Amazon’s Web Services have been getting better and better, but typically by incremental amounts. Up until now, it’s been a slow trickle of improvements to a solid suite of offerings. Cheap storage, cheap computing power, cheap access to PCI compliance, etc.

This new offering however, may truly be a game-changer for their web services division. Amazon’s Virtual Private Cloud lets companies create their own isolated set of EC2 instances and connect them to their own existing IT infrastructure through a VPN connection.

What does all that mumbo-jumbo mean to the business management people? Simple. Now you can augment your IT’s infrastructure without huge capital expenditures. EC2 already runs Windows Server 2008, SQL Server, Oracle Database 11g, IBM DB2, IBM Websphere and many more.

Amazon’s immensely powerful infrastructure is available as a service at prices that will make you wonder if you should bother with your own hardware anymore.

Remember When Video Killed The Radio Star?

By now we should recognize the signs of a major shift caused by a new, “disruptive” technology. After all, we have seen it happen so many times before. The only difference is that today the shifts are quick and dramatic, catching off guard anybody that dares to stand flatfooted. So what is causing the tremors this time? Cloud computing! And it is already hitting with a force that is off the scale, especially for organizations that are not looking for it or prefer to live in the “legacy” world of on-premises business computing strategy and applications.

Perhaps “Video Killed The Radio Star” is not the appropriate analogy to communicate a dramatic shift in computing technology, but for some reason that tune keeps playing in my head whenever I think about this evolution in computing. MTV was a dramatic shift that stopped careers for those unwilling to accept it. It opened the door for a new breed of performers that were willing to adapt. Yet it was only the pinnacle of the iceberg for all the technology changes that followed – from CDs replacing cassettes and vinyl, to iTunes and single song downloads.

Cutting edge performers had been putting out music videos since the Beatles’ Yellow Submarine, not to mention the entire Monkeys TV show (which drove their albums to the top of the charts!). But it was the new technology of cable television and MTV that was the game changer. Cloud computing is the cable television of IT world. IT directors and departments will either have to grasp and ride the movement of computing to web service providers such as saleforce.com, Amazon Web Services and Google Apps, or find themselves and their employers on the clearance shelf of the business world because they have become irrelevant in the market, just like 8-track tapes.

The newspaper industry has experienced this shift as a result of technology change that helps to illustrate this point. The static newspaper has been driven down by the dynamic web page and email alerts for news. You don’t have to own, staff, and maintain huge printing plants running around the clock in order to sell and deliver the news today. Corporate size is not the advantage in distributing the news as it once had been thanks to the internet. Wireless and handheld access to the Internet has further made the hard copy delivery model a competitive disadvantage. The result has been a proliferation of news and information sites, and a long line of newspaper bankruptcies. The down economy has served to accelerate this phenomenon.  Think about this analogy as it relates to cloud computing. You can read other Model Metrics blogs from our technologists that explain in detail how we are leveraging salesforce.com, Amazon Web Services (the business unit) and Google Apps to create an elastic, powerful, and extremely cost effective new world order of computing.

Google “Amazon Web Services” if you want another perspective. My thoughts here are to sound the alarm. There is a change coming and you need to look up now to “the cloud” to take advantage of this opportunity to achieve competitive advantage, and in some cases survival, before it is too late.

Video killed the radio star…Cloud computing is going to kill traditional IT. Those that look to the cloud will be the new winners.

First blog since Dreamforce… not good! The marketing guys are all over me. “You have to blog consistently.” Of course they’re right, but who has the time! Inauguration was yesterday, pretty amazing times. So now that Obama is in and the recession will be coming to an end, banks will become stabilized, the capital markets will bounce back, and general goodness will proliferate throughout the world, it’s time to blog and get ready for a great 2009. Maybe he’ll need a quarter or two…

• EC2 - Host your data center on Amazon, leverage it for databases and mail servers, use it as a disaster recovery site, and leverage vast amounts of computing power. This isn’t the most exciting offering to talk about, but you can have access to Amazon’s amazing infrastructure for pennies.

• S3 – This is what most people think about when they think about Amazon Web Services. This is simply storing documents with Amazon, again, for pennies. You can easily pull images of documents into Salesforce or wherever else, so the user doesn’t even know where it’s located, they just know it’s easy to access and you know that it’s cheap.

• DevPay and Fulfillment Services – Now we’re getting into some more exciting areas. DevPay enables you to leverage Amazon’s shopping cart and billing system for launching a store. You can even sell subscription plans, not just a fee per order. Fulfillment Services is really interesting. This may not be a true cloud app, but you can actually send Amazon your inventory and they’ll store it in their distribution centers, which of course are the best that money can buy. They handle packing and shipping when someone buys from you, whether from your website or from there’s. You can focus on sales and marketing, they focus on the boring stuff that they do better than anyone else. Very cool!

• Mechanical Turk – This is definitely my favorite. Amazon calls it artificial artificial intelligence. It’s basically a workforce in the cloud. Some tasks computers just aren’t that great at. So you can send a task up through Amazon to the Turkers and for pennies they’ll complete the task. These are people located all around the world, who, for 2 cents or 5 cents or 1 dollar, depending on the task, will do something you ask of them. It could be looking at an image and transcribing it into data. When Steve Fossett’s plane went down, they leveraged the Turkers to look at satellite maps and help in their search, scanning for the plane. Companies also leverage it to clean data, analyze catalogs and competitive coupons, etc.

We just closed down our booths at Dreamforce and are all heading back to our respective cities.  Based on credible sources Dreamforce attendance was just a few people shy of the expected 10,000.  That is a very interesting number considering some of the economic news as of late and companies that have travel bans, spending freezes, etc…  This really speaks to the power of SaaS (software-as-a-service) and PaaS (platform-as-a-service) and the value companies see in the cloud even in tough economic times.

This Dreamforce was very different than in years past for more reasons than just the growth in attendance.  The entire first day’s keynote was purely around the platform and force.com enhancements.  Depending on what tracks you attended you almost wouldn’t remember that salesforce.com has a CRM product.  With the advances in APEX, Visualforce and now Sites they have put together a very viable platform that can be used in a wide variety of situations.

We have received a lot of great feedback for our new products that we unveiled at Dreamforce, or shortly before so.  Everyone loves the idea of Search2GO (demo) and searching for data within salesforce.com from their iPhone for any edition of salesforce.com (other than Group edition).  It was exciting to talk to someone from Japan by our mobile booth who is a big fan of Expense2GO and has been using it since it launched with the AppStore back in July.  It really proves the international support of the iPhone and force.com when you see users from all over the world storing data in their local language and currency.

We were fortunate to have early access to force.com Sites as well as the Amazon toolkits and the timing worked out perfectly as we could use them as the foundation for our new Lasso2GO product suite.  We are very impressed with what you can do by leveraging best-of-breed services from force.com and Amazon Web Services  to build cloud platforms that were not possible before these platforms existed.  It was exciting to see Charlie Bell (VP of Infrastructure for Amazon.com) on stage with Marc Benioff and Adam Gross and have them showing off our upcoming CardLasso application.  I’m looking forward to applying this same technology stack to our customer base as we help them build new applications we haven’t even imagined.