Startup Lowers the Cost of Cloud Services by Harnessing Idle Computers

THE INSTITUTEFor many small businesses, cloud-based products such as Amazon Web Services and Microsoft Azure are too expensive. They are looking for affordable alternatives that still provide a variety of features.

The founders of Nakamoto & Turing Labs say their company has developed a product for them. The startup’s Pekka cloud-computing platform uses blockchain technology to connect customers who want compute-intensive services with people around the world who want to rent them their idle computer.

The startup was founded by IEEE Senior Member Chong Li, Member Lei Zhang, and Member Sichao Yang, who is the CEO. All three were coworkers at Qualcomm, in San Diego. They launched the startup in 2018 and have raised US $2 million. The company has six employees in its New York City office and seven at its office in Hangzhou, China.

“Nearly 70 percent of computer processing power goes unused daily in the world—which is a big waste for computer owners,” Yang says. “There are powerful machines such as home gaming computers and computing machines in private data centers that are not being used most of the time. We provide an incentive to [computer owners] to share their machines on our platform.”

Less expensive ALTERNATIVE

Revenue from cloud computing was expected to exceed $200 billion this year. It has been growing annually by about 16 percent, Yang says.

Roughly $25 billion of that revenue is generated by individuals and small business.

“These companies want to use inexpensive, secure, and reliable Web services, but there are still no perfect solutions for them on the market,” Yang says. “We started our business to serve them.”

Pekka can reduce a business’s cloud-computing costs by up to 90 percent, he says. The company charges a 10-percent commission to connect cloud-computing clients with those who want to rent out their computer.

Currently the Pekka platform provides several popular machine-learning frameworks and tools, plus storage, the open-source Web application Jupyter Notebook, and other services. Other offerings the company expects to launch soon are image rendering and blockchain-as-a-service.

Pekka is in beta testing now. N&T expects to launch its commercial version in May. The company has filed two U.S. patent applications for the platform, Yang says.

PEER-TO-PEER SHARING

Blockchain’s decentralized technology provides security and privacy for data on shared computers, Yang says. Unlike current cloud-based Web services in which personal data and proprietary data go to the service provider, Pekka has no tracking mechanism on its central server, nor does the platform store the user’s data, he says. In that sense, he says, Pekka is a peer-to-peer shared computing service.

“Customers can segment their data and submit jobs to multiple geographically distributed machines belonging to different providers,” he says. “The blockchain technology makes sure the jobs run in a secure and trusted environment in a decentralized way.”

To prevent hacking, a job is divided into pieces and distributed to different machines, so a hacker never could access all the data nor be able to identify the data’s owner. Furthermore, the service runs on virtual machines, which has good isolation with the rented computers acting as the hosts, and the data securely housed inside the virtual machines. The person who controls the host computer doesn’t have access to the virtual machine, and the person who controls the virtual machine can’t access the data on the host machine.

COLLABORATIVE ENVIRONMENT

Pekka provides a way for users to share their open-source projects and research results with others, Yang says.

“Researchers from universities are joining industry mainly because the massive data owned by the company could help them generate new ideas or validate new models,” he says. “There are lots of talented data scientists and AI lovers who don’t have access to enough data or to advanced technologies. We are building an open community where people not only can share their computers but also their data, models, or algorithms—which will drive more innovations.”

BUSY VOLUNTEERS

Even though all three N&T cofounders are busy running their startup, they are still active in the IEEE community. They present their research papers and give tutorials at flagship gatherings such as the IEEE International Conference on Communications and the IEEE Global Communications Conference. Yang says all three coauthored a paper with Columbia University professors on how to use low-density parity-check codes to reduce the storage of information or ledger in blockchain. The paper has been submitted to IEEE for acceptance in one of its journals.

INNOVATIVE SPIRIT

Qualcomm’s culture and focus on innovation shaped the cofounders’ way of doing business, Yang says. “Like Qualcomm, we are also technology-driven, with innovation in our genes,” he says.

He compared N&T to the early days of Qualcomm, whose founders saw the potential for code division multiple access (CDMA) in the emerging cellular field as a way to dramatically increase capacity and to make wireless communication more affordable.

“The industry had invested millions in time division multiple access and was reluctant to change course,” Yang says. “Some argued that CDMA was too complex and expensive to deploy, but Qualcomm’s founders’ relentless efforts finally paid off.

“We’re on the same path Qualcomm was on in its early days. The beginning is difficult, but we trust our vision and are working on something that is going to change the world for people who do computing and use Web services, and make them affordable to all.”