Battle of Clouds – Industry Report: Apple creates a new niche with iPad; Google and Amazon might lose big!


Actually this is what that article is saying rather subtly. Here’s the deal and this is what I have said again and again when I spoke/speak of the “new middle” when it comes to the cloud computing wave.

Pre-Cloud Era: Dekstop Age, Windows and the Old Economic Model (few super rich and many poor)

Microsoft, first jilted by super-egotistical IBM in the 80s, went to define its new space, The Desktop! It created the Microsoft and boom! The market was created. Many companies started erupting and developing software for windows. this led to crazy revolution and I remember vividly how folks were crazy getting MSFT certificates. Hardware companies where shipping desktop PCs like mad and there was a massive overpopulation of PCs and Servers.

This market first was freeing the employees from the clutches of the mainframe guys and giving them power in their own hands. Something we call distributed computing. So as some freedom came a lot o things opened up, and most importantly the wallets opened and as more and more hardware and software came into market, countries like Taiwan, China became richer, software houses like Microsoft minted like mad and hardware firms like Intel, Dell, etc went super rich.

Apple was suffering in that decade. Dell’s CEO also told Apple to close its shop and give the money back to its shareholders. Gosh, what a waste would that have been. Good thing is Steve Jobs was rising. He didn’t fall in love with all the font-fetish and design to just let it go. Apple got Steve Jobs in and world was about to change.

Virtualization enters to kill the server market

While x86 market was evolving and booming, there was small firm rising in the distance, a firm we call VMware; a firm whose CEO, Diane Greene was also Steve Jobs favorite. Steve liked her arrogance, because he knew when he saw the kamikaze look in the eyes of the folks who knew that they could change the world.

Anyways before folks realized that VMware was going to be a killer firm, servers and desktops sold like mad. firms like Citrix still made money and did their part of the work in the Server Based computing really good. Server Virtualization was still a non-existent market, pretty much like iPad’s soon to be exploding ecosystem. This non-existant market creator was soon gobbled up by EMC as some engineer whispered in EMC’s CEO, Joe Tucci’s ears to buy it quick.

IBM as usual was playing the “yea we love you”, the same dance they did with Sun till Larry decided to whoop up Sun. Time is wasting. Diane had to make a tough decision of her life as IBM VP’s were mad as to why she decided to sell it. Anyways compnay was sold and as you know VMware is driving every single bit of the “server” part of the Cloud Computing eco-system back to the data center, remote-, co-lo or internal.

Desktop – The Old, ailing and the dying middle

So we now had the old-middle, meaning the desktop and the now-weary user, who soon found out that the freedom of a PC with the ever increasing icons on the screen was a slow and frustrating process. The fun was gone and work was getting boring. There were all kind of attempts to revive the new middles, even by Apple, but all fell flat as the main pre-requisite, the bandwidht and UIs were all way too ugly. Or lets say the time of the new device hadn’t come. Folks were still tied down to their workplace and iPod was a fun thing. Texting and typing got a bit easier with iPhone but things were not really fixed.

Laptops were there but they too would very well be replaced by something really different. Something sexy and something more cool. Steve Jobs started to believe what he never thought would work. Laptops too were over-extended desktop. I know because I change every laptop into a desktop that crunches data. So laptops really didn’t fit in that well. They were a lot better than the desktops. To have a desktop was to be a has-been, to have a laptop better but no one realized that the time had come to wash out the old-middle and to create the new middle. The middle between a smartphone and a laptop. Something for a uber-mobile dude or dudette. Someone like you and me.

iPad: Beginning of the new middle and new economic model (very few super rich and many many rich developers)

This new middle will erode the existing middle which Microsoft used to its advantage to become a multi-billion dollar company with a huge market capital exceeding $300 Billion dollars. This made guys like Bill Gates, Paul Allen and many others who hung close to MSFT juggurnaut multi-billionaires as you read above.

Steve Jobs has the world in his pocket now. Called a national treasure he has everything going to make Apple the mother-of-all companies in the Cloud space as we move into the next era. Just after the release of iPad, he had some scathing remarks for Google and Adobe as he emphasizes that HTML5 will be the next wave and Google should get more serious about their business than just hanging on to the silly mantra he things is “full of crap“.

Funny thing to note is this: Developers went crazy when Microsoft and its windows platform allowed them to develop all kinds of stuff on its platform. iPad could be the next mobile platform that will carry productivity suite and entertainment , all hand in hand. It will truly end up becoming the social networking gear that will drive businesses for social networking and eventually help corporate to embrace social networking that they resist so vehemently.

But more important is this: iPad, just like iPhone is about to make developers around the world get rich. This is by doling out 70% of loot that Apple can share with them. This is very hard to argue against. This will create a new economic model that will take the money from the hands of the few and create a massive market for developers who will work in teams across the planet to provide super intelligent apps for the Apple Ecosystem.

In Closing

With iPad, Apple just decided to kill the evolving Laptop and mobile computer market. Also it will legitimize the ailing publishing industry. It iwll make alliances as it moves to make Bing its new browsing platform. The new middle will be a moving target and thus will require a mobile device that is multi-functional and not necessarily multi-tasking. The other end of the Cloud will be a data center. The desktop market will soon diminish. Laptops will be around and even those ugly netbooks will be around. Apple’s Data Center build-out confirms the fact that it will soon be ready for the Cloud Computing market. We have also done a Brighttalk Cloud Computing talk where Apple was the winner. Check it out on Cloud Computing FPI (Float Point Index) webcast to learn more why Apple, Google and Amazon will be the three fighters in the Cloud Computing race in 2010-2020 era.

Microsoft’s Cloudware too will find its way to the iPad. This all will leave Google in the cold. It has nothing to do with the fact that Steve hates Eric Scmidt’s guts, its simply Steve being the guy he is and running Apple as he should. He knew it back in the 70s what he wanted Apple to be. Right now he can see where Apple possibly is by 2020, 2030. Only if more CEOs could convert that kind if vision into products.

Disclaimer: Also read our new sections Stock Markets to explore and run forecasts on where they will be in the coming years. More paid and free reports wil be published. Most of our reports will also end up on the iPad you are intending to buy.




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