Emil Sayegh: Fast forward to 2014, what we are seeing right now in the market is both of these models hitting a point where frankly they’re becoming less useful as a monolithic type of offering. Companies out there want to be able to benefit from the ability to grow very quickly with the cloud offering for the right applications but also need a solid performance of what used to come with dedicated servers for certain applications like databases and Big Data applications. All those applications need very high I/O still need traditional infrastructures.
Now, you’re in a dilemma. I put my front-end web infrastructure on something like Amazon cloud or Rackspace cloud, but then where do I put my high performance computing needs? Very few companies have been able to bridge those two elements. What we’re seeing is the emergence of hybrid cloud, which allows customers to essentially spin up front-end web resources in a cloud environment in a utility-based model and then have their back-end on robust dedicated gears. That is in the use case of e-commerce wherein you need front-end web and back-end databases all combined in one extremely fast network probably encapsulated in a private network.
That’s where we’re seeing the demand of the e-commerce use case shifting. E-commerce customers want a hardware cloud, which allows them to do both – dedicated for high performance workloads and then web front-end on cloud for workloads that require rapid scale and don’t need as much I/O performance.
Sramana Mitra: When you describe this e-commerce use case and the hybrid cloud demand from that particular segment, I imagine there’s also a size segmentation. What threshold of e-commerce activity are we seeing in this kind of behavior? At this point, e-commerce is a very large industry and there are lots of niche e-commerce players that operate in lightweight infrastructure mode. As the business scales, somewhere that is slipping to the phenomenon that you are describing. What is that threshold?
Emil Sayegh: In e-commerce, you’ve small stores that have few hundred transactions a day to those that have tens of thousands of transactions per day. These customers rely on their web presence for their livelihood. Basically, these are pure e-commerce companies. They are transacting close to half a million to a million a month. Those customers are moving away from a monolithic type of architecture of either just a couple of dedicated servers and maybe one database server, to a more hybrid infrastructure where they’re using both cloud and dedicated to basically scale their environment.
I would say it’s that mid-sized customer that is moving more towards that hybrid infrastructure. You do have some of the smaller companies that can operate on just one or two cloud instances and configure one of those cloud instances as a database. It’s not a lot of high transaction load. The I/O contentions are not big of a deal. I would classify that as a serious e-commerce site.
With hybrid, I think you can actually start with hybrid because it’s not that much more expensive. Start with the hybrid from the get-go even if you are someone that was transacting a few hundred dollars a month and then grow with it. It allows you to grow. It allows you to spin up more dedicated or more cloud. We were at Austin. I can’t tell you the number of startups that stopped by and were tired of hosting at Amazon because they don’t understand why their bill is so high. They don’t understand why it’s so complicated. They’re looking at hybrid as a way to have more sanity in their e-commerce infrastructure.