What’s up with Watson?

IBM(s ibm) likes to trot out Watson any time it needs to tout its tech bona fides. Watson proves that IBM “gets” big data, cloud and now mobile. In January the company even launched a new business unit around Watson dedicated $1 billion to it, and put veteran exec Michael Rhodin in charge of it. All in the hopes that Watson will be a $10 billion business by 2023.

Still, it doesn’t look so great that within weeks of announcing the new business unit, Manoj Saxena, who had led the Watson effort previously left IBM for an early-stage venture fund. He will, IBM said, continue to advise the company.

On Friday, The Wall Street Journal  (registration required) pointed to the fact that Saxena departed four months after telling IBMers what a great opportunity it was to work on technology that could cure cancer (Memorial Sloane Kettering Memorial Hospital is a Watson user). You can’t be blamed for asking what changed in those four months.

One problem I’ve been hearing about for a while is that while Watson is impressive technology, it is not really a product that’s easy to sell. IBM’s decision to open up APIs, to offer Watson’s smarts as a service, is one response to that. You make Watson available in more affordable portions, maybe it’ll gain traction.

According to the Journal Saxena had acknowledged that the plan to make Watson a key part of a raft of applications a la iTunes was risky because of that model’s “high fatality rate” — only a tiny percentage of Apple iTunes apps are profitable.

Sources close to IBM have said privately for some time that Watson has not hit internal targets for new business — no doubt one impetus for the new business unit. One said IBM wanted 100 new  “logos” — big-name corporate  wins in IBM parlance for Watson last year and was only able to close a handful.

An IBM source said you have to look at Watson in the context of the overall IT spending environment. “Watson is powerful but has a limited audience and of those, not many can afford the price,” he said. “All the major accounts are bleeding, IBM itself has been cutting expenses to the bone.” (Indeed a wave of layoffs that started in India and Europe started hitting in the U.S. last week.)

I’ve reached out to IBM for comment and will update as this as needed. Update: An IBM spokeswoman referred  to Saxena’s February 19 blog announcing his departure. IBM has “a great partnership with him to advance cognitive computing,” she added.

GreenQloud goes hybrid

The Icelandic cloud provider known for offering an eco-friendly public cloud has gone hybrid, offering a version of its customized CloudStack infrastructure software to run in customer data centers.

Gigaom research analyst Paul Miller is a fan — saying GreenQloud has pushed beyond its original green message to becoming a big open contributor to CloudStack and expanding into Seattle. “They tend to emphasize ease of use more than some of their competitors  and that philosophy carries across to the new QStack product [with its] simple dashboards,” he said.

The goal is to deliver on the whole hybrid promise or owning the load, renting the spike with some of its dashboards that tell users how much carbon or other pollutants your data center is generating (knock wood) nudging customers towards greener providers, he said. Miller has more on GreenQloud’s Qstack here.

Stucture Show Podcast

Sqrrl co-founder Ely Kahn talks about the NSA’s big data strategy (but not enough to get us all subpoenaed.)

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Note: This story was updated at 1:40 p.m. PST March 4 with IBM comment.