

CIA to software vendors: A revolution is coming - leeskye
http://www.reuters.com/article/2012/02/22/us-cia-software-idUSTRE81L03C20120222

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brian_cloutier
This title is link bait.

The CIA wants to pay for software on demand instead of using long fixed
licenses. This way they won't be quite as locked into a given product and will
have a much easier time catching up with the state of the art.

An interesting note is it sounds like the CIA wants to host software
internally (understandable) and pay for what they use by telling you how much
they used.

There is no revolution here, unless you're in the business of providing
software to the CIA. And even then, only your pay structure is changing.

~~~
famousactress
Totally agree on the title, and revolution is a strong term outside of the
immediate sphere of affected vendors.. but consider that sphere, and how many
businesses operate with giant enterprise licensing agreements.

I think it might be a bigger deal than you think. It's not just pay structure,
it's the fact that the sales cycle, and jobs that would be at stake if someone
admitted purchasing multi-million dollar bullshit encourages companies to hire
great sales teams, sell crap product, and refuse to innovate.

I'd love to see this take hold and infect other agencies that rely on my tax
dollars for ridiculous DOORS licenses, etc.

~~~
spoiledtechie
The other thing I want to add, is most companies make their money from this
type of long drawn out licensing cycle. They lose money on the build, but the
long period of which they "maintain" is what make the most money.

Its even at the point where Govt contractors don't understand how to charge
for what the CIA proposes. Its good for the tax payer, bad for the big govt
contractors and hopefully will save the govt large amounts of money.

I am happy to see it as a tax payer even though I work for one of the large
govt contractors. I wouldn't consider it link bait. It is a revolution in the
idea that contractors won't know how to deal with this.

~~~
famousactress
Totally! And the funny thing is that it's something of a cultural food chain.
The next-biggest entities that likely suffer from this are the sorts of
companies (the Boeings, HPs, Lockheads, Oracles...) that are selling these
agencies the goods (because they buy lots of their software this way as well).
I'd be thrilled to see it trickle down and change the way a lot of these
projects are bought-and-paid-for.

That said? It's nerve-wracking. My (barely educated) impression is that lot of
these projects are something like selling a multi-million dollar project that
hasn't been built yet to the organizational equivalent of the cat-lady from
the Simpsons. Attaching what are essentially performance-weighted payment
structures to it (we'll pay you when/if we use it) sounds risky. Even if you
think you're capable of building a solid product, you're success at this point
also depends largely on the client's ability to predict and specify their
actual needs.

I'm in the weeds, but my point is that I wonder if the CIA might find bidders
for these projects turn shy.

------
nwatson
If any VC's out there are interested in (a) packaging multi-vendor packages of
software services; (b) selling them to interested companies/organizations like
the CIA; (c) helping those customers keep track of their departmental
consumption for payment; (d) making sure those payments get to the
integrators/original-software-vendors; (e) perhaps even letting "customers"
also be "distributors" (infinite hierarchies of resale); (f) >>> paying
Hitachi Data Systems licensing fees on patents <<<; (g) >>> having me be the
CTO <<< ... then I have the complete I.P. understanding and good tech
expertise to put together this solution. There are some technical challenges
but these are surmountable.

Here are patents applied for in 2001 that now have been granted related to all
aspects of software licensing, distribution, hierarchical apportioning of
proceeds, etc. (see Google links after patents list). Note that I did primary
patent disclosures to the I.P. lawyer who filed the patents on behalf of the
small company later acquired by Hitachi. Anyone doing work in this area is
going to step on the claims of these patents. Patents (dang, I just realized
these are still in "patent application phase" form but they've been referenced
by the likes of Oracle, Microsoft, AT&T, BMC, etc. -- Google's patent search
didn't used to return patent applications, I don't think, ... anyway ...):

    
    
      * US 2003/0084000 A1
      * US 2003/0084060 A1
      * US 2003/0084145 A1
      * US 2003/0083994 A1
      * US 2003/0084341 A1
      * US 2003/0083892 A1
      * US 2003/0083999 A1
      * US 2003/0083998 A1
      * US 2003/0083995 A1
      * US 2003/0084343 A1
    

Ugly links:

[http://www.google.com/patents?id=7ZnvAAAAEBAJ&hl=en&...](http://www.google.com/patents?id=7ZnvAAAAEBAJ&hl=en&dq=ininventor:%22Nathan+Watson%22+ram)

[http://www.google.com/patents?id=uZvvAAAAEBAJ&hl=en&...](http://www.google.com/patents?id=uZvvAAAAEBAJ&hl=en&dq=ininventor:%22Nathan+Watson%22+ram)

[http://www.google.com/patents?id=Op3vAAAAEBAJ&hl=en&...](http://www.google.com/patents?id=Op3vAAAAEBAJ&hl=en&dq=ininventor:%22Nathan+Watson%22+ram)

[http://www.google.com/patents?id=55nvAAAAEBAJ&hl=en&...](http://www.google.com/patents?id=55nvAAAAEBAJ&hl=en&dq=ininventor:%22Nathan+Watson%22+ram)

[http://www.google.com/patents?id=uqDvAAAAEBAJ&hl=en&...](http://www.google.com/patents?id=uqDvAAAAEBAJ&hl=en&dq=ininventor:%22Nathan+Watson%22+ram)

[http://www.google.com/patents?id=jZfvAAAAEBAJ&hl=en&...](http://www.google.com/patents?id=jZfvAAAAEBAJ&hl=en&dq=ininventor:%22Nathan+Watson%22+ram)

[http://www.google.com/patents?id=7JnvAAAAEBAJ&hl=en&...](http://www.google.com/patents?id=7JnvAAAAEBAJ&hl=en&dq=ininventor:%22Nathan+Watson%22+ram)

[http://www.google.com/patents?id=65nvAAAAEBAJ&hl=en&...](http://www.google.com/patents?id=65nvAAAAEBAJ&hl=en&dq=ininventor:%22Nathan+Watson%22+ram)

[http://www.google.com/patents?id=6JnvAAAAEBAJ&hl=en&...](http://www.google.com/patents?id=6JnvAAAAEBAJ&hl=en&dq=ininventor:%22Nathan+Watson%22+ram)

[http://www.google.com/patents?id=vKDvAAAAEBAJ&hl=en&...](http://www.google.com/patents?id=vKDvAAAAEBAJ&hl=en&dq=ininventor:%22Nathan+Watson%22+ram)

~~~
nwatson
For a further clarification of a "multi-vendor" scenario, here's a
hypothetical situation:

\- an integrator knows the CIA, FBI, and successor to the KGB all need secure
software services

\- the integrator convinces two secure data centers, one in Reston, VA, and
the other in Moscow, to host equivalent infrastructures

\- the integrator puts together a suite of services consisting of: Oracle DB
(backend store for some services); Microsoft SQL Server (backend store for
others); AT&T network connectivity to/from Reston data center; Russian network
connectivity to/from Moscow data center; SharePoint document repository;
Microsoft Office suite of tools; document-management vendor software managing
search, archival, secure role-based access to documents, automatic purging of
documents after a given time where applicable; EMC networked storage; image-
processing tools with plugin architecture; automated image-processing software
from several small specialized shops to recognize military equipment,
buildings, insurgent hideouts, etc.; bla bla bla bla

\- the integrator puts in measuring tools everywhere to gather usage data:
data transmission; storage used; DB activity; #-of-important-items-recognized-
during-image-processing-runs; #-of-users-in-system-X; #-of-document-views;
etc.

\- the integrator applies billing policies for the entire stack, perhaps on a
different basis per customer (e.g., CIA/FBI get large-volume discount price
list; Syria's secret service gets small-fry high-cost pricing)

\- large organizations will likely have (a) a central consulting group acting
as a distributor to other departments (along with payments to integrator and
income from other departments); (b) other departments that will buy from
central consulting organization

\- at the end of every month, each
department/organization/consultant/integrator either: (a) gets income from
their customers and downstream distributors; (b) pays someone upstream for
their usage; or (c) both pays and gets some income

\- in this case, the integrator (a) pays out to Oracle, Microsoft, EMC, data
centers, etc., all on a per-use basis (of course, a flat monthly fee for any
particular item is also "per-use" of a month); (b) receives incomes from its
direct customers

\- given adequate security the actors in this scheme need not ever know
directly who their upstream or downstream is beyond a single level

------
amalag
This is just one agency but I think they are thinking twice about spending 10m
on a product and getting locked in because it was sold as the be-all end-all.
Big vendors like Palantir, and the database vendors mentioned will pay
attention.

------
jvoorhis
I find the retail metaphor for utility computing supremely awkward.

~~~
manvsmachine
I'm guessing that that's the reporter's fault. The quote seems to referring to
AWS, which they've probably never heard of, leading them to make a uninformed
guess as to its meaning. Just another case of general media reporters covering
stories they're not qualified for.

~~~
lusr
If you guys mean this quote, thank you for allowing my brain to calm down
because for about a minute I thought I was going completely insane in being
unable to parse what was being written.

| "Think Amazon," he said, referring to the electronic commerce giant where
the inventory is vast but the billing is per item. "That model really works."

~~~
manvsmachine
That's the one.

