expertise to other areas of operations by partnering with niche companies. The latest in this series is the partnership between Microsoft and Publicis.

Publicis Groupe is a marketing and advertising company that is expanding its existing alliance with Microsoft. The partnership aims to tap into artificial intelligence and behavioral data segments to offer more targeted email campaigns. Specifically, Publicis will tap into the features of Microsoft Azure and Cortana Intelligence Suite to get greater insights about the behavior and expectations of its customers. Based on this information, it wants to help its clients to create targeted campaigns that will reach out to end-users in an appealing way. More importantly, it is sure to improve the conversion rate and bring in more business and revenue for Publicis’ clients.

Publicis already has its own intelligence system called Cosmos AI, and  this will be made available to business through the Azure cloud platform. From Publicis perspective, this is a lucrative deal as its clients can now have access to both Cosmos and Azure, and this means, Publicis can charge more licensing fees from them. In fact, this combined offering of artificial intelligence can add to the revenue of Publicis in a big way.

For Microsoft too, this is a good deal as it’s another opportunity to extends its platform and collaborate with the ad agency. Microsoft is looking to optimize its platform in the best way possible, especially as it wants to take on AWS – the most dominant player in the cloud market. Also, the fact that the cloud market is growing by leaps and bounds means that more opportunities are coming up for all companies in this market, and Microsoft wants to grab as much as it can.

This partnership between Microsoft and Publicis is not something new, as both the companies have a long history of working together. In 2009, Microsoft had sold its digital agency called Razorfish to Publicis for a sum of $530 million. Interestingly, Microsoft had acquired Razorfish only in 2007 from a company called aQuantive for a whopping $6.3 billion.

So, what does this mean for the cloud industry and the many enterprises that use it?

Almost every partnership augurs well for clients because they have more choices and at the same time, they have access to more features. The same is true for this partnership too. When Cosmos data product is combined with Azure cloud platform, it’s bounty time for marketers, as they can get deeper insights into individual customers, based on which, they can customize their products, create appropriate marketing campaigns and do so much more. The best part is all this information is available in real-time, so they can come with new ways to boost their revenue.

Due to these reasons, this partnership between Microsoft and Publicis works well for everyone.

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Uncategorized

NGA wants to speed cloud deployment

Federal government has come to embrace the cloud in a big way, and many of its departments have already started moving their data and applications to the cloud. Though this is heartening from a technology and user perspective, what is painstaking is the process of approvals. Typically, it takes a minimum of six months for a cloud provider to get security clearance for its service. In fact, six months is when the approvals run at the fastest possible pace. Otherwise, clearance to use cloud service for federal government apps and data can take years. The National Geospatial Intelligence Agency (NGA) wants to change all this.

To those working in NGA this elaborate approval process feels like a super slow motion and this is why they’re doing everything they can to change it. According to Jason Hess, the cloud security head at NGA, many different processes are being put in place to reduce the time it takes for a cloud provider to get security clearance. Ideally, Hess wants all approvals to be cleared in a single day, so the cloud service can be up and running within 24 hours of its application. Currently, the NGA uses a combination of DevOps techniques to get approvals within seven days, but this hasn’t been easy by any breadth of imagination.

This is a big initiative, considering that the NGA is planning to move all of its data and applications to the cloud, in a big to “re-invent security.” The agency is looking to tap into the flexibility of cloud to break-down the IT architecture and re-build it every day, so hackers will experience a new operating environment every day. NGA believes that such a move can confuse hackers and the familiarity with the system, and in the process, will reduce the chances of an attack as well.

Though this idea is unique, its practical application is always questionable. Is it possible to build such a dynamic IT architecture that changes every day? Will there be a specific pattern that would be followed in choosing the architectural style? These are important questions that have to be answered if the NGA wants to use this strategy to prevent outside attacks on its system. If an architectural style is going to be repeated after every few days, then it becomes predictable for hackers. Also, if there is no randomization, then architectural styles can be guessed by sophisticated hackers.

Given these questions, we can say that the NGA’s approach to cyber security is not for everyone. Currently many federal departments have vast amounts of data and legacy systems that can make it almost impossible for them to tear down the IT architecture and build one from scratch each day. At the same time, simply installing cyber security measures at the edges of a network system is not going to work anymore.

So, federal departments have to strike a balance between the aggressive security approach of the NGA and its own problems of legacy systems and siloed data,

Overall, it’ll be interesting to see if NGA’s plan can be implemented across the board.

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Services

What is Adobe Experience Cloud?

On the heels of a phenomenal earnings quarter, Adobe has released another product called Adobe Experience Cloud that is designed to give companies everything they need to provide excellent customer service every single time.

With this product, Adobe has unified all its digital businesses into a single cloud platform. In a way, such a unified product makes sense for Adobe because it’s been having its services all over the cloud.  Now, it’s Creative, Document, Marketing, Analytics and Advertising are combined into Adobe Experience Cloud, so companies can access all that they want from a single location.

To give you a perspective on what this includes:

  • Adobe Marketing Cloud – It comes with a set of solutions that empower marketers to create their unique marketing campaigns, create customer experiences that help them to stay on top of competition, and connect and engage with customers.
  • Adobe Advertising Cloud – This is the first dedicated cloud that allows users to manage all their advertising campaigns across different media in one place.
  • Adobe Analytics Cloud – This is the business intelligence engine that provides deep insights into businesses.
  • Adobe Creative Cloud – This helps to streamline and enhance creative workflows.
  • Adobe Document Cloud – This cloud allows users to sign and send any document from any device.

For individuals though, they can still have access only to Creative and Document because the others simply make no sense to them.

According to different strategists, this move by Adobe is great for many reasons. Firstly, it gives a unified system for Adobe to make the most of the acquisitions it’s been doing over the last two years. More importantly, it can simply plug future acquisitions into its own ecosystem, so they can start making revenue for the company right away.

Secondly, Adobe Experience Cloud will refactor all the existing applications, so they can leverage common data, content, analytics and processes. Such a move is sure to make applications and the entire system more integrated and efficient. From a customer’s point of view, it is a complete system where data can be shared and collaborated across different services.

Thirdly, companies like AWS and Microsoft are creating their own ecosystem to entice customers to use their apps. Adobe is unique because it offers a more creative set of tools that are hugely popular, and this is one of the biggest selling points of the company. With a unified cloud system, it can leverage on this strength and increase its customer base.

Lastly, it opens up new possibilities for Adobe as well as others that want to develop apps based on Adobe’s platform. For example, it’s artificial intelligence product called Sensei can be used to build models and distribute data generated by these models to other services within the platform. Such an opportunity for sharing and collaboration can be a great starting point for companies that want to develop apps based on it.

In all, Adobe Experience Cloud can truly enhance the experience of using a cloud-based product for customers, and for Adobe, this can signal the next big step in its transition to a complete cloud-based provider.

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News

IBM and Wanda team to bring cloud services to China

IBM is sure expanding its cloud footprint beyond the American shores. The latest agreement is with a Chinese company called Wanda, under which IBM will bring more of its services to China.

Both these companies have entered into an agreement to create a new company called Wanda Cloud, that is expected to become operational by 2018. Through this new venture, IBM will offer select cloud infrastructure and PaaS technologies in China.

The newly-formed Wanda Cloud will license IBM technologies and implement them in Wanda-owned data centers. In addition, Wanda Cloud will also sell and distribute these cloud services to companies and individuals, and at the same time, will ensure that their offerings meet the Chinese regulations. The revenue from Wanda Cloud will be shared by IBM and Wanda, though the exact percentage has not been released by the IBM spokesperson.

Wanda Group of companies is a large conglomerate that is mainly engaged in commercial properties, culture and finance. In 2015, the assets of Wanda Group was a 634 billion Yuan while its revenue was  290.16 billion Yuan. In fact, this is the world’s largest real estate enterprise and is the biggest five-star owner in the world. Besides real estate, Wanda Group is also the largest cultural enterprise in China and also, the world’s largest cinema operator. In addition, it also the world’s biggest sports company.

Last year, it spun a new company called Wanda Internet Technology Group to make a foray into the Chinese technology market that is currently dominated by only a handful of well-known names. This agreement is likely to give a big boost to the Wanda Group as it plans to expand into the technology sector in a big way.

As for IBM, this partnership can strengthen its grip over the Chinese market, where American companies have to enter into agreements with local Chinese companies to offer their services. Already, it had  entered into an agreement with another Chinese company called 21Vianet to bring cloud services to China. This partnership is expected to expand its reach in a market that has virtually unlimited potential.

Currently, Alibaba is the largest cloud service provider in China. When Wanda Cloud becomes operational by next year, we can expect the competition to stiffen a bit in the Chinese cloud market, thereby threatening the dominance of Alibaba in this market area. For its part, Alibaba is looking to expand to other regions in the world to take on competition from giants like AWS, as it feels fairly secure in the Chinese market.

This partnership between IBM and Wanda Group, revealed during IBM’s Interconnect tech conference in Las Vegas, comes as a big surprise to many people. Nevertheless, it is sure to augur well for both IBM and Wanda Group, not to mention the many Chinese companies and individuals who can benefit from it.

According to research firm Canalys, the cloud storage market is expected to reach $135 billion by 2020, so it’s little wonder that all major companies are vying to get a lion’s share from this market.

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News

Adobe’s First Quarter Beats Estimates

Adobe Systems Inc posted an impressive first-quarter results that beat the analysts estimates. It reported a revenue of $1.68 billion that amounted to an adjusted earnings per share (EPS) of $0.94. This was higher than what the analysts expected, which was a revenue of $1.65 billion and an EPS of $0.87. In fact, this revenue represents a 22 percent increase.

Much of this increase can be attributed to the astounding success of Adobe’s Creative Cloud Platform, which is one of  Adobe’s core media franchises. Total revenue from this line of business was $942 million, representing an increase of 29 percent. Also, this arm of business was responsible for 56 percent of Adobe’s total revenue.

This giant share of Creative Cloud Platform, in many ways, reflects the strategic shift made by the company over the last few years. A change in its business model, which is to move to a subscription-based revenue stream, has augured well for the company. Prior to this strategy, the company had focused much on the sale of its software package licenses.

So, why this shift boosted the company’s revenue? Earlier, a software license meant that users bought it once and used it across different systems until they ran out of its use. In other words, this was a one-time purchase only. On the other hand, a subscription model is a recurring stream of revenue, as users have to pay monthly or yearly for using the same package.

On the face of it, you may think the difference won’t be much because the company is getting a bulk amount while selling a software license as opposed to monthly billing. In addition, monthly billing leads to accrued income whereas an outright license sale can bring in current revenue.

Well, there are a few aspects you’re missing here. First off, when a user wants to use the same product across a number of computers, he or she will have to buy separate subscriptions because in most cases, one subscription is valid for one computer only In the case of an outright buy, the same cost was split across two or more computers, depending on the license terms of Adobe.

The second and the more important aspect is the elimination of piracy. Like many software companies, Adobe was also losing a substantial amount of money through software piracy where the same software was copied, tampered and resold in the black market. With a subscription-model, there is no such problem as anyone who wants to use the software has to subscribe for it. A simple and neat choice, that also makes management easy.

As a result of this change, Adobe was able to bring in more cash flow into its fold. Reports show that this company’s cash flow from operations increased by 47 percent to $730.37 million. The net income rose to $398.45 million or 80 cents per share. A year earlier, it was $254.31 million or 50 cents per share.

Due to this big result, the shares of Adobe was up by four percent during after-hours trading. Currently, it is trading at $127.25.

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News

Oracle’s Profits Soar on Cloud Optimism

Oracle’s third quarter earnings soared past analysts’ expectations, as it reported a revenue of $9.3 billion. The consensus estimate was $9.25 billion.

Oracle’s revenue rose by three percent when compared to last year, and much of this can be attributed to Oracle’s transition into a cloud-based services provider. Three years ago, Oracle began making a big push towards the cloud market, and the efforts are visible in its revenue.

According to the company, Oracle’s revenue from its software-as-a-service and platform-as-a-service areas, that jumped 85 percent to $1.1 billion, while its total cloud revenue exceeded $1.2 billion. These numbers reflect a 62 percent increase in revenue from the cloud.

Its traditional software licensing business, on the other hand, fell by 16 percent. This goes to show that the company is focusing more on the transition towards its cloud segment than its other traditional areas of business. This is no surprise considering the power of cloud and the huge potential it offers for service providers. In fact, its CEO, Safra Catz opined that the hyper-growth that’s happening in the cloud market has driven his company’s SaaS and PaaS business, and he hopes to capitalize on this trend over the coming years.

Overall, this has been an impressive financial performance from Oracle. It reported an earnings per share of 69 cents, which is almost eight percent more than what it reported a year earlier. In fact, it beat the analysts expectations of 62 cents per share. The company also decided to hike its dividend to 19 cents, up from 15 cents of last year.

Such a positive result caused the company’s share price to soar five percent to $45.18 in after-hours trading. This would probably be the second highest price ever, with the highest being $46.70 set in December 2014.

With this revenue, the painful process of transition is over for Oracle, and it is all set to take on competition from giants like AWS, Microsoft and Google.

In an earnings call with analysts, Larry Ellison, the executive Chairman, said that Oracle has a huge technology lead when compared to AWS and Microsoft. He is believed to have bragged many times about the company’s services, saying that Oracle’s services are cheaper and better than AWS or Microsoft.

To give a perspective, Microsoft’s revenue increased by eight percent while that of Amazon rose by 47 percent during the same period. Given these numbers, we can conclude that Ellison’s comments are grandiose at best. Though Oracle has the potential to overtake Microsoft or AWS in the future, currently, AWS continues to be the undisputed leader in this market.

That said, the progress that Oracle has made over the last three years is remarkable, and at this pace of growth, it can take a big lead over its competitors. What is impressive is the company’s quick transition into the cloud market and the relatively little negative impact on its revenues over the course of this period.

In all, Oracle is making rapid strides, but still has a long way to go to catch up with its competitors.

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News

Societe General Leads the Way in Cloud Adoption

Societe General, the Paris-based bank, is looking to leverage cloud to lower its costs and to provide better services to its customers. Eventually, it wants to become the largest European bank to adopt cloud computing for a good amount of its operations.

To this end, it has entered into an agreement with Microsoft and Amazon. In fact, Societe General’s developers and engineers have been running pilot programs for more than a year now on both Azure and AWS to check for security and reliability of these public cloud platforms. More importantly, these pilot programs looked into the feasibility of using public cloud for banking transactions, where confidential information of users and processes at stored at giant third-party data centers, in a faraway place.

So far, the tests have been satisfactory and Societe General wants to use public cloud services by June. Initially, it plans to start with non-client and non-sensitive content such as financial research and marketing data. Depending on the success of these changes, the bank plans to eventually have 80 percent of its infrastructure and data on internal and external cloud systems.

One of the challenges that Societe General, or for that matter any bank in Europe will have, is the regulatory concerns laid down by the ECB. Currently, ECB has restricted banks to use clouds for storing only non-sensitive data and operations like product development. However, these regulations are expected to ease out in the near future because there is a greater pressure on banks than ever before to reduce costs and improve efficiency.

According to IBM, moving to the cloud can save banks about ten percent of the budget allocated to information technology and operations, to start with. Continued use of cloud can allow banks to save almost 40 percent of costs because they can do away with systems that are not needed anymore. At the same time, their investment in capital infrastructure is also greatly reduced when they have their operations in the cloud.

Intense competition between banks is another factor that can propel banks to take to the cloud. Currently, competition has ensured that profit margins are not easy to come by, so more banks are increasingly looking to move their operations to cloud to leverage its lower costs. To top it, the millennial generation wants to have a digital banking experience, where everything is customized to meet their specific needs. To cater to this demand, banks are forced to embrace advanced technologies and again, want to leverage the power of cloud to run these technologies.

A case in point is Big Data, using which banks can better understand their customers and their expectations. Using these insights, they can provide a more customized service to their customers, that in turn, can go a long way in retaining existing customers and attracting new ones into their fold.

Due to these many advantages, some financial institutions have already started moving to the cloud. HSBC Holdings has partnered with Google while Capital One Financial Corp has partnered with AWS to move its operations to the cloud. This trend has started in Europe too, with Societe General leading the way.

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