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Cloud Computing 101 (Sample) Issue 1 May 28 th 2011 www.alanquayle.com/blog © 2011 Alan Quayle Business and Service Development

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Page 1: Cloud Computing 101 Issue 1  (Sample)

Cloud Computing 101 (Sample)

Issue 1

May 28th 2011

www.alanquayle.com/blog

© 2011 Alan Quayle Business and Service Development

Page 2: Cloud Computing 101 Issue 1  (Sample)

Objectives

• Comparing and contrasting the available delivery models of cloud computing

• Evaluating the benefits of cloud products, including global and regional service

providers, Salesforce.com, Microsoft Azure, Google, and Amazon

• Understanding the underlying technologies of Data Centers and Virtualization

• Understanding the role of operators and web service providers

• Deploying Software as a Service (SaaS) to optimize productivity and

collaboration

• Deploying Platform as a Service (PaaS) to streamline application deployment

• Examining the cost benefits of deploying Infrastructure as a Service (IaaS)

• Understanding implementation issues across security, compliance and business

continuity

• Integrating multivendor cloud products and services

• Focusing on the first two steps, initial business case and pilot project

6/2/2011 © 2010 Alan Quayle Business and Service Development 2

Page 3: Cloud Computing 101 Issue 1  (Sample)

Outline

• Cloud Computing Introduction

o Defining cloud computing

o Definitions: IaaS (Infrastructure as a Service), PaaS (Platform as a Service), SaaS

(Software as a Service), BPaaS (Business Process as a Service)

o The benefits of cloud computing

o Cloud computing components

o Suppliers and market size

o Types of clouds: public, private, hybrid, community

o Cloud trends and vendor solutions

o Emerging standards and regulations

• Understanding the Components: Data Center History and Economics

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

3

© 2011 Alan Quayle Business and Service Development

Page 4: Cloud Computing 101 Issue 1  (Sample)

Outline

• Understanding the Components: Data Center Types and Comparison to Google’s Data Center

o Reviewing the 3 types of DC (Data Center)

o DC Environment

o Internet DC Architecture

o Enterprise DC Legacy / Current

o Google perimeter and DC Overview

o Comparison

• Understanding the Components: Virtualization Technology

o Understanding the role of Virtualization in terms of Commercial or technology

o The life cycle of Virtualization’s components and key technology

o Technology Hotspot analysis of Virtualization

• Understanding the Components: Customer needs and Virtualization

o Analyze the pain points and key requirements (reduce the cost through servers consolidation;

Dynamic scheduling to save energy; Increase the efficiency of management, etc...) in Virtualization

o Analyze the opinion of customers in Virtualization, like usage, maturity...

o The technology trend for customers to choose Virtualization, like VMware, Hyper-v, Xen, KVM...

4

© 2011 Alan Quayle Business and Service Development

Page 5: Cloud Computing 101 Issue 1  (Sample)

Outline

• Understanding the Components: Virtualization Competitive Analysis

o How many main competitors (VMware, Citrix, Microsoft, Oracle, Redhat) we have?

o What about their business models?

o How to win a profit of Virtualization?

o Each competitor’s plans to construct their Virtualization platform?

o SWOT analysis

• Understand the Internet Companies Drivers in Cloud Computing

o Mapping Force, Google and Amazon’s offers

o Cloud Economics, definitions, taxonomy and market size

o Comparison to total IT market

o Cloud Business Case

• Understanding Web Service Providers Focus on Cloud / DCs

o Cloud Hype

o Industry requirements

o Industry Transition

o Data Center Operating System

o DC programming models (PaaS)

o Example providers, PaaS services and pricing

o Deep dive on Force.com, Google App Engine and Microsoft Azure

o What it all means

5

© 2011 Alan Quayle Business and Service Development

Page 6: Cloud Computing 101 Issue 1  (Sample)

Outline

• Implementing SaaS

o Minimizing administration costs

o Improving productivity and collaboration

o Replacing capital investments with pay-per-use

• Implementing IaaS

o Leveraging on-demand servers

o Eliminating software license costs with preconfigured servers

o Migrating existing machine images to the cloud

o Cost-effective, scalable and reliable data storage with Amazon Simple Storage Solution (S3)

• Implementing to minimize risk

o Immediate response to market demands

o Elastically scaling infrastructure capacity to meet organizational demands

o Evaluating operating systems and software with pay-per-use

• Implementing Security in the cloud

o Analyzing security concerns

o Maintaining privacy of proprietary data

o Achieving acceptable reliability and service-level agreements

o Overcoming the risks of public clouds

o Scoping the role: SaaS, PaaS, IaaS

6

© 2011 Alan Quayle Business and Service Development

Page 7: Cloud Computing 101 Issue 1  (Sample)

Outline

• Implementing Virtual Private Cloud (VPC)

o Simulating a private cloud in a public environment

o Google secure data connector

o Amazon VPC

o Industry-standard, VPN-encrypted connections

• Implementing cloud governance

o Retaining responsibility for the accuracy of the data

o Verifying integrity in stored and transmitted data

o Demonstrating due care and due diligence

o Supporting electronic discovery

o Preserving a chain of evidence

• Implementing compliance with government certification and accreditation regulations

o HIPAA, Sarbanes-Oxley and the Data Protection Act

o Following standards for auditing information systems

o Negotiating third-party provider audits

• Implementing business continuity

o Avoiding vendor lock-in

o Exploiting multiple cloud providers for cross-platform interoperability

o Evaluating the impact on employee skill requirements

• Implementing cloud computing in your organization

o Building a business case

o Selecting a pilot project

7

© 2011 Alan Quayle Business and Service Development

Page 8: Cloud Computing 101 Issue 1  (Sample)

Cloud Computing Introduction

Page 9: Cloud Computing 101 Issue 1  (Sample)

What is cloud computing?

Page 10: Cloud Computing 101 Issue 1  (Sample)
Page 11: Cloud Computing 101 Issue 1  (Sample)

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.

Page 12: Cloud Computing 101 Issue 1  (Sample)

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

Page 13: Cloud Computing 101 Issue 1  (Sample)

Telstra spending $600M on cloud-based UC for businesses • Telstra said it plans to invest $600 million to upgrade communications options

for 90 percent of the country's businesses and, in partnership with Microsoft and

Cisco, provide them with cloud-based unified communications.

• The QoS upgrades will encompass 1,6000 exchanges and take the telco until

September to complete.

• The Digital Business package will cost businesses $120 a month and include a

basic ADSL2+ connection to businesses, a Cisco Router and a Cisco digital

phone. Customers can pay an additional $15 a month to have their Internet and

voice connection switch over to the Telstra NextG network automatically if the

ADSL connection fails.

• Telstra said VoIP service would likely follow the QoS upgrade, once it "can give

all the reliability and also the technical backup we think the product needs, then

we will bring it to market."

Everything becomes labelled as Cloud. Really the $600M is on a network upgrade…

Page 14: Cloud Computing 101 Issue 1  (Sample)
Page 15: Cloud Computing 101 Issue 1  (Sample)

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!!!

Page 16: Cloud Computing 101 Issue 1  (Sample)

John McCarthy, 1961

“computation may someday be organized as a public utility.”

Page 17: Cloud Computing 101 Issue 1  (Sample)

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?

Page 18: Cloud Computing 101 Issue 1  (Sample)

What is Cloud Computing?

• Wikipedia - Cloud computing is Internet ('Cloud') based development and use of computer technology ('Computing'). The

cloud is a metaphor for the Internet (based on how it is depicted in computer network diagrams) and is an abstraction for

the complex infrastructure it conceals[1]. It is a style of computing where IT-related capabilities are provided “as a

service”[2], allowing users to access technology-enabled services from the Internet ("in the cloud")[3] without knowledge

of, expertise with, or control over the technology infrastructure that supports them[4]. According to the IEEE Computer

Society "It is a paradigm in which information is permanently stored in servers on the Internet and cached temporarily on

clients that include desktops, entertainment centers, table computers, notebooks, wall computers, handhelds, etc."[5]. “

• No Consensus in the industry for a good definition of “Cloud computing” . Today anything and everything internet will

come with a cloud computing logo

• Simple Definition: If the time difference between - your application needs more capacity and gets more capacity is greater

than instantly it is not cloud computing. i.e. if there is no programmatic way to provision hardware, no pooled capacity and

even worst a purchase order to get new hardware/software.

• The Bottom-line

o Changes the economics of Computing from being a Capital investment to Utilities (You buy electricity you don’t buy generators )

o Changes the way software is developed – Hardware provisioning , Deployment and Scaling now part of developer lifecycle as a

Program / script as compared to a Purchase order

o Automates a whole bunch of infrastructure related tasks and activities leading efficiencies and cost savings

Page 19: Cloud Computing 101 Issue 1  (Sample)

IBM Confidential 19

What is Cloud Computing?

Banking

Retail

IT

• A user experience and a business model

o Standardized offerings

o Rapidly provisioned

o Flexibly priced

• An infrastructure management and

services delivery method

o Virtualized resources

o Managed as a single large resource

o Delivering services with elastic scaling

• Similar to Banking ATMs and Retail Point of

Sale, Cloud is Driven by:

o Self-Service

o Economies of Scale

o Technology Advancement

Page 20: Cloud Computing 101 Issue 1  (Sample)

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

Page 21: Cloud Computing 101 Issue 1  (Sample)

Why Now?

From T-Systems, who has delivered SAP dynamic services since 2004

Page 22: Cloud Computing 101 Issue 1  (Sample)

22

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

Page 23: Cloud Computing 101 Issue 1  (Sample)

23

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

Page 24: Cloud Computing 101 Issue 1  (Sample)

Mapping the Cloud Types

I use this to simply show the lock-in nature of PaaS / SaaS providers model – Amazon is more focused on a business model based on scale.

Page 25: Cloud Computing 101 Issue 1  (Sample)

IT Cloud Services Taxonomy

Cloud

Applications (Apps-as-a-service)

Cloud (Application)

Platforms (Platform-as-a-Service)

Cloud

Infrastructure (Infrastructure-as-a-Service)

App Deploy

IT Cloud Services

App Dev/Test

Page 26: Cloud Computing 101 Issue 1  (Sample)

Cloud Computing Technologies

Technologies Cloud Services

Applications

Dev Platforms

Multi-Tenant, Deployment & Cluster Management

Virtualization, Infrastructure Management and Grid Engines

Processing Hardware

SaaS

PaaS + Support services (Storage, DB, Security, Aggregation)

IaaS

I use this to simply show technologies associated with each layer – when we discuss data center design and architecture we’ll come back to these components.

Page 27: Cloud Computing 101 Issue 1  (Sample)

The NIST Cloud Definition Framework

27

Community Cloud

Private Cloud

Public Cloud

Hybrid Clouds

Deployment

Models

Service

Models

Essential

Characteristics

Common

Characteristics

Software as a Service (SaaS)

Platform as a Service (PaaS)

Infrastructure as a Service (IaaS)

Resource Pooling

Broad Network Access Rapid Elasticity

Measured Service

On Demand Self-Service

Low Cost Software

Virtualization Service Orientation

Advanced Security

Homogeneity

Massive Scale Resilient Computing

Geographic Distribution

Page 28: Cloud Computing 101 Issue 1  (Sample)

Benefit 1) Elastic Capacity

Page 29: Cloud Computing 101 Issue 1  (Sample)

Predicting Infrastructure Needs Com

pute

Pow

er

Time

Predicted Usage

Actual Usage

Waste

Customer Dissatisfaction

Page 30: Cloud Computing 101 Issue 1  (Sample)

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

Page 31: Cloud Computing 101 Issue 1  (Sample)

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

Page 32: Cloud Computing 101 Issue 1  (Sample)

Benefit 2) Faster time to market

Page 33: Cloud Computing 101 Issue 1  (Sample)

Benefit 3) No initial investment (No CapEx)

Page 34: Cloud Computing 101 Issue 1  (Sample)

Benefit 4) Pay as you go, pay for what you use

Page 35: Cloud Computing 101 Issue 1  (Sample)

Benefit 5) Focus on your business

Page 36: Cloud Computing 101 Issue 1  (Sample)

The 70/30 switch

On-Premise Infrastructure

Your Business

Managing All of the “Undifferentiated Heavy Lifting”

30% 70%

Page 37: Cloud Computing 101 Issue 1  (Sample)

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

Page 38: Cloud Computing 101 Issue 1  (Sample)

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

Page 39: Cloud Computing 101 Issue 1  (Sample)

Gartner view: hype cycle

Page 40: Cloud Computing 101 Issue 1  (Sample)

Why Be a Cloud Provider?

Make a Lot of Money

Huge datacenters cost 5-7X less for computation, storage, and networking. Fixed software & deployment amortized over many users. Large company can leverage economies of scale and make money.

Defend a Franchise

What happens as conventional server and enterprise apps embrace cloud computing? Application vendors will want a cloud offering. For example, MSFT Azure should make cloud migration easy.

Attack an Incumbent

A large company (with software & datacenter) will want a beachhead before someone else dominates in the cloud provider space.

Leverage Customer

Relationships

For example, IBM Global Services may offer a branded Cloud Computing offering. IBM and their Global Services customers would preserve their existing relationship and trust.

Become a Platform

Facebook offers plug-in apps. Google App-Engine…

Leverage Existing Investments

Web companies had to build software and datacenters anyway. Adding a new revenue stream at (hopefully) incremental cost.

Page 41: Cloud Computing 101 Issue 1  (Sample)

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

Page 42: Cloud Computing 101 Issue 1  (Sample)

Terminology on XaaS: SaaS, PaaS, IaaS, CaaS and EaaS

• SaaS a.k.a Software As A Service (wikipedia):

o “software that is deployed over the internet and/or is deployed to run behind a

firewall on a local area network or personal computer. With SaaS, a provider

licenses an application to customers as a service on demand, through a

subscription or a "pay-as-you-go" model.”

• SaaS can be seen as the end user consumable service, and

what is usually meant by “cloud computing”.

• Microsoft classifies SaaS into four "maturity levels," whose key

attributes are configurability, multi-tenant efficiency, and

scalability.

• The SaaS model maturity is usually vendor specific.

Page 43: Cloud Computing 101 Issue 1  (Sample)

IaaS: Infrastructure As A Service

• IaaS is scalable IT infrastructure readily attached to

a suitable communication media (Internet in case

of “public cloud” or corporate network in case of

“private cloud”), controlled through appropriate

APIs, and is available to its users in form of an on-

demand service typically with “pay-per-use”

charging model

• IaaS is a provision model in which an organization

outsources the equipment used to support

operations, including storage, hardware, servers

and networking components. The service provider

owns the equipment and is responsible for housing,

running and maintaining it.

• The consuming entity does not manage or control

the underlying cloud infrastructure but has control

over operating systems, storage, deployed

applications, and possibly limited control of select

networking components (e.g., host firewalls).

• IaaS: Amazon EC, IBM computing on demand,

Rackspace

Page 44: Cloud Computing 101 Issue 1  (Sample)

IaaS bases on scale

• IaaS customer promise is about CAPEX and OPEX avoidance, streamlined operations, lower TCO

and lower entry barrier:

o Margins as per offered resources are usually pretty thin

o Revenue is generated by scale and volume

o Scale requires capability to economically cater for low-traffic customers and subsequently scale up to

high volumes

o Business processes for infrastructure operations and management needs to streamlined and mature

o Capability to obtain and cater for scale requirements issues a relatively high entry barrier for a new

entrant in IaaS offering business due to needed investments.

• Usually (but not necessarily always), IaaS players do have existing business, of which IaaS is a by-

plot:

o CSPs, ecommerce, SaaS providers, data-center and hosting business.

o The target is to create revenue from existing under-utilized data center resources.

• Additionally, with the ever-tightening legislation, competition, technology requirements,

efficiency requirements etc., operating own data center requires more and more of specific

competences (e.g. design for energy efficiency, design for compliancy, ...)

o Capability development requires investments and takes focus out of the core business of the company.

Page 45: Cloud Computing 101 Issue 1  (Sample)

PaaS: Platform as a Service

• PaaS: a capability provided to the user to

deploy onto the cloud infrastructure user-

created or acquired applications created using

programming languages and tools supported

by the provider.

• All cloud computing characteristic apply.

• Usually PaaS model includes an application

level framework, e.g. plug-ins for IDE

o Easier application development

o Implied lock-in with the provider

• Focus of PaaS is the developer and respective

ecosystem: Successful PaaS offerings have

tendency of attracting loyal,

open communities of developers.

• PaaS implies leverage of domain specific value,

e.g. business applications and force.com.

• Example: Google Apps, force.com, Facebook

Page 46: Cloud Computing 101 Issue 1  (Sample)

PaaS: an outsourced application server platform?

• It appears that the PaaS providers offering holds similarities to what an

application server stands for

o Obviously, an application server platform is part of PaaS, despite the proprietary nature of

implementations.

• PaaS can be seen as a service, where as an application server (“platform”) is

a technology to implement that service.

• PaaS can be regarded as a application development ecosystem:

o Implementation approach can vary and is not the core consideration: JEE, .NET, LAMP,

Python, Ruby...

o Middleware and connectivity services, elasticity, multi-tenancy

o Collaborative and integrated supporting ecosystem for the applications that are deployed on

PaaS platforms and need to be offered as services to the customers/consumers.

• IaaS scales the infrastructure, whereas PaaS scales the application

development ecosystem.

• For PaaS a key consideration is the risk of lock-in.

Page 47: Cloud Computing 101 Issue 1  (Sample)

CaaS and EaaS

• CaaS a.k.a Communications As A Service (zimbio.com)

o “Delivering telecommunications, instant messaging etc. as a service over

the Internet. Telephony as a service, also known as “Voice as a service”,

employs VOIP (Voice Over Internet Protocol). Software and hardware can

be provided as a service by providers.”

o CaaS is specialized SaaS.

• EaaS a.k.a Everything As A Services

o Another buzz-word, and to some extent even more marketing spin: SaaS,

PaaS and IaaS bundled together as multiple instances.

Page 48: Cloud Computing 101 Issue 1  (Sample)

More Scoping

Page 49: Cloud Computing 101 Issue 1  (Sample)

Framing for cloud computing delivery model

Connectivity and access

Physical computing and storage environment

Computing and storage virtualization

Operating system

Com

putin

g

Infra

stru

ctu

re

Application server containers and database management systems

Content services

Mid

dle

ware

pla

tform

Web portal

BPMS Identity services

Protocol stacks

High availability framework

Sy

stem

ma

na

gem

ent

too

ls

Pla

tform

O&

M

too

ls

Dev. tools

UI frame.

Platform abstraction layer

etc.

Applic

atio

n

insta

nces

Sh

ared

a

pp

licatio

n

ma

na

gem

ent Application integration layer

User interface layer

Applications Partners’ standard

applications

Customized applications

Third party standard

applications

Third party customized applications

IAA

S

PA

AS

SA

AS

The service models are separate: e.g. creating a SaaS offering

by no means requires bundling IaaS or PaaS with it.

Page 50: Cloud Computing 101 Issue 1  (Sample)

Some Myth’s and perceptions

• Isn’t it all about hardware provisioning?

o Not Really – It is also about changing of Software Development Lifecycle

with scaling up , hardware provisioning and deployment all under the

control of developer written programs

• What about Security and Enterprise Adoption ?

o Two answers

• Private Clouds – Starting seeing the adoption of the cloud computing paradigm come into the corporate data center. Big iron vendors are selling Private Cloud Products and Hybrid Solutions.

• The Question: “Just as Banks became a safe place to keep your money away from your safe-box in your grandfathers home , The Cloud will become the default place to keep your data in the future.” – an analogy I prefer is home security, you can outsource to ADT, but in the limit you still need to do some of it yourself.

Page 51: Cloud Computing 101 Issue 1  (Sample)

Some Myth’s and perceptions

• Isn’t this similar to Time Sharing?

o Yes to some extent.

o But it is not all about sharing of resources. It really boils down to cost savings

as a result of automation and changing the software development lifecycle

• How is it different from ASP?

o The ASP value-add was the typical value you get from an outsourcing

company. Leverage knowledge base, trained manpower and some shared

infrastructure to guarantee reliability of operations and potential cost savings

o Cloud Computing is taking the ASP concept to the next level with zero to little

amount of “People Services” and focus on the computing as a utility.

Page 52: Cloud Computing 101 Issue 1  (Sample)

Public Clouds

• Public Clouds are good when

o Have low bandwidth and latency requirements

o Starting with test or development workloads

o Running collaboration applications

o Don’t have an upfront capital budget

• Not so good when

o You need strict performance SLAs

o Uptime is critical – no control over recovery

o Privacy or security is a concern, i.e.

• 3rd party has your data, auditors complain

• Can you review vendor’s security procedures?

o Costs per CPU hour can be larger than that of in-house server deployments.

Committing tightly to a single provider without a proper plan B is a no-go.

Page 53: Cloud Computing 101 Issue 1  (Sample)

Internal Private Clouds

• Positives of internal private clouds

o Anticipated reduction of TCO

o Better hardware capacity

utilization

o Elasticity

• Easy self service provisioning

• More efficient system management

o IT retains control of SLAs

• Data security and privacy

• High performance

• High availability

o Capability to provide spot-on

chargeback reports as per need

• Negatives vs. public clouds

o Requires up front capital

expenditure due to IT investments

in own CAPEX

o Not as useful for small and

medium businesses and

departmental solutions due to

needed investments

• Negatives vs. dedicated hardware

o Performance tax

o Not capable for massive parallel

processing

Page 54: Cloud Computing 101 Issue 1  (Sample)

Cost elements: SaaS versus traditional on-premises SW

• On-premises / in-house

o License payments at acquisition

phase and recurring fees

o Customization and systems

integration costs

o Implementation and deployment

costs for roll-out

o Local IT and systems support

arrangements, either own head-

count or outsourced

o Training costs for end users

o Computing, storage, backup and

network costs

o Support and maintenance costs

• SaaS

o Configuration and systems

integration costs

o Business process adaptation costs

o Sign-up fees

o Recurring subscription fees

o Care and support fees

o Training costs (of a standard

application)

o Internet connectivity costs

o (undefined price tag for potential

strategic transition costs)

Page 55: Cloud Computing 101 Issue 1  (Sample)

Cloud service provider space remains fragmented

Cloud based

services

Cloud native players

Amazon, Salesforce;

Google

IT Service providers

Accenture, Capgemini,

Wipro

Large tech vendors

Cisco, Dell HP, IBM

Telecom providers

AT&T, BT, FT, DT/ T-Systems, Verizon

Page 56: Cloud Computing 101 Issue 1  (Sample)

Why CSPs have a strategic fit for cloud computing

• Shared infrastructure

• CSPs have long history of infrastructure, which is networked and interoperable via well-defined interfaces.

• Managed and hosted IT and communications services

• For a longer time CSPs have relied on vendors’ managed services type of professional services, which means that there is no inherent fear of outsourcing operative responsibilities.

• Data centers

• Data centers operations have been for long time the core of CSP production machines.

• Security, data integrity and trust

• These are the traditional key characteristics of telco business.

• Managed network services and end-to-end SLAs.

• CSPs are familiar with end-to-end SLA thinking and KPI based operations.

• Communications as a service

• Communications and connectivity is the bread and butter of CSPs.

• SME customer base

• The customer base of CSPs does cover SME, which means that they are familiar with the problems and issue within the segment.

Page 57: Cloud Computing 101 Issue 1  (Sample)

What is Cloud Computing For Telcos

Cloud Computing

Engagement for Telcos

New consumer-

centric Cloud Services

Infra-structure

Network-Centric

Mass Adoption

Consumer Reach

Delivery Strength of

trusted services

e.g. Billing

Where Is The Cloud Opportunity For Telcos?

CONSUMER vs ENTERPRISE

Page 58: Cloud Computing 101 Issue 1  (Sample)

Telco’s Enterprise – Consumer Pendulum

• 2005’s: Cloud Computing/SaaS Tech. Populism, Pay/Use, Web 2.0

• 2015’s: Enterprise 3.0 Collaborative Business Models Cloud federated master data and distributed business transactions

75’s: ISDN Telephony

1st Gen. Remote Home Workers

90’s: Multimedia PCs, Cell Phones Digital Kids, Consumerization IT

2010’s: Managed Devices, Media

Convergence Managed Desktops, X-Internet

• 65’s: Mainframes in Data Centers Enterprise drives Tech Awareness

Consumer Enterprise

• 80’s: PC on corporate desktop IT education of working generation

Innovators Converged Personas

Mass Adoptors Consumer Specific Personas Enterprise

Page 59: Cloud Computing 101 Issue 1  (Sample)

Implementing Security

Page 60: Cloud Computing 101 Issue 1  (Sample)

60

Security is the Major Issue

Page 61: Cloud Computing 101 Issue 1  (Sample)

Security Trend – Virtual Firewalls and Additional Procedures Part 1

• Virtualization is essentially adding an operating system. – So there are now two operating systems to monitor and patch, instead of one. This

increases the chances of patches not being up to date creating security risks – Procedures within the data centers running cloud services must be stricter then regular

data center procedures • Traditional intrusion detection doesn’t work on virtual servers.

– Intrusion detection (and intrusion prevention) monitors network traffic (between physical servers) and raises a red flag if there’s a traffic spike or type of traffic not explained by legitimate operations.

– But there’s no way to monitor traffic between virtual servers on one physical host, - emergence of virtual firewalls

• Malware can spread among virtual servers. – Traditional intrusion detection is blind to activity between virtual servers, it’s easy for a

virus or other malignant software to spread from one virtual server to another. – And beyond -- because virtualization is often used in conjunction with clustering that

moves data and applications among two or more physical servers, to provide load-balancing and “failover” in case one server in the cluster encounters a problem.

– A network monitoring system can not analyze this threat. Emergence of virtual firewalls that protect virtual servers.

– VMWare and Citrix have created Hypervisor based solutions that work with existing security vendor solutions

• Confidential data can be compromised because there’s no way to monitor traffic flow between virtual servers sharing the same physical server,

– There’s no way to tell whether confidential or legally protected data (such as medical records or credit card numbers) have been compromised.

– Today this is managed by segregating data on a separate physical sever – and generally not allowed outside of the internal corporate cloud.

Page 62: Cloud Computing 101 Issue 1  (Sample)

Security Trend – Virtual Firewalls and Additional Procedures Part 2

• Malware is now virtual-aware. – “Virtual-aware” viruses can tell when they’re running in a virtual

environment. Though they’ve mostly used this knowledge to hide so far, they could easily be adjusted to attack virtual servers’ vulnerabilities instead.

– According to research by the antivirus company ESET, more than 200,000 virtual-aware malwares were at large in November 2008.

• Other methods of security management include structuring the resource pools to match network segments, and force traffic among pools to pass through the existing network security infrastructure.

– Generally use virtual LANs to achieve this, which results in lower resource utilization and less flexibility in matching workloads to resources.

• VM Ware publishes security guidelines – Limiting VM functionality to only those capabilities required by the

application – General access controls to virtual console and management functions – Quite complex and generally push operators towards partnering with an

established IT integrator in the virtualization space, e.g. HP or IBM

• A Cloud Service is only as strong as its weakest link – Must ensure all VMs implement extra protections – recent Gartner surveys

show less than 20% of enterprise implementations include additional protections for security in virtualization implementations

Page 63: Cloud Computing 101 Issue 1  (Sample)

Security Standards: SAS 70

• SAS 70 is the most commonly adopted security standard among

cloud service providers.

• Roughly 67 percent of cloud service providers follow SAS 70

(Statement on Auditing Standards No. 70), which is an

internationally recognized auditing standard developed by the

American Institute of Certified Public Accountants (AICPA) that

defines the standards an auditor must employ in order to assess the

contracted internal controls of a service organization like a hosted

data center, insurance claims processor or credit processing

company, or a company that provides outsourcing services that can

affect the operation of the contracting enterprise.

Page 64: Cloud Computing 101 Issue 1  (Sample)

Security Standards: PCI DSS & SOX

• PCI DSS

o About 42 percent of cloud service providers follow the PCI DSS (Payment Card Industry Data Security

Standard) standard, a global security standard that applies to all organizations that hold, process or

exchange credit card or credit card holder information.

o The standard was created to give the payment card industry increased controls around data and to

ensure it is not exposed. It is also designed to ensure that consumers are not exposed to potential

financial or identity fraud and theft when using a credit card.

• Sarbanes-Oxley

o Sarbanes-Oxley (SOX) is a security standard that defines specific mandates and requirements for

financial reporting. SOX spanned from legislation in response to major financial scandals and is

designed to protect shareholders and the public from account errors and fraudulent practices.

o Administered by the SEC, SOX dictates what records are to be stored and for how long. It affects IT

departments that store electronic records by stating that all business records, which include e-mails

and other electronic records, are to be saved for no less than five years. Failure to comply can result in

fines and/or imprisonment.

o About 33 percent of cloud service providers follow SOX.

Page 65: Cloud Computing 101 Issue 1  (Sample)

Security Standards: ISO 27001 and Safe Habor

• ISO 27001

o About 33 percent of cloud service providers adhere to ISO 27001, a standard published in 2005 that is

the specification for an Information Security Management System (ISMS).

o The objective of ISO 27001 is to provide a model for establishing, implementing, operating,

monitoring, reviewing, maintaining and improving ISMS, which is a framework of policies and

procedures that includes all legal, physical and technical controls involved in an organization's

information risk management processes.

• Safe Harbor

o About one-fourth of cloud service providers adhere to Safe Harbor principles, a process for

organizations in the U.S. and European Union that store customer data.

o Safe Harbor was designed to prevent accidental information disclosure or loss. Companies are certified

under Safe Harbor by following seven guidelines: Notice, through which individuals must be informed

that their data is being collected and how it will be used; choice, that individuals have the ability to opt

out of data collection and transfer data to third parties; onward transfer, or transfer data to third parts

that can only occur to organizations that follow adequate data protection principles; security, or

reasonable efforts to prevent loss of collected data; data integrity, that relevant data is collected and

that the data is reliable for the purpose for which it was collected; access, which gives individuals

access to information about themselves and that they can correct and delete it if it is inaccurate; and

enforcement, which requires the rules are enforced.

Page 66: Cloud Computing 101 Issue 1  (Sample)

Security Standards: NIST and HIPAA

• NIST

o National Institute of Standards and Technology (NIST) standards, originally designed for

federal agencies, emphasize the importance of security controls and how to implement them.

The NIST standards started out being aimed specifically at the government, but have recently

been adopted by the private sector as well.

o NIST covers what should be included in an IT security policy and what can be done to boost

security, how to manage a secure environment, and applying a risk management framework.

The goal is to make systems more secure. About 25 percent of cloud service providers adhere to

NIST standards.

• HIPAA

o The U.S. Health Insurance Portability and Accountability Act (HIPAA) is followed by roughly

16 percent of cloud service providers.

o The HIPAA standard seeks to standardize the handling, security and confidentiality of health-

care-related data. It mandates standard practices for patient health, administrative and

financial data to ensure security, confidentiality and data integrity for patent information.

Page 67: Cloud Computing 101 Issue 1  (Sample)

Security Standards: FISMA and COBIT

• FISMA

o FISMA, or the Federal Information Security Management Act, was passed in 2002 and created

process for federal agencies to certify and accredit the security of information management

systems.

o FISMA certification and accreditation indicate that a federal agency has approved particular

solutions for use within its security requirements. In its research. About 16 percent of cloud

service providers have obtained FISMA certifications.

• COBIT

o Control Objectives for Information Related Technology is an international standard that

defines the requirements for the security and control of sensitive data. It also provides a

reference framework.

o COBIT is a set of best practices for controlling and security sensitive data that measures

security program effectiveness and benchmarks for auditing. The open standard comprises an

executive summary, management guidelines, a framework, control objectives, an

implementation toolset and audit guidelines. About 8 percent of cloud service providers follow

the COBIT security standard.

Page 68: Cloud Computing 101 Issue 1  (Sample)

Security Standards: Data Protection Directive

• The Data Protection Directive is a directive adopted by the European

Union that was designed to protect the privacy of all personal data

collected for or about EU citizens, especially as it relates to

processing, using or exchanging that data.

• Similar to Safe Harbor in the U.S., Data Protection Directive makes

recommendations based on seven principles: Notice, purpose,

consent, security, disclosure, access and accountability. About 8

percent of cloud service providers adhere to the Data Protection

Directive.

Page 69: Cloud Computing 101 Issue 1  (Sample)

In Some Ways, "Cloud Computing Security" Is No Different Than "Regular Security"

• For example, many applications interface with end users via the web. All the

normal OWASP (Open Web Application Security Project) web security

vulnerabilities

-- things like SQL injection, cross site scripting, cross site request forgeries,

etc., -- all of those vulnerabilities are just as relevant to applications running

on the cloud as they are to applications running on conventional hosting.

• Similarly, consider physical security. A data center full of servers supporting

cloud computing is internally and externally indistinguishable from a data

center full of "regular" servers. In each case, it will be important for the data

center to be physically secure against unauthorized access or potential natural

disasters, but there are no special new physical security requirements which

suddenly appear simply because one of those facilities is supporting cloud

computing

Page 70: Cloud Computing 101 Issue 1  (Sample)
Page 71: Cloud Computing 101 Issue 1  (Sample)

Bitbucket, DDoS'd Off The Air

Page 72: Cloud Computing 101 Issue 1  (Sample)

Maintenance Induced Cascading Failures

Page 73: Cloud Computing 101 Issue 1  (Sample)

73

It's Not Just The Network: Storage Is Key, Too

See http://www.engadget.com/2009/10/10/t-mobile-we-probably-lost-all-your-sidekick-data/ However, see also: Microsoft Confirms Data Recovery for Sidekick Users http://www.microsoft.com/Presspass/press/2009/oct09/10-15sidekick.mspx

Page 74: Cloud Computing 101 Issue 1  (Sample)

74

And Let's Not Forget About Power Issues

Page 75: Cloud Computing 101 Issue 1  (Sample)

Implementing in Your Organization Project Plan

Page 76: Cloud Computing 101 Issue 1  (Sample)

Today’s IT infrastructure is under tremendous pressure and is finding it difficult to keep up…

76

It will reach a breaking point

In distributed computing

environments, up to 85 percent

of computing capacity sits idle

Percentage of executives who report

a security breach and aren’t confident

they can prevent future breaches

70 percent is spent on maintaining current IT infrastructures versus adding new capabilities

Percentage of CIOs who want to improve the way they use and manage their data

Page 77: Cloud Computing 101 Issue 1  (Sample)

Create a roadmap for cloud as part of the existing IT optimization strategy

Consolidate

Virtualize

Standardize and automate

Reduce infrastructure complexity

Reduce staffing requirements

Manage fewer things better

Lower operational costs

Remove physical resource boundaries

Increase hardware utilization

Reduce hardware costs

Simplify deployments

Standardize services Reduce deployment

cycles Enable scalability Flexible delivery

Page 78: Cloud Computing 101 Issue 1  (Sample)

Adoption of cloud computing will be workload driven

• Workload characteristics determine standardization

Web infrastructure applications

Collaborative infrastructure

Development and test

High Performance Computing

...

Test for Standardization Examine for Risk

Database

Transaction processing

ERP workloads

Highly regulated workloads

...

High volume, low cost analytics

Collaborative Business Networks

Industry scale “smart” applications

...

Explore New Workloads

Page 79: Cloud Computing 101 Issue 1  (Sample)

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

– E-mail

– 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.

Page 80: Cloud Computing 101 Issue 1  (Sample)

Public and Private Clouds are preferred for different workloads

Database- and application-oriented workloads emerge as most appropriate

Data mining, text mining, or other analytics

Security

Data warehouses or data marts

Business continuity and disaster recovery

Test environment infrastructure

Long-term data archiving/preservation

Transactional databases

Industry-specific applications

ERP applications

Infrastructure workloads emerge as most appropriate

Audio/video/Web conferencing

Service help desk

Infrastructure for training and demonstration

WAN capacity, VOIP Infrastructure

Desktop

Test environment infrastructure

Storage

Data center network capacity

Server

Source: IBM Market Insights, Cloud Computing Research, July 2009. n=1,090

Top public workloads Top private workloads

Page 81: Cloud Computing 101 Issue 1  (Sample)

There is a spectrum of deployment options for cloud computing

Private Public Hybrid IT capabilities are provided “as a service,” over an intranet, within the enterprise and behind the firewall

Internal and external service delivery methods are integrated

IT activities / functions are

provided “as a service,” over the

Internet

Third-party operated

Third-party hosted and operated

Enterprise data center

Enterprise data center

Private cloud Hosted private cloud

Managed private cloud

Enterprise

Shared cloud services

Enterprise A

Enterprise B

Public cloud services

A

Users

B

Page 82: Cloud Computing 101 Issue 1  (Sample)

There is a spectrum of deployment options for cloud computing

Private

Implemented on client premises

Client runs/ manages

Third-party operated

Enterprise owned

Mission critical

Packaged applications

High compliancy

Internal network

Third-party owned and operated

Standardization

Centralization

Security

Internal network

Mix of shared and dedicated resources

Shared facility and staff

Virtual private network (VPN) access

Subscription or membership based

Shared resources

Elastic scaling

Pay as you go

Public Internet

Third-party operated

Third-party hosted and operated

Enterprise data center

Enterprise data center

Private cloud Hosted private cloud

Managed private cloud

Enterprise

Shared cloud services

Enterprise A

Enterprise B

Public cloud services

A

Users

B

Page 83: Cloud Computing 101 Issue 1  (Sample)

Security is among a top concern with cloud computing... Security Framework provides a structure to address this concern

Data and information Understand, deploy and properly test controls for access to and usage of sensitive data

People and identity Mitigate the risks associated with user access to corporate resources

Application and process Help keep applications secure, protected from malicious or fraudulent use, and hardened against failure

Network, server and end point Optimize service availability by mitigating risks to network components

Physical infrastructure Provide actionable intelligence on the desired state of physical infrastructure security and make improvements

Professional services

Managed services Hardware and software

Page 84: Cloud Computing 101 Issue 1  (Sample)

Movement from Traditional Environments to Cloud Can be in One Step or an Evolution Clients will make workload-driven trade offs among functions such as security, degree of customization, control and economics

Page 85: Cloud Computing 101 Issue 1  (Sample)

Businesses that implement cloud computing are seeing significant results

Reduced IT labor cost by 50 percent in configuration, operations, management and monitoring

Improved capital utilization by 75 percent, significantly reducing license costs

Reduced provisioning cycle times from weeks to minutes

Improved quality, eliminating 30 percent of software defects

Reduced end user IT support costs by up to 40 percent

Simplified security management

Page 86: Cloud Computing 101 Issue 1  (Sample)

Concluding Remarks

Page 87: Cloud Computing 101 Issue 1  (Sample)

Gartner view: hype cycle

Page 88: Cloud Computing 101 Issue 1  (Sample)

But it does make sense for some functions within some organizations….

Page 89: Cloud Computing 101 Issue 1  (Sample)

The NIST Cloud Definition Framework

89

Community Cloud

Private Cloud

Public Cloud

Hybrid Clouds

Deployment

Models

Service

Models

Essential

Characteristics

Common

Characteristics

Software as a Service (SaaS)

Platform as a Service (PaaS)

Infrastructure as a Service (IaaS)

Resource Pooling

Broad Network Access Rapid Elasticity

Measured Service

On Demand Self-Service

Low Cost Software

Virtualization Service Orientation

Advanced Security

Homogeneity

Massive Scale Resilient Computing

Geographic Distribution

Page 90: Cloud Computing 101 Issue 1  (Sample)

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

Page 91: Cloud Computing 101 Issue 1  (Sample)

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

Page 92: Cloud Computing 101 Issue 1  (Sample)

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

Page 93: Cloud Computing 101 Issue 1  (Sample)

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

Page 94: Cloud Computing 101 Issue 1  (Sample)

CSPs and cloud computing

• The large CSPs have long history in running large scale data-centers and

respective operations.

• Hence, it is natural for CSPs to offer services via cloud paradigm, and

enter into the domain of providing enterprise grade cloud computing

services.

o From history perspective the focus has been in IaaS.

o This will most probably continue, since the infrastructure services continue to be a lucrative

necessity.

• Analyst (e.g. Ovum) reports indicate that SaaS/CaaS roadmaps are

evolving within major telco CSPs.

o This is logical growth path, as cloud computing model leverages the telco core competences.

o CSPs already have strong foothold on connectivity, which is essential for XaaS.

o Trend seems to be that IaaS remains the core focus, and SaaS is developed in an opportunistic

way, i.e. develop a solution to a problem, and see whether it could be reapplied for a general

business case according to SaaS.

• Most often CaaS appears to represent communication as a service or

collaboration as a service or unified communications as a services.

Page 95: Cloud Computing 101 Issue 1  (Sample)

Why CSPs have a strategic fit for cloud computing

• Shared infrastructure

• CSPs have long history of infrastructure, which is networked and interoperable via well-defined interfaces.

• Managed and hosted IT and communications services

• For a longer time CSPs have relied on vendors’ managed services type of professional services, which means that there is no inherent fear of outsourcing operative responsibilities.

• Data centers

• Data centers operations have been for long time the core of CSP production machines.

• Security, data integrity and trust

• These are the traditional key characteristics of telco business.

• Managed network services and end-to-end SLAs.

• CSPs are familiar with end-to-end SLA thinking and KPI based operations.

• Communications as a service

• Communications and connectivity is the bread and butter of CSPs.

• SME customer base

• The customer base of CSPs does cover SME, which means that they are familiar with the problems and issue within the segment.

Page 96: Cloud Computing 101 Issue 1  (Sample)
Page 97: Cloud Computing 101 Issue 1  (Sample)

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

– E-mail

– 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.

Page 98: Cloud Computing 101 Issue 1  (Sample)

System Lifecycles

Hyperlinked Models & Metadata

End-to-End Policies

Enterprise Cloud Computing

IT-CONTROLLED CLOUD COMPUTING

• Accelerate application delivery

• Improve IT service management

• Business obtains flexibility while IT maintains control

Application VMs

Metering & Billing Storage

Servers

Public Clouds

Private Clouds

EA & DCA

APP ARCH

IT OPS

IT OPS MGT

Policy-Based Design with Flexibility

Improved Service Delivery with Control

Consumption, Planning, Improvements

Standards & Policies

Portfolio of Virtualized

APPLICATION RESOURCES

Dynamic Availability

Efficient Consumption

Treat Cloud just like any IT project: focus, don't believe the hype, and take it step by step

Page 99: Cloud Computing 101 Issue 1  (Sample)

MPLS SLA

Data Center SLA

Mind the SLA Gap!

Page 100: Cloud Computing 101 Issue 1  (Sample)

Beware Lock-In

Page 101: Cloud Computing 101 Issue 1  (Sample)

Conclusions Business

Applications

Infrastructure Software

Data Center

VPN Email

CRM Mobile

Its what your mother told you, “Don’t put all your eggs in one basket”

Desktop

Analytics