Jake Ross

The main value proposition of cloud computing is better economics, that it’s cheaper to rent hardware, software platforms and applications (via a per-usage or subscription model) than it is to buy, build and maintain them in the corporate data center. But if we expect that cloud computing is here to stay –- and not just a passing fad –- it must be feasible for the cloud providers themselves. So how do they do it?

They do it by leverage economies of scale. Put simply, the idea is that one very large organization can more efficiently build and operate its infrastructure than many small firms can on their own. To better understand this, let’s break down some of the financial advantages leveraged in cloud computing:

Specialization: Specialization is also known as division of labor, a term coined by the father of modern economics, Adam Smith. A company for whom running a large-scale data center is a core part of its business will do so much more cost-effectively than a company for whom it’s merely one aspect. The former will hire the best experts in the world, and will have the management attention required to continuously innovate, optimize and improve operations. And the overhead costs associated with doing so will spread thinly across massive usage. Case in point: Since it needed to use hundreds of thousands of servers, it was worthwhile for Google to build its own, homegrown devices to fit its exact power supply and fault-tolerance needs.

Although in software, anyone can build anything with enough people, time and money (as my old boss used to say, “It’s all ones and zeros”), it makes no sense for individual companies to develop capabilities such as dynamic provisioning, linear scalability and in-memory data partitioning when they’re readily available from off-the-shelf products.

Purchasing Power: Large organizations buy in bulk, which they can leverage to negotiate lower prices. So presumably the cloud provider can acquire lower-costing servers and networks, operating systems and virtualization software. Furthermore, they can negotiate better interest rates, insurance premiums and other contracts.

Utilization: This is perhaps the most important one and what I like to call the Kindergarten Principle, or “sharing is good.” In computing, tremendous savings can be achieved by having multiple companies share the same IT infrastructure.

Experts estimate average data center utilization rates range from 15 percent to 20 percent. If you include the processing, memory and storage capacity available on company-owned laptops and desktops as well, utilization rates may be as low as 5 percent. That’s a lot of waste. Imagine if this were the case in the hospitality industry. In most cases, a hotel with even 50 percent average occupancy rates would quickly go out of business.

So why is this happening with corporate IT?

Application loads are volatile; they experience peaks and troughs based on time of day, day of the week or month, seasons and so on. To avoid hitting the “scalability wall,” companies need to overprovision. So if a company expects a certain daily peak volume (for example, the opening of the trading day for an e-trading application), it will provision enough hardware so that utilization rates at the peak reach no more than 70 percent (leaving some room for unexpected loads – hey, Steve Jobs may announce the next iPhone today). But at other times utilization rates could go as low as 10 percent, with the average somewhere in between.

So the difference between peak loads and average loads drives overprovisioning and a high rate of unused computing capacity. But if we aggregate the activities of several companies, we will not face such volatility in application loads. Let’s see why.

Follow the Sun: In many cases, peaks and troughs in application volumes can largely be attributed to the time of day. Human-facing applications are active during daytime and face very low activity during the night. When New York experiences the opening bell trading spike, London is in the midday lull and Tokyo is going to bed. Same goes for e-commerce sites, social networking sites, gaming sites and others, though these types of applications might experience peaks after business hours as well.

If companies around the globe and in different industries share the same resources on the cloud, higher utilization rates will be achieved by the cloud provider, lowering its costs – savings that it can turn around and pass on to its customers. This model of shared resources even addresses the need to overprovision for unexpected peaks, as it is unlikely that all the cloud users, in all geographical regions and all industries will face peaks at the same time. This is similar to the notion of a bank not having all of the cash reserves necessary to handle the cash commitments to all customers at the same time (is there an equivalent to a bank run in cloud computing?).

Follow the Moon: And with so much focus on energy costs, data center power consumption and cooling (not to mention the environment), there’s also a cloud computing approach known as Follow the Moon. It posits that a cloud provider with physical data centers in several different geographical locations can run the applications that are active from the day side of the world in centers on the night side of the world, taking advantage of lower power and cooling costs.

Cloud computing, therefore, is an economically feasible strategy. Over time, the cost savings will be too compelling for all but the very largest companies to ignore.

Geva Perry is the chief marketing officer of GigaSpaces

If this story interests you then you should definitely check out our upcoming conference, Structure 08.

Earlier this month, I shared with you my post that called for a big wake-up call for Social Networking sector, thanks to the presence of too many me-too players at a time when recent traffic trends are showing signs of hitting a plateau. Hitwise recently reported that in the US, MySpace and Facebook ranked 1st and 2nd had 95% and 93% repeat visitors for the month.

The May 2008 traffic data from comScore furthers that argument. Another interesting finding of the May 2008 data – Facebook is doing much better than MySpace in the overseas markets.

Nevertheless, of late, I have stopped taking traffic on face value, and instead almost always juxtapose it to how much money you make off those page views. (Dave McClure recently chastised me for thinking too much in the short term.)

Matt Brezina, co-founder of Xobni earlier pointed out that Facebook will take in $265 million and MySpace will bring in $755 million in 2008. So unless the overseas (and overall page view) growth translate into real big dollars, our friends at Facebook (and MySpace) have problems. Experts believe that the answer is in better relevance in display advertising – still the dominant form of advertising on the social networks.

Facebook vs Others

The traffic trends have to be troubling for for geographic hits such as Orkut and Friendster. The overseas growth of Facebook also calls into question the veracity of the decision by AOL to pay $850 million for Bebo. Some data crunching by Andrew Chen (using the newly announced Google Trends) shows that Facebook is making big headway in markets such as UK, France, China, and India.  Orkut is very popular in India, while as the map shows Bebo is big in UK and other European countries.

I think it is these guys who need to worry the most with Facebook’s march & MySpace’s rear guard action. I suspect, if Facebook continues to grow, MySpace could opt for buying market share.

But if you take a larger view,  Chen’s conclusion, that “Social networks have weaker network effects than previously speculated,” is quite prescient. As someone once noted, social networks are like night clubs – there is always a cooler, hipper, funkier joint being planned by someone.

Over past few years, generally described as the golden years of social networking have led to the sector’s giants resting on their laurels. The fundamental nature (and utility) of social networks hasn’t really changed. The platform-ization of social networks has led to the rise of social apps that are best described as time wasters. You can be fascinated by vampire bites and what not but in the end, there is a finite amount of time you can waste.

In other words, Social Networks need to find new purposes for people to come back every day and be loyal. I had argued in my previous post that the world of social networks is going to be divided into two – the big players (MySpace, Facebook) and niche players (Dogster, Dopplr etc.)

In a recent chat, Ning CEO Gina Bianchini pointed out that they are adding 2000 new niche social networks every day and are now upto 315,000 networks. The niche is allowing the company to get even good non-optimized, straight-up average eCPMs from AdSense. She pointed out that they are about 3 to 4 times better than the average for general one-size-fits-all social networks. “This is because the social networks on Ning are organized around well-defined topics and interests – skiing, smart cars, diabetes, etc. As a result, contextual advertising works more effectively for Ning than it does for other general social networks,” she said.

Photo Courtesy of comScore via C/Net News.com’s The Social. Social world map courtesy of Le Monde via O’Reilly Radar

Tonight my 14-year-old son, Rocky (my producer), and I leave SFO to start what is bound to be one of the most interesting weeks in our lives. One thing we’re going to try to do is bring you along whenever possible. Before I get to that, though, I can’t say thank you enough to Andrew Feinberg of Capitol Valley.net and Washington Internet Daily enough for getting us into see some really interesting people. He, and his team, have been doing all sorts of work with us for months to make this trip happen and he’s been doing it for free without any expectation of anything in return. Unbelieveable guy and team and all of us at FastCompany greatly appreciate his partnership.

Here’s where to follow me:

1. On my Qik channel. I’ll do frequent live Qik videos. I’ll try to Twitter when interesting ones are about to start.
2. On my Twitter feed. I frequently Twitter from the road about what we’re doing and experiencing, plus I can answer your questions there.
3. On my FriendFeed. Even better place to talk with me. My Twitters, photos, and other things, show up on FriendFeed within minutes of me doing them and this is the best place to talk with me. I probably spend 80% of my time there, so watch this to see the best stuff.
4. Another important feed to watch is my “Likes” feed on FriendFeed. This is totally different than #3 and is YOUR stuff that I’ve “Liked.” If you want to see if there’s some value to FriendFeed this is a good place to lurk and it’s where I track the top news items.
5. On my Flickr feed I’ll post photos. My Nokia phones can get photos up within seconds of me taking them.
6. I’ll be participating in the chat room on my Kyte.tv channel — the chat room there is better because it stays up permanently and I can participate in it via text, audio, or video.
7. Rocky Barbanica, my producer, has a Twitter feed too, and so does Andrew Feinberg.

I probably won’t write many blogs here until I get back. We’re just way too busy. Check out our schedule.

TODAY: A BBQ with my dad and brother and our family. We take the red-eye to New York tonight at about 10 p.m.
SUNDAY: A free day in NYC. The Personal Democracy Forum is throwing a dinner in the evening, which we’ll attend.
MONDAY: We’re attending the Personal Democracy Forum and I’m on a panel where we’ll be talking about the Live Web (of which you are getting a great demo of above). The panel is at 2 p.m. Eastern Time. I’m sure we’ll Twitter and Qik and Kyte that a bit. After the panel we’ll take the train to Washington DC.
TUESDAY: Most of these interviews will be 15 minutes and we’ll be literally running from one interview to the next. I am not sure which ones I’ll be able to Qik, but we’ll try to Qik at least some of them:

• We have the morning mostly free to get acclimated and get our press passes and all that.
• Noon. Senator Tom Coburn. (R-OK)
• 1:30 p.m. Rep. George Miller (D-CA)
• 2:30 p.m. Rep. Nancy Pelosi (D-CA) Speaker of the House.
• 3 p.m. Rep. Tim Ryan (D-OH)
• 4:30 p.m. Rep. John Culberson (R-TX)
• Private dinner to thank Andy Feinberg and his team for planning this schedule, then a night-time photowalk of the Washington Mall.

WEDNESDAY:

• 11 a.m. Kyle McSlarrow, President of National Cable and Telecommunications Association.
• Noon Rep. Cliff Stearns (R-FL)
• 1 p.m. Rep. Ed Markey (D-MA)
• 2 p.m. FCC Commissioner Jonathan Adelstein (D)
• 4:30 Erik Stallman (Tech Counsel to Rep. Zoe Lofgren)
• 6 p.m. Party with Gary Vaynerchuk and Jim Long (about 200 already signed up).

THURSDAY:

• Still being planned out. Possible tour of White House. Also will probably play tourist and see the Newseum and other museums. Jim Long, NBC Camera person at the White house, and famous Twitterer, is working on something, but hasn’t been firmed up yet.

Whew!

Anyway, please come along and we’ll try to get you to participate. If you have any specific questions for any of these people, please leave them here and we’ll read them during our interviews.

For all those times when smooching a Slave Princess Leia action figure just doesn’t cut it, Sega is rolling out a line of 15-inch robot girlfriends that will kiss on command.

The Eternal Maiden Actualization (EMA) will enter into “love mode” and plant one on your face when you lean in for a tiny plastic kiss. EMA will also dance, hand out business cards, and serve as a battery-operated reminder to everyone who owns one that they are lonely, lonely people.

EMA will go on sale in September, and Sega Toys, which makes the doll robot hopes to sell 10,000 of them in its first year.

I never like to buy the first generation of any tech product, so I’ll wait for EMA 2.0, which replicates the girlfriend experience even more by giving you a kiss, then pausing and looking at you. You ask her what’s wrong, she says, “Nothing.” You ask if it was something you did but she just sits there, crosses her robot arms and says, “It’s fine.” You say obviously she’s not fine, to which she responds with, “I’m fine. Whatever. Nothing’s wrong. Let’s just go.” And you say no, let’s talk about it, and she says, “We’re late, let’s just go this party and we can talk about it later,” ruining your whole evening as you try to figure out what exactly you said and — oh. Wait.

Whoops. Kinda drifted off there for a second.

(Image courtesy of Sega press release via CrunchGear.)

What’s in a company name? Plenty. It’s your first opportunity to brand yourself. Get it right and you’ll stand out as clever, useful, and memorable to potential users and investors — even if your product isn’t any good. But get it wrong and you’ll flame out before your product even gets out of beta.

So, what makes Brightmail, PayPal and IronPort great names, but Lycos, Xobni and Vidoop really lousy? It turns out there’s a formula for effective naming and it’s surprisingly simple.

Look at many of the most successful brands and you’ll notice they’re often compound names, consistently made up of two components:

• a word that relates to the company product in a direct, literal sense, establishing a clear association between the brand and what the company does.
• a word not literally related to the product, but rather a metaphorical adjective to evoke a differentiating characteristic or “feeling” about the company’s product.

Our minds are built to make connections, mostly at a subconscious level. When a metaphor is detected, it triggers a process in our brains that associates the metaphor with the next object or reference. This naming system forces the mind to take the cognitive step of associating the metaphor to the product it represents, thus forming a positive association to the brand. And once your brain has woven the connection, it sticks, so there’s a great chance your company name won’t be forgotten.

So when we break down the name Brightmail, we see that “mail” indicates what the product does — they make email — while “bright” is metaphorical, framing their product in a positive light. This same logic applies to PayPal; “pay” is literal, “pal” is metaphorical. Ditto with IronPort, a provider of email and web security products — “iron” is a metaphor for strength and “port” is a literal reference to what the company product protects: network ports.

Search company Lycos tried a made-up word, to ill effect. After all, what’s a lycos? Xobni makes a cool email service, but someone had to tell me that xobni is “inbox” spelled backwards. Vidoop is just yucky. Reminds me of, well, you know.

Of course there are startups that get so far out in front of their competitive fields, or whose products are so exemplary, that names which ought to have been tricky are nevertheless well received.

Consider Twitter. If you had asked me a year-and-a-half ago, I’d have said it was a terrible name — all I could think of was “twit.” But people’s associations with Twitter are good because its communication tool is first-in-class and offers a great experience.

I was recently asked to consult with a startup that is considering re-naming itself. It’s a good thing, because the name they’re using now is totally confusing. It’s one of those Google-wannabe made-up words that sounds vaguely Latin, but isn’t. Worst of all, it doesn’t tell users like me anything about the company’s product (they archive web pages). When the company explained the name to me, I got even more confused.

In my view, while site archiving is useful (and they do it well), this probably isn’t a broad-based enough service to be elevated to the level of a consumer utility, as search or micro-blogging (Twitter) have been. This means their made-up name is unlikely to ever be turned into a verb (like “to google” or “to tweet”).

I suggested some new names, based on the two-part formula:

ArchiText: Archi sounds like architect, a good association. It also refers to archive. “Arch” as a prefix is “chief,” so metaphorically it evokes priority. Text is literal for content. Combined you might get: “storage for vital web content.”
PermaPage: “Perma” evokes impermeability. “Page” is literal.
ArchWeb: “Arch” for “archive,” and the metaphorical “priority.” Web is web.

Evan Paull is software engineer for Mark Logic and a startup consultant.

There is some seriously good stuff on our network of sites today. Here are our top picks, for your Friday reading pleasure:

• NewTeeVee: Liz Gannes has a simple and logical way for YouTube to monetize the much-loathed but very popular user-generated videos, including Nora the piano-playing cat.
• Earth2Tech: T. Boone Pickens is set to spend $12 billion on the world’s largest wind farm in the Texas Panhandle, but his water investment in the area — around $100 million so far — could make an equally big splash for the ex-oilman.
• OStatic: Red Hat has entered the virtualization game by announcing their own hypervisor.
• WebWorkerDaily: Coping with FON-liness. One user decides that the WiFi-sharing service FON is not for him; he explains why he’s giving up on the service that promised to change the world.
• Refresh the Net: Why Five Nines is not enough when it comes to web infrastructure, considering how flexible the term availability has become.

I was recently talking to Richard Donaldson (an adviser of ours at Panorama Capital) of United Layer about a novel approach to optimizing data center cooling – using forward-looking infrared (FLIR) cameras.

United Layer rents a FLIR camera, he told me, the kind typically used to help pilots see at night or in dense fog, to create an infrared thermal image of equipment racks in which inefficient configurations can be easily detected. Once they’re found, United Layer works with the customer to redesign their rack layout, improving equipment performance, lifetime and total cost of ownership. Of course, this process also makes it easier to cool the data center, which helps control United Layer’s operational costs. As Donaldson explained to me in an email:

I think what we can see is that the “densifying” of the racks can become rather problematic when not thought thru – drive arrays should have spacing and be placed at base of cabs or close to cooling. I think that as existing facilities continually try to pack more into racks they will begin to really see how grossly inefficient the old “monolithic” paradigm of trying to cool the whole data center really is. The thermal images allow us to see exactly how each rack layout is good or bad for future design recommendations – all the temperature sensors in the world don’t give this kind of granularity…We also wanted to see real time thermal shots of our cold row heat containment strategies to prove and further illustrate what we knew from limited data.

Using FLIR to examine each equipment rack in a data center appears to be a novel and unique approach to optimizing cooling. I’ve seen thermal scans used to examine entire buildings for thermal leaks and hotspots, but never the use of FLIR to examine actual rack layouts in such detail. While a good quality FLIR camera sells for upwards of $10,000, Donaldson rented one for $80/day — what he called “an entrepreneurial approach.”

There are other new and interesting approaches to measuring the physical environments of data centers, such as the wireless sensors and benchmarking capabilities from Synapsense. But for $80/day I’m tempted to get Donaldson to hook me up with his FLIR camera rental company so I can check out our equipment racks myself.

Image credit: United Layer

If this story interests you then you should definitely check out our upcoming conference, Structure 08.

A few days ago, commenting on one of my posts, a reader inquired about my health, in particular whether or not I was behaving myself. While on the one hand I found it mildly amusing, as it felt like my mom was asking the question — which she does every Sunday — his comment also made me realize how much our little community cares about my well-being.

I’ve been meaning to write about my progress, but I’ve shied away from it because it always felt like I would be imposing on people’s time. And I’m still not ready to share it all.

But in the meantime, I can show off my new icon/avatar for the site. Gone is the old hat-wearing, cigar-chomping, newshound look. Instead, what you have is a simpler, more understated icon whose sparseness reflects my new mantra — less is really more. And doing more with less is really hard. Let’s call this version of me Om 2.0.

Simple food, simple clothes, a simple home and simple, clear writing. Hopefully I can stick to that plan. I have incorporated physical exercise into my daily life, given up smoking, gone almost completely vegetarian and taken to wearing jeans. Life, as they say, is uncomplicated. More importantly, about six months after my heart attack, I have resumed some of my regular activities — including playing tennis on the Wii!

In an interview published this morning in the Financial Times, Microsoft CEO Steve Ballmer said he wouldn’t be looking to pick up any other Internet companies just because the Yahoo deal failed. One can only imagine how far shares of Facebook would have plummeted on that comment had the social networking site been publicly traded. Ditto for Slide and RockYou, both of whom recently raised money at lofty valuations.

“People don’t understand what they’re talking about,” Ballmer told the FT. “At the end of the day, this is about the ad platform. This is not about just any one of the applications.” And for Microsoft, according to the interview, the primary ad platform is search. That makes sense as search is a billion-dollar, proven business.

Application companies have some ad revenue, but right now they’re kind of like cable channels for the web, while an ad platform is the means to a business model that supports that cable channel. Microsoft wants to own the keys to the business model. So to prove their worth, it’s time for application developers to prove their business model.

Verizon President and Chief Operating Officer Dennis Strigl made a big splash at NXTcomm 08 yesterday when he announced that the entire Verizon FiOS footprint could now get speeds of 50 megabits per second. Typically such bandwidth news wouldn’t cause that much of a furor, but there wasn’t much to write home about from the show, which was held in Las Vegas this week.

In his speech, Strigl pointed out that the U.S. has the highest number of broadband users when compared with other countries, in particular that broadband is available in every U.S. zip code. Good point — and one that I’ve made in the past myself — except that it’s no longer true. By that metric, China now leads. Yes, the FCC used to defined broadband as a service that offered, at a minimum, 200 kbps downloads, but it’s since changed that requirement to 768 kbps.

But where Strigl went too far was when he suggested that three-quarters of American households have two providers to choose from — aka a duopoly, which is not my idea of a competitive marketplace. If you factor in wireless and satellite, he said, there are actually six or seven competitors. Talk about twisting the facts to fit one version of the truth! This part of his speech, however, had me choking on my breakfast cereal.

“Massachusetts and New Jersey have similar population density to Korea and Japan and similar broadband penetration. Unlike other countries, what we have accomplished has come not through [government] policy but through private investment.

How telling. So subverting government policy via lobbyists and highly biased friends at the FCC to ensure a future monopoly is all part of good, capitalistic, private investment theory? Maybe Harvard can include that in its future MBA curriculum.

Regardless, I thought it would be fun to see how Massachusetts and New Jersey really square up against South Korea and Japan when it comes to the price of a broadband connection:

Average broadband speeds in South Korea and Japan are 49.5 megabits per second and 63.6 megabits per second, respectively. The average U.S. speed is about 4.9 megabits per second, making it the 14th-fastest country in the world. The average price in South Korea and Japan is about 83 cents per megabit. In the U.S, it’s about $2.83.

But since it would be unfair to use average U.S. stats, I went with Verizon’s prices, the ones it’s going to offer in Massachusetts and New Jersey. On Verizon’s FiOS network, a 50 Mbps connection costs $140 a month — or about $2.80 a megabit. In fact, if you went with Verizon’s 20 Mbps service, you would be paying $3.25 per megabit. (To be fair, Verizon’s price-per-megabit is still cheaper than the $5.25 Qwest charges for its 20 Mbps connection, which costs $105 a month.)

In other words, not until Verizon starts selling a 50 Mbps connection for $41.50 a month and 20 Mbps fiber connection for $16.60 a month can Strigl get away with comparing U.S. broadband with that of the rest of the world.

OK, so AMD refuses to comment on rumors that it plans to introduce a low-power chip aimed at the mobile Internet device market, where it would compete with Intel’s Atom chipset and offerings from several other rivals. And it refuses to claim a block diagram floated by eeepcnews.de as its plans for such a chip.

I was kind of hoping AMD might stay out of this MID market opportunity and focus on its core CPU business and getting its promising graphics processor and CPU platform off the ground instead of chasing Intel, Nvidia, Via, Qualcomm and Texas Instruments and their hopes for a pocket PC market. Plus, AMD’s been here and done that — back in 2002, when it purchased Alchemy Semiconductor and its line of MIPS-based, low-power personal device chips. That deal was a response to Intel’s Xscale assault, and AMD turned around and sold the Alchemy line in 2005.

AMD did, however, keep the low-power x86 chips for the embedded and personal device market that it purchased from National Semiconductor in 2003. The x86 architecture was more familiar to AMD’s existing chips, and the Geode line is still used in low-power devices, but isn’t very fast and wouldn’t be competitive for the MID opportunity.

It’s surprising that AMD doesn’t have anything better on offer already. Especially given AMD CEO Hector Ruiz’s 50×15 project, which aims to get computers and broadband to half of the population by 2015. An AMD-designed, low-power, high-performance chip would have been perfect for the project and then later for the MID market. However, the One Laptop Per Child laptops AMD is using for the project use a Geode processor. If this diagram represents AMD’s answer to Intel and the gang, why the heck has it waited so long? They had a perfect market for an MID chip and they let it pass them by. If anything, AMD could have sacrificed short-term profits for large volumes if it had to. Its main rival isn’t shy about doing that.

Updated: Silicon Valley, once known for groundbreaking innovation and amazing new inventions, these days makes news by personnel moves and executive exits. Not that there’s anything wrong with that — but it’s worth pointing out. Here are some of the latest moves:

• Facebook got a new COO, Sheryl Sandberg, a month after Chief Revenue Officer Owen Van Natta left. Last month, CTO Adam D’Angelo left. Today, Matt Cohler, one of the oldest Facebook employees, left the company to join Benchmark Capital as a general partner. No surprise by Matt’s move because he’s really tight with the eBoys. His exit says a lot about Facebook and its future. Looks like Sheryl is making some changes there. Matt called and pointed out that I was totally wrong about his relationship with Sheryl, who remains a close friend of his. My bad.
  
• Jeremy Zawodny, ex-Yahooer, is joining Craigslist. I couldn’t be happier for him and his new bosses, for they are like peas in a pod.
• Yahoo is losing even more executives — Senior VPs Brad Garlinghouse, Qi Lu and Vish Makhijani are hightailing out it of Dodge, continuing a Yahoo executive exodus that started nearly two years ago but went unnoticed. The only organization more dysfunctional than Yahoo? The New York Mets. My two cents: Jerry should totally recruit from outside of Silicon Valley and bring in a lot of fresh blood. Yahoo needs a cultural cleanse, quickly.

YouTube’s decision to allow long-form videos on its platform got a lot of people talking, including some bloggers claiming that it was a change in their strategy. (In case you want to know what changing strategy is all about, I can recommend reading this excellent article from Harvard Business Review.) What I found funny about this brouhaha over the new strategy is that it’s a really an old strategy that’s been dusted off for legal content.

Many seem to have forgotten that YouTube used to allow long-form videos on its platform. Sure, most of it was not-so-legal, and consisted of the latest television shows and other copyrighted content. In early 2006, I wrote about being able to find everything from cricket matches to television shows on YouTube. They eventually pulled them down, but only to appease the content owners they wanted to sign up for the YouTube platform.

Of course we all know some of the largest content owners decided to back Hulu, hoping to make it the destination site for premium video content. Hulu’s fortunes are getting better, but YouTube has been no shrinking violet. The site has grown to 82 million unique viewers per month and is as dominant as its parent company Google is in the search business. YouTube is so big that it rivals Microsoft in the search business. What that means is that YouTube has a lot of eyeballs but has had a tough time monetizing the content on its constantly growing site. YouTube isn’t the only online video player having a tough time with monetization. Many people in the online video sales business say that even professional video on sites like Microsoft and Yahoo is proving hard to cash in on, with as much as 50 percent of the inventory going a-begging.

YouTube’s problems are more acute because many of the videos it hosts are really short, which makes the content less useful when it comes to embedding advertising into the videos on the site. So it makes perfect sense for the company to encourage long-form videos on its network. Given that none of the big networks are going to give them their content, YouTube is going after produced episodic content. The long-form video opens up more advertising opportunities for YouTube.

They indicated as much at a special event launching the YouTube Screening Room in Los Angeles today. NewTeeVee has a report. NewTeeVee notes that “YouTube’s been hitting the film festival circuit, talking with directors.”

The strategy is rather similar to the one used by Google’s to popularize AdSense. By partnering with smaller content developers, YouTube is betting that it can aggregate enough traffic to sell to Madison Avenue. At the same time, there is a good chance that some of these small players will grow to become large video players and partners of YouTube. They could easily become a hub for indie movies, smaller and niche television content, and even foreign content, making it tough for startups such as Filmaka and Jaman.

It’s another beautiful day in the San Francisco Bay area, though unfortunately it’s going to be spent indoors, in meetings, as we plan for our Structure 08 conference. Almost everyone in the company except Stacey is going to be in the office, and that means a hectic and challenging day. Thankfully there is no SF Giants game today, so we won’t have any crazy onlookers walking past our digs. Anyway, here are some interesting links that might be worth checking out:

• The Wall Street Journal reports that AT&T wants DISH to pay back $500 million in convertible notes, a move that indicates the partners might be on the verge of breaking up. Of course, it also indicates that AT&T has no interest in buying DISH anymore. WSJ points out that DirecTV has leveraged the HDTV trend better than DISH. The growth in the satellite industry has almost halved. AT&T’s move shouldn’t come as a surprise — they have to grow their IPTV business, and fast.
• France is going to ban illegal Internet downloaders, according to Times UK Online. So much for the great, technology-friendly President Sarkozy. He’s joined the likes of Universal’s CEO, in my book — people who don’t quite understand the real issues around the Internet and believe in strongarming.
• Apparently the guys at PPLive have no such problems. Meet the Asian Joost, which is cranking out some big numbers and is on the prowl to buy its way into the U.S. market.
• Amidst all its misery, Motorola has something to celebrate. Its GPON division has found two new buyers, even if they are microscopic in size.
• Are you a Wi-Fi thief? The answer is yes. Seriously, I’m not joking about that.
• More Free SMS for you…and I mean FREE. You know how much I love free SMS services. Today, the folks at 3Jam have introduced a new service that would allow you to send and receive free SMS messages. It’s also context-aware. It’s still in beta, and the first 100 GigaOM readers can try it. I think this one could catch on. Watch how it works on YouTube.
• By the way, did you know that men like the mobile web and constitute 88.1 percent of total web users? Or so claims Opera. I think that would be that 88.1 percent of Opera users are men. Nearly 14.7 million used their Opera Mini to browse the web. Great, though not as much fun as iPhone browsing. I use it for checking out WAP.MLB.COM — all the time!
• There is a growing army of people who, like me, stumble into becoming web workers, which isn’t as easy as it seems.
• And if all that seems frivolous, then it is frivolous. Check out this report on Earth2Tech, which points out that our planet’s climate change problems are worse than previously thought. This comes from a group of highly respected, Nobel Prize-winning scientists.

Before I sign off, I just wanted to get your feedback on this “interesting” post — if you like it or not, should I carry on or not, or perhaps how best to improve it. I have embedded a little poll for a spot test.

The 10 hours of video uploaded every minute to YouTube could be a problem for Google’s infrastructure. Video files are fat and people don’t want to wait long once they press play, which means keeping them requires a trade-off between fast access and cheap storage. A range of companies are trying to address these sorts of storage problems through compression, caching and even Flash memory in the data center.

 But since you can’t cache everything, the recent study from Tubemogul, which shows that online videos get the most views in the first three days (with the peak demand occurring on Day Three), can help set caching policies. Dropping a video from the cache after 11 days would mean only half of the video’s viewers would be tormented with a slightly slower upload time.

Parallel processing isn’t just for supercomputers or GPUs anymore. Computer makers are throwing multiple cores at everything from servers to your printer. But the focus on horsepower misses a crucial problem associated with adding more processors. To really take advantage of them, you have to rewrite your code.As anyone who’s ever hosted a demolition party well knows, you can only throw so many workers at a problem before people start to linger at the edges, swill your alcohol and generally stop helping. You need not just manpower, but a good way to organize those workers so that someone, says, preps a drop cloth before your walls get taken out. And others prep for cleanup while the plaster is flying.

Silicon doesn’t tend toward drunken destruction, but if you’re putting the cores in place, it would be great to give them better instructions. Otherwise the promise of performance is just a promise, which is why Microsoft and Intel recently pledged $20 million to two universities trying to figure out an easy way to translate the billions of lines of code into an instruction set for multicore chips.

Others are pushing Erlang as a potential solution to parallel programming, while those in the supercomputing industry are warning of a performance drop caused by applications not keeping up with the cores. Software startup VirtualLogix is trying to use virtualization software to govern how multicore chips run applications by making the programs think they’re running on one processor.

Last week, during the launch of the iPhone, Steve Jobs told the New York Times that the next generation of the Apple OS will not focus on new features, but will instead solve the problem of writing software for multicore processors. Apple has code-named the technology Grand Central, and based it on a programming language called OpenCL. It will parallelize C programming languages for graphics processors.

Besides investing millions of research dollars into the search for a magic compiler or reviving an older language, chip vendors are coming up with stopgaps. Unfortunately these stopgaps are focused solely on their own silicon. Nvidia has released a tool called CUDA to help translate C languages into parallel instructions that can be used by Nvidia’s GPUs for scientific computing. (Apple’s OpenCL looks similar to CUDA.) And AMD also has its own effort, called Stream.

Freescale on Monday announced a set of multicore embedded processors that come with software support in the form of a simulator that ships before the chips do. As a result, users can start their development efforts and test their multicore code weeks ahead of time. “Customers are not looking for suppliers to offer them a chip and then leave them to program it themselves,” explained Steve Cole, a systems architect for Freescale. “There’s a certain amount of support and market knowledge that we need to have to help our customers.”

With all the work it takes to rewrite code, it’s no wonder everyone from startups to established companies are desperately searching for the programming equivalent of a Babel fish to solve the problem. The one that succeeds will be responsible for taking computing to its next jump in speed.