Kick Off:
A major enterprise software company CEO said this in 2008: “The interesting thing about cloud computing is that we’ve redefined cloud computing to include everything that we already do. I can’t think of anything that isn’t cloud computing with all of these announcements. The computer industry is the only industry that is more fashion-driven than women’s fashion. Maybe I’m an idiot, but I have no idea what anyone is talking about. What is it? It’s complete gibberish. It’s insane. When is this idiocy going to stop?”
That was Larry Ellison, CEO of Oracle, in 2008. Fast-forward eight years and Oracle bought NetSuite this week, a company that has cloud computing throughout its DNA. This signals the way cloud-computing is remaking enterprises top to bottom.
Of course, these days it’s not just about putting data in the cloud, it’s about using it in a smart way once it’s there. Even sophisticated companies can take a while to really understand how to use the cloud (apparently it took Oracle years!). I see a lot of companies letting their in-house infrastructure team lead the effort to move to the cloud. This doesn’t produce the best results, however, because the cloud is fundamentally different than that super-expensive datacenter you’ve been paying for: it’s agile and self-service. The whole point is to let your data-scientists and analysts get access to computing power as soon as they need it. So if you’re moving to the cloud, I strongly suggest empowering your data scientists to run their own access to it. I’ve seen several companies through this and happy to talk you through it if your firm is making the leap.
In the News:
You hear a lot about people jurisdiction-hunting for tax havens and places that will let them set up secretive shell companies. Well the same thing is happening in a way with data storage. Companies like Microsoft have been in court arguing that information they are storing is out of reach of the U.S. government, based on where it is stored. Microsoft recently convinced a US court that data it has stored in Ireland is out of U.S. jurisdiction. Whether this ruling is good or bad for privacy remains a hot debate in the industry, with a prominent privacy advocate saying this week that the ruling creates data borders that could be bad.
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The data integration company Talend IPO’d this week. There are other publicly-traded data companies, like Teradata. This shows the maturation of this part of the tech industry out of strictly start-up form. Teradata also made news with an acquisition of a UK data company.
In Industry:
For years, people in finance have been buzzing about the possibility of using data from around the web for a sort of sentiment analysis that will lead to good stock picks. One company, Kavout, is now merging that sort of information with traditional fundamental datapoints in an algorithm it says leads to better outputs.
Interestingly, Kavout says it’s starting to use “deep learning” to find new trading strategies. I hear this idea coming up more and more, and I’m curious to see how it plays out. I’ll admit I’m a little skeptical – deep learning has made huge strides in voice and image recognition, but the technique requires a huge amount of data to be made to work. As one researcher argues here, if we look at how much data is used in other successful uses of deep learning and translated that into stocks, it would be the equivalent of hundreds of thousands of years of data (which we obviously don’t have).
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Amazon keeps knocking it out of the park on its earnings, and a lot of the reason is its cloud-computing platform, where scores of companies like mine store their data. But the Amazon’s Prime program is also adding substantially to its earnings and the FT said this week that its use of customer data in Prime is a big part of its success.
Quirky Corner:
Most people try to be fairly open-minded in tech, but still there are some taboo questions. Like sex robots. MIT Technology Review has a full list.
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Apple announced on Wednesday that it has sold 1 billion iPhones. How does that compare to the number of Playstations, Harry Potter books and “Thriller” albums sold? Interesting compilation of best sellers across a variety of categories here.
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Ray Kurzweil, my favorite font of crazy futurist predictions, gave a keynote speech at a Seattle mobile technology conference where he argued that we are currently in by far the best time in human history. His point: we have unprecedented access to data about what’s going on in the world than we ever have before. As our access to information about bad events increases, our perception is that things are getting worse, even though things are actually improving. Personally, I think it’s the job of the data industry to help us move beyond sensationalism and really understand what the mass of data is telling us.
Braxton McKee is the technical lead and founder of Ufora, a software company that has built an adaptively distributed, implicitly parallel runtime. Before founding Ufora with backing from Two Sigma Ventures and others, Braxton led the ten-person MBS/ABS Credit Modeling team at Ellington Management Group, a multi-billion dollar mortgage hedge fund. He holds a BS (Mathematics), MS (Mathematics), and M.B.A. from Yale University.
