Mythbusting the Private Cloud

The popularity of cloud concepts and the expected benefits from cloud computing have certainly raised expectations. Forrester now predicts that cloud spending will grow from US$40 billion to $241 billion in the global IT market over the next 10 years, and yet, there’s still a lot of confusion about the true payoffs and risks associated with cloud adoption. IDC has it’s own numbers.

Some enterprises expect to use cloud and hybrid clouds to save on costs, improve productivity, refine their utilization rates, cut energy use and eliminate gross IT inefficiencies. At the same time, cloud use should improve their overall agility, ramp up their business-process innovation, and generate better overall business outcomes.

To others, this sounds a bit too good to be true, and a backlash against a silver bullet, cloud hype mentality is inevitable and is probably healthy. Yet, we find that there is also unfounded cynicism about cloud computing and underserved doubt.

So, where is the golden mean, a proper context for real-world and likely cloud value? And, what are the roadblocks that enterprises may encounter that would prevent them from appreciating the true potential for cloud, while also avoiding the risks?

We assembled a panel to identify and debunk myths on the road to cloud-computing adoption. Such myths can cause confusion and hold IT back from embracing cloud model sooner rather than later. We also define some clear ways to get the best out of cloud virtues without stumbling.

Joining our discussion about the right balance of cloud risk and reward are Ajay Patel, a technology leader at Agilysys; Rick Parker, IT director for Fetch Technologies, and Jay Muelhoefer, vice president of enterprise marketing at Platform Computing. The discussion is moderated by Dana Gardner, Principal Analyst at Interarbor Solutions.

Listen to the podcast (45:19 minutes).

Here are some excerpts:

Dana Gardner: Let’s begin to tackle some of the cloud computing myths.

There’s an understanding that virtualization is private cloud and private cloud is virtualization. Clearly, that’s not the case. Help me understand what you perceive in the market as a myth around virtualization and what should be the right path between virtualization and a private cloud?

Rick Parker: Private cloud, to put a usable definition to it, is a web-manageable virtualized data center. What that means is that through any browser you can manage any component of the private cloud. That’s opposed to virtualization, which could just be a single physical host with a couple of virtual machines (WMs) running on it and doesn’t provide the redundancy and cost-effectiveness of an entire private cloud or the ease of management of a private cloud.

So there is a huge difference between virtualization and use of a hypervisor versus an entire private cloud. A private cloud is comprised of virtualized routers, firewalls, switches, in a true data center not a server room. There are redundant environmental systems, like air-conditioning and Internet connections. It’s comprised of an entire infrastructure, not just a single virtualized host.

Moving to a private cloud is inevitable, because the benefits so far outweigh the perceived risks, and the perceived risks are more toward public cloud services than private cloud services.

Gardner: We’ve heard about fear of loss of control by IT. Is there a counter-intuitive effect here that cloud will give you better control and higher degrees of security and reliability?

Parker: I know that to be a fact, because the private cloud management software and hypervisors provide redundancy and performance monitoring that a lot of companies don’t have by default. You don’t only get performance monitoring across a wide range of systems just by installing a hypervisor, but by going with a private cloud management system and the use of VirtualCenter that supports live motion between physical hosts.

It also provides uptime/downtime type of monitoring and reporting capacity planning that most companies don’t even attempt, because these systems are generally out of their budget.

Gardner: Tell us about Fetch Technologies.

Parker: Fetch Technologies is a provider of data as a service, which is probably the best way to describe it. We have a Software as a Service (SaaS) type of business that extracts formats and delivers Internet-scale data. For example, two of our clients are Dow Jones and Shopzilla.

Gardner: Let’s go next to Ajay. A myth that I encounter is that private clouds are just too hard. “This is such a departure from the siloed and monolithic approach to computing that we’d just as soon stick with one server, one app, and one database,” we hear. “Moving toward a fabric or grid type of affair is just too hard to maintain, and I’m bound to stumble.” Why would I be wrong in assuming that as my position, Ajay?

Ajay Patel: One of the main issues that the IT management of an organization encounters on a day-to-day basis is the ability for their current staff to change their principles of how they manage the day-to-day operations.

The training and the discipline need to be changed. The fear of the operations being changed is one of the key issues that IT management sees. They also think of staff attrition as a key issue. By doing the actual cloud assessment, by understanding what the cloud means, it’s closer to home to what the IT infrastructure team does today than one would imagine through the myth.

For example, virtualization is a key fundamental need of a private cloud — virtualization at the servers, network and storage. All the enterprise providers at the servers, networks, and storage are creating a virtualized infrastructure for you to plug into your cloud-management software and deliver those services to a end-user without issues — and in a single pane of glass.

If you look at the some of the metrics that are used by managed service companies, SIs, and outsourcing companies, they do what the end-user companies do, but they do it much cheaper, better and faster.

How they do it better is by creating the ability to manage several different infrastructure portfolio components in a much more efficient manner. That means managing storage as a virtualized infrastructure; tier storage, network, the servers, not only the Windows environment, but the Unix environment, and the Linux environment, including all that in the hands of the business-owners.

Today, with the money being so tight to come by for a corporation, people need to look at not just a return on investment (ROI), but the return on invested capital.

You can deploy private cloud technologies on top of your virtualized infrastructure at a much lower cost of entry, than if you were to just expand utilizing the islands of bills of test, dev environment, by application, by project.

Gardner: I’d like to hear more about Agilysys? What is your organization and what is your role there as a technology leader?

Patel: I am the technology leader for cloud services across the US and UK. Agilysys is a value-added reseller, as well as a system integrator and professional services organization that services enterprises from Wall Street to manufacturing to retail to service providers, and telecom companies.

Gardner: And do you agree, Ajay, with Forrester Research and IDC, when they show such massive growth, do you really expect that cloud, private cloud, and hybrid cloud are all going to be in such rapid growth over the next several years?

Patel: Absolutely. The only difference between a private cloud and public cloud, based on what I’m seeing out there, is the fear of bridging that gap between what the end-user attains via private cloud being inside their four walled data center, to how the public cloud provides the ability for the end-user to have security and the comfort level that their data is secure. So, absolutely, private to hybrid to public is definitely the way the industry is going to go.

Gardner: Jay at Platform, I’m thinking about myths that have to do with adoption, different business units getting involved, lack of control, and cohesive policy. This is probably what keeps a lot of CIOs up at night, thinking that it’s the Wild West and everyone is running off and doing their own thing with IT. How is that a myth and what does a private cloud infrastructure allow that would mitigate that sense of a lot of loose cannons?

Jay Muelhoefer: That’s a key issue when we start thinking about how our customers look to private cloud. It comes back a little bit to the definition that Rick mentioned. Does virtualization equal private cloud — yes or no? Our customers are asking for the end-user organizations to be able to access their IT services through a self-service portal.

But a private cloud isn’t just virtualization, nor is it one virtualization vendor. It’s a diverse set of services that need to be delivered in a highly automated fashion. Because it’s not just one virtualization, it’s going to be VMware, KVM, Xen, etc.

A lot of our customers also have physical provisioning requirements, because not all applications are going to be virtualized. People do want to tap in to external cloud resources as they need to, when the costs and the security and compliance requirements are right. That’s the concept of the hybrid cloud, as Ajay mentioned. We’re definitely in agreement. You need to be able to support all of those, bring them together in a highly orchestrated fashion, and deliver them to the right people in a secure and compliant manner.

The challenge is that each business unit inside of the company typically doesn’t want to give up control. They each have their own IT silos today that meet their needs, and they are highly over provisioned.

Some of those can be at 5 to 10 percent utilization, when you measure it over time, because they have to provision everything for peak demands. And, because you have such a low utilization, people are looking at how to increase that utilization metric and also increase the number of servers that are managed by each administrator.

You need to find a way to get all the business units to consolidate all these underutilized resources. By pooling, you could actually get effects just like when you have a portfolio of stocks. You’re going to have a different demand curve by each of the different business units and how they can all benefit. When one business unit needs a lot, they can access the pool when another business unit might be low.

But, the big issue is how you can do that without businesses feeling like they’re giving up that control to some other external unit, whether it’s a centralized IT within a company, or an external service provider? In our case, a lot of our customers, because of the compliance and security issues, very much want to keep it within their four walls at this stage in the evolution of the cloud marketplace.

So, it’s all about providing that flexibility and openness to allow business units to consolidate, but not giving up that control and providing a very flexible administrative capability. That’s something that we’ve spent the last several years building for our customers.

It’s all about being able to support that heterogeneous environment, because every business unit is going to be a little different and is going to have different needs. Allowing them to have control, but within a defined boundaries, you could have centralized cloud control, where you give them their resources and quotas for what they’re initially provisioned for, and you could support costing and charge back, and provide a lot more visibility in to what’s happening.

You get all of that centralized efficiency that Ajay mentioned, but also having a centralized organization that knows how to run a larger scale environment. But then, each of the business units can go in and do their own customized self-service portal and get access to IT services, whether it’s a simple OS or a VM or a way to provision a complex multi-tier application in minutes, and have that be an automated process. That’s how you get a lot of the cost efficiencies and the scale that you want out of a cloud environment.

Gardner: And, for those business units, they’d also have to watch the cost and maybe have their own P&L. They might start seeing their IT costs as a shared services or charge-backs, get out of the capital expense business, and so it could actually help them in their business when it comes to cost.

Muelhoefer: Correct. Most of our customers today are very much still in evolution. The whole trend towards more visibility is there, because you’re going to need it for compliance, whether it’s Sarbanes-Oxley (SOX) or ITIL reporting.

Ultimately, the business units of IT are going to get sophisticated enough that they can move from being a cost center to a value-added service center. Then, they can start doing that granular charge-back reporting and actually show at a much more fine level the value that they are adding to the organization.

Parker: Different departments, by combining their IT budgets and going with a single private cloud infrastructure, can get a much more reliable infrastructure. By combining budgets, they can afford SAN storage and a virtual infrastructure that supports live VMotion.

They get a fast response, because by putting a cloud management application like Platform on top it, they have much more control, because we are providing the interface to the different departments. They can set up servers themselves and manage their own servers. They have a much faster “IT response time,” so they don’t really have to wait for IT’s response through a help desk system that might take days to add memory to a server.

IT gives end-users more control by providing a cloud management application and also gives them a much more reliable, manageable system. We’ve been running a private cloud here at Fetch for three years now, and we’ve seen this. This isn’t some pie-in-the-sky kind of thing. This is, in fact, what we have seen and proven over and over.

Gardner: I asked both Ajay and Rick to tell us about their companies. Jay, why don’t you give us the overview of Platform Computing?

Muelhoefer: Platform Computing is headquartered in Toronto, Canada and it’s about an 18-year-old company. We have over 2,000 customers, and they’re spread out on a global basis.

We have a couple of different business units. One is enterprise analytics. Second, is cloud, and the third is HPC grids and clusters. Within the cloud space, we offer a cloud management solution for medium and large enterprises to build and manage private and hybrid cloud environments.

The Platform cloud software is called Platform ISF. It’s all about providing the self-service capability to end-users to access this diverse set of Infrastructure as a Service (IaaS), and providing the automation, so that you can get the efficiencies and the benefits out of a cloud environment.

Dana Gardner

Dana Gardner is president and principal analyst at Interarbor Solutions, which tracks trends, delivers forecasts and interprets the competitive landscape of enterprise applications and software infrastructure markets for clients. He also produces BriefingsDirect sponsored podcasts. Follow Dana Gardner on Twitter. Disclosure: Platform Computing sponsored this podcast.

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