More than 25 percent of Yankee Group survey respondents say they expect at least a third of their infrastructure to move to cloud computing in the next 12 months, but company-wide adoption remains low. To uncover what lies ahead for cloud computing in 2010, Yankee Group interviewed executives from 25 cloud computing pioneers—including early cloud service providers, telecom operators, and infrastructure and software vendors. Their unique perspectives and key strategies tout the power of the cloud and offer a view into its impact: Will cloud computing be an evolution or a revolution?

Zeus Kerravala and I were delighted to have three cloud thought leaders join us for today’s webinar:

• Doug Hauger, General Manager, Microsoft Windows Azure
• Raj Nathan, Executive VP and Chief Marketing Officer and Senior VP, Sybase
• Jayshree Ullal, President and CEO, Arista

The discussion was lively and thoughtful–a special thanks to each of them for taking the time do join us. A replay of the webinar is below. We’re also offering a complimentary download of the report that inspired this webinar: “Clouds in 2010: Vendor Optimism Meets Enterprise Realities.” Register as a guest for access.

The webinar runs about an hour: audio (mp3) and slides (pdf).

Yesterday, I participated in an Emerging Issues Forum at the Federal Reserve Board of Governors—they called it “Protecting Consumers in a Mobile Finance World”. Easier said then done. Granted,  the Federal Reserve is trying to focus on the future technological trends impacting consumers, and not just the current issues we face on a daily basis. They are looking for the balance to ensure consumer protection while not stifling innovation—a lofty goal. Let’s hope they are up to the challenge.

While the day was primarily focused on identifying ways to ensure that consumer protection must keep pace with technological change, I wanted to share some interesting data points presented throughout the day.
•    USAA: A strong 14% mobile banking adoption from its 7.4M members which is considerably higher than the largest US banks; $250M deposited through their Remote Deposit Capture application between August 2009 and Jan 1, 2010.
•    E-Bay: $600M processed over the mobile channel in 2009 showing the great opportunity to come from mobile payments
•    Telekom Austria Group: 50% of parking meters are paid in Austria using the mobile channel, 1,700 merchants accept the A1 payments brand run by a consortium of mobile operators
•    Center for Financial Services Innovation: 21M Americans are underbanked according to a 2009 FDIC survey, 64% of underbanked consumers rate location “extremely important” when choosing a financial institution

These statistics highlight the growing presence of mobile banking and payments as well as the opportunity to expand financial services to more segments of the US population.

But the key question of the day was “What should policy makers look for?”

My answer:
Consumers cannot be left unprotected when we are seeing hockey stick growth in mobile banking, and mounting expectations for mobile payments over the next few years. Not only will security and phishing concerns exist, unscrupulous people will try to steal personal information from consumers. All of this points to the need for consumer regulatory protections.

Past experiences in the prepaid card world and the limitations of Reg E and Reg Z have taught policy makers valuable lessons.  In the vain of a great boxer that bobs and weaves, they must be nimble enough to update regulations quickly on both sides of the innovation versus consumer protection equation. Although Washington is not always known for moving quickly, the Federal Reserve should first tackle authentication and security concerns. Regulators should also start by simplifying the state by state licensing requirements, which create difficult environments for start-ups to launch nationwide services and take advantage of economies of scale.

While researching my new book ANYWHERE: How Global Connectivity is Revolutionizing the Way We Do Business, I had the good fortune to speak with over 50 connectivity thought leaders. I’m using my blog to periodically share some of the insight that didn’t fit into the book.

In this excerpt from my interview with Paul Sagan, president and CEO of Akamai Technologies, which provides managed services to power the performance and delivery of rich media online, dynamic transactions and enterprise applications over the Internet, we discuss the path to ubiquitous connectivity, obstacles to its growth, and how connectivity is accelerating human evolution.

Paul Sagan, President & CEO of Akamai Technologies (c) W. Marc Bernsau

How is connectivity changing over the next five to 10 years? What’s happening to the network from where you sit?

This is a consumer answer to your question, but I do believe this change will help power business things, too. We’re starting to see the Internet becoming television, replacing the giant gorilla in the home. Call it the HD Web, if you will. You will be able to get competitive quality, variety and control over your ‘IP television’ (that’s an incomplete term, but I don’t yet know what to call it) better than you get with conventional TV today. At Akamai, we are starting to deliver live TV streams of HD-type quality, using the term “HD” loosely. A majority of viewers are now selecting the higher-quality video streams over the lower-quality ones.

We handled the NCAA March Madness [U.S. college basketball playoffs] on the Web for CBS this year, as we have for some years now. This wasn’t the first year that they had cable-network-size audiences. We served hundreds of thousands of live simultaneous viewers, but for the first time, a majority of those viewers selected video streams of 1 Mbps bandwidth or greater. That’s a stunning milestone. And that’s in the U.S., where the potential audience has very low penetration of FiOS-quality broadband to the home.

You could argue that’s not ‘true’ HD, not Blu-Ray quality, but it’s more than watchable—after two beers, you can’t tell the difference, and maybe that’s always how college basketball is watched. ‘Two-beer HD,’ maybe we should call it.

What that means to me is that the Internet is now a challenge to TV. If you extend broadband growth out three, five or even 10 years, it’s still a pretty short horizon. TV gets fundamentally changed, and from there, so does gaming and all home entertainment. That is a sea change in the economy. All of home entertainment was completely analog until not that long ago! That affects all sorts of businesses.

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Yankee Group, as per usual, had a large contingent of executives, analysts, and support personnel attend Mobile World Congress in Barcelona last week.  Over a delightful tapas meal, a group of us decided that it might be fun and useful to share our thoughts on the best and worst practices we observed from exhibitors at the show and consolidate them into a short list.  I volunteered to consolidate the sagest advice from the greater YG team. 

Below is a simple list of recommendations based on the best (and worst) practices we observed. 

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Because of my current research interests, most of my meetings at MWC 2010 in Barcelona were about mobile broadband and in particular, the crunch that network operators experience as usage soars.

At his press conference, Ericsson’s CEO seemed to breeze by the issue in a “Brave New World” speech (why do these always remind me of films from the 1939 New York World’s Fair?). But it came up in meetings with the rest of his company and with every other vendor I met with from Tier 1 network vendors (Alcatel-Lucent, NSN, Huawei), to OSS vendors (Amdocs, Comverse, Convergys, Telcordia), to mobile backhaul vendors (RAD, Cambridge) and of course with Femtocell vendors (Airvana) and specialists like Allot. It was the “elephant in the living room” in a Telecom TV panel discussion I did on WiFi and it even came up in a discussion with over-the-air TV chip maker Telegent who proposes their solution as a way to off-load streaming TV traffic from the mobile network.

In every meeting the following question either arose naturally out of the discussion or I forced the issue and asked it directly:

Are dongles (mobile broadband modems) or smartphones to blame for the problem?

Hardly surprising that the answers were almost equally balanced between the one and the other i.e. both are to blame. But depending on the country, the principal blame will lie ether with smartphones or with dongles.

In developed markets like North America and Western Europe, the blame lies with smartphones. Sometimes it is bad protocols or bad settings and so sometimes just a software refresh by the device manufacturer gets things under control. But most of the damage is done by apps that constantly poll the network for new information. As the king of the app ecosystem, the Apple gets singled out but the issue isn’t the iPhone per se but the types of applications advanced smartphones like the iPhone encourage users to install.

In emerging markets like Latin America or Eastern Europe or developing Asia Pacific, the issue is dongles. Lack of adequate fixed broadband and heavy marketing by mobile operators mean that 3G wireless connections are increasingly the primary means of accessing the internet in these countries. As I have written elsewhere, that means the devices are stationary instead of in motion, connected for long periods of time instead of just for brief dips into an app or for a quick search and they are often used for heavy video or even peer-to-peer traffic. To state the obvious, this is not the kind of use-case the 3GPP standards bodies had in mind.

The solutions are many but they basically boil down to variations of the following

1. Optimization of device protocols
2. Traffic shaping and prioritization
3. Pricing schemes beyond flat-rate that encourage economic use of mobile broadband
4. Off-loading fixed-use case traffic to fixed networks
5. Waiting for LTE

Of these only “Waiting for LTE” is anything more than a stop-gap, a way to slow down traffic growth and hope that LTE arrives before the seemingly inevitable crash of 3G networks.

Much has been made of Apple’s pervasive industry influence, accomplished without actually participating at the in-person events that make up the annual tech sector calendar. But here at Mobile World Congress in Barcelona this week, Google has been the largest presence without a presence.

“What will Google do next (to us)?” has been the prevailing question in virtually every executive conversation I’ve had. It’s safe to say the industry fears Google’s brand, cash, capabilities, and perhaps most of all, sheer audacity. I suspect if Google announced plans to put a new data center on the moon, the network community would nod sagely and say, “Sure; it was only a matter of time.”

Google CEO Eric Schmidt keynoting the 2010 Mobile World Congress (c) Monty Metzger

Tuesday night, Google CEO Eric Schmidt entered a packed auditorium, nominally to give a conference keynote. What he really did was subject himself to the Spanish Inquisition. He did offer some formal remarks, but following that, with poise a politician would envy, he fielded questions from attendees for close to 45 minutes.

Diplomacy was the order of the hour; he took pains to talk about how honored he was to attend, how Barcelona is now “the place to be” for the computing industry, and how the enormous success of the mobile sector to date is due to the community gathered here this week.

Some highlights:

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Carl Howe beat me to the punch on Microsoft’s Windows Phone 7 announcement, but having just played with a Phone 7 demo device and being briefed by Microsoft on the new OS, let me expand on three of Carl’s original comments:

- WP7S is focused on the consumer. Absolutely. In the words of Michael Chang, Senior Product Manager, “Microsoft in the past built for OEM’s – with this product, Microsoft built for consumers.” Consumers here means actual people, too, not office drones who need only productivity applications. Critics will highlight that WP7S doesn’t offer the most cutting-edge features, but Chang says this misses the point: “We don’t want to build a phone that does everything, but we do want to build phones that help you live.”

- WP7S is differentiated in its offering. Yes, but moreso through its integration with other Microsoft properties than in any unique aspects of the UI or consumer experience. For example, the way WP7S integrates social media is slick, but no more so than what Motorola offers through its MotoBlur streams. But the deep integration with Zune (for music content) and X-Box Live (for gaming) demonstrate how the scope of Microsoft’s businesses can be an a tremendous asset in mobility.

- Microsoft gave up on legacy code that was holding it back. Yes – and this is perhaps the most significant aspect of the 7 Series annoucement. Chang talked about how Microsoft, after some serious soul searching, recognized the need to make “fundamental changes” in mobile, and chose to “blow up” the engineering team and start from scratch. (Chang even used the word “humility” to describe Microsoft’s approach to new product development.) This was no doubt a painful and – considering how fast the industry is moving, and how quickly Apple and Google/Android are gaining device market and mindshare – costly decision, but ultimately should prove to be exactly the right course of action.

Since we’re still months away from seeing an real WP7S device, it’s probably not worth making too much of Microsoft’s new OS. (After all, Samsung also recently announced a new OS – Bada – and they’ve been showing off an actual phone at Mobile World Congress to demonstrate its capabilities.) But in an era of non-stop Google vs Apple media coverage, WP7S is a good reminder that there are more than two horses in the race for the future of mobile computing.

I spent half of the first day of Mobile World Congress attending and moderating for an Alcatel Lucent IMS customer showcase event was attended by the normal IMS cheerleaders – France Telecom/Orange, NTT Docomo, Telefonica, Belgacom, SFR and a new face with Verizon Wireless [VZW].  Alcatel Lucent says IMS is the pots and pans you need in the next generation network kitchen.
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Windows Phone 7 Series home screen

Microsoft announced its new take on its Windows Mobile OS today at Mobile World Congress, christened Windows Phone 7 Series (I’ll abbreviate it WP7S for convenience; see a demo here, Microsoft Silverlight required). Despite my enjoyment of my present Phone, I’m really pleased and excited to see this.

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Today’s NYT has the story: putting a mobile router in school buses to offset the sometimes long commutes kids have. The students can do homework and chat online with teachers while they cover the miles to and from school and sporting events.

Yet another example of the gradual expansion of the Anywhere Network.  It’s a natural hole to fill in the network fabric.

Here’s another one: Eurostar. I was stunned a few months ago when, after settling into my seat and carefully arranging my work things around me, I discovered that the train — a bastion of regular London-Paris commuters — was completely network-free.

Given that Google seems to be inclined to make large gestures to try to stimulate the behavior of others in the marketplace, perhaps its holiday-time free airport Wi-Fi should be followed up by free Eurostar Wi-Fi — perhaps during Roland Garros?

To be sure, the school students may not be using the access for schoolwork only. But the point is this: eventually we will find it incredibly anomalous to be offline. And talk of “going online” will feel just as incredibly dated. All of the things we will want to do while we’re moving around on public transporation — including the things that the providers of that transportation want us to do, like read their safety instructions and absorb advertising for their on-board food and drink — will require the network.