I’ve just been to China. Again. It’s only been a few months since I was last there.
I was lucky enough to attend the 5th China Cloud Computing Conference at the China National Convention Center in Beijing. You probably have not heard of it, but it’s an impressive conference. It’s “the one” for the cloud computing industry. It was a unique view for me – more of an inside-out view of the industry. Everyone who’s anyone in China’s cloud industry was there.
First, the air was really hazy, but I don’t think the locals considered it that bad. The US consulate iPhone app said the particulates were in the very unhealthy range. Imagine looking across the street. Sure, you can see the building there, but the next one? Not so much. Look up. Can you see past the 10th floor? No, not really. The building disappears into the smog. That’s what it was like at the China National Convention Center, which is part of the same Olympics complex as the famous Birdcage stadium: http://www.cnccchina.com/en/Venues/Traffic.aspx
I had a fantastic chance to catch up with a university friend, who has been living in Beijing since the 90’s, and is now a venture capitalist. It’s amazing how almost 30 years can disappear and you pick up where you left off. He sure knows how to live. I was picked up in his private limo, whisked off to a very well-known restaurant across the city, where we had a private room and private waitress. We even had some exotic, special dishes that needed to be ordered at least a day in advance. Wow. But we broke Chinese tradition and had imported beer in honor of our Canadian education.
Sizing up China’s cloud infrastructure
The most unusual meeting I attended was an invitation-only session – the Sino-American roundtable on cloud computing. There were just about 40 people in a room – half from the US, half from China. Mostly what I learned is that the cloud infrastructure in China is fragmented, and probably sub-scale. And it’s like that for a reason. It was difficult to understand at first, but I think I’ve made sense of it.
I started asking why to friends and consultants and got some interesting answers. Essentially different regional governments are trying to capture the cloud “industry” in their locality, so they promote activity, and they promote creation of new tools and infrastructure for that. Why reuse something that’s open source and works if you don’t have to and you can create high-tech jobs? (That’s sarcasm, by the way.) Many technologists I spoke with felt this will hold them back, and that they are probably 3-5 years behind the US. As well, each government-run industry specifies the datacenter and infrastructure needed to be a supplier or ecosystem partner with them, and each is different. The national train system has a different cloud infrastructure from the agriculture department, and from the shipping authority, etc… and if you do business with them – that is you are part of their ecosystem of vendors, then you use their infrastructure. It all spells fragmentation and sub-scale. In contrast, the Web 2.0 / social media companies seem to be doing just fine.
Baidu was also showing off its open rack. It’s an embodiment of the Scorpio V1 standard, which was jointly developed with Tencent, Alibaba and China Telecom. It views this as a first experiment, and is looking forward to V2, which will be a much more mature system.
I was also lucky to have personal meetings with general managers,chief architects and effective CTOs of the biggest cloud companies in China. What did I learn? They are all at an inflexion point. Many of the key technologists have experience at American Web 2.0 companies, so they’re able to evolve quickly, leveraging their industry knowledge. They’re all working to build or grow their own datacenters, their own infrastructure. And they’re aggressively expanding products, not just users, so they’re getting a compound growth rate.
Here’s a little of what I learned. In general, there is a trend to try and simplify infrastructure, harmonize divergent platforms, and deploy more infrastructure by spending less on each unit. (In general, they don’t make as much per user as American companies, but they have more users). As a result they are more cost-focused than US companies. And they are starting to put more emphasis on operational simplicity in general. As one GM described it to me – “Yes, techs are inexpensive in China for maintainence, but more often than not they make mistakes that impact operations.” So we (LSI) will be focussing more on simplifying management and maintainence for them.
Baidu’s biggest Hadoop cluster is 20k nodes. I believe that’s as big as Yahoo’s – and it is the originator of Hadoop. Baidu has a unique use profile for flash – it’s not like the hyperscale datacenters in the US. But Baidu is starting to consume a lot. Like most other hyperscale datacenters, it is working on storage erasure coding across servers, racks and datacenters, and it is trying to make a unified namespace across everything. One of its main interests is architecture at datacenter level, harmonizing the various platforms and looking for the optimum at the datacenter level. In general, Baidu is very proud of the advances it has made, and it has real confidence in its vision and route forward, and from what I heard, its architectural ambitions are big.
JD.com (which used to be 360buy.com) is the largest direct ecommerce company in China and (only) had about $10 billion (US) in revenue last year, with 100% CAGR growth. As the GM there said, its growth has to slow sometime, or in 5 years it’ll be the biggest company in the world. I think it is the closest equivalent to Amazon there is out there, and they have similar ambitions. They are in the process of transforming to a self-built, self-managed datacenter infrastructure. It is a company I am going to keep my eyes on.
Tencent is expanding into some interesting new businesses. Sure, people know about the Tencent cloud services that the Chinese government will be using, but Tencent also has some interesting and unique cloud services coming. Let’s just say even I am interested in using them. And of course, while Tencent is already the largest Web 2.0 company in China, its new services promise to push it to new scale and new markets.
Extra! Extra! Read all about it …
And then there was press. I had a very enjoyable conversation with Yuan Shaolong, editor at WatchStor, that I think ran way over. Amazingly – we discovered we have the same favorite band, even half a world away from each other. The results are here, though I’m not sure if Google translate messed a few things up, or if there was some miscommunication, but in general, I think most of the basics are right: http://translate.google.com/translate?hl=en&sl=zh-CN&u=http://tech.watchstor.com/storage-module-144394.htm&prev=/search%3Fq%3Drobert%2Bober%2BLSI%26client%3Dfirefox-a%26rls%3Dorg.mozilla:en-US:official%26biw%3D1346%26bih%3D619
I just keep learning new things every time I go to China. I suspect it has as much to do with how quickly things are changing as new stuff to learn. So I expect it won’t be too long until I go to China, again…
I’ve been travelling to China quite a bit over the last year or so. I’m sitting in Shenzhen right now (If you know Chinese internet companies, you’ll know who I’m visiting). The growth is staggering. I’ve had a bit of a trains, planes, automobiles experience this trip, and that’s exposed me to parts of China I never would have seen otherwise. Just to accommodate sheer population growth and the modest increase in wealth, there is construction everywhere – a press of people and energy, constant traffic jams, unending urban centers, and most everything is new. Very new. It must be exciting to be part of that explosive growth. What a market. I mean – come on – there are 1.3 billion potential users in China.
The amazing thing for me is the rapid growth of hyperscale datacenters in China, which is truly exponential. Their infrastructure growth has been 200%-300% CAGR for the past few years. It’s also fantastic walking into a building in China, say Baidu, and feeling very much at home – just like you walked into Facebook or Google. It’s the same young vibe, energy, and ambition to change how the world does things. And it’s also the same pleasure – talking to architects who are super-sharp, have few technical prejudices, and have very little vanity – just a will to get to business and solve problems. Polite, but blunt. We’re lucky that they recognize LSI as a leader, and are willing to spend time to listen to our ideas, and to give us theirs.
Even their infrastructure has a similar feel to the US hyperscale datacenters. The same only different. ;-)
A lot of these guys are growing revenue at 50% per year, several getting 50% gross margin. Those are nice numbers in any country. One has $100’s of billions in revenue. And they’re starting to push out of China. So far their pushes into Japan have not gone well, but other countries should be better. They all have unique business models. “We” in the US like to say things like “Alibaba is the Chinese eBay” or “Sina Weibo is the Chinese Twitter”…. But that’s not true – they all have more hybrid business models, unique, and so their datacenter goals, revenue and growth have a slightly different profile. And there are some very cool services that simply are not available elsewhere. (You listening Apple®, Google®, Twitter®, Facebook®?) But they are all expanding their services, products and user base. Interestingly, there is very little public cloud in China. So there are no real equivalents to Amazon’s services or Microsoft’s Azure. I have heard about current development of that kind of model with the government as initial customer. We’ll see how that goes.
100’s of thousands of servers. They’re not the scale of Google, but they sure are the scale of Facebook, Amazon, Microsoft…. It’s a serious market for an outfit like LSI. Really it’s a very similar scale now to the US market. Close to 1 million servers installed among the main 4 players, and exabytes of data (we’ve blown past mere petabytes). Interestingly, they still use many co-location facilities, but that will change. More important – they’re all planning to probably double their infrastructure in the next 1-2 years – they have to – their growth rates are crazy.
Often 5 or 6 distinct platforms, just like the US hyperscale datacenters. Database platforms, storage platforms, analytics platforms, archival platforms, web server platforms…. But they tend to be a little more like a rack of traditional servers that enterprise buys with integrated disk bays, still a lot of 1G Ethernet, and they are still mostly from established OEMs. In fact I just ran into one OEM’s American GM, who I happen to know, in Tencent’s offices today. The typical servers have 12 HDDs in drive bays, though they are starting to look at SSDs as part of the storage platform. They do use PCIe® flash cards in some platforms, but the performance requirements are not as extreme as you might imagine. Reasonably low latency and consistent latency are the premium they are looking for from these flash cards – not maximum IOPs or bandwidth – very similar to their American counterparts. I think hyperscale datacenters are sophisticated in understanding what they need from flash, and not requiring more than that. Enterprise could learn a thing or two.
Some server platforms have RAIDed HDDs, but most are direct map drives using a high availability (HA) layer across the server center – Hadoop® HDFS or self-developed Hadoop like platforms. Some have also started to deploy microserver archival “bit buckets.” A small ARM® SoC with 4 HDDs totaling 12 TBytes of storage, giving densities like 72 TBytes of file storage in 2U of rack. While I can only find about 5,000 of those in China that are the first generation experiments, it’s the first of a growing wave of archival solutions based on lower performance ARM servers. The feedback is clear – they’re not perfect yet, but the writing is on the wall. (If you’re wondering about the math, that’s 5,000 x 12 TBytes = 60 Petabytes….)
Yes, it’s important, but maybe more than we’re used to. It’s harder to get licenses for power in China. So it’s really important to stay within the envelope of power your datacenter has. You simply can’t get more. That means they have to deploy solutions that do more in the same power profile, especially as they move out of co-located datacenters into private ones. Annually, 50% more users supported, more storage capacity, more performance, more services, all in the same power. That’s not so easy. I would expect solar power in their future, just as Apple has done.
Here’s where it gets interesting. They are developing a cousin to OpenCompute that’s called Scorpio. It’s Tencent, Alibaba, Baidu, and China Telecom so far driving the standard. The goals are similar to OpenCompute, but more aligned to standardized sub-systems that can be co-mingled from multiple vendors. There is some harmonization and coordination between OpenCompute and Scorpio, and in fact the Scorpio companies are members of OpenCompute. But where OpenCompute is trying to change the complete architecture of scale-out clusters, Scorpio is much more pragmatic – some would say less ambitious. They’ve finished version 1 and rolled out about 200 racks as a “test case” to learn from. Baidu was the guinea pig. That’s around 6,000 servers. They weren’t expecting more from version 1. They’re trying to learn. They’ve made mistakes, learned a lot, and are working on version 2.
Even if it’s not exciting, it will have an impact because of the sheer size of deployments these guys are getting ready to roll out in the next few years. They see the progression as 1) they were using standard equipment, 2) they’re experimenting and learning from trial runs of Scorpio versions 1 and 2, and then they’ll work on 3) new architectures that are efficient and powerful, and different.
Information is pretty sketchy if you are not one of the member companies or one of their direct vendors. We were just invited to join Scorpio by one of the founders, and would be the first group outside of China to do so. If that all works out, I’ll have a much better idea of the details, and hopefully can influence the standards to be better for these hyperscale datacenter applications. Between OpenCompute and Scorpio we’ll be seeing a major shift in the industry – a shift that will undoubtedly be disturbing to a lot of current players. It makes me nervous, even though I’m excited about it. One thing is sure – just as the server market volume is migrating from traditional enterprise to hyperscale datacenter (25-30% of the server market and growing quickly), we’re starting to see a migration to Chinese hyperscale datacenters from US-based ones. They have to grow just to stay still. I mean – come on – there are 1.3 billion potential users in China….
Tags: Alibaba, Amazon, Apple, ARM, Baidu, China, China Telecom, datacenter, Facebook, Google, Hadoop, hard disk drive, HDD, hyperscale, Microsoft, OpenCompute, Scorpio, Shenzhen, Sina Weibo, solid state drive, SSD, Tencent, Twitter