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The rise of the enterprise app store

In this podcast we have a company spotlight for you on Interoute and we’ll be hearing their views on the rise of the enterprise app store and the changes within the purchase requirements for enterprise level applications. Joining me is Interoute’s CTO Matthew Finnie to tell us more.

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Matthew starts by giving us a bit of background on Interoute the company and why they have specific views on this market.

We are an infrastructure provider right across Europe and we do everything as we say from the ground to the cloud that means literally everything from our 60,000 kilometers of Lit Fibre right up to fairly sophisticated converge networking cloud computing infrastructure for some of the biggest companies in Europe and across the world so our services extending into 88 countries and we basically focus on communications, computing and connectivity infrastructure for enterprises and for service providers.

Talk us through the transitions and changes in the way that organisations are purchasing applications over the past few years?

I think where we have come from is that people would have bought their computing resources or assets and then license it in some way, everything from the days when you would get your books and books of CD’s and label it up and this kind of thing. We have always had pretty much the same mechanism whereby we want to buy the license for something. But the what has changed with things like the consumer app stores is instead of me taking physical media and having it come through the post or a person delivering it and shoving it into a machine I am now downloading it. This is possible because networks have got quick enough and useful enough as a delivery method but fundamentally we still have the enterprise level, and we still have a model whereby we are going out and licensing it in pretty much the same model as we have for the last 10-15 years. Now though you have got more of a subscription type model but fundamentally we have improved the delivery of the media and this is the pivot point in all of this in terms of how our consumer app store is starting to tip over into the enterprise and all that entails.

It appears to be a case of people wanting the same experience within the purchase of enterprise app’s as they currently have within the consumer market then?

Ten or twenty years ago your enterprise experience, your company experience, your corporate experience led your home experience you would go into the office to upload the video or download the video or do whatever you wanted to do. However, these days it is probably the inverse, people stay at home and feel they have got a far better experience and more agility in how they use their IT environment at home than they would have in the office. There are a ton of reasons behind that security and IT practice being one but fundamentally I think the biggest difference is really the difference between the thing you are downloading it onto and I think that is where the challenge is really for the enterprise app store.

How have the developments in cloud services affected this process?

The rise in cloud if you want to give it that name really means for many people that they can get access to those services which in traditional times would buying a server that you would rack, connect and patch it through to your corporate network for access. It created a model where if people have those kinds of platforms they have far more agility because they can get them as and when they need it. You are getting closer to this environment. If you take this ultimate consumer environment you are out and about and trying to find something and you realize that there is an app that does that thing for you, you can download it and you can use it instantaneously. The enterprise is never going to quite do that immediately because typically you are downloading it, using it and then if you like it only then releasing it to a community. One of the key developments we have seen and one of the big shifts in the way people buy from us is that one of the challenges for the enterprise is that unlike the consumer who has an iPhone or an Android phone or a Windows desktop or an Apple operating system, i.e. 4 or 5 tightly controlled platforms, the enterprise is a far more complex beast. It may have grown organically; it may have grown through acquisition so you have got different bits of infrastructure in different places and not always on the right place. So, one of the things we have seen a lot people doing is using the cloud and we checked network communication and computing as really a way of homogenizing their infrastructure. That gives you a much more level playing field in terms of how your corporate infrastructure can run and therefore it means that the enterprise app store actually starts to make a lot more sense if you have got a consistent layer of infrastructure.

We had a customer the other day who is a VPN customer of ours who needed a firewall, he went onto our cloud store and had a quick look and decided it kind of made sense had a quick live text chat with one of our engineers and then bought it. That was it. In the traditional world that transaction would have been a 2 to 4 week type engagement. You are getting a far more immediate type of interaction but a key part of that is is people are able to standardize their infrastructure.

Has this enabled software vendors to pass on a cost saving to their customers as well?

That is one of the most fascinating things and we see first hand what people are willing to pay for. Most people will be aware that one of things we see with cloud infrastructure / software defined networks is that it kind of breaks apart the components of software technology.

For example, that firewall you used to buy as a box is really a Linux box running some software. Now you strip off the software you can see in the naked daylight the value of that software. On the cloud store we advertise the price that the consumer tells us that they think is the right one which is great. It is interesting to watch what people will pay for and what they won’t pay for and in what they see value and what they won’t see value in. I think the next 2 years are going to be really interesting because if you like for every type of software we have on the cloud store we will have the nearest open source equivalent. The key thing you have right now is that you have far more transparency about it especially at the appliance level. The cost of the software was hidden in the cost of the hardware in the appliance level and if you separate the two out as you do now you will say that the Firewall was for instance, 160 Euros a month and be able to question whether that is good value and the answer is – it depends on the user.

Is there a security risk here in that the way that the software is delivered is opening up an opportunity for malware planters to access a much larger number of organisations than they could have ever have dreamt of with traditional software delivery?

I think the thing about security in the cloud is sort as the same as it ever was really. If you look at how for example we have built our cloud infrastructure we have tied it into the NTLS infrastructure so we use network separation to isolate instances so those instances are matched from the hypervisors through the VLAN and beyond so it is exactly the same security and separation mechanisms you will use in your own private cloud environment. Fundamentally people talk about the cloud at a computing level but you have got to bear in mind that everybody is connecting to a network and all networks (99% of them) for most people will be shared in some way or multitalented to give it the more correct term. I think the normal considerations have to be taken into account just because it has got cloud in front of it does not mean you shouldn’t ask where is my data. Is all the software that sits on your cloud store has it been certified has it been checked do you know where it has come from, this kind of thing. I think that for us we have seen for security that most of the security concerns are answered in exactly the same way as you would answer any question and I think that should be the rule that anyone should apply, the key thing here is if you ask a question like that and you give an answer which I was once given when someone asked where the data was then I would start to worry because if it is in the cloud you want a street address. It is in a data centre somewhere and it is extracted and it is the level of control that you give the user in these sorts of things that is important so whatever the brand whatever the label just apply the same security rigor that you would with any service and you will probably get the right answer.

Have you had to challenge perceptions around the idea that some IT managers may hold that a program on a disk is fundamentally safer than something downloaded from a website or cloud server?

I would have thought (and you can’t speak for all IT managers) that most of them would have been comfortable with receiving patches and updates from software vendors via networks which has been the case for a number of years now. I remember when I had a company and we were working with Microsoft a lot and we would get our update pack through the post in the early to mid 90’s. It was big, there were a lot of CD’s there and most people should be comfortable with receiving software off the likes of Microsoft via for instance. You can’t be completely paranoid but by the same token you should just be sensible. If you trust the brand you are getting it from, be it a brand you know or someone who has got a track record of customers that look like you and smell like you then that is a big part of it. Is it a website you have never been to before? Does it share a generic name or sounds like something slightly knocked up? Then I would probably doubt it myself too. Again it comes back to apply a sort of common sense, if it is a brand you know and trust and also if you can ring someone up and say this didn’t work then you can buy with confidence. That’s another thing, what is your comeback if it doesn’t work and what is your comeback if things don’t work out the way you want them to? It is understanding that and it is reading the SLA that will tell you what they are willing to warrant and what they are not willing to warrant.

Does the way that this delivery method allows IT Mangers to pick and choose certain elements of software they want to pay for actually impact in the way that the applications are actually developed?

Yes because I think you still have a fairly strong element of even thought the delivery mechanism is changing quite rapidly the licensing mechanism is still almost the same shrink-wrapped model you used to have, you buy it and you might have a lease model etc. One of the biggest things we saw when we first started the cloud store was how differently people wanted to use this. One of the key things that this environment gives you is the ability to do is just try things and see if they work and if they do then you buy them and I think that is what changes with software is that people are going to be far more agile in the bits they use so instead of having these big long development programs at the end of which you are only going to get some kind of result. Instead, people are releasing little modules as they go through and I think for a lot of people the way they digest software will be more receptive and we have seen the ones that do well are the ones that have the lowest barrier to entry. They will have utility billing module right down to an hour the minimum commitment might only be a month or something and so people are really able to have complete freedom to try something. What that does is it ultimately reduces and eliminates the pre decision type work that people have traditionally had to go through. I think the software licensing will change and on the back of the change you are also going to see a shift in the way software is developed to be more modular in the way it is released.