Copacetic

Jarek’s on the same PDC hothouse program as me and he’s just started a blog. Good to see some of the other PDC hothouse founders online….

• Freshmeat announcement page (update : fixed borked link)
• Celtix Home Page
• Product page from the Iona Website
• The Celtix Demo page

InfoWorld reports on the launch of Celtix Iona’s new Open Source ESB. Iona are a little late to the Open Source party but I would expect the Celtix product to put up a pretty good showing on the technical front.

However they suffer from the same problem as Cape Clear, how do you compete on the one hand against tier one incumbents like Oracle and IBM and also hold the line against OpenSource experts like Apache and JBoss?

If egos could be massaged, one way to compete would be to merge both companies back into a single entity. The original goals of Cape Clear (low cost commodity products in the XML/CORBA/J2EE space) were lost long ago and they now range across the same prospect base as Iona.

Chris is safely ensconced on the board as chairman so any old enmity could be smoothed over by the new Iona CEO Peter Zotto. Give Annrai back his old job as CTO, tag him as a serial entrepreneur (did it twice!) and move all the Cape Clear staff back from the pugatory of Donnybrook to the central location of Shelbourne Road.

Job done!

Del.icio.us has added a network feature that allows you to add users you know to your network. Then you get to add their links to your del.icio.us cloud.

I just got Outlook successfully installed from my  Microsoft Actionpack and Intellisync gets flogged to Nokia leaving me high and dry.

My original plan was to sync outlook with my Yahoo address book and calendar, giving me the best of both worlds. Guess we’ll have to add Address book and calendar  management to the Secantus user story list.

Cape Clear has broken cover with its latest investment round of USD$15m. The latest partners to invest are InterWest one of the Silicon Valley Sand Hill mob. As Annrai is reported to have said in 2005 in the Sunday Business Post,

So only a billion to go then Annrai :-).

From what I gather on the web and my own sources Cape Clear total investment to date is broken down as follows,

• 2 Million in seed funding from ACT in 2000
• 16 million in Series A funding from Accel and Greylock in 2001
• 10 million in Series B funding from Accel and Greylock 2003
• 5-10 million: A phantom series C round raised as a set of warrants amongst existing investors. It was never press released and their is no mention of it on the net.
• 15 million in a series D round in the last few weeks with InterWest

So we can guess that the total investment is at least USD$48m and may be significantly more.

Thats a lot of money for a bit player in the web services/SOA/ESB market place. Even at a preference multiple of one they would need to make USD$100million in a trade sale before any of the common stock holders see a dime.

Answers on a post card for the last Irish company to make a trade sale exit that netted more than $100m…

Disclosure: I was Director of Engineering at Cape Clear from 2000 to 2003 and I have (common) stock in the company.

From del.icio.us/popular, 11 ways to backup your del.icio.us bookmarks.

TechCrunch reports on a new offering from Amazon called S3. S3 is a web-service that will allow developers to leverage Amazon’s backend infrastructure to provide low cost storage services to their customers. The pricing is,

• $0.15 per GB-Month of storage used
• $0.20 per GB of data transferred

This compares very favourably with the competition. However there is an issue here for most users. Most of the competition use a flat fee model for a given amount of storage (e.g. IBackup charges you $9.95 a month for 5GB of space). This is the price you pay whether you use it or not. Amazon uses a variable pricing model that charges like a utility for the time period the storage was used and the amount of storage used for that period. This will not sit well with end-users who are uncomfortable using services where they cannot easily predict the costs.

This might fly for storage costs alone, but when you include bandwidth costs it becomes impossible to predict the final price. Ask any user how much bandwidth they consumed reading and writing files in the last day, month, year and you’ll find most people are pretty clueless (myself included).

The competition offers no bandwidth pricing or caps at the moment so you can expect their prices to drop in line with Amazon’s in order to compete. At that point Amazon will have to address their bandwidth pricing policy to stay in the game.

TechCrunch recently reviewed The Online Storage gang, a group of companies that provide online virtual storage using a variety of business models. While this was an interesting article I found it disatisfying from a number of perspectives,

• The article failed to normalise the pricing model so that a prospective purchaser could do a comparison between the different vendors offerings.
• They conflated the business models of pure virtual storage players (e.g. XDrive, Box.net), structured vendors (flickr, eSnips and Multiply), backup vendors (Mozy) and ISPs (GoDaddy).
• The comparision table was a flickr image and therefore difficult to read

So what distinguishes these different vendors and their relative marketing positions? As indicated above I would divide the market into four kinds of offerings,

• Virtual Storage Vendors: Virtual Storage vendors offer online disk space and price according to quota allocations. Their primary costs are related to spinning disks (see Nik Cubrilovic’s excellent analysis) which means power consumption, network bandwidth and collocation footprint and maintainance dominate the equation. Their revenue model is therefore strictly pay for use as it is hard to interject an advertising stream into a pipe of raw data. You can tell a Virtual Storage vendor by the fact that they will have a Storage Plan link somewhere on there front page, that details the rising scale of prices with increasing demand for storage. If virtual storage follows the model of local storage, reads will dominate over writes.
• Structured Storage Vendors: Structured storage vendors offer storage for a particular type of file (the most well known being flickr, but Glide is also a strong rising contender). They have a similar cost structure to their Virtual Storage companions but can augment their revenue with advertising. They therefore often use a Free+Premium model where the basic service is free and you pay for additional enhanced services. Bandwidth limits for free users are a useful model for these vendors as it allows them to easily predict future demand.
• Backup Vendors: Backup vendors are focussed on recovery from failure or deletion. They are in the insurance business and although most model their services like the virtual storage vendors their costs should in theory be substantially lower as in the backup model writes dominate over reads and these vendors should be able to utilise tape storage to dramatically reduce their data centre costs.

I have produced a comparison table that splits the vendors along these lines using the TechCrunch list as a starting point and adding a list of Remote backup vendors culled from a number of websites on the net.

The table is split into three groups Virtual Storage Vendors, Remote Backup vendors and Sharing/Structured Storage Vendors. I have not done much analysis on the structured storage vendors as a I don’t see those guys as the focus of this study which is trying to determine what price virtual storage is likely to be. More work on the Sharing guys may follow.

I’ve included three prototypical plans for 5, 10 and 20GB of storage. I should point out that even 20GB will barely store the average user’s music collection, never mind their photos. Yet, very few vendors (AllMyData is the notable exception) quote for disk space over the 50GB limit. I then map the vendor’s closest plan in each case and normalise the table to generate a comparsion column for 5, 10 and 20GB of storage. The data for 20GB is graphed on the graph tab for easy comparison.

Some interesting points to note,

• Virtual Storage parallels backup storage in price. The most expensive backup vendor (BackupCellar) is $500 more expensive per year that the most expensive Virtual Storage Vendor (iStorage). This shouldn’t be the case as backups storaged on tape have sub-cent prices per Gigabyte year compared to holding all the data online on a power hungry, failure prone spindle.
• The differential price between the mid-range and highest price vendors is over 75%. There is some serious price gouging going on here (yes I’m talking to you and you).
• The business Models are all identical. They all offer a storage plan and the concept of a remote disk. Only AllMyData has anything different to offer in terms of offering up storage on your local disk to reduce your cost of purchase. Their pricing is also so wildly out of line with the competition (in a good way) that you have to ask yourself if they might have made a miscalculation.

Of course the likelihood is that Google is going to put most of these vendors to the sword when the launch (if they launch?) their GDrive product.

Until then caveat emptor, it pays to shop around.