cloud computing in south africa reality or fantasy
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Cloud computing in South AfricaReality or Fantasy?
AIGS Conference18th June 2012
Chantel Lindeman
2
Agenda
Evolution of cloud computing
Platform as a Service: Next Hot Cloud
Uptake of cloud computing: The Reality
South African Cloud Computing Market
Data Centre Uptake: Virtualised Environment
Where is your Business?
3
Generational shift of computing platform over the past 40 years
Technology Economic Business
Centralised compute & storage,
thin clients
Optimised for efficiency due to
high cost
High upfront costs for hardware and
software
PCs and servers for distributed
compute, storage, etc.
Optimised for agility due to low cost
Perpetual licence for OS and
application software
Large DCs, commodity HW,
scale-out, devices
Order of magnitude better efficiency and
agility
Pay as you go, and only for what you
use
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• Public cloud offers the opportunity to fully exploit the cost savings inherent in cloud computing services
‒ Company relies on the service provider for security and data backup
• Private cloud ensures more security as data and applications are stored internally
‒ Some companies use it initially to gain insights and confidence into Cloud computing services
‒ It still requires upfront costs and hands-on management, therefore it does not fully exploit the cost-reduction potential
• Hybrid cloud enjoys ‘the best of both worlds’, as it offers the flexibility to have SaaS and the discretion on managing the security and data ‒ Costly to keep resources on a private
cloud while the resources on the public cloud pose a security risk
Three deployment models available for cloud computing
5
Agenda
Evolution of cloud computing
Platform as a Service: Next Hot Cloud
Uptake of cloud computing: The Reality
South African Cloud Computing Market
Data Centre Uptake: Virtualised Environment
Where is your Business?
6
The integration between IaaS and SaaS which leads to PaaS
• Public cloud IaaS is driven by cost efficiency and scalable storage
• Private clouds embrace the platform = PaaS
‒ Increases efficiency and productivity of Enterprise Development Organisations
• Public SaaS cloud moves towards PaaS
‒ Customer demands for isolation and customerization
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The broken promise of cloud - enterprises restrict cloud usage to non critical apps (e-mail and web hosting)
• Costs reduction: Do not eliminate IT workers or shut down data centres
• Scalability: multiple management environment
• On-premises and hosted; dedicated and shared; public, private and hybrid cloud
• Streamline IT: little impact to burdensome challenges
• Examples: maintain critical legacy systems
Robust and integrated PaaS solution can achieve the efficiency of a shared cloud environment while extending the benefits beyond hosting of isolated apps
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Most PaaS services are available to users on demand, with the provider managing the hardware and software
Reduce risk in cloud
environment
Manage mission critical
systems
IntegrationSafely test
environments separately
Increase quality
and control
Decrease development
time
• Easily replicable images enables developers in minimizing coding
• Application can be deployed immediately
• Co-ordinate alignment of applications with corporate requirements for security
• Applications can be tested at same scale as production environment
• Bringing together of new and legacy applications together with minimal coding
• Manage SAP and Web applications
• Enterprise IT department is able to specify performance specs
• Leverage cloud with higher degree of confidence
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Agenda
Evolution of cloud computing
Platform as a Service: Next Hot Cloud
Uptake of cloud computing: The Reality
South African Cloud Computing Market
Data Centre Uptake: Virtualised Environment
Where is your Business?
10
Global Cloud Market Takes Off: This what is what the market is saying including Frost & Sullivan …
The global cloud market is predicted to increase fro $41 billion in 2011 to more than $241 billion by 2020
2008 2010 2012 2014 2016 2018 20200
50
100
150
200
250
300
Predicted Global Cloud Market
Years
Re
ve
nu
e (
Bill
ion
do
llars
)
Predicted
Source: 2011 Forrester Research
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… yet, adoption remains slow due to multitude of factors
Unfamiliar
Believers
Unconvinced
Familiarity and adoption of IaaS
Have never heard of IaaS
11%
Not very familiar with IaaS
29%Familiar with and currently using IaaS
9%
Familiar and planning to implement IaaS within 2 years
13%
Familiar with or have considered IaaS, but no plans to implement
37%
• Providers have captured the earlier adopters
• Believers are convinced of the benefits of cloud computing‒ However, they are concerned with
cloud security
• The Unconvinced are less likely to recognise the benefits of cloud computing‒ Lack of cost reductions
‒ Private data centres are at low risk of incurring securing breach
• The Unfamiliar perceptions of the cloud were negative or undecided‒ Concerned about performance
and reliabilitySource: Frost & Sullivan, 2011N = 301
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Agenda
Evolution of cloud computing
Platform as a Service: Next Hot Cloud
Uptake of cloud computing: The Reality
South African Cloud Computing Market
Data Centre Uptake: Virtualised Environment
Where is your Business?
13
• Adoption rates in South Africa are low‒ Even though cloud dominates IT
discussions ‒ Simplicity in implementing the
technology and cost savings• IaaS is showing steady growth
‒ Understanding of the product offering
‒ Visibly see the cost benefits on P&L with reduction in infrastructure spend
• SaaS is in development phase‒ Niche players are building traction
in the market• PaaS is new to the market but is
expected to rapidly increase over next 5 years
Cloud Services Market: Market Cycle (South Africa), 2011
PaaS
MaturityDevelopment Growth Decline
Time
Mar
ket
Va
lue
Source: Frost & Sullivan
IaaS
SaaS
In South Africa, the uptake of cloud computing is still in the development phase
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A combination of the on-premises and virtualised data centre allows companies to retain its core services on-site and move non-critical offerings off-site
On premises Cloud Computing
Traditional Datacenter
Virtualised Datacenter
Off premisesOn-premises/
Hosted
Well- known, stable,secure
Utilisation < 15%
Management Costs Decrease
Utilisation increases to > 50%
Deliver IT as a Service Control
Shared cloud-like agility and economics
Global reach
Capacity on demand
Service standardization
High agility
Scale economics
Key driver in South Africa has been the evolution of the data centre environment
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Agenda
Evolution of cloud computing
Platform as a Service: Next Hot Cloud
Uptake of cloud computing: The Reality
South African Cloud Computing Market
Data Centre Uptake: Virtualised Environment
Where is your Business?
16
As traditional products mature, newer products are being introduced
Source: Frost & SullivanBubble size represents revenue/subscriber size of service area
Data Centre Adoption Trends
Ad
op
tio
n R
ate
Low
HighIntroduction Growth Maturity Decline
LAN
WANWeb Hosting
SaaS
Hosted Enterprise Security
DR
Remote Backup
Managed servers
Cloud storage
Virtual Desktop
Basic Hosting
Hosted Managed Backup
Virtual Server
Cloud storage, virtual server and desktop, remote backup
and hosted exchange are promising service segments as
traditional product lines are maturing
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Basic Hosting
Cloud Storage
Disaster Recovery
Hosted Enterprise Security
Hosted Managed Back up
LAN
Managed Servers
Remote Backup
SaaS
Virtual desktop
Virtual server
Web-Hosting
0 100 200 300 400 500 600 700 800 900
Virtualisation solutions and cloud-based services will drive data centre revenues in future
Source: Frost & Sullivan analysis
CAGR Virtualisation solutions are a key technology trend as they offer significant efficiencies and cost savings to companies of all sizes
As a result SaaS, virtual desktop and virtual server are expected to have the highest growth rates to 2016
The importance of core services to overall data centre revenues will decline by 2016, as these services also become more commoditised
SaaS uptake will be driven by hosted
exchange, CRM and UC
Cloud storage is a small sub-product
of cloud-based services
8%
13%
30%
23%
10%
8%
2%
8%
10%
5%
12%
5%20102016
Growth forecasts per product sector, 2010 – 2016
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Virtualisation at the heart of the cloud business model
Cost avoidance
Expand capacity at minimal cost,
by maximising the use of existing
resources
Saves energy costs; and, by decreasing the overall footprint,
avoids or defers build out of the data
centre
Application Mobility
High availability, "always on" applications
Easy to implement business
continuity plans
Ease of Implementation
VM can be built in a matter of hours
or even less
Frost & Sullivan expects virtualised
offerings to overtake the uptake of
managed services
Source: Frost & Sullivan analysis
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Financial (7)
Mining (5)
Tourism (3)
0.9 9 90 900 9000
Log of Sum of Expenditure (ZAR Million))
Expenditure on data centres can comprise as much as 85% of total ICT spend as for banks
= 4000 PC’s
Data Centre SpendICT SpendProportion of staff With access to a PCWithout access
Retail and mining represent opportunities for virtualised desktops
Financial services spend on data centres is high, but a large proportion is in-house
Note: Data is presented for the sample of 50 companies selected in conjunction with Telkom
Number of potential PC’s for desktop management
Total spend per sector in the sample
78%
22%
66%
34%
60%40%
45%55%
55%45%
44%56%
82%
18%
Average PC Access
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Security will always be a concern but the financial sector consistently are looking for ways to cut costs
Key solutions for the financial sector
Managed ServersThe safety of data is critical in the financial sector. Regulation is a barrier to moving data off site, however. The management of servers on site can be outsourced
SaaSSoftware as a Service (SaaS) allows the user to effectively rent the use of select software which saves on licensing fees
VirtualisationVirtualisation has been used as a means to reduce hardware requirements within the financial sector. However, most virtualisation has been restricted in house
High Barrier
Medium Barrier
Low Barrier
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Most retailers continue to keep data centres in-house, but larger retailers are considering virtualisation
Key solutions for retail sector
WANConnectivity is important in the retail sector as information must be shared and consolidated from different branches
Managed ServersMany retailers choose to outsource data centre management services and these are often lucrative contracts
VirtualisationThis includes virtual desktop, virtual server and cloud storage, and addresses cost sensitivities in the sector
High Barrier
Medium Barrier
Low Barrier
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Due to the nature of the manufacturing sector, it is not always conducive to build sophisticated data centres
Key solutions for the manufacturing sector
Basic HostingManufacturing companies process large amounts of data and often have sites all across the country, the servers need to be hosted in a satisfactory manner
VirtualisationVirtualisation is a popular adoption trend within the manufacturing sector. Companies see the value in it and are taking steps to prepare for it
WANConnectivity is essential for the manufacturing sector as various branches are scattered around the country
High Barrier
Medium Barrier
Low Barrier
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Agenda
Evolution of cloud computing
Platform as a Service: Next Hot Cloud
Uptake of cloud computing: The Reality
South African Cloud Computing Market
Data Centre Uptake: Virtualised Environment
Where is your Business?
24
Source: UN-Habitat, 2010, Frost & Sullivan analysis.
DYNAMIC INFRASTRUCTURE
Automate
Aggregate
Consolidate
Separate Liberate
Test & Development
Self-Managing Datacenters
Capacity On Demand
Server Consolidation
Enterprise Computing
Clouds On & Off Premise
Emerging TechVirtualization
maturity
Server standardization & services-
based compute
Network standardization & services-
based infrastructure
Cloud framework & application
standardization promoting
full stack interoperabilit
y & portability
Private
Public
ICT is an enabler, therefore the decision must match the need required by the company
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Where is your Business on the Journey?
Source: Frost & Sullivan Analysis
Hybrid Cloud
Automation
Private Cloud
Public Cloud
Virtualisation
Consolidation
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http://www.frost.com
Your Contact For Additional Information
Chantel LindemanBusiness Unit Leader – ICT Africa
Tel: +27 21 680 3205Mobile: +27 82 555 3851E mail: [email protected]
For additional information