A Cloudy Weekend

It has been eight years since I last smoked a cigarette. Every so often the urge to smoke rears its ugly head and the demon weed tries to seduce me. The seduction lasts for only a millisecond, but it is a long hour. It passes, and life resumes its course. But I’m left thinking — you are never free of addiction!

For the past few days, news—general, economic, and technology— and its interpretation has had a similar narcotic hold over me. Even though it has been more than a year, my mind has not washed the dateline drug from its crevices. There are times when the old twitch returns and has me reaching for the nearest keyboard — usually my iPhone 6 plus — tapping out a few lines. After two paragraphs I abandon the effort, realizing that the news has already been reduced to its bare essence — a tweet. Ironically, if you started your career working for a newswire, you always knew that the essence of the news is that first alert — a headline — that goes out. Everything else is just something to fill the pages.

These past two weeks have been “twitchy” weeks, and my Quip folder is full of half-finished drafts. Many of them prompted by the news events that have a connection with my personal storyline. There was a time when in the pages of Red Herring, I (wrongly) argued that as the world was going all fiber, and Alcatel would emerge as a leading networking equipment maker. Instead it merged with Lucent, and the results were as nutritious as freedom fries. So, a few weeks ago when Nokia, when another company whose story is interwoven with my own storyline, bought Alcatel-Lucent, more memories surfaced. Memories from a different era, when I was a pure network and telecoms reporter.

The rumors of the deal, first reported by Bloomberg, reminded me of an old research report, where one of the Wall Street analysts (in the aftermath of telecom bust) pointed out that there would be, at most, four or five equipment vendors to service the needs of mobile network operators. I’ve forgotten his name, and also the name of the investment bank—but he was right. Well, almost.

If memory serves, he believed the major vendors would be Motorola, Nortel, Lucent, Ericsson, and Nokia. Today, Motorola and Nortel are history. Lucent, along with Alcatel, will soon join them. Siemens is now part of Nokia. The consolidation moves in weird ways, but the big winner is a company that wasn’t even on the radar at the time of my prediction—Huawei. They dominate the world, thanks to their expansion into emerging African and Asian telecom economies. Huawei are in Russia and in Latin America. Huawei is big because the Chinese Government wants them to be big and thus they play by rules which are unique to them.

Nokia, on the other hand, is a company desperately trying to reinvent itself as a wireless networking hardware company. It’s betting that by getting bigger, it can compete with Huawei and Ericsson and a slew of other smaller vendors. There’s much that should worry the crap out of Nokia shareholders, however, challenges that I began to write about in a blog post that I soon abandoned, mostly because it no longer really mattered. No one wanted to talk about the deal, this $17 billion deal, by the next day.

And there was the news of GoogleFi—announced, tellingly, on the Google blog and not in some publication. Google’s MVNO-based service marries WiFi and Cellular back haul (from T-Mobile and Sprint) in a seamless manner, and delivers it using (only) new Google Nexus devices. Incindentally, It is something companies like Republic Wireless have been attempting.

In France, Free has similarly been working towards this vision. However, to see something I’d written about nearly a decade ago come to fruition (albeit in a different flavor) was a flashback moment. It was a moment when I met a fast talking Chris Sacca — who desperately tried to talk me out of writing a piece for Business 2.0. Friendship followed but the piece went ahead anyway.

And there was the biggest news of 2015: Amazon Web Services is nearly a six billion-dollar-a-year business and growing fast. It is profitable, and it pads Amazon’s bottom line in a way the core business cannot. I have been a believer in Amazon’s cloud foray long before we started using the marketing term cloud. It was that belief that it was a fundamental economic shift in how computing and rated equipment was bought and companies acquired their software prompted a column for Business 2.0 and it was the spark that led to us starting the Structure Conference. The disruptive force of on-demand computing was plain as a day. If anything, Amazon’s results should show that cloud computing is under-hyped , and despite all the marketing hype from every other vendor, it is Amazon that is setting the agenda.

Microsoft is using its ecosystem to hoist Azure and make a massive (and often not very well understood) transition—something Jonathan Vanian wrote in his Fortune piece yesterday. The question everyone should be asking is what are IBM, HP, and others going to do? Where is Google? Do we realize how far the mandarins of Mountain View lag behind Amazon? I look at Amazon and I see amazing things. Amazing because they have built a Microsoft Windows-like ecosystem and a cloud operating environment that truly is “full stack.”

Not only does AWS have the proverbial operating system, but through newer applications such as Email it has started to follow the Microsoft “apps” model. And the company keeps increasing its Developer offerings, such as machine learning as a service, launched a few weeks ago. I am surprised by the lack of coverage of something that, just a few years ago, was so exotic and expensive that only hedge funds could pay for it. Or as my good friend Sean Gourley points out, “We are now at the point where ‘advanced’ Data Science is now literally in the same bucket as Mechanical turks and dollar-a-TB storage.”

But I’ll let others who are at the frontlines figure out the words and the news. I look at these unfinished posts of mine and get that millisecond of ticklish feeling. Wondering, what if…

April 26, 2015, San Francisco. 

Letter from Om

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