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Cloud demystified

Information Session for a Belgian financial institutionGabriele Bozzi @gabrielebozzi

25/10/2011

© Gabriele Bozzi

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What is Cloud Computing?

Cloud Computing is an operating

model!

© Geek and Poke

© Gabriele Bozzi

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What makes the Cloud a utility service?You heard it “ad nauseam”

• The modern Utility Computing model: Scalability (theoretically: infinite) Elasticity (don’t waste resources) Accessibility (everybody, on demand, no lock-in) API (no API, no party!) Unlimited storage (better if file-oriented) Automation (if runs more than once: automate!)

John Mc Carthy predicted in 1964 that computing: « will eventually become an utility service in the future ». It took

more than 40 years to make it happen.

© Gabriele Bozzi

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FOOTBALL

SOCCER

COMPUTING ON DEMAND

CLOUD

Why “Cloud”?

The author takes full responsibility of his views

© Gabriele Bozzi

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Surprise: the Cloud is an enabler!

• The Cloud is an operating model (again)• It allows IT to react and act faster• It doesn’t make save you money, rather spend

it better*• It doesn’t require disruptive investments in

terms of assets

*This will be explained later (Jevons Paradox)

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Resistance is futile

Strategic importance of information technology in business has diminished as IT

has become more commonplace, standardized and cheaper*

*See Nicholas G. Carr references

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IT is a commodity

InnovationCustom built

Product

Commodity

Utility Services

Certainty

Ubi

quity

Improvement

Dem

and

Computing, as a product, has become so widespread and improved so much that is now transitioning to the utility service model

Thanks to Simon Wardley for mapping the “S” curve to Cloud Computing

The curve’s slope represents the investment impact

This is the zone where ROI is maximised

© Gabriele Bozzi

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The marketer’s party: Private Clouds

You have heard so much bad marketing from vendors about Private Cloud systems and Private

Cloud storage that aren't really cloud, now you have bad connotations about the whole thing.

Why limit it to “Private”? Why not call it (and use it as) Enterprise Cloud?

Apparently “Private” is a misnomer: in the initial Cloud-hype cycle, many vendors were worried of the “control” issue of Cloud, therefore “Private” sounded more sellable

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The posture against Enterprise Cloud

• The promise is to increase level of efficiency by building your own abstraction layers

• Cloud administrators run an entire data-center, instead of being responsible for just one technology

• It is the evolutionary mid-term technology to bridge Enterprise IT to full commoditisation

• Be it IaaS, PaaS, SaaS: the objective is to raise competitiveness by adopting standard practices

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Risks

• Of course the Cloud has risks: Transitional risks: governance issues, security

of supply, general security Outsourcing risks: lock-in, price competition,

loss of strategic control Disruption risks: non-commodity products

falling victim of the change

The truism of the day is:”Don’t put all your eggs in one basket”

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So: Do I need Cloud?

No, but consider those activities that are becoming less strategic; by ignoring commoditisation you are likely to create a competitive disadvantage for yourself as anyone else is racing for ubiquitous benefits

*Originally proposed by Leigh Van Valen (1973)

You

Market

Certainty

Ubi

quity

Competitive gap

The Red Queen Hypothesis*: "It takes all the running you can do, to keep in the same place."

© Gabriele Bozzi

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The Jevons Paradox

“Technological progress that increases the efficiency with

which a resource is used, tends to increase the rate of

consumption of that resource”*

William Stanley Jevons

In Cloud terms:

Expect no significant reduction in spending by adopting Cloud,

because it opens more opportunities to generate

competitive IT consumption*The Coal Question, 1865

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Are there Quick-wins to achieve with Enterprise Cloud?

• Yes! Here are some areas to watch out: Extreme load variation Storage, information management Big DataCommoditise procurementNon strategic activities

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Extreme load variationAn unfair comparison

• SEPA DD platform on Open Systems

• Elastically allocated VMs, EJB 3

• In-memory caching• 24m bulk transactions per

run (< 8hrs)• 3.800 Man-days to

production• Up to 50% of processing

comes from unused CPU

• SEPA DD platform on mainframe

• Monolithic code on mainframe

• File transfers• 5m bulk transactions per

day• 6.100 Man-days to

production• Mips cost affects TCO

(typically 2000m)

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250k 500k 1m 2m 4m 8m100%

105%

110%

115%

120%

125%

130%

135%

140%

145%

1 2 6 %

1 2 1 %

1 1 2 %1 1 6 %

1 2 2 %

1 4 0 %

Monthly TCO Cloud (%)

Monthly TCO in-house (%)

Storage, information management

• Press editors and news providers deploy a unified online store for their publications

• Proposed architecture: Object storage supports ingestion and content storage/distribution on the same support (55TB of publications and semantic indexes)

• Keep back-office processes in-house

Active monthly

Users

N.B. TCO takes in account: Depreciation of IT and turn-over of equipment.Depreciation of Cloud prices on 3yrs span

3 yrs estimate

In-house storage and content distribution has higher TCO than Cloud storage

© Gabriele Bozzi

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BigData goes public Clouds (1)

• Bank Of America uses Map-Reduce (Hadoop) to cope with cross product risk management: from home loans to online banking

• Bankinter in Spain uses Amazon cloud computing as an integral part of their credit-risk simulations. Reduces process times from 23hrs to 20min

• Capture and deliver near-real time results!

• Use innovative data imaging (R, Tableau)

Wed Thu Fri Mon Tue

Up to 3000 CPUs

Baseline 300 CPUs

Typical Duty Cycle of CPU utilization for Risk Management Systems a financial institution runs on Amazon’s public Cloud

Courtesy of Amazon AWS® Europe

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Assisted Desktop Virtualization

• DaaS: Desktop as a Service, no CapEx (e.g. Citrix Farm)

• Good for provisional procurement, home working, outsourced workforce

• Shares economies of scale of the Cloud with the customer

• Decrease 3 to 5 times the yearly TCO of a Virtual Desktop (e.g. 360 US$ vs 1.200 US$)*

*Prices are exclusive of application procurement (just Windows)

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Thank you!

See appendixes for more material

© Gabriele Bozzi

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Appendix A: vendors, technologies

• Microsoft Azure (PaaS) is coming to a datacenter near you (yours)• Amazon AWS, the public Cloud is becoming more enterprise• OpenStack, the linux of Open Source• Piston Cloud Computing , Enterprise-grade, high security OpenStack implementation• Citrix CloudStack , agnostic cloud infrastructure platform• RightScale, manages multiple Clouds unlocking your infrastructure• Dell Boomi, IT management on the Cloud• Rackspace, the “other” public Cloud, acquired CloudKick, great Cloud monitoring tool• Puppet, Chef, are two well established automation tools• Hadoop, on the way to become a standard for highly scalable distributed batch jobs• VMWare Octopus, the Cloud file exchange for the Enterprise• VBlock, Cisco, Vmware EMC to bridge Cloud with existing operational models• Nirvanix, simply the best object storage on the market: now partnering with IBM• Fujitsu Global Cloud Platform, offers a Cloud infrastructure in Belgium• Thales, making the Cloud more secure by dispersing information• CA, acquired 3Tera and delivers Cloud IT management software• IBM SmartCloud, the integrated application platform• Nolio, is application release automation for development and dev-Ops• Desktone, desktop PCs as a service!

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Appendix B: references

• The Enterprise Cloud Leadership Council http://www.tmforum.org/EnterpriseCloudLeadership/8009/home.html

• Van Valen “The Red Queen Hypothesis” http://en.wikipedia.org/wiki/The_Red_Queen_hypothesis

• Simon Wardley (Lef.csc.com) “Situation Normal, everything must change” http://www.youtube.com/watch?v=5Oyf4vvJyy4

• William Stanley Jevons: “The Coal Question” http://en.wikipedia.org/wiki/The_Coal_Question

• Nicholas G. Carr: Does IT Matter? Information Technology and the Corrosion of Competitive Advantage (Harvard Business School Press)

© Gabriele Bozzi

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Appendix C: Useful links

• IBM Implements secure Government Cloud: http://bit.ly/aRjEWp• Thales and Layer 7 to make Cloud more secure: http://bit.ly/pDp7Ac• 90 Cloud companies to watch in 2011: http://bit.ly/fvGbci• Cloud Computing use cases newsgroup: http://bit.ly/p9yGga• CloudScaling builds Clouds, Google-class Clouds: http://cloudscaling.com/• TibCo Silver Cloud platform: http://bit.ly/qkEfCi• Enstratus, Cloud governance utilities and consulting: http://bit.ly/8geaNf• Cloud functional and performance testing from Soasta: http://www.soasta.com/• The Belgian Cloud marketplace, IaaS, DaaS: http://bit.ly/q196mo

© Gabriele Bozzi

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Appendix D: On the inevitability of the Cloud

This cartoon appeared on Geek & Poke in March 2011

It was meant to be humoristic

Amazon presented on October 2011 “Silk”; a browser that runs on their Cloud and is accessible by a rendering engine on Amazon Kindle Fire

Resistance is futile…

© Gabriele Bozzi

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Appendix E: Enterprise Clouds

Agnosticiy

Mar

ket U

biqu

ity

Strategic control

Dem

and OpenStack

CitrixGigaspaces

MS Hyper-VAzure

Vblock Cloud

FoundryCA

Applogic

PaaS integration levels

• Strong

• Competitive

• Evolving

HP, Dell, Fujitsu

HP, Dell, Fujitsu, IBM

Likely sell-out

Nimbula

OracleExalogic

The selection is not exhaustive of the current market’s status

© Gabriele Bozzi