A New Call To Industrial Growth

First NYC Subway created by Private Sector.

First NYC Subway created by Private Sector.

Continuing my ongoing call for the new industrial players to stand up and own growth, this post will deal with the concrete connection between technology deployment and concrete economic growth. I am differentiating deployment from research. And while I believe research and development is vital, I also believe the speed of the modern business environment requires that research by actively and instantly deployed to garner the maximum effect on global economic growth.

There are several reasons for this distinction. First, the gap between research and application creates a growing gap in productivity gains from research. Second, the nature of modern means of production eliminates the need for the separation as proven by cloud deployment models, rapid manufacturing and the agile methods of modern application deployment.

Instead of public policy simply pouring into funding random acts of research, if that funding could partially target actual deployment of modern forms of digital production the economic impacts would be profound. On top of actual productive technology deployments, see eBay example, environmental improvements could be more easily realized.  PUE gains in datacenters are often relegated to extremely large customers who can afford to acquire the risk of new tech deployments. Imagine what could be possible if multiple energy savings initiatives could hit the field in real projects where energy consumption could be radically reduced AND cost per kilowatt could radically improve data productivity.

And I need to be clear that there is little to no need for Government to get involved in the actual capitalization process.  Cash on the balance sheets of current enterprises could fund the initiatives in a very serious way.  And with zero bureaucratic overhead.  By leveraging expertise in multiple fields, including, of course, my chosen field of datacenter solutions :) , enterprises could indeed be building the infrastructure for a more modern society (and one that is more sustainable as well).

As an example, most people mistakenly believe that Government built the NYC Subway System.  When in fact Industrialists of that time did.  We need folks to stand up and invest in the most efficient deployments of datacenter capacity across the globe.  To ensure that capacity is there to support healthcare, public safety, commerce, entertainment, media, energy exploration and life saving big data analytics now and well into our mutual future.

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The New Industrialists – Datacenters and Rebuilding the Economy

Driving that final spike in the Transcontinental Railroad.

Driving that final spike in the Transcontinental Railroad.

I had a great conversation last week with one of my direct reports and our CEO.  As those of you who know me well, you understand that I am a traditional capitalist.  I understand the depths of industrial risk and expansion that helped build the US economy into a powerhouse.  And I understand the opposite.  What Ayn Rand accurately named “moochers” in Atlas Shrugged.  Those so called industrialists that failed to take on the challenge of building their dreams, on their own dime, assenting to their own risk and rather relying on a system of ties to the public sphere to shield themselves from risk and pass it along to an unknowing public.

In our conversations we discussed some of the great industrialists in history and some of the incredibly gutsy moves they made to build industries.  Whether in literature developing a new steel alloy despite the risks or in reality challenging different modes of electricity distribution or pushing forward into the cloud before anyone said it was wise.

I have in my bones the DNA of a builder.  And I am thrilled to have the ability to tap into those roots once again in my new role at Digital Realty.  But as I explained during the discussions it is much more than that to me.  It is an opportunity to rebuild our economy.  Not just in the US, but the global economy.  In ways reminiscent of the railroad builders of old.  Or those who built the US Interstate system.  Or the Panama canal.  Or buried cable across the oceans.

You see, data is the currency of this century.  But it lays upon a foundation that is not sustainable.  Enterprises that continue to build their own datacenters are burning the capital that their sales teams generate.   While the value of data is now top of mind to every CEO, COO and CFO, that value is being eaten by inefficient deployment of capital to build, operate and maintain the datacenters that support the workload.

There has arisen a new industry that eliminates that waste.  Datacenter providers can manage capital more efficiently, rabidly consolidate their supply chain, invest in new and cutting edge technologies, focus on opex maximizing PUE efficiency and deploy new technologies with speed that mirrors the new time to market requirements globally.

But its more than the elimination of waste.  The creation of multitenant datacenters by companies like ours opens up new construction projects in areas of cities that often lay dormant.  Creating family sustaining, pension building, building trade jobs.  From Sheet Metal to Carpentry, from Bricklayers to Operating Engineers, all will benefit from continued reliance on these companies to build in areas in need of development bringing construction, and then clean datacenter, jobs to the area.

And so there we are.  A grouping of companies sitting at this generations version of the birth of the Overland Route.  Creating a new pathway for the commerce of the day.  An efficient route for data to flow, in high performance datacenters, without waste and overhead holding back hiring in enterprises.  The risk is ours to take in building out this future.

Lets drive that final railroad spike!

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Not Cloud First, Cloud Now: Stand up and Fight for Citizens #gov20 #opengov #abouttime

Not Cloud First, Cloud Now #gov20 #opengov

Not Cloud First, Cloud Now #gov20 #opengov

IDC recently released a study that resulted in interesting coverage from GigaOm.  They found that the folks in government that could benefit most from cloud computing are actual those with the highest degree of resistance – local governments.  States were not far behind.  This release happens at the same time that the Federal Government is staring down a fiscal cliff that promises to reinstitute a deep recession that will damage our economy for years to come but also will result in significant service shortages throughout the country for those who can afford such delinquency the least.

I have been preaching about the cloud for years.  And for multiple vendors.  As well as inside government as a Chief Information Officer.  I have met all the resistance from security to privacy to job elimination to control.  The excuses have gone on and on for years.  But this past few years, the game has become very real.  And not just within IT.  The pain is being felt, in terms of budget pressures, at every level and layer of government.  The missions that folks were trying to protect are now simply under fatal assault as they moved too slowly to adopt more efficient technology to accomplish their goals.  The time is certainly upon us, to demand an end to governments paying for hardened silos, underutilized infrastructure, poor security, massive data center expenses and an operational budget that is embarrassing.

The data is screaming for us to do this now.  The report above from GigaOm is joined by the now infamous Forbes article showing $12B that could be saved in the Federal Government (enough to fund NASA), or Winvale’s piece showing that DoD could save $37B with the cloud, TechAmerica showing that all government could save between 25% and 50 %.  Or the Brookings Institute showing that the savings could range from 37% to 99%.

At the same time all layers of government are facing huge budget shortfalls.  In their current accounts alone, States are seeing budget shortfalls across the country from .8% in Virginia ($145M) to nevada with a 36.2% shortfall ($1.2B).  On a pure dollar basis, California is topping the bunch with over $15B in gap to makeup.

According to Deltek, the State of Florida will spend nearly $900M on Information technology in FY13 and is facing a budget shortfall of over $1B.  On the conservative side, if they could save 50% they would nearly cut the shortfall in half.  What could they save?

The proposed and actual budget cuts were deep.  Here are some examples.  $300M was cut from the University System.  The Florida Clerks of Courts were cut by $31M and the eligibility age for state sponsored tuition for foster care students was proposed to be lowered to save $11M.  Budget cuts have also caused a $4M shortfall to cover Floridas Infectious Disease Control Efforts (while TB was on the rise).

Those are just SOME of the examples in one state.  And remember the potential savings would top $450M! The suffering that is being felt, across government, and more importantly by citizens not being served, is now a much deeper one.  The objections that have masked other intentions simply cannot stand.  The protection of favorite vendors that create and sustain this unfair budget situation must end.  Those advocating for a move to the cloud need to embrace the comparison of objections to these cuts in citizen service, environmental protections, educational attainment and economic growth.

All levels of government have a set of secure tools, across multiple vendors, providing incredible potential, huge flexipbility and the budget savings that budget directors need.  And that citizens are dying to have.

It can no longer be just cloud first, it must be cloud now!

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Why the NY Times is wrong on #datacenters, especially in consideration of #gov20

NY Times Article on Datacenters Misses Huge Points - #gov20

NY Times Article on Datacenters Misses Huge Points – #gov20

It almost seems like piling on to attack the NY Times assessment of datacenters and their impact on society at this point.  When Forbes, InformationWeek, GigaOM, Wired and tons of other publications point out the weakness in the Times article, why add fuel to the fire?  Because they are missing an enormous piece.

You see data taken as a point in time always misses a vitally important context, movement.  If you take a point in time of the National Debt during the Clinton Administration, the number in abstract seemed shocking, but the trend was positive back then, eliminating deficits and targeting debt reduction.  If you looked at crime statistics in NYC near the start of the Giuliani era, the raw numbers looked bad, but the trend was positive after implementation of the “broken windows” policy.  Similarly, looking at datacenter energy consumption without context (not even going into the 2006-era data that was used), is not only a bad idea, but it paints the industry in such a light that true progress, continued progress, is threatened by the very piece that was penned presumably to move this industry forward.

I will not point out the logical fallacies, old data, cherry picked information to provide the allure of depth issues with the Times piece, but I will point to a vitally important piece that is not covered as deeply as needed and provide a bit of color from my career which can provide some insight into the progress the data center industry has made and how ill-timed and wrong-minded the Times piece is.

The Industry Cares about PUE (and you)

I was actually a bit shocked that the treatment of energy use in data centers seemed to completely avoid the industry’s use of standard measures to help improve utilization.  The industry itself, without help from the NY Times or local, regional or national governments got together to develop metrics that would allow them to better control data center power consumption.  They developed the PUE (Power Usage Effectiveness) and DCiE (Data Center infrastructure Efficiency) its reciprocal.  I want to stress that reliance on these measures is not sufficient to cover advances in energy utilization.  As with all metrics, this should be utilized as a way to engage in a conversation of efficiency not a simple target to be accomplished.

That being said, the industry’s embrace of PUE is an indicator of something very powerful.  And that is competitive advantage.  The data center industry has embraced the outcomes of decreased PUE, and more important holistic energy use control, as a competitive differentiator inside a highly competitive marketplace.  There is nothing more powerful in society than a highly competitive marketplace, targeting a measurable output, to put powerful pressure on that metric moving forward.  It is one thing for an industry to try to avoid bad press, negative consumer sentiment or regulation.  But for those of us who have worked in these environments, there is nothing like a smart, agile competitor working to put you out of business to motivate your company to provide better energy utilization across the board.  Bottom, and top, line control is vitally tied to decreased PUE in this industry as other competitive advantages are sometimes more difficult to land in a customer.  Therefore, over the past few years, this industry all by itself has been motivated not simply out of benevolence  but out of self preservation and competition to address the problems discussed in the Times articles.

And how have they done?  Overwhelmingly well.  Over at DataCenter Knowledge you can read about incredible advances in PUE ratings that were also coupled with build-out costs that were MORE efficient than previous efforts.  I know that the scuttle can be about folks misrepresenting the metric and greenwashing things, but understand that this effort lies within an industry that is self motivated by competitive advantage to provide its customers with real, reliable and true data on energy use.  And data that is easily proven once the data centers are commissioned and complete.  The market will resolve to the most efficient use regardless of pressure from the press.

And unlike reporters, I speak from direct knowledge.  As CIO for the State of Wisconsin I worked to authorize and build an enterprise class, Tier III data center for our state government.  I was subject to PUE claims from all types of vendors.  I saw it from our design/build firms, our PDU vendors, arguments from competing hardware vendors, and conversations with our utilities.  We did not build this in a right-leaning anti-green location.  We built it iin Madison, Wisconsin.  Arguably one of the greenest cities in North America.  And competition allowed us to select for energy conservation and to position ourselves better than we were before.

The Largest Movement is to Come (Government)

Which leads me to my final point.  Since working for Governor Doyle as his CIO, I have worked for a few places with an incredible impact on Datacenters, one of which was the center of the second Times article.  I was lucky enough to have worked for Microsoft as their GM for Worldwide Government, and currently work as SVP in Salesforce.com’s Public Sector group.  I have seen firsthand how the bifurcated data center market cares directly about energy usage and despite the challenges hurled at each in the Times article, I need to testify in defense of the customer side of data center practice.

I worked globally to push utilization of the public cloud at both companies.  I was, and continue to be, impressed at how seriously each takes PUE and more advanced metrics in terms of energy use.  Both companies press hard on their data center providers, both internal and external, to control energy utilization.  First as an effort to control costs, but more importantly, as outlined above, as a competitive differentiator.  I was part of multiple efforts to push for better PUE in order to leverage the data in an effort to more effectively move the market from internal on-premise data utilization to cloud based usage (including working directly with Microsoft’s first Chief Environmental Architect).  A trend that allows for incredible scale and more pronounced positive effect on PUE than any other shift.  As client companies decommission their internal data centers and push them to optimized and optimizing cloud based data centers, PUE is dramatically reduced across the entire data center universe.  And it is pushed by competition, not external pressure.  The more these efforts are embraced, and the benefits of multi-tenant cloud services are substituted, the more you will see all of us utilize data more efficiently.  Especially when you consider the rising number of cloud based startups that are able to take advantage of their larger predecessors like Salesforce that have made cleaner, lower-PUE data centers available due to their anchoring effect on the market.

You see, the Times data was point data.  Seemingly shocking.  But did not take into account where IT load was TAKEN from.  From inefficient “data centers” like the Facebook closet referenced in the first article.  From unvirtualized environments stacking up 20% utilization rates.  From siloed departments within one company being leveraged into an enterprise class data center to serve the global efforts of that same comapny.  You see, the movement has been away from those inefficient structures into highly efficient, and competitive, structures that place incredible downward pressure on things like PUE, and even better holistic measures, moving forward.

And the huge risk of demonizing the data center community right now, is the big domino has yet to fall completely.  The government space worldwide accounts for an unprecedented amount of compute capacity and data storage.  I know, I managed it.  If the efforts of this brave community are set out as demons, the pressure will resolve and advancement stalled at the worst possible time.  As the governments of the world currently stand ready to make an unprecedented shift to cloud computing, now we must highlight the good work, reward those pushing harder and make the case that the governments of the world need to shift their compute methodology to take advantage of not just the incredible costs savings evident in cloud computing and consolidated data centers, but to also embrace a much more positive effect on the environment as we start to shift more fully into a data consumer based society.

My friends in the Central Governments and Local and Regional Governments of the world often talk about their efforts as anchor tenants in the future.  They have scale unheard of and they have the possibility of pushing further an industry that has done incredible things in five short years to improved upon energy efficiency in data centers across the globe.  I hope that the onslaught of press coverage unearthing the challenges to the Times article continue to embolden the data center industry to continue its pursuit of energy efficiency with the competitive advantage argument propelling them forward despite the efforts to introduce unneeded external pressure upon them.

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The Importance of Girls in a New War to end Poverty – #gov20

Girls are the Answer

Girls are the Answer

I often start my speeches, in every corner of the globe, with a video from The Girl Effect.  My wife and two daughters know exactly why I care so much about the topic.  And my daughter, now 13, has given me the best gift I could have asked for.

She has a project at school that will be a year long.  She can tackle any subject.  It needs to be community focused, but little guidance after that.  She came to Mom asking if she could focus on something like “The Girl Effect”.  When Mom told me, I brimmed with pride.

Parents everywhere wonder if they are doing the right thing, if they are raising kids to be active parts of their world, whether they introduced technology too soon, whether they restricted access to hard, whether they taught enough.  Whether they developed strong and yet empathetic citizens.  And wondering when they would find out.  For us, it is apparently at 13.

Our conversations so far have been around the economic impact of addressing young girls as a target would have.  And I am proud that her focus is dual – US and Global.  She understands the issues are different, but the effects are profound.  That by fixing the irrational problems surrounding girls in lesser developed countries, the out comes are stunning.  According to USAID, “by empowering women farmers with the same access to land, new technologies, and capital as men, we can increase crop yields by as much as 30 percent and feed an additional 150 million people”.   And according to the Girl Effect,  “An extra year of primary school boosts girls’ eventual wages by 10 to 20 percent. An extra year of secondary school: 15 to 25 percent.”  And, “When women and girls earn income, they reinvest 90 percent of it into their families, as compared to only 30 to 40 percent for a man.”

And while she will have one eye on the globe, she will have her feet firmly planted in the US.  That girls in this country suffer from similarly stifling effects of poverty.  That unlocking a solution for them in cities around this proud nation has a disproportionate effect on the health and wealth of all of us.  That by securing strength among girls in Chicago, Seattle, Milwaukee, New York and elsewhere will have a positive and unstoppable effect on girls in rural america and onward.  And that our strength here will be multiplied to her sisters overseas, tightening the circle and creating a tide to rise all boats.

But my favorite part of my daughter’s journey is the understanding that, in the West, women have only recently become enfranchised and that, now, more than ever, they have a responsibility to solidify the ladder they used to climb up to enable the girl effect worldwide.  So, while my daughter is privileged, she will start the cycle in our city, in her school.  At 13, she will shoulder a very tiny fraction of the load carried by her counterparts overseas.  She will use the gifts she has been given, to charm the socks off of everyone around her, to demand that we not simply state that we care about our girls, but that we will FIGHT to enable them across the globe.

Thank you Madison.

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Technology Innovation in Government must be Non-Partisan – #gov20 #opengov

Picaso unveiled at Chicago Convention Center, first project of Chicago Building Commission.  Imagine GO Bonds for technology.

Picaso unveiled at Chicago Convention Center, first project of Chicago Building Commission. Imagine GO Bonds for technology.

As a Democrat I certainly love that my party has included technology in the public sector as part of the solution to the ills that face our civics.  It is vital that we leverage technology to make government more effective and more efficient.  Also vital, is the use of technology to engage and embrace our citizens as an integral part of the policy conversations that will build the next American Century.  But, as a citizen that cares about statecraft, I need to highlight that we must strip political advantage from technology in the public sector.  It is simply too important for us to make political advantage from technology deployment.

We are not without models where this has worked.  Building programs in most states and local governments have turned to building commissions that used to be based upon bi-partison makeup, citizen and industry participation, radical openness and an understanding that the infrastructure we need is too important to go through the booms and busts of political transitions.  When we deal with items this way we get sustained building programs that span administrations and build infrastructure that both public transportation and commerce can share.  We must do the same with technology.

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Login.Berlin puts pressure on US to kick off innovative cities program – #gov20 #opengov

login.berlin is set to challenge the London version of the same

login.berlin is set to challenge the London version of the same

The ongoing war (OK, skirmish) between London and Berlin on which city will be the tech hub of Europe has been rekindled due to the Government’s investment in the city as a new digital hub.  It is great to see competitive juices up among Europe’s great cities to help drag them out of economic crisis.  The focus on technology, supported by government spending to attract and develop jobs, is right on.

The US has had great focus on economic development over the past few years and we have seen creative organizations and some incredible success stories (See Michigans efforts and successes with MEDC and their public scorecard so folks can see their success).  But it would be great for cities in the US to kickoff a competition to help drive urban oriented tech investment and startup support.  Sure San Francisco is a mecca, but there are cities across the US who have invested in broadband, in tech ed, in favorable tax treatments and research clusters.

Lets unleash our competitive spirit to beat out Berlin and London.

 

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