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Cloud Computing 101 SAMPLE
Issue 2
April 28th 2012
www.alanquayle.com/blog
Outline: Part 1: Introduction to Cloud Computing
• Confusion and Cloud-Washing
• Cloud Consolidation
• History
• Vision
• Definitions – focus on NIST
• Cloud computing reference architecture
• Actors, Brokers, Consumers, Auditors,
• Cloud Types: Public, Private, Community and Hybrid
• Orchestration and Management
• Business support, security and privacy
• Cloud Benefits and Issues
• Cloud Misconceptions
• The Open Group Survey 2011
2
Outline: Part 2: Getting into the Details
• Mapping suppliers and technologies in Cloud Computing
• Understanding the economics behind the benefits
• Quantifying the benefits
• Cloud market taxonomy and market size
• CSPs and Cloud Computing
o AT&T, BT, DT, NTT, Orange, SingTel, Verizon
• Mapping the workloads
• SOA and the Cloud
• Cloud Computing in Asia
3
Outline: Part 3: Understanding the Components
• Summary: Web 2.0, SaaS, Utility Computing, Virtualization, SLAs, Autonomic computing, Grid
technology, Web Services, Service Oriented Architectures, Free and Open Source Software
• Deep Dive: Virtualization
o History
o Issues and Trends
o Supplier review: Citrix, IBM, Linux, Microsoft, Novell, Symantec, Oracle, VMWare
• Deep Dive: Data Centers
o History and the drive for efficiency and availability
o Changes and pressures on DC – drive for DC management
o Capex and opex DC costs
o DC economics drives cloud computing
• Deep Dive: Force.com, Google, Microsoft and Amazon
o Force.com
o Google App Engine
o Microsoft Azure
o Amazon Web Services
• Netflix deep dive • AWS walk-through
4
Outline: Part 4: Implementation
• Survey - what workloads others are moving into the cloud
• Summary
o Key points in cloud migration
o Industry : Workload : Cloudability Space
• Project Plan – example from IBM
• Decision Tree for implementing Cloud Computing
o The Open Group decision tree
• Security
o Reviewing SAS70, PCI DSS, ISO27001, NIST, HIPAA, FISMA, CoBIT, Data
Protection Directive, practical aspects
• Architectural Review
• Concluding Remarks
5
Cloud Computing Introduction
6
Outline: Part 1: Introduction
• Confusion and Cloud-Washing
• Cloud Consolidation
• History
• Vision
• Definitions – focus on NIST
• Cloud computing reference architecture
• Actors, Brokers, Consumers, Auditors,
• Cloud Types: Public, Private, Community and Hybrid
• Orchestration and Management
• Business support, security and privacy
• Cloud Benefits and Issues
• Cloud Misconceptions
• The Open Group Survey 2011
7
What is cloud computing?
8
Gartner view: hype cycle
9
10
We Live in Hyped Times! • “Amazon and PSN outages won't halt cloud revolution.” source The Register
• “SURVEY: Future-proofing the cloud.” source Network World
• “Virtualization, cloud computing to dominate Interop.” source Network World
• “Is Your Data Center Ready for Cloud Computing?” source Web Buyers Guide
• “Demystifying the Cloud – A Conversation with Dell’s CIO and CTO!” source Baseline Briefing
• “Cloud-enabled Wi-Fi: Less Dollars, More Sense” source Network World
• “Apple’s new services are expected to include a "digital locker" solution enabling consumers to
store their iTunes music, movie and television libraries on Apple servers for access on multiple
iOS-based devices.” source Fierce Mobile Content.
• “Brocade Unveils CloudPlex cloud architecture, an open framework for building virtualized data
centers, and offered a look at new technologies coming up in the near future to help make such
data centers possible. “ source CRN
• “CenturyLink goes from local to global player with Savvis acquisition.” source Fierce
Free Software Foundation founder Richard Stallman called cloud computing,
“worse than stupidity.”
Bottom-line: If you’re systems are down or you loose customer data its not the Cloud
Provider that suffers / goes out of business – they just issue a credit for the disruption. 11
First Phase of Cloud Consolidation
• Verizon acquired Terremark, a Infrastructure / Platform as a Service (I/PaaS)
provider, for $1.4 billion, to provide IT infrastructure services targeting the
enterprise market.
• Dell spent more than $2 billion in six months acquiring cloud technologies,
including PaaS provider Boomi, and is investing another $1 billion in a group of
global data centers.
• IBM acquired Cast Iron, Boomi’s competitor.
• Time Warner Cable acquired NaviSite.
• CenturyLink acquired Savvis
• Microsoft and Toyota forged a strategic partnership to build a global platform
for Toyota Telematics Services using Windows Azure.
• CA Technologies and Unisys entered into a joint venture that combines CA’s
virtualization and service management products with Unisys’ virtualization and
cloud advisory, planning, design and implementation services.
Likely see further consolidation as Telcos realizes their weaknesses in selling Cloud into enterprise – particularly small medium enterprise 12
Evolution
• Cloud computing has evolved through a number of
phases which include grid and utility computing,
application service provision (ASP), and Software as a
Service (SaaS).
• But the overarching concept of delivering computing
resources through a global network is rooted in the
sixties.
Those Sixties!!!
13
John McCarthy (1927-2011), 1961
“computation may someday be organized as a public utility.”
14
• One of the first milestones for cloud computing was the
arrival of Salesforce.com in 1999, which pioneered the
concept of delivering enterprise applications via a simple
website.
15
• The next development was Amazon Web Services in
2002, which provided a suite of cloud-based services
including storage, computation and even human
intelligence through the Amazon Mechanical Turk.
16
• Then in 2006, Amazon launched its Elastic Compute
cloud (EC2) as a commercial web service that allows
small companies and individuals to rent computers on
which to run their own computer applications.
17
• Another big milestone came in 2009, as Web 2.0 hit its
stride, and Google and others started to offer browser-
based enterprise applications, though services such as
Google Apps.
Purely representational purposes only!
18
• 2009 also saw the advent of Microsoft into the cloud
computing game with its product Windows Azure
• Azure as an operating environment "designed to manage
extremely large pools of computational resources." The simple
explanation is that Microsoft wants customers to run their
Windows-based applications over the Internet using
Microsoft's data centers, with Azure being the system that
organizes resources and handles spikes in demand.
19
• Many IT professionals recognize the benefits cloud
computing offers in terms of increased storage, flexibility
and cost reduction
• Considerations such as security, data privacy, network
performance and economics are likely to lead to a mix of
cloud computing centers both within the company
firewall and outside of it
And Now…….
20
The Dream of Cloud Computing
• Semiconductor Fabs Expensive – Typically > $1 Billion
– Too Much for Most Designers
• Fabs Take Outside Work – Fabs Amortize Cost
– Other Designers Make Chips
• Allowed Explosion of Designs – More Players Afford Rented Fab
• New Datacenters Very Expensive – Only a Few Companies Can
Afford Huge Datacenters
• Utility Computing Datacenter Owners Amortize Costs – Utility Computing Users Get
Advantages of Elasticity
– Datacenter Resources Shared Across Many Users
Utility Computing Integrated Circuit Foundries
But a private cloud doesn’t deliver scale? 21
The NIST Definition of Cloud Computing
o Cloud computing is a model for enabling convenient, on-demand network access to a
shared pool of configurable computing resources (e.g., networks, servers, storage,
applications, and services) that can be rapidly provisioned and released with minimal
management effort or service provider interaction. This cloud model promotes availability
and is composed of five essential characteristics, three service models, and four deployment
models.
Characteristics 1. On-demand self-service 2. Broad network access 3. Resource pooling 4. Rapid elasticity 5. Measured service
Service models 1. Cloud Software as a Service (SaaS) 2. Cloud Platform as a Service (PaaS) 3. Cloud Infrastructure as a Service (IaaS)
Deployment models 1. Private cloud 2. Community cloud 3. Public cloud 4. Hybrid cloud
22
Why Now?
From T-Systems, who has delivered SAP dynamic services since 2004 23
NIST 3 Cloud Service Models
• Cloud Software as a Service (SaaS)
o Use provider’s applications over a network
• Cloud Platform as a Service (PaaS)
o Deploy customer-created applications to a cloud
• Cloud Infrastructure as a Service (IaaS)
o Rent processing, storage, network capacity, and other fundamental computing
resources
• To be considered “cloud” they must be deployed on top of cloud
infrastructure that has the key characteristics
24
Service Model Architectures
Cloud Infrastructure
IaaS
PaaS
SaaS
Infrastructure as a Service (IaaS)
Architectures
Platform as a Service (PaaS)
Architectures
Software as a Service
(SaaS)
Architectures
Cloud Infrastructure
SaaS
Cloud Infrastructure
PaaS
SaaS
Cloud Infrastructure
IaaS
PaaS
Cloud Infrastructure
PaaS
Cloud Infrastructure
IaaS
25
NIST Reference Model: Background • The NIST cloud computing definition is widely accepted as a valuable contribution toward providing a
clear understanding of cloud computing technologies and cloud services.
• It provides a simple and unambiguous taxonomy of three service models available to cloud consumers:
cloud software as a service (SaaS), cloud platform as a service (PaaS), and cloud infrastructure as a
service (IaaS).
• It also summarizes four deployment models describing how the computing infrastructure that delivers
these services can be shared: private cloud, community cloud, public cloud, and hybrid cloud.
• Finally, the NIST definition also provides a unifying view of five essential characteristics that all cloud
services exhibit: on-demand self-service, broad network access, resource pooling, rapid elasticity, and
measured service.
• These services and their delivery are at the core of cloud computing. In the cloud computing model, the
primary focus is a more economic method of providing higher quality and faster services at a lower cost
to the users.
• In the traditional IT service delivery model, there is a large emphasis on procuring, maintaining and
operating the necessary hardware and related infrastructure. The cloud computing model enables CIOs,
IT project managers and procurement officials to direct their attention to innovative service creation for
the customers.
26
NIST Reference Model: Background
• The NIST cloud computing reference architecture focuses on the requirements of
“what” cloud services provide, not a “how to” design solution and implementation.
• The reference architecture is intended to facilitate the understanding of the
operational intricacies in cloud computing.
• It does not represent the system architecture of a specific cloud computing system;
instead it is a tool for describing, discussing, and developing a system-specific
architecture using a common framework of reference.
• The design of the NIST cloud computing reference architecture serves the following
objectives:
o to illustrate and understand the various cloud services in the context of an overall cloud
computing conceptual model;
o to provide a technical reference to USG agencies and other consumers to understand, discuss,
categorize and compare cloud services; and
o to facilitate the analysis of candidate standards for security, interoperability, and portability
and reference implementations.
27
NIST Cloud Computing Reference Architecture
• The NIST cloud computing reference architecture defines five major
actors:
o cloud consumer,
o cloud provider,
o cloud carrier,
o cloud auditor and
o cloud broker.
• Each actor is an entity (a person or an organization) that participates in
a transaction or process and/or performs tasks in cloud computing.
• A cloud consumer may request cloud services from a cloud provider
directly or via a cloud broker.
• A cloud auditor conducts independent audits and may contact the
others to collect necessary information.
28
NIST Reference Model
29
Actors in Cloud Computing
30
Cloud Benefits & Issues
31
Benefits
• Shorter provisioning times: The provisioning of servers, applications, and application
environments is far quicker and cheaper to do leading to quicker time-to-market for new
products and services, shorter project timescales, and faster benefit realization.
• Reduced capital outlay: The ability to buy computing resources, whether applications or
infrastructure on a pay-as-you-go basis reduces the need for capital investment in hardware
and software. This in turn may make it easier to finance projects, which can rely upon
revenue generation to finance project outlay far sooner than would otherwise be the case.
The burden of upfront investment and thereafter capital depreciation and the risk of
stranded investments should a project fail is reduced.
• Allows more use of “try before you buy”: The ability to try a new product or service is
enhanced through the use of Cloud Computing services where the investment in trials and
proof-of-concept activities is much reduced. Trialing also reduces the risk of later
implementations.
• Reduces the cost of “one-off” activities: One-off activities which would otherwise be
extremely costly to finance with purchased or traditionally leased computing resources can
be more cheaply provisioned using Cloud Computing; e.g., migration or data
cleansing/conversion activities. 32
Cloud Misconceptions
33
SaaS is not dependent on PaaS which is not dependent on IaaS – They’re independent
• This illustration implies a relationship between IaaS, PaaS, and SaaS and gives rise to the idea that
the three service models are necessarily layered one upon the other. Although both software and
platform services will rely upon some elements of infrastructure (the fundamental “plumbing” of IT;
e.g., servers, network, storage), to infer that all SaaS is founded upon a PaaS and that in turn upon
IaaS is an extrapolation which will not stand closer analysis.
• Were this true, then for the service model and characteristics of Cloud Computing to apply then
each layer would have to be separately deliverable as a service with all the attendant components
allowing metering, account management, billing, self-service, etc.
• In reality, in a given purchase or consumption of Cloud Computing
services, the interaction is with one of these layers. One is either
buying or consuming software, platform, or infrastructure. That the
means by which the provision of this service is achieved is invisible
and of no concern is one of the founding concepts of Cloud
Computing. Although it is tempting to assume that all sellers of SaaS
services have reached extremely high levels of maturity in their
provision of infrastructure, that they employ sophisticated and
highly effective virtualization, for example, may not actually be the
case. At the level of service interaction of a consumer of SaaS it will
not be apparent and nor should it be. 34
The OpenGroup Cloud Computing Survey 2011
35
36
37
38
39
Part 2: Getting into the Details
40
Outline: Part 2: Getting into the Details
• Mapping suppliers and technologies in Cloud Computing
• Understanding the economics behind the benefits
• Quantifying the benefits
• Cloud market taxonomy and market size
• CSPs and Cloud Computing
o AT&T, BT, DT, NTT, Orange, SingTel, Verizon
• Mapping the workloads
• SOA and the Cloud
• Cloud Computing in Asia
41
One More Look at the Cost Model
UserHourscloud × (revenue – Costcloud) ≥
UserHoursdatacenter × (revenue – ) Costdatacenter
Utilization
How Much You Make Per User Hour in a
“Pay as You Go” Cloud
How Much You Make Total in a “Pay
as You Go” Cloud The Compute Cost
of the Work in a Datacenter
But You Pay for the Whole Datacenter Even When It Is
Underutilized!
Have to Increase the Charge for the Work You Do to Make Up for
Underutilization
How Much You Make Total in a Datacenter
Implementation of Your App
Utilization Assumptions Make a Big Difference in the Costs of Cloud
versus Datacenter!
42
43
Cloud-Based Infrastructure
Your Business
More Time to Focus on Your Business
Configuring Your Cloud
Assets
70%
30% 70%
On-Premise Infrastructure
30%
Managing All of the “Undifferentiated Heavy Lifting”
Cloud’s goal: flip this equation
44
Companies have different motivations for leveraging cloud
Risk &
Compliance 34,000-employee
bank deploying a
private cloud from
IBM to centralize
management of
desktops via an
enterprise class data
center rather than at
the user stations,
Gets greater remote
flexibility without
sacrificing control to
improve efficiency.
Employee
Productivity
Enable collaboration
across 300K global
employees as well as its
network of customers,
partners and suppliers.
Saving 30 minutes per
day or 120hr per year
per person.
IBM LotusLive has 18
million users in 99
countries
Analytics &
Security Operations support 9
major commands,
nearly 100 bases, &
700,000 active military
personnel around the
world. Design secure
cloud infrastructure for
defense & intelligence
networks; insights
about cyber attacks,
network, system or
application failures,
while automatically
preventing disruptions.
Time to Value
Creates an
ecosystem for PayPal
3rd Party developers
Reduces developer
effort to deploy a work
environment with
seamless PayPal Test
Sandbox access
45
IBM Cloud Business Model
Current IT
Spend
Strategic Change Capacity
Hardware, labor & power savings reduced annual cost of operation by 83.8%
Hardware Costs ( - 88.7%)
Labor Costs ( - 80.7%)
100%
Deployment (1-time)
Note: 3-Year Depreciation Period with 10% Discount Rate
Hardware Costs (annualized)
Liberated funding for new development, transformation investment or direct saving
Labor Costs (Operations and Maintenance)
Power Costs (88.8%)
Power Costs
Software Costs
Software Costs
New Development
Impact: Reduction of Total Cost of Ownership of
Data Center Infrastructure
Reduced Capital Expenditure
- Improved utilization reduces requirement for
new capital purchases
Reduced Operations Expenditure
- Lower facilities, maintenance, energy, IT
service delivery and labor costs
Additional Benefits
- Reduced risk, less idle time, more efficient
use of energy, acceleration of innovation
projects, enhanced customer service
Business Case Results Annual savings: $3.3M (84%) from $3.9M to $0.6M Payback Period: 73 days Net Present Value (NPV): $7.5M Internal Rate of Return (IRR): 496% Return On Investment (ROI): 1039%
ROI Analysis
Infrastructure Middleware Applications
Private
Cloud
@ In-house
Data Center
Virtual
Private
Cloud
@
Dedicated
Provider
Public
Cloud
@ Global
Provider
Business
Value
Level Of
Sharing
Full Cloud Taxonomy
Business
Processes
PURE
CLOUD
MARKET
EXTENDED
CLOUD
MARKET Infrastructure
Virtualization
Tools
BP
Virtualization
Tools
Dynamic
Infrastructure
Services
Integration-
as-a-Service
IaaS SaaS
PaaS BPaaS
Dynamic
Apps
Services
Dynamic
BPO
Services
Middleware
Virtualization
Tools
Apps
Virtualization
Tools
47
Infrastructure Middleware Applications
Private
Cloud
@ In-house
Data Center
Virtual
Private
Cloud
@
Dedicated
Provider
Public
Cloud
@ Global
Provider
Business
Value
Cloud market size 2012
Business
Processes
Level Of
Sharing
~$15b Market
~$28b Market
~$11b Market
PURE
CLOUD
MARKET
EXTENDED
CLOUD
MARKET
48
Cloud Service
Management
Provisioning
Change
& Config
Availability
& Performance
Service
Desk
Billing
Backup
& Recovery
Security
Master Data
Management
Infrastructure Middleware Applications Business
Value
Cloud market size 2012
Business
Processes
Level Of
Sharing
$8.3b $6.2b $13.2b $300m
$3.1b $300m $3.1b
$500m $12.5b $500m
$4.5b
$1.5b
Infrastructure
Virtualization
Tools
BP
Virtualization
Tools
Dynamic
Infrastructure
Services
Integration-
as-a-Service
IaaS SaaS PaaS
Dynamic
Apps
Services
Dynamic
BPO
Services
Middleware
Virtualization
Tools
Apps
Virtualization
Tools
BPaaS
Private
Cloud
@ In-house
Data Center
Virtual
Private
Cloud
@
Dedicated
Provider
Public
Cloud
@ Global
Provider
Purpose is to demonstrate the roles cloud computing plays and current market size 49
Cloud Services as a % of IT
Worldwide IT Spending by Consumption Model
IT Cloud Services
On-Premise IT
5%
10%
CAGR
26%
4%
44
17
0
100
200
300
400
500
600
2009 2013
Wo
rld
wid
e IT
Sp
end
ing
($
bil
lio
n)
359
416
50
Cloud Services Growth Impact
460.4
433.1
430
435
440
445
450
455
460
465
470
475
480
485
2012 2013
Wo
rld
wid
e I
T S
pe
nd
ing
($
bil
lio
n)
Net new IT growth = $27.3 billion
IT Cloud
IT Cloud Services growth
Traditional IT product growth
27%
73%
Sources of Incremental IT Spending Growth in 2013 Cloud vs. Traditional Products
51
Main topics to be addressed prior adoption of cloud computing paradigm
• Security
• Availability
• Performance
• Interoperability
• Flexibility
• Personalization
• Unit costs
• One time transition costs
• Total cost of ownership
• SLA stipulations
• Liabilities of the provider
• Lock-in risks and implications
It’s the same as any Service Provider Decision: Don’t get locked-in 52
Cloud Computing and Telcos
53
Telcos in the Cloud
• Telcos committed US$11 billion to cloud pursuits in 2011
o Eight out of 10 transactions involve datacenter assets
• Service differentiation remains poor
o 122 new services, 70% mass-market offers, heavy SaaS usage
• Telco strengths are underplayed
o Security and cloud mobility aren’t creating an unfair advantage
• ROI is a long game….
o Cloud services contribute a single-digit percentage of telco revenues today
• Few have solve the problem of enterprise credibility
54
55
56
AT&T
57
Cloud APIs
58
119 Cloud APIs On Programmable-Web
59
Deutsche Telekom
60
T-Systems Cloud Positioning
T-Systems has created significant thought
leadership collateral in the Cloud Computing space. Its positioning of Cloud computing has received broad endorsement, its
Dynamic Enterprise Cloud positioning has won it significant business in
Germany. If offers end to end SLAs,
from the desk top to the data center. While other
operators have struggled to make that end to end offer T-Systems was one of the first
(in Germany anyway.) “In Germany we are the only
provider to offer cloud services with an end to end SLA.” source VP Networks
61
NTT
62
Keane provides extensive IT credentials in SAP and Oracle implementations across many industries as well as across the enterprise application stack. 63
Keane becomes the face of NTT Data America, the solutions group within NTT Data aims to achieve common solutions across regions, though the mobile link remains weak.
64
Intelligroup has extensive SAP and Oracle implementation experience in Pharmaceutical, manufacturing and consumer goods verticals. 65
Value Team is an Italian IT Consultancy, that is also strong in LATAM, again buying IT market share. Deal was announced in April 2011. With this acquisition NTT Data now has solid global coverage.
66
How the NTT Groups Fits Together
Dimension Data focuses on deployment (of communication platforms – Cisco and Microsoft) and maintenance of IT systems. NTT Communications focused on transport services. NTT Data
focused on IT Services. However, in practice there are many overlaps in Europe, Latin America and North America. 67
Orange Business Services
68
Cloud Roadmap
69
OBS Cloud Roadmap
70
71
Verizon Business
72
Everything as a Service Evolution
73
Verizon Buys Terremark
• In January Verizon announced plans to acquire Terremark Worldwide for U.S.$1.4 billion or U.S.$19
per share in cash—an acquisition price that is four times Terremark’s projected 2011 revenue of
U.S.$351 million.
• The acquisition highlights the unique market dynamics of cloud computing. Not since the dot-com
boom has a market seen such explosive growth in startups together with rapid consolidation and
acquisition. It’s a land grab, and Verizon just bought a big chunk.
• In September 2010, Verizon entered into a partnership with Terremark that focused on the SMB
segment. Verizon’s Computing as a Service (CaaS) SMB runs on Terremark’s infrastructure and data
centers, but Terremark also has a strong presence in the large enterprise and federal government
segments.
• The acquisition instantly gives Verizon a stronger position in the enterprise cloud computing market.
• The acquisition is also good news for enterprises, because those that want to adopt cloud computing
services now have more and better options.
• Also in January Hewlett-Packard announced its HP Enterprise Cloud Services-Compute, a service that
expands its offerings and enables it to position hybrid cloud to enterprises.
Verizon’s acquisition of Terremark demonstrated VZB was committed to dominating the Cloud Computing business . In part VZB was struggling with CaaS in gaining broader
market adoption – Terremark solves this issue. 74
Verizon Benefits
• Data center scale and build-out skills.
o Terremark has 567,000 square feet of data center space available as of Q2 2011, with
significant room to grow. More importantly, Terremark knows how to build data centers
that are uniquely able to deliver cloud computing services to enterprises.
• Growth in managed services.
o Fifty percent of Terremark’s business is higher margin managed services, including
enterprise cloud computing services.
• Strong security skill set.
o According to Yankee Group’s Anywhere Enterprise: 2010 U.S. Cloud Computing
FastView Survey, security is still one of the leading barriers to enterprise adoption of
cloud computing (see next slide).
o Coupled with Verizon’s acquisition of CyberTrust, Terremark’s Federal Information
Security Management Act (FISMA)-compliant data centers and best-of-breed cloud
security expertise give Verizon meaningful competitive differentiation.
VZB now has the best security credentials of any cloud based service provider. If it can persuade the broader market of these credentials it has the ability to dominate the global
market. 75
Example CaaS portal 76
CloudSwitch Bought by Verizon in August 2011
77
Why CloudSwitch?
78
Mapping the Workloads Some Practical Discussion
79
Defining the Map
• Start by grouping enterprise applications into classes of
applications.
• Then depending on the lifecycle ( e.g. Test & Development, Staging
or Production) , usage environment and security requirements of a
class of applications, an enterprise architect can define a set of
principles and guidelines to help decide when to use cloud
computing service and what type of service to use.
• Next slide shows an example from an enterprise architect of a well
known global brand.
80
Example of One Enterprises’ Mapping
Class of Enterprise Applications
Test & Development
Staging Production
Business Communications
Virtual Private Cloud
Virtual Private Cloud Private Cloud
CRM (e.g. SAP, Salesforce.com)
Public Cloud Virtual Public Cloud Public Cloud
Applications supporting critical business processes
Public Cloud Virtual Private Cloud Private Cloud
Productivity Improvement
Public Cloud Virtual Private Cloud Public Cloud
Financial Virtual Private Cloud
Virtual Private Cloud
Private Cloud
81
Reality Check: Its not just security
• One of the main barriers to enterprise adoption of cloud computing
service is the effort required to migrate corporate applications from
their internal hosting service to public cloud or virtual private cloud
and vice versa.
• Technology such as Verizon CloudSwitch service is now available to
allow an enterprise user to seamlessly switch applications between
their internal (e.g private cloud ) hosting service and Virtual Private
Cloud or Public Cloud.
• This type of technology should help drive down the barrier to future
user adoption of third party provided cloud computing service.
82
Cloud Migration Reality Check Part 1
• Standalone web applications built specifically for a particular cloud can be rolled out
quickly and relatively easily using templates offered by the cloud provider or software
from third parties.
• But it’s far more complex to run an enterprise application in a preferred public cloud
while staying integrated with the internal environment and its associated services,
processes, tools, and relationships.
• Moving an enterprise application to a cloud takes extensive manual configuration,
complex engineering, and trial and error — with success not always assured.
A whole landscape of specifications for OS versions, storage, networks, and
management tools has to be mapped and modified for an external environment that
is usually unfamiliar to internal IT staff.
• In addition, the applications almost always need to reach back to services and
processes in the data center, setting up a number of integration issues that are not
easily resolved. Thus, migration projects often take weeks or longer, preventing many
companies from even considering cloud deployment.
83
Cloud Migration Reality Check Part 2
• The separate, largely isolated environment imposes management
challenges that don’t occur internally when the application is under
enterprise control.
• These same challenges also apply to new enterprise applications
developed in the cloud since they also require integration with data
center tools, processes, and services.
• Everything from authentication and authorization to internal
databases and basic services has to be managed separately for an
application to run in the cloud.
84
Source of Cloud Migration Delay and Blocking
• 1. Rebuilding the application stack within the cloud
• 2. Setting up the network
• 3. Adding end-to-end security
• 4. Managing the application in a separate environment
85
1. Rebuilding the Application Stack
• The cloud has a model similar to a virtualized data center environment where users or administrators can
provision virtual resources such as CPU, memory, and storage from a pool of physical resources.
• However, the processes used for building, launching, and managing servers in a public cloud are very different
from those used internally.
• Most cloud providers today require you to start from one of their base templates. These templates are customized
for a particular environment, including tools, drivers, agents, or specific configurations for leveraging the available
networking and storage capabilities.
• Even when a provider offers a method for uploading existing application images, the drivers, tools, and
modifications associated with an application must be included for compatibility with the chosen cloud
environment.
• This creates a different starting point and will affect how application stacks are built and maintained.
• Using the cloud requires that these components be rebuilt to match the cloud provider’s environment. Many
applications take advantage of services that exist within a data center, such as DNS or LDAP, that are not available
in the cloud.
• This requires re-architecting the applications that depend on these services, whether duplicating the services
within the cloud, building methods to extend existing services to the cloud, or some combination of the two.
• These differences between the data center and the cloud trigger a chain of integration issues including potential
changes in base operating systems, storage, networking, virtualization, and shared services.
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1. Rebuilding the Application Stack: OS
• The cloud provider will specify operating system versions as well as versions for
related components such as storage and network devices, drivers, and
virtualization tools.
• However, complying with their requirements can be problematic. For example,
in Linux environments, cloud providers require a particular kernel version
which must be matched by any application-specific kernel modules.
• This is particularly difficult when using third-party software since the required
code and/or tools may not be available to allow recompilation.
• The hypervisor version also has to match, as do the drivers and tools which
interact with it. Conflicts may not be easy to resolve — for example, if a cloud
provider is using VMware ESX 3.5, and the enterprise has already moved to ESX
4.0.
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1. Rebuilding the Application Stack: Storage
• Storage and data management challenges in the cloud result from the diverse and often
unfamiliar processes offered by cloud providers.
• Cloud providers define the relationship between servers and storage, and often impose
constraints on everything from allocation size limits to the ways in which storage is
managed. Enterprise customers will also have to adjust to two major storage differences:
ephemeral storage and lack of shared storage.
• Perhaps one of the most disorienting features in the cloud is the use of ephemeral storage,
which means that if you turn off the server, or it has a hard fault, everything on the drive is
lost (data, boot parameters, updates, logs, etc.).
• This type of storage is fine for stateless servers (think web tier servers) which receive the
data they need from another source during operation, but is impossible to use for many
enterprise applications.
• The introduction of this type of storage into your operating environment adds a
management burden since you have to actively avoid using it for things that are important
to you. 88
1. Rebuilding the Application Stack: Storage
• The second major storage difference is the general lack of shared storage in the cloud.
Shared storage is widely used in high availability and redundancy configurations, where if
one server goes down, others pick up the workload because they
• map to the same disk.
• Today’s clouds are unable to map a storage device to more than one server, so shared
storage in the cloud is currently not possible. As a result, high availability must be
achieved through some different and less proven architecture.
• This type of fundamental change highlights a major problem when adapting existing
applications to meet cloud requirements: the need to redesign the application to run
without a “tried and true” solution.
• Further, if the application is developed using third party software (such as Oracle), there
may be no opportunity to “redesign” it. Rather, you would have to select a different
product or manufacturer to get the necessary functionality.
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1. Rebuilding the Application Stack: Replicating Data Centers
• Most enterprise applications work with a range of tools and services such as identity
management, monitoring, and directory services. When applications which rely on
these services are moved into the cloud, or new ones are created there, the
applications become disconnected from the data center, breaking important
relationships and dependencies.
• Therefore these key services and control processes need to be modified, replaced, or
possibly even eliminated to accommodate the cloud provider’s environment.
o Do you create a separate version of internal processes and control systems to run
independently within the cloud?
o Do you implement new services in the cloud with similar capabilities and find a way to tie them
back to the data center?
o Do you simply retool or build the application so it doesn’t depend on those services?
• The usual approach is to engage a professional services firm to assist in porting and
integrating the environment, or the cloud provider may provide similar services as
part of their managed hosting. The typical result is a lot of heavy (and expensive)
lifting in order to make it work.
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SOA and the Cloud Service Oriented Cloud Computing Infrastructure
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Cloud Computing In Asia Frost and Sullivan Analysis
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Part 3: Understanding the Components: Enabling Technologies
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Outline: Part 3: Understanding the Components
• Summary: Web 2.0, SaaS, Utility Computing, Virtualization, SLAs, Autonomic computing, Grid
technology, Web Services, Service Oriented Architectures, Free and Open Source Software
• Deep Dive: Virtualization
o History
o Issues and Trends
o Supplier review: Citrix, IBM, Linux, Microsoft, Novell, Symantec, Oracle, VMWare
• Deep Dive: Data Centers
o History and the drive for efficiency and availability
o Changes and pressures on DC – drive for DC management
o Capex and opex DC costs
o DC economics drives cloud computing
• Deep Dive: Force.com, Google, Microsoft and Amazon
o Force.com
o Google App Engine
o Microsoft Azure
o Amazon Web Services
• Netflix deep dive • AWS walk-through
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Location and Scale: It’s Easier to Ship Data than Power!
• Datacenters Are Popping Up in Surprising Places
o Quincy, WA
• Google, Microsoft, Yahoo!, and Others…
o San Antonio, TX
• Microsoft, US NSA, and Others…
Price per Kilo Watt Hour
Where? Possible Reason Why
3.6 cents Idaho Hydroelectric Power; Not Sent Long Distance
10.0 cents California Electricity Transmitted Long Distance over the Grid; Limited Transmission Lines in the Bay Area; No Coal Fired Electricity Allowed in California.
18.0 cents Hawaii Must Ship Fuel to Generate Electricity
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Data Center Economics – simply scale
Scale is the main driver for cloud computing – its 5-7 times cheaper than doing it in house. This is the fundamental principle of Amazon’s business model. So why focus on a private
cloud when it doesn’t have scale?
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Understanding the Internet Companies
97
Mapping the Cloud Development Platform Landscape
Web Centric
Enterprise Centric
Best Effort
High Availability
Adding capabilities Improving Availability
Move into hosted / managed solutions
The challenge for Google and Amazon is can they break out of the ‘geek developer’ into mainstream enterprise, or will Oracle and IBM’s approach of providing integrated web-centric and enterprise-centric solutions be preferred by the buyers of enterprise services? See Oracle and IBM analysis for more details on their approach.
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Amazon Web Services
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AWS Customers: Netflix.com
- More than 9 Billion USD market cap - Migrating 100% on Amazon Web
Services - So far: movie lists, website search,
transcoding, recommendations, etc. - 24 M subscribers, 100k+ DVD titles
"AWS let us focus on innovation"
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112
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AWS Customers: Customers in 190 Countries
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AWS Customers: Asia Pacific customers
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Part 4: Implementation
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Outline: Part 4: Implementation
• Survey - what workloads others are moving into the cloud?
• Summary
o Key points in cloud migration
o Industry : Workload : Cloudability Space
• Project Plan – example from IBM
• Decision Tree for implementing Cloud Computing
o The Open Group decision tree
• Security
o Reviewing SAS70, PCI DSS, ISO27001, NIST, HIPAA, FISMA, CoBIT, Data
Protection Directive, practical aspects
• Architectural Review
• Concluding Remarks
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Survey: Implementing in Your Organization Recent Survey
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Implementing in Your Organization Project Plan
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Workloads ready for cloud computing
• Analytics
– Data mining, text mining or
other analytics
– Data warehouses or data marts
– Transactional databases
• Business services
– Customer relationship
management
(CRM) or sales force automation
– Enterprise resource planning
(ERP) applications
– Industry-specific applications
• Collaboration
– Audio/video/Web conferencing
– Unified communications
– VoIP infrastructure
• Desktop and devices
– Desktop
– Service/help desk
• Development and test
– Development environment
– Test environment
• Infrastructure
– Application servers
– Application streaming
– Business continuity/
disaster recovery
– Data archiving
– Data backup
– Data center network capacity
– Security
– Servers
– Storage
– Training infrastructure
– Wide area network (WAN)
capacity
Source: IBM Market Insights, Cloud Computing Research, July 2009.
Decision Tree for Cloud Computing
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Summary
125
Implementing in Your Organization Architecture
126
Concluding Remarks
127
Gartner view: hype cycle
128
129
But it does make sense for some functions within some organizations…. 130
NIST Reference Model
131
Elasticity, Risk, and User Incentives Services Will Prefer Utility Computing to a Private Cloud When:
Demand Varies over Time
Provisioning for Peak Leads to Underutilization at Other Times
Pay by the Hour (Even if the Hourly Rate is Higher)
Demand Unknown in Advance
Web Startup May Experience a Huge Spike If It Becomes Popular
Pay as You Go Does Not Require Commitment in Advance
The Value of Cost Associativity
UserHourscloud × (revenue – Costcloud) ≥
UserHoursdatacenter × (revenue – ) Costdatacenter
Utilization 132
Cloud Is Mostly Driven by Money
Economics of Cloud Computing Are Very Attractive to Some Users
Cloud Computing Will Track Cost Changes
Better than In-House
Investment Risks May Be Reduced
Predicting Application Growth Hard
In-House, You Must Provision for Peak
133
Cloud-Based Infrastructure
Your Business
More Time to Focus on Your Business
Configuring Your Cloud
Assets
70%
30% 70%
On-Premise Infrastructure
30%
Managing All of the “Undifferentiated Heavy Lifting”
Cloud’s goal: flip this equation
134
Benefits
• Shorter provisioning times
• Reduced capital outlay
• Allows more use of “try before you buy”
• Reduces the cost of “one-off” activities
• Costs associated with testing can be reduced
• Reduction in internal data center capacity
• Better architecture and design
• Consolidation and central administration:
• Greener IT
• Resources
• Improved administration and maintenance:
• Better quality services available from Cloud Computing:
• Better security
• Flexibility
• Improved financial control 135
Issues
• IT security and compliance
• Not mature
• Lack of clear definition of components
• Software licensing
• Service delivery clarity
• Calculating costs of service
• Integration
• Green IT
136
137
IBM Cloud Business Model
Current IT
Spend
Strategic Change Capacity
Hardware, labor & power savings reduced annual cost of operation by 83.8%
Hardware Costs ( - 88.7%)
Labor Costs ( - 80.7%)
100%
Deployment (1-time)
Note: 3-Year Depreciation Period with 10% Discount Rate
Hardware Costs (annualized)
Liberated funding for new development, transformation investment or direct saving
Labor Costs (Operations and Maintenance)
Power Costs (88.8%)
Power Costs
Software Costs
Software Costs
New Development
Impact: Reduction of Total Cost of Ownership of
Data Center Infrastructure
Reduced Capital Expenditure
- Improved utilization reduces requirement for
new capital purchases
Reduced Operations Expenditure
- Lower facilities, maintenance, energy, IT
service delivery and labor costs
Additional Benefits
- Reduced risk, less idle time, more efficient
use of energy, acceleration of innovation
projects, enhanced customer service
Business Case Results Annual savings: $3.3M (84%) from $3.9M to $0.6M Payback Period: 73 days Net Present Value (NPV): $7.5M Internal Rate of Return (IRR): 496% Return On Investment (ROI): 1039%
ROI Analysis
Workloads ready for cloud computing
• Analytics
– Data mining, text mining or
other analytics
– Data warehouses or data marts
– Transactional databases
• Business services
– Customer relationship
management
(CRM) or sales force automation
– Enterprise resource planning
(ERP) applications
– Industry-specific applications
• Collaboration
– Audio/video/Web conferencing
– Unified communications
– VoIP infrastructure
• Desktop and devices
– Desktop
– Service/help desk
• Development and test
– Development environment
– Test environment
• Infrastructure
– Application servers
– Application streaming
– Business continuity/
disaster recovery
– Data archiving
– Data backup
– Data center network capacity
– Security
– Servers
– Storage
– Training infrastructure
– Wide area network (WAN)
capacity
Source: IBM Market Insights, Cloud Computing Research, July 2009.
MPLS SLA
Data Center SLA
Mind the SLA Gap!
140
Beware Lock-In
141
Source of Cloud Migration Delay and Blocking
• 1. Rebuilding the application stack within the cloud
• 2. Setting up the network
• 3. Adding end-to-end security
• 4. Managing the application in a separate environment
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