Daily Archives: May 20, 2023

HONG KONG (AP) Alibaba plans to spin-off of its cloud computing business and said Thursday that its logistics and grocery units will explore initial public offerings as the Chinese e-commerce company kickstarts a restructuring of its operations in hopes of spurring growth.

The company in March announced plans to reshape itself into six business divisions with plans to allow all but its core e-commerce business to raise external capital and go public.

In an earnings call Thursday, Alibaba CEO Daniel Zhang said that the Alibaba plans to fully spin off its cloud computing unit and complete a public listing in the next 12 months, allowing it to optimize operations, Zhang said.

Alibabas board of directors approved the full spin-off of the cloud computing unit via a stock dividend distribution to shareholders, the company said.

Zhang also said that Freshippo, its groceries arm, as well as logistics arm Cainiao, are ready to go public.

Alibabas board has approved plans to begin Freshippos IPO process and Cainiao will explore an IPO in the next 12 to 18 months, he said.

Other units such as Alibabas international digital commerce group, which operates Singapore-based e-commerce platform Lazada, will also explore raising external capital as it seeks to expand globally.

Alibaba Group Holding on Thursday posted a lower-than-expected 2% rise in revenue for the quarter ended March, suggesting that spending has been slow to bounce back in China since the removal of COVID-19 restrictions amid slowing economic growth.

The company reported revenues of 208.2 billion yuan ($29.6 billion) for its March quarter. It also reversed losses from the same quarter last year, posting a net income of 23.5 billion yuan ($3.3 billion) due to one-off gains from its equity investments.

Revenue from its China commerce business Alibabas largest business unit by revenue declined 3% compared with the same period last year. Its cloud computing unit also declined 2% in revenue.

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Alibaba approves cloud computing unit spin-off, prepares for grocery and logistics arms to go public - Yahoo Finance

By Stephen Nellis

(Reuters) - Ampere Computing on Thursday released a new family of data center chips with technology it has custom-designed for cloud computing companies.

Founded by former Intel Corp president Renee James, Ampere has focused on courting cloud companies that buy thousands of chips at a time and in turn rent them out. The company has deals in place with Alphabet Inc's Google Cloud, Microsoft Corp's Azure and Oracle Corp's cloud unit, among others.

Unlike Intel, Ampere uses a computing architecture from SoftBank Group Corp-owned Arm Ltd, which is also an investor in Ampere. But the new AmpereOne offerings announced Thursday are the first that use Ampere's own custom-designed computing cores, which are the most important part of the chips, which are in turn the brains of data center servers that power everything from business apps to social media sites.

The new Ampere chips will have as many as 192 of those cores where Intel chips tend to have only a few dozen. The high core counts are because cloud companies make money by slicing up chips and selling just a piece of their computing power to customers, and having a large number of cores makes doing so easier.

After Ampere disclosed its approach, Advanced Micro Devices announced a 128-core chip based on the what is called the "x86" architecture used by AMD and Intel. Intel also has a high-core-count chip in the works.

"It's flattering that the x86 vendors have been able to get closer to us, but we're well on our way to higher core counts now," said Jeff Wittich, Ampere's chief product officer.

Ampere last year filed a confidential registration with U.S. securities regulators for an initial public offering. Oracle, where Ampere's CEO James sits on the board, is a major investor. James declined to say when Ampere might go public.

"We did not pull our registration. We are ever hopeful that the market will open and that it will open for growth companies," James said.

(Reporting by Stephen Nellis in San Francisco; Editing by Mark Potter)

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Ampere Computing launches its custom chips aimed at cloud computing - Yahoo Finance

Amazon Web Services is a hulking mess of a cloud computing platform. It offers hundreds of distinct products and services, many of which overlap, with pricing schemes that almost seem designed to confuse. Enterprises love AWS, but then again, they also have armies of IT staff to figure it all out.

There's a big market for cloud computing simplicity. Platforms like DigitalOcean, Akamai's Linode, Vultr, Netlify, Vercel, and many others aim to make life as simple as possible for developers. In some cases, that means a highly curated list of services with dead-simple pricing. In others, it means an opinionated serverless platform that makes deploying applications a breeze.

Cloudflare (NET -0.91%) is taking the latter route with its serverless Workers platform. With Workers, developers can deploy full-stack applications to Cloudflare's global fleet of edge servers. Code runs nearly instantly as close to the end user as possible.

Cloudflare has been building an ecosystem around Workers for the past few years, rolling out products including R2 object storage, Pub/Sub for messaging, and the D1 relational database. But there's been one glaring problem that has made the whole platform a non-starter for many potential customers, and Cloudflare finally has the pieces in place to fix it.

Any useful web application needs some sort of database. There are countless database software options to choose from. In the world of relational databases, there's Oracle, Microsoft's SQL Server, and open-source options like MySQL and PostgreSQL. Outside of relational databases, there's the document-based MongoDB, key-value store Redis, and a slew of others. Some applications may use multiple databases, while others may stick to one. But somewhere, data needs to be persisted in an orderly, queryable way.

The one thing that almost all databases have in common is that they don't work over HTTP. In other words, hitting the database isn't just a simple API call. Databases generally use lower-level, long-lived TCP connections with custom protocols.

Up until now, Cloudflare's Workers did not support TCP connections. That means that a developer running a database somewhere else could not use Workers with that database without resorting to a middleman. A developer could set up a server application outside of Cloudflare that accepts API calls from a Worker, pulls data from the database, and returns it to the Worker, but the Worker could not access the database directly.

That's an annoying problem. Annoying enough, in all likelihood, to make Cloudflare Workers a non-viable option for many developers. The good news is that Cloudflare finally has the beginnings of a solution to this problem. On Tuesday, the company announced a new feature for Workers that allows outbound TCP connections.

Cloudflare Workers can now connect to any service that accepts TCP connections. There are some caveats, though. For connecting to databases, the database driver library a developer uses to initiate and manage the connection must explicitly support Cloudflare's solution. Cloudflare is working on broadening support, but there are currently big gaps.

Database access was the missing piece of the puzzle for Cloudflare workers. Once a Worker can connect directly to any database, the potential of the platform greatly expands. Suddenly, a developer hosting a database on AWS, or on any other cloud platform, can run their actual application on Cloudflare Workers, benefiting from the global reach of Cloudflare's network.

Serverless platforms like Cloudflare Workers take cloud computing and distill it down into deploying applications and not worrying about issues like scaling and performance. The platform takes care of all that. Compare this to the nightmare of managing complex cloud infrastructures on AWS, and you can see why serverless platforms are gaining in popularity.

With database access on its way to being a solved problem, Cloudflare Workers takes another step toward largely eliminating the need for a traditional cloud platform for developers and businesses.

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Timothy Green has positions in DigitalOcean. The Motley Fool has positions in and recommends Amazon.com, Cloudflare, DigitalOcean, Microsoft, and MongoDB. The Motley Fool has a disclosure policy.

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Cloudflare Is Fixing the Biggest Problem with Its AWS Killer - The Motley Fool

Amazons cloud computing unit plans to invest $12.7 billion in India by 2030 to meet growing demand for cloud services in the worlds most populous country, the company announced Thursday.

The long-term commitment will take Amazon Web Services total investment in India to $16.4 billion, following its $3.7 billion investment between 2016 and 2022, which Amazon (ticker: AMZN) used to launch two data infrastructure regionsin Mumbai and Hyderabad.

Big...

Amazon s cloud computing unit plans to invest $12.7 billion in India by 2030 to meet growing demand for cloud services in the worlds most populous country, the company announced Thursday.

The long-term commitment will take Amazon Web Services total investment in India to $16.4 billion, following its $3.7 billion investment between 2016 and 2022, which Amazon (ticker: AMZN) used to launch two data infrastructure regionsin Mumbai and Hyderabad.

Big Tech companies have been expanding their footprint in one of the worlds fastest-growing economies in recent years. Microsoft (MSFT) has three data centers in India and plans to open a fourth, while Alphabet (GOOGL) opened its second cloud data center region in the country in 2021.

Apple (AAPL) has also expanded its presence in the country, opening its first stores in the South Asian country in April, while iPhone maker Foxconn is planning to build a new factory in the state of Karnataka. The states chief minister Basavaraj Bommai said it will create 100,000 jobs.

AWSs investment in data center infrastructure will create 131,700 jobs annually, it said in a release.

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Since 2016, AWS has invested billions of dollars into cloud infrastructure in India to support the tremendous growth we have witnessed in the use of cloud for digital transformation, AWS Indias president of commercial business, Puneet Chandok said.

Write to Callum Keown at callum.keown@barrons.com

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Amazon's Cloud Business Makes a Big Bet on India. Big Tech Loves the Country. - Barron's

What happened

There's no question that the primary driver of the stock market over the past year or so has been the state of the economy. High inflation, rising interest rates, various political dramas, and concerns about a potential recession have all weighed on the market.

Yet investor sentiment has been rising in recent weeks, as earnings season showed that the sky was not falling, contrary to popular belief. Furthermore, slowly but steadily improving economic conditions are fueling investor hopes for a so-called "soft landing," with the economy ultimately avoiding a recession.

With that as a backdrop, Cloudflare (NET -0.91%) rose 19.3%, Confluent (CFLT) climbed 18.5%, and Splunk (SPLK -0.50%) jumped 13.3% for the week, as of 11:11 a.m. on Friday, according to data provided by S&P Global Market Intelligence.

Image source: Getty Images.

A check of all the usual sources -- regulatory filings, earnings results, and changes to analysts' targets -- turned up little in the way of company-specific news driving these cloud stocks higher this week. This seems to suggest that the majority of investors are responding to incremental improvements in the state of the broader economy.

The U.S. Department of Labor released its unemployment weekly claims report, which revealed that initial jobless claims decreased by 22,000 to 242,000 for the week ending May 13, which was well below economists' forecasts of 254,000. It also marked the largest drop in weekly jobless claims since November 2021. Continuing claims, or the number of people already collecting unemployment benefits, decreased by 8,000, largely unchanged at a total of 1.79 million. This suggests that unemployed workers are finding new positions quickly.

The strength of the labor market continues to defy concerns that a recession could be imminent. Further debunking those fears were better-than-expected results from Walmart, which points to resilient consumer spending -- the bedrock of the economy.

In the lone piece of company-specific news, regulatory filings confirmed that activist investor Starboard Value more than doubled its position in Splunk. For the quarter ending March 31, Starboard increased its stake by 2.7 million shares, bringing its total holdings to 4.6 million -- or roughly 2.8% of the shares outstanding.

Starboard has previously said it believes Splunk is undervalued, compared to its opportunity, and has a significant opportunity to drive operational improvements and expand its margins -- an opinion that's no doubt music to the ears of shareholders.

But while investor sentiment saw the glass as half full this week, the market is just one negative report away from turning south, since challenges remain and stocks will continue to be volatile for the foreseeable future.

So what does all this have to do with cloud computing stocks? Software-as-a-service (SaaS) and other cloud-based businesses have been particularly hard hit by the downturn, as investors turned to the safety of profitable stocks.

A quick look at Confluent, Cloudflare, and Splunk show that they were, indeed, part of that illustrious group, with their stocks down 71%, 66%, and 26%, respectively, during 2022. It's no coincidence that all three were unprofitable over the past year.

However, as the specter of a recession dims, investors are increasingly willing to take chances on these stocks, as long as they have compelling growth prospects.

Then there's the matter of valuation. None of these stocks is cheap, though they are trading at a significant discount to their recent highs. Cloudflare, Confluent, and Splunk are currently selling for 12 times, 8 times, and 4 times next year's sales, respectively, when a reasonable price-to-sales ratio is generally between 1 and 2.

Valuation shouldn't be viewed in a vacuum, and investors frequently award higher valuations to businesses with continued strong revenue growth -- even unprofitable ones -- given the chance of strong future returns.

For investors willing to hold their shares for three to five years, these stocks represent an intriguing opportunity. While they aren't for everyone, this trio of companies could generate impressive gains over time, but they do carry a higher degree of risk.

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Why Cloudflare, Confluent, and Other Cloud Stocks Soared This Week - The Motley Fool

May 18 (Reuters) - Ampere Computing on Thursday released a new family of data center chips with technology it has custom-designed for cloud computing companies.

Founded by former Intel Corp (INTC.O) president Renee James, Ampere has focused on courting cloud companies that buy thousands of chips at a time and in turn rent them out. The company has deals in place with Alphabet Inc's (GOOGL.O) Google Cloud, Microsoft Corp's (MSFT.O) Azure and Oracle Corp's (ORCL.N) cloud unit, among others.

Unlike Intel, Ampere uses a computing architecture from SoftBank Group Corp-owned (9984.T) Arm Ltd, which is also an investor in Ampere. But the new AmpereOne offerings announced Thursday are the first that use Ampere's own custom-designed computing cores, which are the most important part of the chips, which are in turn the brains of data center servers that power everything from business apps to social media sites.

The new Ampere chips will have as many as 192 of those cores where Intel chips tend to have only a few dozen. The high core counts are because cloud companies make money by slicing up chips and selling just a piece of their computing power to customers, and having a large number of cores makes doing so easier.

After Ampere disclosed its approach, Advanced Micro Devices (AMD.O) announced a 128-core chip based on the what is called the "x86" architecture used by AMD and Intel. Intel also has a high-core-count chip in the works.

"It's flattering that the x86 vendors have been able to get closer to us, but we're well on our way to higher core counts now," said Jeff Wittich, Ampere's chief product officer.

Ampere last year filed a confidential registration with U.S. securities regulators for an initial public offering. Oracle, where Ampere's CEO James sits on the board, is a major investor. James declined to say when Ampere might go public.

"We did not pull our registration. We are ever hopeful that the market will open and that it will open for growth companies," James said.

Reporting by Stephen Nellis in San FranciscoEditing by Mark Potter

Our Standards: The Thomson Reuters Trust Principles.

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Ampere Computing launches its custom chips aimed at cloud ... - Reuters

DaaS in cloud computing has revolutionized the way organizations approach desktop management and user experience, ushering in a new era of flexibility, scalability, and efficiency. DaaS transcends the limitations of traditional desktop infrastructures, offering a seamless and immersive virtual desktop experience accessible from anywhere, at any time, on any device. Whether its a bustling metropolis or a remote corner of the world, DaaS empowers users to unlock their full productivity potential, untethered by the constraints of physical workstations. As the demand for remote work, mobility, and collaboration intensifies, DaaS in cloud computing emerges as a transformative force, revolutionizing the way businesses operate and paving the path to a future where the desktop is no longer confined to a desk, but becomes an ethereal gateway to boundless possibilities.

Desktop as a Service is a cloud computing model that delivers virtual desktop environments to end-users over the internet. It provides a complete desktop experience, including the operating system, applications, and data, all hosted and managed in the cloud. With DaaS, users can access their virtual desktops from any device with an internet connection, allowing for increased mobility and flexibility.

In the DaaS model, the desktop infrastructure is hosted and maintained by a cloud service provider. This eliminates the need for organizations to manage and maintain their own physical desktop hardware and infrastructure. Instead, businesses can subscribe to a DaaS service and pay for the resources they need on a usage basis.

The primary purpose of Desktop as a Service is to provide a cloud-based solution for delivering virtual desktop environments to end-users. DaaS aims to decouple the desktop infrastructure from physical hardware by hosting and managing virtual desktops in the cloud. This architectural shift allows businesses to achieve greater flexibility, scalability, and cost efficiency in their desktop management approach.

From a technical standpoint, DaaS serves to abstract the complexities of desktop provisioning, maintenance, and management by centralizing these tasks in the cloud. It leverages virtualization technologies and remote display protocols to deliver a rich desktop experience to end-users, regardless of their location or the device they are using. By encapsulating the entire desktop stack, including the operating system, applications, and data, within a virtual instance, DaaS enables seamless access and collaboration, improved disaster recovery capabilities, and enhanced security controls.

There are primarily two different types of Desktop as a Service models: multi-tenancy DaaS and single-tenancy DaaS.

Both multi-tenancy and single-tenancy DaaS models offer benefits and considerations depending on the specific needs of an organization. Organizations should evaluate their requirements, budget, security concerns, and customization needs to determine which type of DaaS model aligns best with their business objectives.

Yes, Desktop as a Service is a specific type of Software as a Service (SaaS). While SaaS is a broad category encompassing various cloud-based software applications delivered over the internet, DaaS specifically refers to the delivery of virtual desktop environments as a service.

SaaS refers to the model where software applications are hosted and provided by a service provider to end-users over the internet. Users access these applications through web browsers or specialized client software, eliminating the need for local installation and maintenance.

10 edge computing innovators to keep an eye on in 2023

The main difference between Software as a Service (SaaS) and Desktop as a Service (DaaS) lies in the nature of the services they provide:

DaaS, on the other hand, is specifically designed to deliver complete virtual desktop environments. It includes the operating system, applications, and user data, all hosted and managed in the cloud. DaaS enables users to access their desktops remotely from any device with an internet connection, providing a full desktop experience.

DaaS, in contrast, provides an entire desktop experience. It includes the operating system and allows users to access a virtual desktop environment that mimics a traditional local desktop. Users can run multiple applications, customize their desktop settings, and perform tasks similar to what they would do on a physical desktop.

DaaS, on the other hand, requires a more complex infrastructure to host and manage complete desktop environments. It includes virtualization technologies, remote display protocols, and storage systems to deliver the desktop experience to end-users. DaaS infrastructure needs to handle not only application delivery but also the complexities of operating systems, user profiles, data storage, and access controls.

One example of Desktop as a Service is Amazon WorkSpaces, provided by Amazon Web Services (AWS). Amazon WorkSpaces is a fully managed DaaS solution that allows users to access their virtual desktops securely from anywhere using various devices.

With Amazon WorkSpaces, organizations can provision and manage virtual desktops in the cloud, eliminating the need for on-premises infrastructure and maintenance. Users can access their virtual desktops through a web browser or the Amazon WorkSpaces client application, enabling a consistent desktop experience across different devices.

Amazon WorkSpaces offers a range of features, including customizable hardware configurations, persistent user profiles, and integration with other AWS services for seamless data storage and management. It provides security controls such as encryption, multi-factor authentication, and network isolation to protect sensitive data and ensure compliance.

DaaS empowers organizations to unlock the value of their data without the need for extensive infrastructure investments or specialized expertise. In this section, we will explore the benefits that DaaS brings to the table.

DaaS in cloud computing offers exceptional scalability and flexibility. With DaaS, businesses can easily scale up or down their desktop infrastructure based on their needs, without worrying about the underlying hardware limitations. The cloud provides the necessary resources to accommodate increased workloads or expanding teams, ensuring seamless operations and user satisfaction. Whether an organization needs to add new users, upgrade software, or allocate additional storage, DaaS in cloud computing allows for quick and efficient adjustments.

This scalability and flexibility eliminate the need for manual hardware upgrades, reducing costs and administrative burden. By leveraging the cloud, businesses can easily adapt to changing requirements and focus on their core operations, while enjoying the benefits of a dynamic and responsive desktop infrastructure.

DaaS in cloud computing offers significant cost savings compared to traditional desktop infrastructures. Instead of investing heavily in on-premises hardware, businesses can opt for a subscription-based model where they pay only for the resources they need. This eliminates the upfront capital expenditure associated with purchasing and maintaining physical infrastructure. Moreover, DaaS reduces ongoing operational costs by eliminating the need for IT staff to manage hardware, perform updates, or troubleshoot issues.

With cloud-based desktops, businesses can also benefit from centralized management, enabling efficient resource allocation and reducing wastage. The pay-as-you-go model of DaaS allows organizations to align costs with actual usage, making it a cost-effective solution for businesses of all sizes.

Security is a critical concern for businesses, and DaaS in cloud computing addresses this issue comprehensively. Cloud service providers implement robust security measures to protect desktops and data. These include data encryption, access controls, regular backups, and disaster recovery options.

By leveraging the cloud, businesses can ensure that their desktop infrastructure is hosted in secure environments with round-the-clock monitoring and advanced threat detection systems. DaaS also reduces the risk of data loss or theft due to physical damage or theft of hardware devices. Centralized data storage and backup mechanisms in the cloud provide an added layer of protection against potential data breaches or system failures, providing peace of mind for businesses.

DaaS in cloud computing enables enhanced accessibility and collaboration among users. Desktops hosted in the cloud can be accessed from any device with an internet connection, allowing employees to work remotely or access their workspaces on the go. This flexibility promotes productivity, as users can easily access their personalized desktop environments from various locations and devices.

Additionally, DaaS facilitates seamless collaboration among geographically dispersed teams. Multiple users can access and work on the same virtual desktop simultaneously, enabling real-time collaboration and reducing the need for file transfers or version control issues. These capabilities empower businesses to embrace remote work policies and foster a more collaborative and agile work environment.

DaaS in cloud computing simplifies IT management and maintenance tasks. Rather than dealing with complex hardware and software configurations, businesses can offload the responsibility to cloud service providers. DaaS providers handle backend operations such as software updates, security patches, and system maintenance, ensuring that desktop environments are up to date and running smoothly.

This reduces the burden on internal IT teams, allowing them to focus on strategic initiatives and core business functions. Additionally, DaaS provides centralized management tools that enable administrators to easily provision, monitor, and manage desktops from a single interface. This simplifies tasks such as user onboarding, resource allocation, and troubleshooting, enhancing operational efficiency and reducing IT overhead.

DaaS in cloud computing offers increased mobility and device independence for users. Since desktop environments are hosted in the cloud, employees can access their virtual desktops from a wide range of devices, including laptops, tablets, and smartphones. This mobility allows for greater flexibility in work practices, enabling employees to be productive from any location and on any device.

Moreover, device independence means that users are not tied to a specific device or operating system. They can seamlessly switch between devices without any loss of data or functionality, providing a consistent and personalized desktop experience. DaaS in cloud computing empowers organizations to embrace the growing trend of Bring Your Own Device (BYOD) policies, promoting employee satisfaction and work-life balance.

Deploying traditional desktop infrastructures can be a time-consuming process that involves procuring hardware, installing software, and configuring systems. DaaS in cloud computing eliminates these complexities and enables rapid deployment of desktop environments. With cloud-based desktops, businesses can provision new desktops and applications within minutes, significantly reducing the time-to-value.

This agility is especially beneficial in scenarios where businesses need to onboard new employees quickly or scale up operations to meet growing demands. By leveraging the cloud, organizations can accelerate their time-to-market, gain a competitive edge, and respond swiftly to business opportunities. DaaS in cloud computing streamlines the deployment process, allowing businesses to focus on their core activities and achieve faster results.

Ensuring business continuity and recovering from unexpected disruptions are crucial for organizations. DaaS in cloud computing offers robust disaster recovery capabilities that help businesses quickly resume their operations in the event of a disaster or system failure. Cloud service providers implement backup and replication mechanisms to safeguard desktop environments and data.

In case of a hardware failure or natural disaster, businesses can easily restore desktops and access their critical applications and data from alternate locations. This resilience provides peace of mind and minimizes downtime, ensuring that employees can continue working without significant disruptions. DaaS in cloud computing offers a reliable and cost-effective solution for disaster recovery, allowing businesses to protect their operations and maintain high levels of productivity.

Managing software licenses can be a complex and time-consuming task for businesses. DaaS in cloud computing simplifies software management by providing centralized control and licensing options. With cloud-based desktops, businesses can easily provision and manage software applications for their users from a single platform.

This centralized approach streamlines license allocation, updates, and compliance monitoring. It eliminates the need for individual installations and license management on each desktop, saving time and reducing administrative overhead. Additionally, cloud service providers often offer flexible licensing models, allowing businesses to scale up or down their software usage based on their needs. This flexibility ensures cost optimization and helps organizations stay compliant with software licensing agreements.

DaaS in cloud computing offers improved performance and user experience compared to traditional desktop infrastructures. By leveraging the clouds robust infrastructure, businesses can provide users with high-performance virtual desktops that are responsive and capable of handling resource-intensive applications.

Cloud service providers optimize their environments to deliver low-latency, high-bandwidth connections, ensuring smooth and efficient desktop interactions. Users can access their desktops quickly, launch applications seamlessly, and experience minimal lag or downtime. Moreover, DaaS allows for personalized desktop configurations, enabling users to customize their environments according to their preferences and work requirements. This level of performance and customization enhances user satisfaction, productivity, and overall work efficiency.

XaaS: Accessing technology solutions on demand

In a symphony of cloud-based innovation, the harmonious union of DaaS in cloud computing resonates with transformative power, orchestrating a grand finale to traditional desktop limitations. Like a maestro leading an ensemble, DaaS takes center stage, unlocking a symphony of flexibility, efficiency, and seamless user experiences. It conducts a melodious blend of mobility, scalability, and security, captivating businesses with its captivating performance.

With DaaS as the virtuoso, the limitations of physical workstations are swept away, and the digital realm becomes an enchanted landscape of boundless possibilities. Like a painters brush on a canvas, DaaS paints a masterpiece of improved productivity, simplified management, and liberated collaboration. It erases geographic boundaries, allowing teams to dance together across continents and time zones, their movements perfectly synchronized.

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DaaS In Cloud Computing: Benefits And Risks - Dataconomy

Security issues in cloud computing pose significant challenges for organizations. While the cloud offers numerous benefits, it also introduces a range of risks that demand attention. As technology evolves, so do the threats, and organizations must stay vigilant to safeguard their valuable assets. Understanding these risks is crucial, but equally important is the awareness that effective solutions exist to mitigate them. By proactively addressing security concerns, organizations can harness the power of the cloud while maintaining the integrity, confidentiality, and availability of their data and resources.

The landscape of cloud security is dynamic and ever-evolving, with new threats emerging constantly. Below, we will delve into the top 14 security issues in cloud computing that organizations must be aware of to ensure the protection of their sensitive data and resources. By understanding these risks, organizations can take proactive measures to mitigate vulnerabilities and fortify their cloud environments against potential security breaches.

Never lose your ID, especially in cyberspace

In contrast to an organizations local infrastructure, their cloud-based deployments reside beyond the network perimeter and are directly reachable via the public Internet. Although this grants enhanced accessibility of the infrastructure for employees and customers, it also amplifies the susceptibility for malicious actors to illicitly penetrate an organizations cloud-based resources. Inadequate security configurations or compromised credentials can furnish assailants with unimpeded entry, potentially without the organizations awareness.

Cloud Service Providers (CSPs) typically offer a range of application programming interfaces (APIs) and customer interfaces, which are extensively documented to enhance their usability. However, this practice introduces potential risks when customers fail to adequately secure these interfaces within their cloud infrastructure. The customer-focused documentation, while intended to facilitate usage, can inadvertently aid cybercriminals in identifying and exploiting vulnerabilities to gain unauthorized access and exfiltrate sensitive data from an organizations cloud environment.

Cloud computing is designed to facilitate effortless data sharing. Many cloud platforms offer features like email invitations and shared links to collaborate with others and grant access to shared resources. While this convenience is advantageous, it also introduces significant security concerns. Link-based sharing, a popular option due to its ease of use, poses challenges in controlling access to shared resources. Shared links can be forwarded, stolen, or guessed by cybercriminals, leading to unauthorized access. Moreover, revoking access for a specific recipient becomes impossible with link-based sharing.

Insider threats pose a significant security concern for organizations, as malicious insiders already possess authorized access to the organizations network and sensitive resources. The pursuit of this level of access is what commonly exposes attackers to their targets, making it challenging for unprepared organizations to identify malicious insiders. Detecting such threats becomes even more challenging in cloud environments. Companies have limited control over the underlying infrastructure in cloud deployments, rendering many conventional security solutions less effective. Additionally, the direct accessibility of cloud-based infrastructure from the public Internet and prevalent security misconfigurations further complicate the detection of malicious insiders.

Due to the placement of an organizations cloud-based resources outside their corporate network and reliance on third-party infrastructure, conventional network visibility tools prove ineffective in cloud environments. Moreover, some organizations lack specialized security tools tailored for cloud deployments. Consequently, monitoring and safeguarding cloud-based resources become challenging. The limited ability to monitor and protect these resources leaves organizations vulnerable to potential attacks, emphasizing the need for cloud-specific security solutions to enhance visibility and fortify defense mechanisms.

Cybercriminals operate strategically, targeting entities with the potential for profitable attacks. Cloud-based infrastructure, due to its direct accessibility from the public Internet and frequent inadequate security measures, becomes an attractive target. Furthermore, the shared nature of cloud services across multiple organizations amplifies the impact of successful attacks, enabling repetitive exploitation and enhancing the likelihood of success. Consequently, organizations cloud deployments have emerged as prime targets for cyberattacks, given the abundance of sensitive and valuable data they hold.

The cloud plays a vital role in supporting business operations for numerous organizations, serving as a storage platform for critical data and a foundation for running essential internal and customer-facing applications. Consequently, a successful Denial of Service (DoS) attack targeting cloud infrastructure can result in significant repercussions across multiple companies. Particularly concerning are DoS attacks where the attacker demands a ransom to halt the attack, posing a substantial threat to the integrity and availability of an organizations cloud-based resources.

Cloud-based environments offer seamless data sharing capabilities, accessible directly from the public Internet. Users can easily share data through email invitations or by sharing public links. While this convenience fosters collaboration, it raises significant apprehensions regarding potential data loss or leakage, which organizations often consider their top cloud security concern. Sharing data through public links or setting cloud repositories as public exposes them to anyone possessing the link, and dedicated tools actively scan the Internet for vulnerable cloud deployments, amplifying the risk of unauthorized access and data exposure.

Data privacy and confidentiality represent significant concerns for organizations. Stringent data protection regulations such as GDPR, HIPAA, and PCI DSS necessitate the safeguarding of customer data, imposing severe penalties for security breaches. Additionally, organizations possess a substantial amount of internal data crucial for maintaining a competitive edge. While leveraging the cloud offers advantages, it has raised significant security apprehensions for most of the organizations. Many organizations lack the expertise to ensure secure cloud usage, resulting in heightened risks of data exposure, as evidenced by numerous cloud data breaches.

Cybercriminals frequently exploit cloud applications and environments to carry out phishing attacks. The widespread adoption of cloud-based email services like G-Suite and Microsoft 365, along with document sharing platforms such as Google Drive, Dropbox, and OneDrive, has led employees to expect emails containing links that request them to verify their account credentials for accessing specific documents or websites. This familiarity inadvertently assists cybercriminals in acquiring an employees cloud service credentials. Consequently, the accidental exposure of cloud credentials is a significant worry for most of the organizations as it jeopardizes the privacy and security of their cloud-based data and resources.

Numerous organizations have well-defined protocols to address internal cybersecurity incidents. This is facilitated by their ownership of on-site network infrastructure and the presence of in-house security personnel, enabling them to swiftly contain such incidents. Moreover, this ownership grants them sufficient visibility to ascertain the incidents extent and undertake appropriate remediation measures. Conversely, cloud-based infrastructure limits an organizations visibility and ownership, rendering conventional incident response processes and security tools ineffective.

Data protection regulations such as PCI DSS and HIPAA mandate organizations to demonstrate stringent access controls for safeguarding sensitive information like credit card data and healthcare records. This may entail establishing a physically or logically isolated segment within the organizations network, granting access solely to authorized employees with a genuine requirement. However, ensuring and validating regulatory compliance becomes more challenging when migrating regulated data to the cloud. Cloud deployments grant organizations limited visibility and control over infrastructure layers, making legal and regulatory compliance a significant cloud security concern for most of the organizations. Meeting these requirements necessitates specialized cloud compliance solutions.

Cloud providers typically maintain multiple data centers across various geographic locations, enhancing the accessibility and performance of cloud-based resources while ensuring the fulfillment of service level agreements during disruptive events like natural disasters or power outages. However, organizations utilizing cloud storage often lack visibility into the specific data center locations within the providers network. Compliance with data protection regulations like GDPR becomes crucial, as storing EU citizen data in cloud platforms with data centers outside approved areas may result in regulatory non-compliance. Additionally, varying jurisdictional laws governing data access for law enforcement and national security purposes can impact customer data privacy and security.

While the cloud offers several benefits to organizations, it also introduces unique security risks and considerations. Cloud-based infrastructure differs significantly from on-premises data centers, necessitating distinct security approaches. Traditional security tools and strategies may not provide adequate protection for cloud environments. To gain comprehensive insights into the prevailing cloud security challenges and threats, we recommend accessing the Cloud Security Report for detailed information and valuable recommendations.

These security issues in cloud computing demand the utmost attention from organizations. The risks associated with cloud technology are significant, requiring diligent efforts to safeguard sensitive data and mitigate potential breaches.

By recognizing the top 14 cloud security risks discussed in this article, organizations can take proactive steps to fortify their cloud environments. Implementing robust access controls, encryption measures, and comprehensive monitoring solutions can significantly enhance the security posture of cloud-based resources.

It is essential for organizations to prioritize cloud security, leveraging advanced technologies and best practices to safeguard their assets and maintain the confidentiality, integrity, and availability of their data.

With careful planning and strategic measures, organizations can navigate the cloud landscape with confidence and resilience in the face of evolving security challenges. Gartners article called Is the Cloud Secure? still sheds light on this matter, if you need further reading.

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14 Security Issues In Cloud Computing And Their Solutions - Dataconomy

Via Satellite illustration.

This is the second of a two-part series analyzing the value of edge computing in space by the Boston Consulting Group. Read Part One: Size of the Prize: How Will Edge Computing in Space Drive Value Creation?

What key drivers are necessary to ensure that edge computing in space is widely adopted to the degree that it reaches an inflection point of affordability? We at the Boston Consulting Group believe that cybersecurity, cost, and ESG will drive the market for edge computing in space.

Cybersecurity is an area in which edge computing offers distinct advantages. Cloud computing is vulnerable to the ever-increasing risk of cybersecurity breaches, which can lead to major data theft or loss. Organizations across industries that collect personally identifiable information on a public cloud expose themselves to liability and/or compliance concerns, while sensitive intellectual property and proprietary industry data can become vulnerable to cybersecurity attacks at various nodes of transmission particularly given growing dependency on cloud computing.

The main challenge presented by the current cloud computing landscape is that corporate services and data are entrusted to third parties and are exposed to a higher level of risk, both in terms of security and privacy. The top three threats to cloud systems are unsafe API interfaces, data loss or theft, and hardware failure. The widespread use of virtualization in the implementation of cloud infrastructure also creates security problems because it alters the relationship between operating systems and underlying hardware, introducing an additional level that must be managed and protected.

In contrast, edge computing introduces multiple advantages for cybersecurity since data is processed locally. This eliminates risks stemming from data transfers, which are typically encrypted and inevitable when using typical terrestrial cloud solutions. With edge computing, complex calculations occur at the IoT device/perimeter server level and the only transfer is that of the final result to the user. The risk of data loss is driven more by damage to local servers, rather than cybersecurity vulnerabilities.

Cost also presents an area of advantage to edge computing. Organizations could achieve operational cost savings by using edge computing due to the minimal need to move data to the cloud. Since data is processed at the same location where it is generated (in this case, on the satellites themselves, collecting imagery through hyperspectral or SAR capability or remote sensing data), processing these batches of data on the same satellite would also yield a significant reduction in the bandwidth needed to handle the data load.

Hosting applications and data on centralized hosting platforms or centers creates latency when users try to use them over the internet. Large physical distances coupled with network congestion or outages can delay data movement across the network. This then delays any analytics and decision-making processes.

Edge computing in space, in this context, could enable data to be accessed and processed with little or no obstacles, even when there is poor internet connectivity. Importantly, if there is failure with one edge device, it will not destroy the operation of the other edge devices in the ecosystem, facilitating a reliable, connected system.

Finally, there are potential gains to be achieved in terms of ESG metrics by adopting in-space edge computing capability. With the cloud business model dominating, there are emerging concerns about the environmental effects of centralized processing. Processing centers require enormous resources to function; they contribute to carbon emissions, accounting for 0.6% of all greenhouse gas emissions, and produce electronic waste, adding to the burden humans put on the environment in pursuit of advancement.

Edge computing has become a potential alternative to moving data centers to greener practices. The edge helps reduce the networking traffic coming in and out of centralized servers, reducing bandwidth and energy drains. This frees up bandwidth at the data center itself and bandwidth for the organization, overall, in terms of any centralized servers on-premises. Moving edge computing to space would achieve even further reductions in energy consumption required at the terrestrial data center level, while the needs for temperature control and cooling would be eliminated by the freezing temperatures in LEO.

In order to estimate an overall market for edge computing in space and explain why in-space edge computing capability and associated user interface applications need to be built, we triangulated three approaches to the market: Supply, Demand, and Cost.

Today, roughly 20% of data processing and analysis occurs locally, with 80% happening in centralized data centers and computing facilities.

We developed a high, low, and base case for estimating the share of industry addressable by space solutions, and as a core assumption of the model, we used reliance on cybersecurity to gauge what share of industry would be addressable by space. With this model, we expect an estimated $250 million market by 2030 with defense and satcom as leading industries for application. However, it is important to note that the estimated $250 million market is addressed by only one segment of the total scope available as one looks at the Edge Computing in Space Capability Stack (Figure 2).

Figure 2: The capability stack for edge computing in space demonstrates the breadth of functions which could be enabled and supported for different end users. Source: BCG analysis.

Further upside would emerge as addressable market opportunity for connectivity service providers (satcom/telecom), applications developers (who would be responsible for developing the apps for the specific government customer to interpret processed information, for example); terminals/user interface manufacturers; and the residual flow down to data centers for cloud computing purposes. Other segments of Edge Computing in Space Capability Stack would see further value unlocked as Edge in Space comes online, delivers key capabilities to the highest need customer groups (e.g., those in defense), and brings the cost curve down for commercial use cases and applications to emerge.

By estimating demand for cloud computing across target industries, supply for satellite revenue in the aggregate space market, and comparing the cost of terrestrial and space data storage centers, we believe that there is more demand for cloud computing in space than the supply of satcom providers.

Our model indicates that the cost to host data in space will closely approach terrestrial data costs past 2030, while on supply and demand, we anticipate more demand for cloud computing space than supply of satcom providers.

In light of these differentiating factors and our model research, demand for edge computing is established and expected to grow (Figure 3). We project all of Satellite IoT spending, $1.5 billion by 2030, to be addressable given the importance of cybersecurity. We estimate the relevant edge computing market (excluding hardware and non-core service software) to be $0.3 billion by 2030, of which 75% would be in-scope. Finally, we estimate up to 2% of the total $1.2 billion cloud compute market by 2030 to be in-scope due to the selective applicability of cybersecurity and latency needs for real-time analysis.

However, research indicates that supply is currently lagging behind expected need due to insufficient public and private investment, with key implications for government and private investors.

The key drivers to understanding which companies will unlock the potential of edge computing in space include prioritizing cybersecurity, lowering cost burden, and adopting ESG practices. With increasing digitalization, the space economy will further benefit from integrating edge computing into space-based business models. However, companies and governments must help develop the needed supply that our current space investment demands.

While cloud computing will remain an integral part of the overall market for the foreseeable future, the advantages offered by edge computing in space are clear enough that actors in the most promising markets of defense and agriculture should be considering the questions posed earlier. For government, how can they leverage this technology to enhance the security of critical assets and information? How should government invest in developing the market for space-based edge computing, and how can they effectively support its growth? What role will incentives play will they be tied to ESG targets?

For industry, there are questions around how to sell to target customers in key markets such as government and agriculture. Are the start-up and non-recurring engineering costs prohibitive and what investments and partnerships will be required? What scenarios exist for the development of requisite ground infrastructure?

Go to market success will require integrating the edge computing in space-as-a-service capability into a suite of other services that could already be on offer. In addition, as commercial space stations look to develop edge computing in space offerings, successful methods will integrate this capability among others in orbit, such as where and how remote sensors collect the data, where and how the data analytics are performed, and potentially offering various data streams to the same group(s) of customers utilizing the same sensors to optimize quality and quantity of output.

The space industry is no stranger to partnering closely with suppliers and customers, including governments, to develop and deliver new technology and advance the art of the possible. By making the right investments, governments, investors, and users in edge computing can turn democratizing space from an expression into a reality.

This paper is the second two-part series analyzing the value of edge computing in space by the Boston Consulting Group. Read Part One: Size of the Prize: How Will Edge Computing in Space Drive Value Creation?

S. Sita Sonty leads Boston Consulting Groups Commercial Space team. John Wenstrup is a senior leader in BCGs Technology, Media & Telecommunications practice. Cameron Scott is Global Sector Lead for Defense and Security. AndDr. Hillary Child is a Project Leader from BCGs Chicago office.

Additional research by Avril Prakash, Sarvani Yellayi, Ansh Prasad, and John Kim

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Size of the Prize: Assessing the Market for Edge Computing in Spaces - Via Satellite