Deep anatomy Cloud era: Cloud Computing's business code

What is cloud computing? Now is not no answer, but too many answers.

Now the answer to "What is cloud computing" is so much that people can't figure out http://www.aliyun.com/zixun/aggregation/14032.html "> What is Cloud computing."

The reason is that people just inductive local phenomenon, just grasp the cloud computing this elephant a part of the cloud as a whole.

Of course, a comprehensive induction, than the local induction is not much better, it makes the cloud computing infinitely complex, into details, still confused what is cloud computing. Like the whole of the elephant cut into countless fragments, yards into a piece of the body, so that people still do not see what is.

Therefore, we need to make a theoretical generalization, the most essential kernel of cloud computing, so that this kernel is not submerged in its phenomenon extension.

Here, I intend to do a core analysis of cloud computing from the very essence of economic theory. So that people who do not understand the technology can also directly grasp its commercial essence.

I think the core feature of cloud computing is centralization and decentralization to grasp resources. From the phenomenon, on the one hand, in the cloud to share the digital resources, on the other hand, in the end to improve the efficiency of distributed computing; its economic implication is that the initial fixed input and marginal input between the Division of labor, through large-scale sharing of the former, safeguarding the latter's customization, overall to achieve the effect

Perhaps the text we use to interpret the kernel is not reduced by the simplicity of the kernel, but at least we can do it around a central center rather than taking cloud computing as a basket and putting anything irrelevant into it.

The kernel of cloud computing from the experience

Before entering the economic theory analysis, we first from the experience, check our proposed cloud computing the simple kernel, whether conforms to the technical sense cloud computing.

Cloud Computing's core can be summed up as "a center, two basic points", a central, is to improve efficiency (that is, pay increase), two basic points, one is to share, and the other is to disperse value-added. If you can say one more word, it is: in the focus of sharing and decentralized value-added, through the interface (such as the API) to join.

A good definition should be concise enough without omission. We can check this definition.

Google CEO Eric. Mr Schmidt argues that cloud computing, unlike traditional pc-based computing, distributes computing and data across a wide range of distributed computers, making computing power and storage highly scalable and facilitating access to the network for Applications and services through a variety of access modes.

This definition takes into account the relationship between centralization and decentralization, especially the characteristics of distributed computing, and the connection method is mentioned. But there is no clear emphasis on the focus. In this respect, Kai-fu Lee has added "let the Internet" as a "cloud" to each Netizen's data center and Computing Centre "this feature." None of them mentioned user value added and on-demand access, although Google has personalized this in actual combat.

Merrill Lynch believes that cloud computing is delivering personal and commercial applications from centralized servers via the Internet. These servers share resources, and through sharing, resources can be used more efficiently.

In this definition, the focus and the sharing are mentioned, and the decentralized applications (individual applications and commercial applications) are also taken into account. But it is not clear that the distributed characteristics of the application, do not mention the value-added of the application, do not explicitly mention the link.

The father of Grid computing Ian Foster that cloud computing is a model of large-scale distributed computing, driven by the economies of scale. In this mode, some abstract, virtualized, dynamically scalable and managed computing power, storage, platforms, and services are pooled into resource pools and paid to external users on demand via the Internet.

This definition is more comprehensive in that it refers to a centralized aspect ("massive") and also to distributed computing, as well as sharing ("virtualization", "resource pooling") and value-added ("on-demand delivery"). In particular, it refers to efficiency ("economies of scale", that is, the increase in scale returns, but ignores the increase in scope returns).

Second, the economics explanation of cloud computing

Looking at cloud computing from an economic rather than a technical point of view, there are two aspects that are different from the traditional economy. One is the increment of compensation, the second is the separation of fixed initial input and marginal input, which reflect the technical characteristics of the new economy different from the old ones.

1, the first major difference, cloud computing presents an increase in returns, not only the increase in scale, but also the scope of compensation increase.

1 The difference between the interpretation of neo-classical interpretation and the new economy: industrial economy and network economy, reflected in cloud computing

The neoclassical economic theory and the new economic growth theory, in a sense, represent the different interpretations of the industrial economy and the network economy to the world.

The efficiency assumption of neo-classical economic theory is that the compensation is decreasing or the remuneration is unchanged; the efficiency assumption of the new economic growth theory is the increment of remuneration. This is the fundamental difference between the two. This difference reveals the biggest difference between the industrial economy and the network economy.

First of all, it needs to be explained that the efficiency point of view, rather than the efficient view, is because the perspective of efficiency does not distinguish between cloud computing and traditional industrialized economic and technological characteristics. We often hear that when people talk about the benefits of cloud computing, they say that cloud computing can reduce costs, improve profitability, and improve efficiency. But that's not the point. Because almost any technology can reduce costs, improve profitability and improve efficiency, it cannot separate cloud computing from traditional industrial technology.

Efficiency is in the market size and scope of the unchanged conditions said. Effectiveness is the rate of change in efficiency, when the efficiency (cost and benefit ratio) in the size or scope of the change in terms of, industrial technology and network technology will present (tangent slope positive and negative signs) the opposite characteristics, such as can be seen in the same efficiency, the difference between the increase in returns and the decline in

There is a particular reason to do so for the economic interpretation of cloud computing. Only by adopting the perspective of efficiency can we reveal the economic effect of the cloud and the end. Because of the increase in remuneration and diminishing returns, to a large extent, it is determined by the relationship between initial fixed input and marginal input. The cloud corresponds to the initial fixed input, and the end corresponds to the marginal input.

The increase in returns is determined by the economic and technological characteristics of the initial fixed input and low marginal input. The economic and technical characteristics of material production in traditional economy are low initial fixed investment and high marginal investment, which leads to the increment of marginal cost and diminishing marginal income. It is hard to use shared infrastructure, platforms, and software to reduce marginal inputs, like cloud computing.

Cloud computing initial fixed investment high, marginal input low, which leads to diminishing marginal cost, marginal income increment. In cloud computing, both infrastructure, platform and software require higher initial fixed inputs. Once built, however, it can be reused over and over again, and each value-added business, with a lower marginal input, can be launched without developing infrastructure, platforms and software from scratch.

This is precisely the difference between neo-classical theory and new economic growth theory. Scholar Yong has described the difference between neo-classical theory and new growth theory: "neo-classical theory assumes that total production function has the same property of scale." The key amendment of new growth theorists to the neoclassical growth model is to consider technology factor A as an endogenous variable of economy, so that the total production function in the new growth model shows the property of increasing scale returns. ”

Now we see the first step in using economics to explain cloud computing: instead of simply saying that cloud computing can reduce costs, improve profitability, and improve efficiency, it can be accurately expressed as a mathematical marginal concept, which translates into "more ... The more ... "the expression, for example, the greater the size, or the more complex the scope, the more the cloud can reduce costs, improve profitability, improve efficiency. The implication is that, in the case of scale and scope variables, if cloud computing is used, efficiency will be reduced from low to high; At the same time, it is also an objective indication of the conditions under which cloud computing--in the small size and scope of our country--is not working, and cannot be blindly adopted.

(Responsible editor: The good of the Legacy)