The Planet Blog

At the beginning of this week, The Planet sent a gaggle of sales and marketing folks (and an iPod) to the Windy City for HostingCon 2007. Having never been to Chicago, I jumped at this opportunity to get a slice of deep dish pizza and meet with some of the other players in this wild world of web hosting.

Little did I know that I would be walking into a maze of buzz words, tchotchkes, and salespeople eager to explain why their product was the most innovative, dynamic, and usable development to hit the hosting market since email.

I don’t want to use this post to brag about the assortment of toys that will be cluttering up my desk for the next month or two, and I am in no position to speculate on whether or not a new server-kicking robot will be the solution to all server-related problems in the future, but I can break down a few of the buzz words that have been creeping around the industry for a little while: Service Empowerment, Grid Computing, Software As A Service (SaaS), Virtualization. I am a technically literate guy with a few years of experience in the hosting realm, but I had to stop and scratch my head about what some of these terms meant (assuming that they actually mean something).

Service Empowerment

On Tuesday morning, a keynote panel was scheduled to discuss Service Empowerment, but that discussion quickly led into a Grid Computing, Virtualization, and Software as a Service debates. The panelists unanimously shrugged at the title topic and admitted to searching for the term in preparation for the discussion. This buzz term has not built much steam (yet?), so by nipping the potential confusion in the bud, I’ll keep you from furrowing your brows and running to “The Google” in the future … it’s all about usability.

While “usability” has gotten more than its fair share of buzz in the past few years, it has gained such a broad understanding that its vernacular definition perfectly defines Service Empowerment: Allowing your customer to use your service easily and intuitively. If I offered you a petabyte of storage and an account that allows you to upload a megabyte of storage per day, I am not empowering you to use the service I am selling you. That example may seem silly, but it is a clear-cut way of thinking about the issue.

Grid Computing

The Planet’s very own Bryce Edwards explained the basics of clusters and Grid Computing about a month and a half ago, but I hope that you will accept my toonie on the topic (because two Canadian dollars are worth just a bit more than two cents here in the US).

In theory, grid computing allows for high availability across a group of servers and failover in the event of hardware failure. Imagine that your single server’s resources are water in a water glass. If your site or service has an influx in traffic or usage, the glass fills up. If the water reaches the top of the glass, your server is operating at 100%. But what happens when one more person comes to your site or uses your service?

In a true grid computing setup, you will have a group of servers functioning as one. Grid computing would be illustrated in our example by placing several other drinking glasses next to yours. One glass takes some parts of the water, the other glasses around it take other parts of the water. The glasses will not fill up nearly as quickly because the water is spread among them, and if necessary, more glasses can be added. Putting it back into server terms, your server will share the work with as many other servers as are necessary to provide the same seamless service for your users/customers as one user/customer accessing one machine. In this setup, because no single server is shouldering the entire processing load, individual servers in the grid can be replaced without service interruption.

Currently, grid computing is in its infancy, but as we see operating systems and software developed to fully realize its potential, this technology could gain a whole lot of momentum.

Software as a Service (SaaS)

A large compounding factor in understanding Software as a Service is understanding the idea of “advanced” or “managed” services. An advanced service, in the IT infrastructure sense, is a hands-on hosting solution. Whether you order an advanced service to monitor the loads on your server or seek software-specific service and support, you are essentially paying for additional features from your hosting provider. The idea of “Software as a Service” is a hands-on hosting solution that provides you specific software service and support.

The biggest player associated with this buzz term is Microsoft Exchange. Exchange is the most widely recognized enterprise email solution on the market, and when businesses seek Exchange hosting, they are actually ordering Microsoft Exchange’s software as a service from their hosting provider. Rather than starting with a blank slate, ordering Software as a Service sets up your account to be immediately usable in a particular way.

If all of that isn’t confusing enough, I’ve got one more gem for you: If you have ever ordered Web hosting, you have likely ordered software as a service. The control panel that you are given with a new hosting account is the software you are given to control the tangible server resources you ordered! Because everyone has spoken so generally about “Software as a Service” recently, I’m not surprised to see blank stares around the room when someone mentions it.

Virtualization

Virtualization is a very broad term in the IT infrastructure environment, so I do not have an easy task in trying to define it. Essentially, virtualization is the process of fooling software about hardware resources. In one case, virtualization can break down a single server into multiple similar and independent instances (a la Virtual Private Servers), and in another case, it can combine multiple servers together to appear as one single server (a la Grid Computing). The process of virtualization separates hardware and software layers working together in order to more efficiently manage resources and scale.

As soon as the virtualization concept is fleshed out a little more and developed, it will lead to a different IT infrastructure perspective. As one of the keynote panelists at HostingCon explained, “It will allow us to get away from looking at boxes (servers) as containers.”

I know, I know … this picture doesn’t have anything to do with Virtualization, Software as a Service, Grid Computing, or Service Empowerment, but I was going to get in trouble if I didn’t include it.

I was interested in the recent acquisition of Postini by Google for $625m. Congrats to the team from Postini. I know a few of the guys that are out counting their money right now.

People can argue back and forth all day as to whether this was a reasonable valuation or how much of a strategic fit Postini is for Google. I for one was really surprised by the price, until I saw that it was an all-cash deal. All of my economics profs would always tell me there is no difference in how you choose to fund an acquisition, whether it be cash off the balance sheet, or financed through debt or through stock. However, it seems time and time again companies that generate huge cash balances on their balance sheet are eager to go out and buy with the cash they have.

Public companies that amass a large cash position face enormous pressure to spend the cash. All of that cash on the balance sheet is just dead weight from a valuation perspective. The obvious outs are invest in your company, but that leads to dilution of margin/EPS and hits to market cap; issue a dividend, but that means you’re admitting to the market that you aren’t a growth play; buy back stock, but that is useless unless you use a HUGE amount of cash; or go out an acquire with cash. I’ve talked to numerous executives who feel absolutely handcuffed by these forces. It’s even more frustrating to the guys working at the company who want to do something entrepreneurial from the inside. Having worked at public companies, I’ve personally had proposals shot down since executives would rather acquire than invest internally simply because they hated the alternative uses of cash.

Here is the opportunity and why the cards are stacked in the favor of aggressive startups and entrepreneurs. Simply put, startups and smaller companies provide a pressure valve for these cash-rich public companies that are looking for a growth engine for their businesses. It’s why these guys have VP’s of Corp Dev that are always out scouring the market looking for ways to spend money. These guys are often measured on how many deals they get done. All the more reason to take the jump with the next great SaaS company or media or content service.

Anyone who has worked for a company that’s been acquired knows how tough it can be. I’ve been through it a number of times. The old faithful from The Planet and EV1Servers know this as well as anyone. I know we’re all glad to be able to just focus on growing the business…

- Urvish

I live and breathe technology, just like many of our customers. In speaking with my colleagues, they encouraged me to share my thoughts on a few technologies that are important to the Web hosting business.

In particular, clustering is top of mind for me right now. We talk a lot about clustering. So what does it really mean? Clustering involves multiple computers working together so they can be viewed as one. You’ve probably heard of a database cluster or a clustered Web server farm. These are prime examples of taking multiple servers and using clustering to give you high availability or high-performance computing which provides scalability that’s typically achieved by load balancing servers within the cluster.

One thing common with clusters is that the servers are typically setup independently and then joined with the cluster. This means that the operating system and applications are installed, and then configured to work as part of the cluster. For most clustering implementations, a single application instance cannot use the resources of more than one physical machine.

If you want an application to run on three servers, it requires that you install the application on three nodes in a cluster. Then the cluster can be set-up for load balancing the application across the three nodes.

Another critical clustering factor that shouldn’t be overlooked is storage. Clusters typically share a common back-end storage system so that all nodes in the cluster are working with the same data. Whether it’s a SAN with Web application content with all the nodes performing simultaneous reads in a load balancing cluster, or a direct attached storage subsystem that the nodes of a high-availability cluster exclusively access, the common shared storage is an integral part. For example, products may include Oracle Real Application Cluster (RAC), Microsoft Windows Compute Cluster Server, Sun Cluster and RedHat Cluster Suite.

Another hot topic is grid computing, which has many similarities to clusters and is often referred to interchangeably. A grid offers the ability to add or remove resources — like servers — from the grid as needed. This is referred to as “computing on demand” or “cloud computing.”

One distinction is that applications on a grid can typically scale to more than one physical server. Another nice feature of grid computing is that each node can be commodity hardware, so we can leverage the servers we already offer which provides a value to both our customers and to The Planet.

A grid is also well suited for running separate applications in a utility computing environment. Imagine if you had a SaaS application, and it ran on a grid where you subscribed to a minimum set of resources like CPU GHz, storage GBs and network Mb/sec. The grid would dedicate the minimum required resources to your application, and make sure there are enough resources in reserve to meet any bursting or scaling that may be required. It could add more servers to your grid on demand and free them up when they are no longer needed.

So these are the type of technologies that we’re evaluating at The Planet. Stay tuned for more details.

- Bryce