Arbitrage

Everything into the browser

I attended the Google Enterprise CIO Summit at the Google offices in Cambridge yesterday. Dave Girouard, Rajen Sheth and Alex Diacre presented. Couple of interesting takeaways/quotes:

• Google is the worlds 4th largest manufacturer of servers – behind Dell, HP, IBM. They build them to run in their own data centers. It’s the kind of overlooked data point that helps people understand the vast resources Google can/will put behind their Enterprise IT business.

• Google Enterprise is currently profitable as a standalone business.

• Dave Girouard did an excellent job of explaining why continuous innovation is the key to Google’s future in the Enterprise. Right now they are innovating to make email and calendar migrations meet Enterprise requirements – but in the near near future they will be delivering differentiated apps and features and platform capabilities that will drive adoption of Google as a core Enterprise vendor. Today they differentiate primarily on ROI  – and they have a strong story there – but in the not too distant future Google will differentiate on feature/functionality (think of the role Wave can potentially play in changing enterprise communications). This should scare Microsoft.

• The customer stories and case studies show that Google Enterprise is still in an early adopter phase. Lots of patterns and best practices are yet to be sorted out.

• Money quote from a large customer that recently migrated from exchange to Gmail – “dumping Exchange/Outlook was a big step towards getting everything into the browser”.  “Everything into the browser” is a good way of thinking about where cloud computing is taking Enterprise IT and if Enterprise IT is moving to an “everything into the browser” world – that’s a world where Google is, without doubt, one of the winners.

Identity for On Demand and SaaS

The momentum around the migration of enterprise IT architecture to On Demand models is undeniable...and likely to accelerate in the forecasted IT spending climate.We started planting mustard seeds in the SaaS community two years ago - it is nice to look at a snapshot now and see what we've accomplished - 130 SaaS/BPO vendors adopting Ping for internet SSO. 

Bailing Out - the Hoard Trade

My cousin the bond trader emailed today after the bailout bill failed and said the only trade left was to HOARD.

The situation is truly confounding. In principal, I'm against the federal government taking crap assets off the financial services companies (and paying a premium to do it). I am also leery of Republican scare tactics and the way they use doomsday scenarios to push legislation. I am also confident that if there was a reasonable solution to the crisis - it would not be sourced out of the W administration. Add it all up and it leaves me in the same camp with the ... House Republicans - WTF?!?.How did I end up there?

Net/net: Hoarding may not be such a bad call.

I think the underlying dynamic that is coming to bear is the steady increase in income inequality in the US - which has been a persistent trend over the last 30-40 years. Check the Gini Index 1913-2004



People in society at large can sense the inequality gap and so broad political support for a bill like the banking bailout is non-existent.

Another interesting historical  chart to look at is Total Debt to GDP ratio 1920 to Present:

So you can see that as inequality rises - so does total debt i.e. I want to live like Paris Hilton but I don't have the cash so I'll borrow to pay for my day spa/SUV/vacation in Vegas/McMansion etc. etc.. This debtor consumerist posture coincides with low interest rates, pick your payment loans, NINJA loans - the predatory lending all feeds on the rise in inequality and voila massive financial crisis.

If you look at those two charts and extrapolate forward- based on the fact that the former highs in both charts occurred at the start of the Great Depression - you can see hoarding is not a bad call.

Or maybe personally bailing out and moving the family to New Zealand - but then they have big earthquakes there...

Choose Your Own Reality

You know how sometimes when you talk to a person who holds a different political viewpoint from your own, they seem like they are living in a completely different universe of information? Well, it is because they are. Periodically, I'll post a summary of headlines from Huffington Post and Drudge Report side by side to help illustrate. Here is today's version as of 7:13 AM PT:

Drudge OBAMA SCOLDS BIDEN ON AIG FLIP-FLOP:  'JOE SHOULD HAVE WAITED'... BIDEN:  OBAMA AD MOCKING MCCAIN 'TERRIBLE'  GREEN$PAN HAS NEW BOOK OUT MONDAY... Gunman opens fire at school in Finland, 9 dead... Video:  Biden says ad that mocked McCain was 'terrible' ...

Huffington Post MCCAIN LOSES HIS HEAD BAILOUT BATTLE: Senate Banking Committee Grills Bernanke, Paulson On $700 Billion Plan... GOP And Democrats Both Slam Plan As Massive, Poorly Conceived Democrats: Ban Executive "Golden Parachutes"... Stocks Open Higher

Salesforce.com and SAML for SSO

Flew under the radar a bit, but it is now official that Salesforce.com supports SAML for Single Sign On. This is great news for Salesforce.com customers – they now have an open industry standard for implementing SSO. The key benefit of using SAML instead of proprietary SSO is that with SAML the same solution a customer uses for SSO to Salesforce.com can be used with GoogleApps or any of the other hundreds of companies that now support the SAML standard. No more one offs for SSO.

In the bigger picture, the fact that the leading On Demand application has made the move to SAML is a signal that the SaaS/On Demand community is on the path of adopting common models for identity management and security in general. Really good stuff!