Monday, December 08, 2008

The Wisdom of Clouds is moving!!!

Finally! It's been a long time coming, but the "morphing" of The Wisdom of Clouds I've hinted at a couple of times in the last month is finally here. Dan Farber and Margaret Kane, the good editors the CNET, have agreed to publish this blog (with a slight name change) on the CNET Blog Network. Hence forth the blog will be titled "The Wisdom of the Clouds", and located at http://news.cnet.com/the-wisdom-of-clouds. Please go there and subscribe today.

CNET is one of the most respected IT news sources, and with about 15 million unique visitors a month this is a huge opportunity to broaden the cloud computing discussion to the mainstream IT community. The other members of the CNET Blog Network include such thought leaders as Matt Asay, Gordon Haff and Peter N. Glaskowsky, and I am humbled to be listed among them.

However, I also want to recognize and thank each of you for helping to make The Wisdom of Clouds what it is today. At the beginning of 2008, I had a little over 120 subscribers. This last week saw a record 948 subscribers, with over 200 of you reading each new post within 24 hours of it hitting the feeds, and about 50 more reading the same on the blog pages itself. It has been tremendously enriching to see the uptake in interest, and I am grateful to each of you for your interest, attention and feedback. Thank you.

Unfortunately, this transition will not be without its inconveniences. As you may have guessed, I will no longer be publishing to this site; for now http://blog.jamesurquhart.com will become an archive site for the two years or so of posts that I've written since early in my Cassatt days. I will frequently reference back to those posts initially, but all new material will appear at CNET. If you want to follow where the conversation goes from here, it is important that you go the the CNET URL and subscribe.

I will probably continue to publish my del.icio.us bookmarks to the existing feed for a while, but I want to consolidate that traffic with the article publications over time. Stay tuned for how that will work out. I won't be bookmarking my own posts as a rule; thus subscribe to the new feed.

Please let me know if you have any problems or concerns with the transition, and I hope that each and every one of you will continue to be a part of my own education about the cloud and its consequences. As always, I can be reached at jurquhart at (ignore this) yahoo dot com.

Again, thank you all, and I'll see you on The Wisdom of the Clouds.

Saturday, December 06, 2008

The Two Faces of Cloud Computing

One of the fun aspects of a nascent cloud computing market is that there are "veins" of innovative thinking to be mined from all of the hype. Each of us discover these independently, though the velocity of recognition increases greatly as the effects of "asymmetrical follow" patterns take effect. Those "really big ideas" of cloud computing usually start as a great observation by one or a few independent bloggers. If you are observant, and pay attention to patterns in terminology and concepts, you can get a jump on the opportunities and intellectual advances triggered by a new "really big idea".

One of these memes that I have been noticing more and more in the last week is that of the two-faceted cloud; the concept that cloud computing is beginning to address two different market needs, that of large scale web applications (the so-called "Web 2.0" market), and that of traditional data center computing (the so-called "Enterprise" market). As I'll try to explain, this is a "reasonably big idea" (or perhaps "reasonably big observation" is a more accurate portrayal).

I first noticed the meme when I was made aware of a Forrester report titled "There Are Two Types Of Compute Clouds: Server Clouds And Scale-Out Clouds Serve Very Different Customer Needs", written by analyst Frank E. Gillett. The abstract gives the best summary of the concept that I've found to date:

"Cloud computing is a confusing topic for vendor strategists. One reason? Most of us confuse two fundamentally different types of compute clouds as one. Server clouds support the needs of traditional business apps while scale-out clouds are designed for massive, many-machine workloads such as Web sites or grid compute applications. Scale-out clouds differ from server clouds in five key ways: 1) much larger workloads; 2) loosely coupled software architecture; 3) fault tolerance in software, not hardware; 4) simple state management; and 5) server virtualization is for provisioning flexibility — not machine sharing. Strategists must update their server virtualization plans to embrace the evolution to server cloud, while developing a separate strategy to compete in the arena for scale-out clouds."
Get it? There are two plans of attack for an enterprise looking to leverage the cloud:
  • How do you move existing load to the IaaS, PaaS, and SaaS providers?
  • How do you leverage the new extremely large scale infrastructures used by the Googles and Amazons of the world to create new competitive advantage?
Around then I started seeing references to other posts that suggested the same thing; that there are two customers for the cloud: those that need to achieve higher scale at lower costs than possible before, and those that want to eliminate data center capital in favor of a "pay-as-you-go" model.

I'm not sure how revolutionary this observation is (obviously many people noticed it before it clicked with me), but it is important. Where is it most obvious? In my opinion, the three PaaS members of the "big four" are good examples:
  • Google is the sole Scale-out vendor on the list...for now. I hear rumors that Microsoft may explore this as well, but for now it is not Mr. Softy's focus.
  • Microsoft's focus is, on the other hand, the enterprise. By choosing a .NET centric platform, Azure, complete with Enterprise Service Bus and other integration-centric technologies, they have firmly targeted the corporate database applications that run so much of our economy today.
  • Salesforce.com is perhaps the most interesting in that they chose to compete for enterprises with force.com and Sites, but through a "move all your stuff here" approach. Great for the Salesforce.com users, but perhaps a disadvantage to those wishing to build stand-alone systems, much less those wishing to integrate with their on-premises SAP instances.
The point here, I guess, is that comparisons between Scale-out and Enterprise clouds, while sometimes tempting (especially in the Google vs. Microsoft case), are rather useless. They serve different purposes, often for completely different audiences, and enterprise IT organizations would do better to focus their efforts on the specific facet of cloud computing that applies to a given project. If you are a budding PaaS vendor, understand the distinction, and focus on the technologies required to meet your market's demand. Don't try to be "all cloud to all people".

Except, possibly, if you are Microsoft...

Monday, December 01, 2008

The enterprise "barrier-to-exit" to cloud computing

An interesting discussion ensued on Twitter this weekend between myself and George Reese of Valtira. George--who recently posted some thought provoking posts on O'Reilly Broadcast about cloud security, and is writing a book on cloud computing--argued strongly that the benefits gained from moving to the cloud outweighed any additional costs that may ensue. In fact, in one tweet he noted:

"IT is a barrier to getting things done for most businesses; the Cloud reduces or eliminates that barrier."
I reacted strongly to that statement; I don't buy that IT is that bad in all cases (though some certainly is), nor do I buy that simply eliminating a barrier to getting something done makes it worth while. Besides, the barrier being removed isn't strictly financial, it is corporate IT policy. I can build a kick butt home entertainment system for my house for $50,000; that doesn't mean it's the right thing to do.

However, as the conversation unfolded, it became clear that George and I were coming at the problem from two different angles. George was talking about many SMB organizations, which really can't justify the cost of building their own IT infrastructure, but have been faced with a choice of doing just that, turning to (expensive and often rigid) managed hosting, or putting a server in a colo space somewhere (and maintaining that server). Not very happy choices.

Enter the cloud. Now these same businesses can simply grab capacity on demand, start and stop billing at their leisure and get real world class power, virtualization and networking infrastructure without having to put an ounce of thought into it. Yeah, it costs more than simply running a server would cost, but when you add the infrastructure/managed hosting fees/colo leases, cloud almost always looks like the better deal. At least that's what George claims his numbers show, and I'm willing to accept that. It makes sense to me.

I, on the other hand, was thinking of medium to large enterprises which already own significant data center infrastructure, and already have sunk costs in power, cooling and assorted infrastructure. When looking at this class of business, these sunk costs must be added to server acquisition and operation costs when rationalizing against the costs of gaining the same services from the cloud. In this case, these investments often tip the balance, and it becomes much cheaper to use existing infrastructure (though with some automation) to deliver fixed capacity loads. As I discussed recently, the cloud generally only gets interesting for loads that are not running 24X7.

(George actually notes a class of applications that sadly are also good candidates, though they shouldn't necessarily be: applications that IT just can't or won't get to on behalf of a business unit. George claims his business makes good money meeting the needs of marketing organizations that have this problem. Just make sure the ROI is really worth it before taking this option, however.)

This existing investment in infrastructure therefore acts almost as a "barrier-to-exit" for these enterprises when considering moving to the cloud. It seems to me highly ironic, and perhaps somewhat unique, that certain aspects of the cloud computing market will be blazed not by organizations with multiple data centers and thousands upon thousands of servers, but by the little mom-and-pop shop that used to own a couple of servers in a colo somewhere that finally shut them down and turned to Amazon. How cool is that?

The good news, as I hinted at earlier, is that there is technology that can be rationalized financially--through capital equipment and energy savings--which in turn can "grease the skids" for cloud adoption in the future. Ask the guys at 3tera. They'll tell you that their cloud infrastructure allows an enterprise to optimize infrastructure usage while enabling workload portability (though not running workload portability) between cloud providers running their stuff. VMWare introduced their vCloud initiative specifically to make enterprises aware of the work they are doing to allow workload portability across data centers running their stuff. Cisco (my employer) is addressing the problem. In fact, there are several great products out there who can give you cloud technology in your enterprise data center that will open the door to cloud adoption now (with things like cloudbursting) and in the future.

If you aren't considering how to "cloud enable" your entire infrastructure today, you ought to be getting nervous. Your competitors probably are looking closely at these technologies, and when the time is right, their barrier-to-exit will be lower than yours. Then, the true costs of moving an existing data center infrastructure to the cloud will become painfully obvious.

Many thanks to George for the excellent discussion. Twitter is becoming a great venue for cloud discussions.

Saturday, November 29, 2008

What is the value of IT convenience?

RPath's Billy Marshall wrote a post that is closely related to a topic I have been thinking about a lot lately. Namely, Billy points out that the effect of server virtualization hasn't been to satisfy the demand on IT resources, but simply to accelerate that demand through simplifying resource allocation. Billy gives a very clear example of what he means:

"Over the past 2 weeks, I have had a number of very interesting conversations with partners, prospects, customers, and analysts that lead me to believe that a virtual machine tsunami is building which might soon swamp the legacy, horizontal system management approaches. Here is what I have heard:

Two separate prospects told me that they have quickly consumed every available bit of capacity on their VMware server farms. As soon as they add more capacity, it disappears under the weight of an ever pressing demand of new VMs. They are scrambling to figure out how they manage the pending VM sprawl. They are also scrambling to understand how they are going to lower their VMware bill via an Amazon EC2 capability for some portion of the runtime instances.

Two prominent analysts proclaimed to me that the percentage of new servers running a hypervisor as the primary boot option will quickly approach 90% by 2012. With all of these systems sporting a hypervisor as the on-ramp for applications built as virtual machines, the number of virtual machines is going to explode. The hypervisor takes the friction out of the deployment process, which in turn escalates the number of VMs to be managed."
The world of Infrastructure as a Service isn't really any different:
"Amazon EC2 demand continues to skyrocket. It seems that business units are quickly sidestepping those IT departments that have not yet found a way to say “yes” to requests for new capacity due to capital spending constraints and high friction processes for getting applications into production (i.e. the legacy approach of provisioning servers with a general purpose OS and then attempting to install/configure the app to work on the production implementation which is no doubt different than the development environment). I heard a rumor that a new datacenter in Oregon was underway to support this burgeoning EC2 demand. I also saw our most recent EC2 bill, and I nearly hit the roof. Turns out when you provide frictionless capacity via the hypervisor, virtual machine deployment, and variable cost payment, demand explodes. Trust me."
Billy isn't the only person I've heard comment about their EC2 bill lately. Justin Mason commented on my post, "Do Your Cloud Applications Need to be Elastic?":
"[W]e also have inelastic parts of the infrastructure that could be hosted elsewhere at a colo for less cost, and personally, I would probably have done this given the choice; but mgmt were happier just to use EC2 as widely as possible, despite the additional costs, since it keeps things simpler."
In each case, management chooses to pay more for convenience.

I think these examples demonstrate an important decision point for IT organizations, especially during these times of financial strife. What is the value of IT convenience? When is it wise to choose to pay more dollars (or euros, or yen, or whatever) to gain some level of simplicity or focus or comfort? In the case of virtualization, is it always wise to leverage positive economic changes to expand service coverage? In the case of cloud computing, is it always wise to accept relatively high price points per CPU hour over managing your own cheaper compute loads?

I think there are no simple answers, but there are some elements that I would consider if the choice was mine:
  • Do I already have the infrastructure and labor skills I need to do it just as well or better than the cloud? If I were to simply apply some automation to what I already have, would it deliver the elasticity/reliability/agility I want without committing a monthly portion of my corporate revenues to an outside entity?

  • Is virtualization and/or the cloud the only way to get the agility I need to meet my objectives? The answer here is often "yes" for virtualization, but is it as frequently for cloud computing?

  • Do I have the luxury of cash flow that allows for me to spend up a little for someone else to worry about problems that I would have to handle otherwise? Of course, this is the same question that applies to outsourcing, managed hosting, etc.

One of the reasons you've seen a backlash against some aspects of cloud computing, or even a rising voice to the "its the same thing we tried before" argument, is that much of the marketing hype out there is staring to ignore the fact that cloud computing costs money; costs enough to provide a profit to the vendor. Yes, it is true that many (most?) IT organizations have lacked the ability to deliver the same efficiencies as the best cloud players, but that can change and change quickly if those same organizations were to look to automation software and infrastructure to provide that efficiency.

My advice to you: if you already own data centers, and if you want convenience on a budget, balance the cost of Amazon/GoGrid/Mosso/whoever with the value delivered by Arjuna/3TERA/Cassatt/Enomaly/etc./etc./etc., including controlling your virtualization sprawl and preparing you for using the cloud in innovative ways. Consider making your storage and networking virtualization friendly.

Sometimes convenience starts at home.

Friday, November 28, 2008

Two! Two! Two! Two great Overcast podcasts for your enjoyment

It's been a busy week or so for Geva Perry and I, as we took Overcast to a joint podcast with John Willis's CloudCafe podcast, and had a fabulous discussion with Greg Ness of Archimedius.net. Both podcasts are available from the Overcast blog.

The discussion with John focused on definitions in the cloud computing space, and some of the misconceptions that people have about the cloud, what it can and can't do for you, and what all that crazy terminology refers to. John is an exceptionally comfortable host, and his questions drove a deep conversation about what the cloud is, various components of cloud computing, and adjunct terms like "cloudbursting". It was a lot of fun to do, and I am grateful for John's invitation to do this.

Greg Ness demonstrated his uniquely deep understanding of what network security entails in a virtualized data center, and how automation is the lynch pin of protecting that infrastructure. Topics ranged from this year's DNS exploit and the pace at which systems are getting patched to address it, to the reasons why the static network we all knew and loved is DOA in a cloud (or even just a virtualized) world. I really admire Greg, and find his ability to articulate difficult concepts with the help of historical insight very appealing. I very much appreciate his taking time out of his busy day to join us.

We are busy lining up more great guests for future podcasts, so stay tuned--or better yet, subscribe to Overcast at the Overcast blog.

Monday, November 24, 2008

Is IBM the utlimate authority on cloud computing?

There was an interesting announcement today from IBM regarding their new "Resiliant Cloud" seal of approval--a marketing program targeted at cloud providers, and at customers of the cloud. The idea is simple, if I am reading this right:

  • IBM gets all of the world's cloud vendors to pay them a services fee to submit their services to a series of tests that validate (or not) whether the cloud is resiliant, secure and scalable. Should the vendor's offering pass, they get to put a "Resiliant Cloud" logo on their web pages, etc.

  • Customers looking for resiliant, secure and scalable cloud infrastructure then can select from the pool of "Resiliant Cloud" offerings to build their specific cloud-based solutions. Oh, and they can hire IBM services to help them distinguish when to go outside for their cloud infrastructure, and when to convert their existing infrastructure. I'm sure IBM will give a balanced analysis as to the technology options here...

I'm sorry, but I'm a bit disappointed with this. IBM has been facing a very stiff "innovator's dilemma" when it comes to cloud computing, as noted by GigaOm's Stacy Higgenbotham:
"IBM has been pretty quiet about its cloud efforts. In part because it didn’t want to hack off large customers buying a ton of IBM servers by competing with them. The computing giant hasn’t been pushing its own cloud business until a half-hearted announcement at the end of July, about a month and half after a company exec had told me IBM didn’t really want to advertise its cloud services."
She goes on to note, however, that IBM has some great things in the works, including a research project in China that shows great promise. That's welcome news, and I look forward to IBM being a major player on the cloud computing stage again. However, this announcement is just an attempt at making IBM the "godfather" of the cloud market, and that's not interesting in the least.

Still, I bet if you want to be an IBM strategic partner, you'd better get on board with the program. Amazon, are you going to pay the fee? Microsoft? Google? Salesforce.com? Anyone?

Friday, November 21, 2008

Do Your Cloud Applications Need To Be Elastic?

I got to spend a few hours at Sys-Con's Cloud Computing Expo yesterday, and I have to say it was most certainly an intellectually stimulating day. Not only was just about every US cloud startup represented in one way or another, but included were an unusual conference session, and a meetup of fans of CloudCamp.

While listening in on a session, I overheard one participant ask how the cloud would scale their application if they couldn't replicate it. This triggered a strong response in me, as I really feel for those that confuse autonomic infrastructures with magic applied to scaling unscalable applications. Let me be clear, the cloud can't scale your application (much, at least) if you didn't design it to be scaled. Period.

However, that caused me to ask myself whether or not an application had to be horizontally scalable in order to gain economically while running in an Infrastructure as a Service (IaaS) cloud. The answer, I think, is that it depends.

Chris FlexFleck of Citrix wrote up a pretty decent two part explanation of this on his blog a few weeks ago. He starts out with some basic costs of acquiring and running 5 Quad-core servers--either on-premises (amortized over 3 years at 5%) or in a colocation data center--against the cost of running equivalent "high CPU" servers 24X7 on Amazon's EC2. The short short of his initial post is that it is much more expensive to run full time on EC2 than it is to run on premises or in the colo facility.

How much more expensive?

  • On-premises: $7800/year
  • Colocation: $13,800/year
  • Amazon EC2: $35,040/year
I tend to believe this reflects the truth, even if its not 100% accurate. First, while you may think "ah, Amazon...that's 10¢ a CPU hour", in point of fact most production applications that you read about in the cloud-o-sphere are using the larger instances. Chris is right to use high CPU instances in his comparison at 80¢/CPU hour. Second, while its tempting to think in terms of upfront costs, your accounting department will in fact spread the capital costs out over several years, usually 3 years for a server.

In the second part of his analysis, however, Chris notes that the cost of the same Amazon instances vary based on the amount of time they are actually used, as opposed to the physical infrastructure that must be paid for whether it is used or not (with the possible exception of power and AC costs). This comes into play in a big way if the same instances are used judiciously for varying workloads, such as the hybrid fixed/cloud approach he uses as an example.

In other words, if you have an elastic load, plan for "standard" variances on-premises, but allow "excessive" spikes in load to trigger instances on EC2, you suddenly have a very compelling case relative to buying enough physical infrastructure to handle excessive peaks yourself. As Chris notes:
"To put some simple numbers to it based on the original example, let's assume that the constant workload is roughly equal to 5 Quadcore server capacity. The variable workload on the other hand peaks at 160% of the base requirement, however it is required only about 400 hours per year, which could translate to 12 hours a day for the month of December or 33 hours per month for peak loads such as test or batch loads. The cost for a premise only solution for this situation comes to roughly 2X or $ 15,600 per year assuming existing space and a 20% factor of safety above peak load. If on the other hand you were able to utilize a Cloud for only the peak loads the incremental cost would be only $1,000. ( Based on Amazon EC2 )
Premise Only
$ 15,600 Annual cost ( 2 x 7,800 from Part 1 )
Premise Plus Cloud
$ 7,800 Annual cost from Part 1
$ 1,000 Cloud EC2 - ( 400 x .8 x 3 )
$ 8,800 Annual Cost Premise Plus Cloud "
The lesson of our story? Using the cloud makes the most sense when you have an elastic load. I would postulate that another option would be a load that is not powered on at full strength 100% of the time. Some examples might include:
  • Dev/test lab server instances
  • Scale-out applications, especially web application architectures
  • Seasonal load applications, such as personal income tax processing systems or retail accounting systems
On the other hand, you probably would not use Infrastructure as a Service today for:
  • That little accounting application that has to run at all times, but has at most 20 concurrent users
  • The MS Exchange server for your 10 person company. (Microsoft's multi-tenant Exchange online offering is different--I'm talking hosting your own instance in EC2)
  • Your network monitoring infrastructure
Now, the managed hosting guys are going to probably jump down my throat with counter arguments about the level of service provided by (at least their) hosting clouds, but my experience is that all of these clouds actually treat self-service as self-service, and that there really is very little difference between do-it-yourself on-premises and do-it-yourself in cloud.

What would change these economics to the point that it would make sense to run any or all of your applications in an IaaS cloud? Well, I personally think you need to see a real commodity market for compute and storage capacity before you see the pricing that reflects economies in favor of running fixed loads in the cloud. There have been a wide variety of posts about what it would take [pdf] to establish a cloud market in the past, so I won't go back over that subject here. However, if you are considering "moving my data center to the cloud", please keep these simple economics in mind.