I’m involved in writing a Gigaom Research Roadmap on what I call the distributed core. File sync-and-share has rapidly moved from a consumer convenience to the core element of a distributed computing architecture for the enterprise. Basically, we’re in a period of rapid expansion around the notion of a distributed virtual file system, which is backpatching our operating systems.
A seemingly innocuous product like Dropbox, which syncs folders on my laptop hard drive with a mirror of those files in the cloud and on my mobile devices, and then allows me to share them with other people, is actually something much larger. It’s a distributed, social, virtual file system. And that’s the reason that Dropbox has 300 million users. And there are dozens of other companies scrambling for a share of that market, as well as the majors: Apple iCloud, Microsoft OneDrive, and Google Drive are all moving to carve off a slice of this enormous market.
Yesterday, Amazon made a huge splash at a NYC event, announcing Amazon Zocalo (as covered by Gigaom Research), its offering in the enterprise side of the distributed core market. Amazon has built a very solid cloud services business with Amazon Web Services, and now adds Zocalo to those offerings, built on S3 file storage.
I’m glad I have not filed my report, because this will change everything. One thesis of the report is that the market is ready for consolidation, and that actions by the giants — Google, Apple, and Microsoft — are likely to cause that. Well, now there is a new giant in the space, and it’s going to suck a lot of air out of the room.
In the company’s own words,
Amazon Zocalo is a fully managed, secure enterprise storage and sharing service with strong administrative controls and feedback capabilities that improve user productivity. Users can comment on files, send them to others for feedback, and upload new versions without having to resort to emailing multiple versions of their files as attachments. Users can take advantage of these capabilities wherever they are, using the device of their choice, including PCs, Macs, and tablets. Amazon Zocalo offers IT administrators the option of integrating with existing corporate directories, flexible sharing policies, audit logs, and control of the location where data is stored. Customers can get started using Amazon Zocalo with a 30-day free trial providing 200 GB of storage per user for up to 50 users.
Here’s the product features as found in the company announcement:
Amazon Zocalo offers the following benefits to users:
- Easy sharing: Amazon Zocalo lets users share documents, spreadsheets, presentations, webpages, images, PDFs, or text files with others.
- Access from any device: Users can access data stored in Amazon Zocalo and view and leave feedback anywhere, anytime, from the device of their choice, including laptops, iPad, Kindle Fire, and Android tablets. Amazon Zocalo can sync files across devices to ensure files are available anywhere, anytime.
- Simple feedback: Users can request and manage feedback from others, and contributors can highlight any word, sentence, paragraph, or area of a document or file and leave detailed feedback. Amazon Zocalo also notifies contributors and document owners about review activities and approaching deadlines via email.
- Central file hub: Amazon Zocalo provides users with a central location for both the documents and files they are reviewing as well as those they own and are soliciting feedback on. With all these files in one location, reviewers have access to all of the related feedback in a single web view, making reading or contributing comments as simple as a few clicks.
- Available with Amazon WorkSpaces: Amazon WorkSpaces, AWS’s virtual desktop in the cloud service, is integrated withAmazon Zocalo. All Amazon WorkSpaces customers get Amazon Zocalo for free (with up to 50 GB of storage).
Amazon Zocalo offers the following benefits to administrators:
- Security: All data stored in Amazon Zocalo is encrypted in transit and at rest, and administrators can set policies to control users’ sharing behavior, choose the AWS Region where users’ data is stored, and view audit logs to track file and user activity.
- Integration with corporate directory: Amazon Zocalo can integrate with an organization’s existing Active Directory, meaning that end users can continue to use their existing enterprise credentials to access Amazon Zocalo.
- Low cost: Amazon Zocalo is priced at $5 per user per month, including 200 GB of storage. For Amazon WorkSpaces customers,Amazon Zocalo is free up to 50 GB of storage, and $2 per user per month for up to 200 GB of storage. With Amazon Zocalo there is no hardware to purchase and maintain and no software to deploy; administrators simply enable the service for their organization and invite users.
This is a robust enterprise solution, likely to satisfy the desires of IT staff regarding the document storage, syncing, and sharing controls. But Amazon is going farther, creating a competitor to Google Docs as well. Here’s a screenshot of the document commenting capabilities (but no doc editing, at least not yet):
Arik Hesseldahl makes the observation that Dropbox is built on Amazon’s S3 service, and this is not an uncommon situation, since Netflix uses AWS and Amazon is now a competitor with its own streaming service. And he makes the understatement of the day: ‘One way or another, the enterprise file-sharing dance floor is starting to look a little crowded.’
Guess I am going to add another few paragraphs to my report. Something about how very few companies can match Amazon’s ability to scale, or Amazon’s willingness to make very thin margins to make that scaling very, very cost competitive. Those paragraphs may read like a requiem for many of the smaller players jostling for market share in the enterprise distributed core market.
Cisco posted lower-than-expected numbers for the fiscal first quarter yesterday, and gave guidance for the next quarter of revenue falling up to 10%. It appears to be tied to declining sales in emerging markets. Net income dropped to $2 billion, or 37 cents a share, from $2.09 billion, or 39 cents a share.
Digging into the enterprise software side of things, “collaboration” — which includes WebEx, Jabber, and the former Quad enterprise collaboration tool, now renamed WebEx Social — only grew 1% in the period, which is really flat, and is only 8% of the companies revenues.
I don’t think we can expect much innovation coming out of a “collaboration” product that is based firmly on the WebEx brand and now long-in-the-tooth notions of ‘enterprise collaboration’ based on video-conferencing rooms instead of lightweight, real-time chat that is cropping up everywhere (see Real time isn’t what it used to be: It’s really real time, now).
The Data Center line item grew 44% in the same period, which shows the direction the company’s revenue is headed.
Remember that Cisco’s CEO, John Chambers, announced plans in August to cut up to 4,000 jobs — primarily middle managers — to remain lean and quick to move despite rising revenue at that time. A clear warning sign that the company was sensing slowing in the pipeline.
Note: I am putting “collaboration” in scare quotes for two reasons. First, we’ve moved into an era where nearly all work in the business is conducted socially: people share, converse, communicate and cooperate with other people all the time. The term “collaborate” simply means to work together, which is now the norm not the exception. So it’s another adjective, like “social”, where most of the metaphorical power has been drained by overuse.
However, when referring to the category of software that is specifically designed to support working socially I use the term work management, and there are different subcategories based on what sort of activities and information is being supported, like task management, in which the principal information object is tasks, for example.
A second reason for the scare quotes is that make a distinction between cooperative work and collaborative work, as two very different ways of working together, or coworking (see Using “cowork” as an umbrella term for how we work together).
Cross-application file-sharing and -syncing needs security from policies as well as technology. And the tech might come from the OS.
Yammer is pitching an open graph-like platform for integration, and using it on software that doesn’t just come from new parent Microsoft.
Box has done well with integration options. It should start to zero in on the feature-suite approach.
Integrating HootSuite’s social media dashboard into other collaboration and marketing technology is the way to go. Not acting as a communications hub.
Google is talking about how Google+ can integrate existing Google apps to deliver an enterprise collaboration or work media product. Remember Wave? It never caught on partly because it lacked a single killer use case, and Google, without much of a direct sales or support organization to service enterprise customers, couldn’t create one for them. This time Google is taking the approach of “cobble together these things you’re already using,” and offering some simple admin tools to help. I’ve praised the bolt-on approach for Yammer and other work media tools, and yet I think specialists are wise to build suites of social enterprise solutions. Google feels like it might be caught somewhere in the middle.
On its earnings call, Salesforce.com showed 34 percent revenue growth and called marketing its next billion-dollar business. Salesforce has made some big bets on social media marketing technology. The company is well positioned, but it has a lot of work to do.
In a clash of enterprise social collaboration, Salesforce has the bigger announcement, but product doesn’t ship till the second half of 2013. Salesforce says it will be getting into the hosted community business, enabling companies to create private social networks to collaborate with remote employees, customers, and their supply chain. Companies like Jive and Telligent are well ahead of the big guy on that front, even if Saleforce says Chatter has 150,000 paying users. Yammer gets a fairly minor upgrade, with new email integration features and connections to HootSuite and a variety of other services. Salesforce also announced that its Buddy Media acquisition closed. Though that’s a social media marketing play, it has nothing much to do with these other work media or enterprise collaboration tools.