CIO’s Playbook to Cloud Computing<br />March 2010<br />®Cloud Commerce Inc. - Proprietary & Confidential  <br />5/10/2010<...
Introductions<br />®Cloud Commerce Inc. - Proprietary & Confidential  <br />5/10/2010<br />2<br />Michael Vienhage - Manag...
Agenda<br />Introductions<br />Greenfields<br />Defining Cloud Computing<br />Types of Cloud Computing <br />Co-Lo vs. Clo...
5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential  <br />4<br />I/T… it’s Complicated<br />Datacenter/Compu...
HVAC</li></ul>Servers<br /><ul><li>CapEX
Raised Flooring</li></ul>Internet<br /><ul><li>Maintenance</li></ul>Firewall<br /><ul><li>Square Footage
Upgrades</li></ul>Backup Device<br /><ul><li>Power
Support Software</li></ul>Storage<br />Network<br /><ul><li>Contracts
Integration
Servers/Racks/Routers/Disc Space
Custom Code
Fire Suppression
Security System
Security Patches
Service Packs
Disaster Recovery</li></li></ul><li>5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential  <br />5<br />CLOUD C...
Agenda<br />Introductions<br />Greenfields<br />Defining Cloud Computing<br />Types of Cloud Computing <br />Co-Lo vs. Clo...
5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential  <br />7<br />What is Cloud Computing?<br />What it is:<b...
Key Enablers: Bandwidth Proliferation, Web 2.0, Security Technology Improvements and Large Scale Commodity Data Centers
Transformative computing model that will change the economics of the multi-billion dollar software industry.
Said bluntly…  A New Utility: Computing Services</li></li></ul><li>5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Con...
January 2009, Greg Altin came up with the idea for  Cloud Commercein his kitchen.</li></li></ul><li>Introductions<br />Gre...
Types of Cloud Computing?<br />Infrastructure<br /><ul><li>Business in a Box
Industry Focused</li></ul>BAAS<br />Apps<br />Business<br />Stacks<br />Est. Market Size by 2012<br />Cloud Computing Ecos...
NetSuite
Gmail/Google Apps
Hosted Exchange</li></ul>~$21B<br />SAAS<br />Platform<br /><ul><li>Microsoft Azure
SalesForceAppXChange
NetSuite SuiteCloud
FaceBook</li></ul>PAAS<br />~$9B<br /><ul><li>Amazon
RackSpace Cloud
HP/IBM/Verizon</li></ul>IAAS<br />~$2B<br />Sources: AMR, Gartner, IDC<br />
What is Cloud Computing?<br />2009<br />2010<br />2011<br />2012<br />2013<br />Adoption Timeline<br />BAAS<br />SAAS<br /...
Introductions<br />Greenfields<br />Defining Cloud Computing<br />Types of Cloud Computing<br />Co-Lo vs. Cloud Computing<...
Co-Lo vs. Cloud Computing<br />Multi-Focus SERVICES<br />Co-Location or Private Clouds are not Cloud Computing.  Here’s Wh...
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CIO Playbook on Cloud Computing

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  • Here’s where things get a little CLOUDY
  • Clear the air about the Marketing Hype
  • But as James Carvell said…. IT’S THE ECONOMY STUPID
  • Where does Cloud Computing fit in?
  • Where does Cloud Computing fit in?
  • Where does Cloud Computing fit in?
  • CIO Playbook on Cloud Computing

    1. 1. CIO’s Playbook to Cloud Computing<br />March 2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />5/10/2010<br />1<br />Michael Vienhage<br />Managing Partner<br />Greg Altin<br />Founder and Managing Partner<br />
    2. 2. Introductions<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />5/10/2010<br />2<br />Michael Vienhage - Managing Partner<br />Prior to joining Cloud Commerce, Michael worked at CSI Leasing, Inc. in sales and marketing as Vice President, Marketing. His primary focus was in business development and relationship management. He opened the Charlotte, NC office in 1990 helping CSI expand their operation to a new region of the country. Michael had responsibility for developing new relationships in the Mid Atlantic region.<br />Greg Altin - Founder and Managing Partner<br />Prior to founding Cloud Commerce, Greg served in multiple roles at Brown Shoe Company (NYSE: BWS) including Vice President of Information Systems. In this position, he was responsible for managing a major portion of the application portfolios that supported corporate governance and administration systems, worldwide sourcing and product development, domestic wholesale, corporate EDI, customer support, and e-commerce business units, including Shoes.com (www.shoes.com). <br />
    3. 3. Agenda<br />Introductions<br />Greenfields<br />Defining Cloud Computing<br />Types of Cloud Computing <br />Co-Lo vs. Cloud Computing<br />The True Value Proposition of the Cloud<br />Adoption Considerations<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />3<br />
    4. 4. 5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />4<br />I/T… it’s Complicated<br />Datacenter/Computer Room<br />Applications/Software<br />Your<br />Business<br /><ul><li>Software Licenses
    5. 5. HVAC</li></ul>Servers<br /><ul><li>CapEX
    6. 6. Raised Flooring</li></ul>Internet<br /><ul><li>Maintenance</li></ul>Firewall<br /><ul><li>Square Footage
    7. 7. Upgrades</li></ul>Backup Device<br /><ul><li>Power
    8. 8. Support Software</li></ul>Storage<br />Network<br /><ul><li>Contracts
    9. 9. Integration
    10. 10. Servers/Racks/Routers/Disc Space
    11. 11. Custom Code
    12. 12. Fire Suppression
    13. 13. Security System
    14. 14. Security Patches
    15. 15. Service Packs
    16. 16. Disaster Recovery</li></li></ul><li>5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />5<br />CLOUD COMPUTING<br />Get out of the data center business.<br />Eliminate the headaches of Licensing… start “Paying for Value”<br />Elasticity and Flexibility.<br />
    17. 17. Agenda<br />Introductions<br />Greenfields<br />Defining Cloud Computing<br />Types of Cloud Computing <br />Co-Lo vs. Cloud Computing<br />The True Value Proposition of the Cloud<br />Adoption Considerations<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />6<br />
    18. 18. 5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />7<br />What is Cloud Computing?<br />What it is:<br /><ul><li>“Cloud Computing”: What Exactly Is It Anyway? </li></ul>Wall Street Journal - 2/8/2010“Any service or program sent over an Internet connection can be considered a cloud service. An outside vendor runs the servers and software, so the buyer doesn’t have to worry about the technical issues in-house-and can focus on its own business.”<br /><ul><li>An old idea that’s been around for 30 years
    19. 19. Key Enablers: Bandwidth Proliferation, Web 2.0, Security Technology Improvements and Large Scale Commodity Data Centers
    20. 20. Transformative computing model that will change the economics of the multi-billion dollar software industry.
    21. 21. Said bluntly… A New Utility: Computing Services</li></li></ul><li>5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />8<br />What is Cloud Computing?<br />Where did it come from?<br />Diagrams from the Network Guys<br /><ul><li>August 2006, where Eric Schmidt of Google described their approach to SaaS as “cloud computing” at a search engine conference.
    22. 22. January 2009, Greg Altin came up with the idea for Cloud Commercein his kitchen.</li></li></ul><li>Introductions<br />Greenfields<br />Defining Cloud Computing<br />Types of Cloud Computing <br />Co-Lo vs. Cloud Computing<br />The True Value Proposition of the Cloud<br />Adoption Considerations<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />9<br />Agenda<br />
    23. 23. Types of Cloud Computing?<br />Infrastructure<br /><ul><li>Business in a Box
    24. 24. Industry Focused</li></ul>BAAS<br />Apps<br />Business<br />Stacks<br />Est. Market Size by 2012<br />Cloud Computing Ecosystem<br /><ul><li>SalesForce.com
    25. 25. NetSuite
    26. 26. Gmail/Google Apps
    27. 27. Hosted Exchange</li></ul>~$21B<br />SAAS<br />Platform<br /><ul><li>Microsoft Azure
    28. 28. SalesForceAppXChange
    29. 29. NetSuite SuiteCloud
    30. 30. FaceBook</li></ul>PAAS<br />~$9B<br /><ul><li>Amazon
    31. 31. RackSpace Cloud
    32. 32. HP/IBM/Verizon</li></ul>IAAS<br />~$2B<br />Sources: AMR, Gartner, IDC<br />
    33. 33. What is Cloud Computing?<br />2009<br />2010<br />2011<br />2012<br />2013<br />Adoption Timeline<br />BAAS<br />SAAS<br />PAAS<br />Model Saturation <br />- Heavy<br />- Moderate<br />IAAS<br />- Light<br />Small<br />Medium<br />Enterprise<br />Company Size<br />
    34. 34. Introductions<br />Greenfields<br />Defining Cloud Computing<br />Types of Cloud Computing<br />Co-Lo vs. Cloud Computing<br />The True Value Proposition of the Cloud<br />Adoption Considerations<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />12<br />“A decision to go with a private cloud is a decision to run lower utilization levels, consume more power, be less efficient environmentally, and to run higher costs.”, <br />-James Hamilton <br />Amazon<br />Agenda<br />
    35. 35. Co-Lo vs. Cloud Computing<br />Multi-Focus SERVICES<br />Co-Location or Private Clouds are not Cloud Computing. Here’s Why:<br /><ul><li>Co-Lo is outsourcing your datacenter to 3rd party.
    36. 36. You still bear the burden of software licenses and maintenance.
    37. 37. Co-Lo must maintain staff/resources to provide Multi-Focus services (lower optimization)
    38. 38. Unable to Realize Cloud Scale(Economic & Capability)
    39. 39. CC=SINGLE FOCUS SERVICE</li></ul>CLOUD COMPUTING<br />Single Focus SERVICE<br />Co-Location/Managed Data Center<br />
    40. 40. Introductions<br />Greenfields<br />Defining Cloud Computing<br />Types of Cloud Computing<br />Co-Lo vs. Cloud Computing<br />The True Value Proposition of the Cloud<br />Adoption Considerations<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />14<br />“IT systems and applications support people account for 30% to 60% of total 5-year systems costs.“<br />“43% of Enterprise Adopters cite cost savings as the top reason moving to the cloud.”, <br />-Yankee Group<br />Agenda<br />
    41. 41. Key Benefits<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />15<br />Built in Redundancy and Failover<br />No Long Term Commitments<br />Ubiquitous Access<br />Rapid Elasticity<br />Ease of Deployment<br />Pay only for you use<br />Eliminate CapEX<br />Reallocate Labor Pool<br />Accelerated time to benefits<br />
    42. 42. Infrastructure<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />16<br />Cloud Economics<br />Infrastructure<br />Management<br />Management<br />R&D<br />R&D<br />Support<br />Support<br />Build <br />Economy<br />Cloud<br />Economy<br />Long Run Avg Cost<br /> Aggregate Capacity<br />-SCALE ECONOMICS-<br />Shift from<br />Diseconomies of Scale <br />to <br />Economies of Scale<br /><ul><li>Need maintain a staff to support a wide range of technologies (Low Optimization)
    43. 43. Service level cost cannot be spread optimally (User base is generally fixed but cost increase)
    44. 44. Systems are often underutilized due to peak load strategies and estimated growth
    45. 45. Higher Service Levels = Higher Costs
    46. 46. DISECONOMIES OF SCALE
    47. 47. Cost for High Service Levels are spread across large user bases.
    48. 48. Focus Drive Efficiencies (Optimizes resources on repeatable processes/function )
    49. 49. High Elasticity=No Excess Capacity Waste
    50. 50. Pay Only for What You Use
    51. 51. ECONOMIES OF SCALE</li></li></ul><li>Introductions<br />Greenfields<br />Defining Cloud Computing<br />Types of Cloud Computing<br />Co-Lo vs. Cloud Computing<br />The True Value Proposition of the Cloud<br />Adoption Considerations<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />17<br />CLOUD COMPUTING is #1 in Gartner’s Top 10 Strategic Technology Areas for 2010:<br />Cloud Computing<br />Advanced Analytics<br />Client Computing<br />…<br />Agenda<br />
    52. 52. 6 Commandments of Cloud Computing Services<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />18<br />Moving Your Organization to the Cloud<br />Value to Your Company<br />Single Focus Service Delivery<br />Multi Tenant Architecture<br />Multi Point/Redundant Data Centers<br />Subscription Model (no-lock)<br />Clear SLA (availability/performance)<br /> Appropriate Security and Privacy Controls<br />Enables Provider to Optimize Solution ( Cost)<br />Leverage Repeatable Processes/Resources ( Cost)<br />High AvailabilityBuilt-In Disaster Recovery<br />Flexible and Elastic Usage Model<br />Insurance<br />Risk Management<br />
    53. 53. So What’s Cloudable?<br /><ul><li>Hybrid Approach (Co-Lo + Cloud)
    54. 54. Co-Lo Infrastructure Strategic Systems
    55. 55. Cloud  Utility Core Business Operations*one size does not fit all</li></ul>GeneralRecommendation<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />19<br />Tactical Systems<br />Strategic<br />Systems<br />Infrastructure<br />Core Business Operations<br />Utility Systems<br />Management Support Systems<br />Business Differentiating Systems<br />MATURE<br /><ul><li>Hosted Email
    56. 56. Message Archiving
    57. 57. Fax Services
    58. 58. Collaboration (Sharepoint)
    59. 59. Document Management
    60. 60. Backup Services</li></ul>MATURING<br /><ul><li>Database
    61. 61. Storage
    62. 62. Virtual Server
    63. 63. Development Platform</li></ul>*Security, Integration and Governance are biggest challenge<br />MATURE<br /><ul><li>ERP/Financials
    64. 64. CRM
    65. 65. Hosted VOiP
    66. 66. Marketing Solutions
    67. 67. eCommerce</li></ul>EMERGING…<br /><ul><li>Business Intelligence and Analytics
    68. 68. I/T Portfolio Mgt.</li></li></ul><li>Moving Your Organization to the Cloud<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />20<br /><br />Align Cloud Solutions with your Business Needs<br />Focus on areas of your business where change can be justified <br /><ul><li>Need to Reduce Cost?
    69. 69. Service Level Improvement?
    70. 70. Support Growth?
    71. 71. Need for Upgrade?
    72. 72. More Flexibility/Elasticity Needed?</li></li></ul><li>Moving Your Organization to the Cloud<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />21<br /><br /><br />Align Cloud Solutions with your Business Needs<br />Learn From Others<br />Leverage lessons from Cloud Computing from:<br /><ul><li>Partners
    73. 73. Internet (lot’s of info)
    74. 74. Seminars/Industry Groups
    75. 75. Your Peer Network</li></li></ul><li>Moving Your Organization to the Cloud<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />22<br /><br /><br /><br />Align Cloud Solutions with your Business Needs<br />Learn From Others<br />Develop Justifiable Business Case<br />Assess the Risks and Rewards:<br /><ul><li>Not everything should go to the cloud
    76. 76. Work to Quantify Real Costs (for both sides)…and be honest!
    77. 77. Use Hard and Soft Costs
    78. 78. Develop a 5-6 Year Comparative TCO</li></li></ul><li>Moving Your Organization to the Cloud<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />23<br /><br /><br /><br /><br />Align Cloud Solutions with your Business Needs<br />Learn From Others<br />Develop Justifiable Business Case<br />Remember the 6 Commandments of Cloud Services<br />6 Commandments of Cloud Services<br />Single Focus Service Delivery<br />Multi Tenant Architecture<br />Multi Point/Redundant Data Centers<br />Subscription Model (no-lock)<br />Clear SLA (availability/performance)<br />Appropriate Security and Privacy Controls<br />
    79. 79. Moving Your Organization to the Cloud<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />24<br /><br /><br /><br /><br /><br />Align Cloud Solutions with your Business Needs<br />Learn From Others<br />Develop Justifiable Business Case<br />Remember the 6 Commandments <br />of Cloud Services<br />Experiment… it’s easy with the Cloud<br />Be Willing to go on a Test Drive<br /><ul><li>Experiment with some of the services to learn.
    80. 80. Take advantage of Free Trials
    81. 81. Talk with a Cloud Consolidator</li></li></ul><li>5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />25<br />CLOUD COMPUTING<br />Evolution or Revolution?<br />Get out of the data center business.<br />Eliminate the headaches of Licensing… start “Paying for Value”<br />Elasticity and Flexibility.<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />25<br />
    82. 82. Contact Us<br />Web: www.CloudCommerce.com<br />Phone: 314.932.2200<br />Email: info@cloudcommerce.com<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />5/10/2010<br />26<br />About Us<br />Cloud Commerce helps organizations understand, and benefit from cloud computing. We focus exclusively on applications in the cloud. We show business how leveraging the cloud can save money, while providing a secure and reliable alternative to running on-premise solutions.<br />
    83. 83. 5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />27<br />
    84. 84. Stats<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />28<br />
    85. 85. Cloud Strategy<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />29<br />Cloud Strategy Framework<br />
    86. 86. Available Services<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />30<br />
    87. 87. Pros and Cons<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />31<br />3 Stages of Computing<br />Tradition On-Premises IT<br />Requires IT staff.<br />Capital cost intensive<br />Difficult to upgrade and patch.<br />Unpredictable costs.<br />Difficult to maintain compliancy.<br />Data center may not provide high availability (power, HVAC, etc)<br />Users<br />Your<br />Business<br />Internet<br />Business Applications<br />Firewall<br />Higher level of internal control.<br />Ability to customize services.<br />Data is on-site. <br />Can operate without Internet <br />Backup Device<br />E-Mail<br />Storage<br />Network<br />
    88. 88. 5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />32<br />3 Stages of Computing<br />Managed Data Center (Collocated)<br />Requires IT staff.<br />Capital cost intensive<br />Difficult to upgrade and patch.<br />Unpredictable costs.<br />High costs for managed services.<br />Redundant cost if some systems are still on premises.<br />Data center may not provide high availability (power, HVAC, etc)<br />Pros and Cons<br />3rd Party Managed Data Center<br />Users<br />Your<br />Business<br />Business Applications<br />Storage<br />Network<br />Firewall<br />E-Mail<br />Backup Device<br />Higher level of internal control.<br />Ability to customize services.<br />Leverages facilities of professionally managed data center.<br />
    89. 89. 5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />33<br />3 Stages of Computing<br />Requires reliable internet connection.<br />Distributed Security<br />Distributed User Control<br />Cloud Computing<br />Employees Work Anywhere.<br />Lower Capital Expenditures.<br />Focus on business not technology.<br />No Worry Upgrades.<br />Enterprise Class Tools.<br />Faster implementations.<br />Lower upfront and ongoing costs. <br />Pay only for services you need.<br />Guaranteed service-level agreements (SLAs). <br />PREDICTABLE SPENDING<br />HIGH AVAILABILITY, REDUNDANT DATA CENTERS (BUILT IN DISTASTER RECOVERY)<br />Service Provider<br />Pros and Cons<br />Users<br />E-Mail<br />Your<br />Business<br />Service Provider<br />Storage<br />Firewall<br />Service Provider<br />Telephone PBX<br />Business<br />Applications<br />SELECTIVLY MIGRATE APPLICATIONS TO THE CLOUD<br />
    90. 90. Stats<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />34<br />Research firm IDC projects overall spending on subscription based software to grow at a compounded rate of 18% to $19.8 billion by 2012.<br />Yankee Group concludes that IT systems and applications support people account for 30% to 60% of total 5-year costs. [“TCO of On-Demand Applications Is Significantly Better for SMBs and Mid-Market Enterprises.” Yankee Group. June 1, 2005]<br />“Spending on cloud computing will capture 25% of IT spending growth in 2012 and nearly a third of growth in 2013”, IDC predicts.<br />
    91. 91. Security<br />Disadvantages<br />2 tier or flat architected networks are a risky<br />Only expose front end user interface<br />Credential management is fragmented and not centralized (yet).<br />Control of Solutions are segmented<br />Benefits?<br />1. Centralized Data<br />2. Incident Response / Forensics<br />3. Password assurance testing (aka cracking)<br />4. Logging<br />5. Improve the state of security software (performance)<br />6. Secure builds<br />7. Security Testing<br />(CloudSecurity.org - Assessing the Security Benefits of Cloud Computing )<br />5/10/2010<br />®Cloud Commerce Inc. - Proprietary & Confidential <br />35<br />

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