Deutsche Borse cloud exchange to have same limitation of those before it

In a word, it's about compatibility

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Deutsche Borse, best known for operating stock exchanges, is getting into a new kind of exchange. It plans to launch a service for “trading” cloud computing resources.

The platform will allow businesses to choose providers based on price and location of the cloud. Initially, it will only include storage and compute resources.

Cloud providers can also use the exchange to buy resources to offer to customers. So for instance, if a customer must keep some data in a certain market for legal reasons but their cloud provider doesn’t operate in that market, the provider can buy storage from another provider and supply it to the customer.

CloudSigma and Equinix are two big names that have signed up to be part of the exchange.

Deutsche Borse is only the latest organization to try to link cloud providers. The first was Enomaly’s SpotCloud, initially designed as an exchange where providers could offload unused capacity. Virtustream bought Enomaly in late 2011 and I haven’t heard much about it since, although it appears SpotCloud is still running.

Then there’s Rackspace and VMware. Both companies are trying to link clouds built with their technologies in ways that aim to make it easy for businesses to consume cloud services even if their provider of choice doesn’t offer exactly what they need.

The problem with all of the efforts is technology compatibility. In the case of SpotCloud, Rackspace and VMware, only cloud service providers running technologies from those vendors can be a part of their respective exchanges.

That may limit the providers that can participate but it makes sense for cloud consumers who often will need to standardize on a cloud platform. In many instances, businesses will want to only use cloud services that are built on a single technology. That makes it much easier to move workloads and stitch together projects that may run on multiple clouds.

Deutsche Borse, however, calls its platform “vendor-neutral.” Presumably that means clouds of any color can participate in the exchange. That sounds nice but won’t solve the problem: Businesses that use the exchange, then, will most often need to sort through providers to find a compatible cloud. Compatibility is an issue, whether it means restricting the number of providers in an exchange or forcing users to search for a compatible cloud.

However, the tide is starting to turn, meaning Deutsche Borse might be on to something. I am increasingly hearing talk of “multi-cloud,” where businesses use a host of different cloud services that don’t necessarily connect. A business might use Amazon Web Services to host an ecommerce service, Azure to run a Microsoft application, and Parse to run a mobile app. None of those services may interact with another.

That said, I suspect that most companies that would turn to an exchange like the one Deutsche Borse is building will do so for legal reasons – they’ll be looking for a service that they need by law that their current provider can’t offer. Those scenarios likely will need to interact with an application running elsewhere, requiring compatibility among the cloud services.

I’ve asked CloudSigma for comment on the compatibility issue but the company is based in Zurich so I don’t expect a response until tomorrow. I’ll update this post if I hear anything interesting from the company.

Read more of Nancy Gohring's "To the Cloud" blog and follow the latest IT news at ITworld. Follow Nancy on Twitter at @ngohring and on Google+. For the latest IT news, analysis and how-tos, follow ITworld on Twitter and Facebook.

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