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Cloud round up; Facebook waves chequebook; Patents; & China Mobile’s M2M - Telco 2.0 News Review

[Ed: We’re working on the final edits of the San Francisco brainstorm analysis and will be sharing some of the insights and new ideas over the next few weeks and more at the EMEA Executive Brainstorm, 12-13 June 2012 in London, where we’ll build on the momentum with a great agenda in a smart new venue. Make sure you sign up while you can, SF was packed and London is heading the same way fast - please email contact@stlpartners.com for more.]

HP is getting closer and closer to a massive public cloud deployment, and here’s a detailed story on the technology. Interestingly, it’ll be the first prime-time rollout of OpenStack, the effort to create a standard API layer for big cloud systems. Even more interestingly, starting on the 10th of May, Akamai CDN features are being built in to the service, as are HP’s clones of Amazon’s Elastic Block and Relational Database Services.

Meanwhile, Citrix has pulled out of OpenStack and started its own project, CloudStack, which basically open-sources the technology Citrix bought with the inevitably-named Cloud.com a few months ago. The big difference - apart from the usual collaboration project ego wars - is that CloudStack is intended to implement the same APIs that Amazon uses. (However, API-compatibility with Amazon is also a goal of OpenStack, so expect more arguing and trash-talking and a lot of non-standard standards.)

Barb Darrow at GigaOM reckons one of the conclusions from this is that the standards war is over, and everyone’s going to converge on AWS. Ovum provides some more evidence of this, looking at the deal between Amazon and Eucalyptus to license the Amazon APIs. The interesting thing here is that Eucalyptus is an on-premise solution, so you can have AWS compatibility with machines that live in your own basement.

Dan Woods at Forbes argues that, as AWS is the de facto standard and Amazon has evidently decided to accept that other, rival clouds and on-premises systems will implement it, it’s time that Amazon opened up the development process to customers and third-party AWS API implementers.

The reality driving all this is enormous scale, as AWS S3 came within touching distance of 1 trillion objects in storage this quarter. We’d use this as Chart of the Week, but as the comments point out, the equally spaced bars represent unequally spaced data points (although the effect actually understates the growth).

Microsoft is getting in the cloud in a serious way, and this week they announced another new data centre. The really telling development, though, was that the Linux Foundation estimated that Microsoft is now the 17th biggest contributor of code to Linux. Once they called it a cancer and tried to sue everyone involved, now they check in patches - quite possibly because the Microsoft Azure cloud might contain more of it than we might think.

Another huge data centre for Prineville, Oregon. Photos of Apple’s iDatacentre.

Of course, a major use case for all this stuff is pushing video at the Internet’s eyeballs, and then crunching all the resulting metadata to work out who gets paid, what gets recommended, etc. High Scalability talks to one of the world’s biggest porn sites about how they manage, and Extreme Tech has some more - the numbers are hilariously enormous whether you find the networking or the data-crunching more interesting. On the telecoms side of things, YouPorn has to push 800Gbps of traffic in the peak, while the database team has to deal with logs that accumulate at a rate of 15GB per hour. And they’re business-critical, because the allocation of revenue depends on analysing the page-views, clicks, referrers, etc.

Whatever your video problem, you may be relieved to note this Toshiba product, a server that can stream video from a SSD out to the network in hardware without touching the CPU.

At the same time as generic IT hardware has been infiltrating the network, networking vendors have been trying to pull more general-purpose computing tasks into networking equipment, usually on the principle that if you can do it in hardware you can do it faster. That’s a case in point. But at the same time, the emerging field of software-defined networking is trying to resolve the contradiction and make the network elements as programmable as if they were just another computer. Google is the latest to go for it, and Urs Hölzle, author of The Data Centre as a Computer, is interviewed.

One company that combines cloud and video is of course Netflix, and here’s a great blog post on their recommendations system.

Instagram Engineering is a fascinating blog about running a huge photo-sharing website in the cloud…who are we fooling? Of course you want to hear about the Facebook deal. So here goes. Facebook took out Instagram this morning for One. Billion. Dollars, in “cash and shares”, almost certainly mostly Facebook shares worth whatever they’re going to be worth one day. If Facebook’s business model is a tad hazy, it is as nothing to Instagram’s, but this hasn’t stopped an epic bout of Silly Valley hype.

One person who is no doubt satisfied is Instagram’s CEO, who stands to walk away with $700m personally. Here’s a take from an actual photographer, who raises the question of why, if Facebook really wanted a photo site, they didn’t buy Flickr. Not only is it the original and best, like Kellogg’s Corn Flakes, it’s got actual paying users.

AllThingsD points out that Instagram was criticised for leaking too much location information, and therefore they’ll fit right in…we paraphrase. ReadWriteWeb thinks it’s a mistake and Facebook ought to build a mobile OS. Because Android is such a cash cow.

Andrew Ross Sorkin at Dealbook warns against rich men spending other people’s money on toys, which seems apposite. The LA Times has a look at what ex-Facebookers are spending their shares on (mostly, more startups). And here’s a deep look at Facebook’s software deployment process.

A genuinely useful photo app. And here’s the Chart of the Week, asking if the Facebook empire will eventually go the way of Rome: unfortunately it’s not realistically going to fit in our blog!

Here’s a story that combines a look back into the history of the Web with a concern that’s right up to date. Microsoft has bought $1.1bn worth of patents from none other than AOL. AOL shares rose 45% on the news.

Yahoo! is also trying to extract value from its pile of old patents. In retaliation for their suit, Facebook is countersuing. More than one of these patents actually predates Facebook as a company.

Meanwhile, the European Commission stepped into the FRAND wars, after both Apple and Microsoft reported Motorola Mobility (i.e. Google) to the commission over their treatment of patent disputes. They’re not happy about Motoogle bringing injunctions over whole products where they have undertaken to be fair, reasonable, and nondiscriminatory in the past. Of course, Apple has been quite happy to go after whole Samsung product lines in the past, although that referred to form-factor design rather than technology.

And even more apps move out of Google Maps. This time it’s the Wikipedia iOS app. Interesting detail: Microsoft is a key funder of the Open Street Map Foundation.

Finally, meet the one-line software patent, which expired this week after protecting Mitsubishi’s investment in the following statement for the last 22 years:

if (s->a < lsz) { s->c += s->a; s->a = lsz; }

Explanations at the link (it’s a critical part of a fax standard).

In the smartphone world, HTC saw its Q1 profits plunge 70%, on revenues down 35%, as the commoditisation they helped to launch came home to roost. They’re within £95m of sinking below Asymco Horace’s event horizon (he argues that smartphone vendors that make a loss never recover and eventually exit). We will see how the Tegra 3-powered phones from this year’s MWC do…also, Sony was having a ‘mare this week although they blame the TV business for the £4bn loss.

Samsung, the big winner next to Apple in the smartphone game has apparently been agonising about whether the Galaxy S III should have a hardware home button. Elsewhere, pick up your Apple iPhone 5 rumours. A more technical version is of course at Ars Technica.

Horace confirms that what we probably knew - iPhone users are addicted, and over half of US sales are repeat customers. Will Apple give MacBooks surround sound?

Ars reviews the Nokia 900 and concludes that you shouldn’t buy one, due to AT&T and Microsoft support issues. There’s a hardware teardown here.

Elsewhere, Google’s Larry Page issued a manifesto in which he talked up AdSense (oddly), mentioned the famous $2.5bn in mobile, and promised self-driving cars.

Far below the low-earth orbit world of the CEO suite, Sony said “thanks but no thanks” to the latest Android update coming out from the Googleplex. Basically, their own measurements suggest that Android ICS is a resource hog, with the browser typically using about 20-30MB more RAM than the last version. Further, graphics are more likely to make use of hardware acceleration, which is great if you need it but battery-sapping if you don’t, and database operations are slower.

Wired has an interesting discussion of Google’s Project Glass, essentially a hardware component for its existing Google Goggles AR platform. (So the Google goggles that work with Google Goggles are Google Glass, but running Google Goggles…)

That said, Android is the number 1 smartphone OS in China, although whether Google sees any money as a result is doubtful, what with all the forkdroids. Speaking of which there’s a rumour that Amazon will launch a smartphone this year.

Perhaps Google ought to be paying some attention to the core advertising business, as Samsung has decided it wants its own mobile ads platform?

And here’s obviously the sensible place for a touchscreen: the streets of New York City.

Berg Insight puts the world M2M installed base at 108 million customers, with the biggest and fastest-growing market being Asia-Pacific. The market in China roughly doubled in size this year, making China Mobile probably the world’s No.1 in M2M with 14 million connections in service. M2M, of course, has special challenges: meet the forever-day bug, by analogy to a zero-day bug. That is to say, the machine with the bug never, ever gets patched.

Elsewhere in Asian telecoms, Bharti Airtel promised that LTE was coming to Bangalore within the next 30 days. No surprise, then, that India’s demand for semiconductors is surging.

Arch-rivals Reliance are preparing to IPO their submarine cables in the Reliance Globacomm division in a deal with an unusual structure that lets them keep management control while also raising about $1.4bn to help with their debt problem. Telco 2.0 expects that overcapacity on key routes is going to turn out to be a major issue.

After years of scrapping, TeliaSonera owns 44% of Russian operator MegaFon, and now their biggest rival wants out via a complex swap deal, in which he would buy out fellow-oligarch Mikhail Fridman’s Alfa Group and then swap the MegaFon shares for shares of YoTa, the former WiMAX operator that has been proposed as the owner of a single shared LTE network for Russia.

LightSquared owner Philip Falcone, meanwhile, is considering bankruptcy.

In the UK, EverythingEverywhere has hired bankers to sell the chunk of spectrum it has to disburse. The only likely buyer is 3UK, which evidently caps the potential price. The Voice of Broadband links to a European Union update on NGA deployment - note that the UK’s target (25Mbps to 90% by 2015) is the least ambitious in the Union.

David Burgess of OpenBTS fame has an interesting talk with an operator on the industry’s future. The 3G & 4G Wireless Blog has posts on radio relays in LTE and energy efficiency.

What Skype can learn from Netflix. Skype’s big ad campaign. Freespee for price-comparison web sites. Iran plans to have its own private Internet where everyone will use the same e-mail provider.

And farewell to Jack Tramiel, personal computing pioneer behind the Commodore PET, the Amiga, and the Atari ST.

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