The IT Strategy Letter
Doug Kaye, RDS Strategies LLC
December 1, 2003 (Subscribe)

In this issue:

Viva Las Vegas. Two weeks ago I shuttled back and forth between three conferences: COMDEX, cdXpo, and Apachecon. They were so different, they might was well have been hosted on different planets.

COMDEX was a miniature version of its former self. The conference that used to take over every hotel room and every inch of exhibit-hall space in Las Vegas now fits into just a portion of the Las Vegas Convention Center. You can walk the floor in less than one day. The mix of exhibitors was the same as always: from scaled-down Microsoft and Intel booths to the Asian OEMs offering everything from PC cabinets, patch cables, and CD-ROM manufacturing machines. Even the guys that sell shrink-wrap machines were still there. It's still shoulder-to-shoulder in the aisles, though, so it continues to be a look-don't-talk kind of event. The importance of COMDEX has always been the opportunity to schedule meetings in advance with people coming from far away rather than the conference or exhibits. I did get to see Bill Gates' opening keynote in the huge (7,000 seat) Aladdin Theatre, but as others have already reported...boooring!

Jupitermedia's cdXpo was the new event in town, held at the Mandalay Bay resort. (The conference facilities are great, but it's a half-mile walk from parking to the meeting rooms.) Attendance-wise, this show was a disaster. Rooms set for 100 often had less than ten people. I sat in on one panel discussion in which the panelists nearly outnumbered those in the audience. The most anticipated presentation was the keynote by SCO's CEO, Darl McBride (see below). But in a room that could hold perhaps 1,000, I'd say fewer than 100 showed up. This was the second Jupitermedia event I've been to in the past 30 days, and the second that was woefully under-attended. In these tight economic times, it's hard enough to produce a successful conference, even if you're the #1 show in your industry. But Alan Meckler's company seems to be trying to compete as the #2 or #3 conference in each niche, and that's gotta be tough on the wallet.

In stark contrast to cdXpo's quiet and empty rooms, Apachecon 2003 was packed and abuzz. This conference continues to be one of the major geekfests of the year with in-depth presentations on virtually every package supported by the Apache Software Foundation. Unofficially, there were over 400 attendees: only 1/100th the attendance of COMDEX, but 100x more valuable. As usual for events of this type, the real action was in the BOFs and the opportunities to meet people outside of the conference rooms. I had a chance to interview the grandfather of Apache, Brian Behlendorf (see below), and PHP creator Rasmus Lerdorf (to be posted later this weel) for IT Conversations.

Overall? I'll be at Apachecon 2004, pass on COMDEX, and probably won't have to decide about cdXpo--I'd be surprised to see it back next year.
Posted Monday, November 24, 2003 7:29:34 AM

Utility Computing: A Loss Leader for Vendors? I attended a number of sessions on the topics of utility/grid/autonomic computing at both COMDEX and the Jupitermedia cdXpo conference last week. I've been studying these topics recently, and I'm having trouble accepting one of the supporting arguments: that systems are too expensive and that we therefore need to increase our system-utilization ratios.

It's deja vu. In the 1960s, mainframes were so expensive that we had to keep them running 24x7. Staff was cheap, but the hardware cost a fortune, so we queued up jobs to run at all hours of the day in order to keep the CPUs busy. Then, in the 1970s, came the minicomputers--the first computers we could afford to turn off at night, and the first computers we could generally afford to dedicate to single tasks, even if they weren't full time. The PCs of the 1980s continued that trend: hardware and software that was so inexpensive, we could dedicate it to the individual.

So what's changed in the 2000s? Hardware is cheaper than ever, but for the past three years, we've been in a recession, and IT managers have been asked to do more for less. I think utility computing *may* be a vendor-centric answer to the spend-less demand. The vendors don't really want to hear "spend less." Utility computing is their way of re-wording the requirement as "spend more for more." But that's not the customers' real requirement. The vendors aren't listening. (Or perhaps they can't.)

I think there's a good chance the overhead and complexity of utility computing will ultimately prove to outweigh its benefits. That's why SANs cost so much more than the underlying disk drives, and server clusters do likewise. Discrete systems are always less expensive than linking them together to squeeze every last drop of performance out of them. [There's been some discussion that my criticism may not apply to the "grid computing" applications similar to the SETI project, but it's still valid for "utility computing."]

Once the economy recovers and IT budgets rise, the demand for spend-less will diminish, as will (I predict) at least the cost-saving argument in support of utility computing. What we'll continue to see is the ever-increasing cost of software as a percentage of overall system cost. I expect this to be the greatest area of IT manager dissatisfaction, and the driving force behind the increasing use of open-source solutions. Oracle (with its database pricing in particular) and Microsoft will have to respond to the need for lower pricing if they're to beat off the open-source threat.

I listened to a few case studies of utility-computing success, and I'm very suspicious of their economics. The customers claimed lower costs than using traditional solutions. But if you dig deeper, I think you may well find that all of the systems in these early case studies have been sold as loss leaders in order to generate buzz surrounding the utility-computing concept. When you price these systems out using legitimate street prices, I think you'll find they're very expensive.
Posted Tuesday, November 25, 2003 2:12:42 PM

My Observation: IT for LOBs? In speaking to CIOs and IT managers over the past year I've noticed a shift of control of IT from the corporate level to lines of business (LOBs). Sure, it's long been the case that each LOB has controlled its own IT budget, but IT has typically been a centralized function with each LOB competing for resources. Increasingly I'm seeing LOBs with their own IT departments and even their own CIOs. Anyone else noticing this trend? How about within your own organization?
Posted Tuesday, November 25, 2003 4:59:46 AM

Darl McBride: There's No Free Lunch...or Free Linux (an IT Conversation). "I'm not a penguin slayer or a suit-happy cowboy," McBride says in this keynote speech--the most anticipated event of Jupitermedia's cdXpo November 2003 conference. When McBride joined SCO, its market cap had fallen from $1 billion to just $6 million, and the company had only six months to live.

Now under his leadership, SCO is aggressively enforcing its alleged intellectual property rights through licensing and litigation with the help of attorney David Boies--the same lawyer that represented Al Gore in Gore v. Bush in front of the U.S. Supreme Court, Napster in RIAA v. Napster, and the U.S Federal Government in their prosecution of Microsoft.

Instead of our usual interview-style format, in this IT Conversation we present McBride's unedited keynote speech in order that you can hear his positions in his own words. In subsequent episodes we'll be interviewing other prominent personalities associated with the Linux and open-source communities to get their reactions.

Is McBride doing the right thing for his shareholders? (What would you do in his place?) Is SCO indebted to the open-source Linux community? After you've had a chance to listen to McBride's speech, join in the discussion.

[For a good textual summary of McBride's presentation see Phil Windley's weblog.]
Posted Saturday, November 22, 2003 12:57:22 AM

Brian Behlendorf on SCO and Open Source (an IT Conversation). The day after Darl McBride's speech (above), I asked Brian for his reaction to the whole SCO/IBM/Linux/GPL debate.

Brian discusses the potential impact of the SCO lawsuit on the open-source movement. (Developers are more amused than scared, he says.) Is the validity of the GPL at risk? Does that even matter? And what does the future hold for SCO?

Along the way, we delve into the fundamental concepts behind open source. It's not an economic system, according to Brian, but rather a method or process. It's the third chapter in the open-systems story, the first two chapters having been open hardware/software architectures and open standards.

If you have any interest in open-source software, you won't want to miss this conversation with an open-source pioneer, considered by many to be the grandfather of Apache.
Posted Saturday, November 22, 2003 12:21:04 PM

Eben Moglen on the GPL: "If the GPL means what it says, SCO loses its trade secret lawsuit against IBM, and cannot carry out its threats against users of the Linux kernel. But if the GPL is not a valid and effective copyright permission, by what right is SCO distributing the copyrighted works of Linux's contributors, and the authors of all the other copyrighted software it currently purports to distribute under GPL?" according to Eben Moglen, a professor of law at Columbia University Law School and the general counsel of the Free Software Foundation as reported in this interesting article in eWeek.
Posted Monday, November 24, 2003 11:49:16 AM

Carol Coye Benson: Liability and Federated Identity. Carol writes, "...liability transfer is the 800-pound gorilla everyone wants to wrestle...I believe large-scale identity federations will all operate with explicit disavowals of liability." She explains that while liability transfer functions in payment networks, it doesn't make sense for general-purpose federated-identity circles of trust.

But reading Carol's essay, I'm again thinking of the limited value of federated identity for consumer applications. If my business partners won't assume liability for the identities they assert, I'll need to re-authenticate consumers before I accept high-value transaction from them. In other words, I may accept a federated identity while someone is shopping, but at checkout time I'll still need to ask for a password, etc. Given the shop/buy ratio of most consumers, that's better than nothing, but hardly the quantum increase in consumer convenience federated identity has been promising.

As Carol says, liability transfer doesn't make sense in most federated-identity networks. I see that as another indication of the limited value of such networks.
Posted Monday, November 24, 2003 6:43:56 AM

Jim Rapoza: Liberty Alliance Has Missed the Point. "...while users may welcome this kind of convenience, they will do so only if it doesn't cost them in privacy and security...[and with regard to the Liberty Alliance specification] you can't help but notice that there are far too many 'shoulds' and not enough 'wills' or 'musts.'" [Source: eWeek]
Posted Monday, November 24, 2003 5:57:38 PM

Loosely Coupled--Now Available as a PDF (at a 63% Discount)


  • Entire book: US$14.95
  • Major parts (4 total): US$5.95 each
  • Individual chapters (21 total): US$1.95 each

As an alternative to the hardcopy edition, you can now download my latest book in PDF format at a substantial discount using PayPal or BitPass. From the time you purchase the eBook version, you have 7 days during which you can download the content up to 10 times. The PDF files can be printed, but the text cannot be copied or modified. Review of the Week:

"This book provides an excellent explanation of why companies should be looking at Web services. It approaches the topic with an honest and straightforward description of the problem space Web services are targeted to address and the characteristics/short comings of those technologies as they exist today and as they are expected to evolve. Perfect for IT decision makers who are evaluating how/where Web services fit in their corporate IT strategy."

--James Snell, IBM, author Programming Web Services with SOAP
(Read more reviews.)

Loosely Coupled in a New Bibliography. A new book, Enterprise Integration Patterns--Designing, Building, and Deploying Messaging Solutions by Gregor Hohpe and Bobby Woolf lists my latest book in the bibliography:

A refreshing look at Web services. Instead of wading through APIs, we get to read about the core principles at work in service-oriented architectures in a technology-neutral, jargon-free way. This book is likely too high-level for developers itching to make that SOAP call, but it is ideal for technical managers and architects who have to explain these concepts to non-techies.
That precisely captures my intentions in writing the book, so it's good to know it's working. Enterprise Integration Patterns initially looks interesting, but it's 680 pages, so I haven't had a chance to read much of it. When I can find the time, I'll return the authors' favor and review it here.
Posted Tuesday, November 25, 2003 11:16:35 PM

P2P Content Delivery. Including this post by Don Park, there's been a lot of talk on the blog channels in the past few days about Bit Torrent. If you're interested in some of the history and technology underlying peer-to-peer content delivery, take a look at a paper I wrote two years ago entitled Peer-to-Peer Content Delivery Using Information Additive Codecs (PDF).
Posted Sunday, November 30, 2003 2:32:39 PM

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The IT Strategy Letter is published weekly by RDS Strategies LLC. Much -- but not all -- of the content is published earlier in Doug Kaye's weblogs.


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"...essential reading for anyone seeking to deploy this technology."

--John Hagel, III,
management consultant
and author of
"Out of the Box"


Read More Reviews of Loosely Coupled