Cloud Computing 101 Issue 1 (Sample)

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Sample of Cloud Computing 101 course given at Cloud Asia 2011

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Cloud Computing 101 Issue 1 (Sample)

  1. 1. Cloud Computing 101 (Sample)Issue 1May 28th 2011www.alanquayle.com/blog © 2011 Alan Quayle Business and Service Development
  2. 2. Objectives• Comparing and contrasting the available delivery models of cloud computing• Evaluating the benefits of cloud products, including global and regional service providers, Salesforce.com, Microsoft Azure, Google, and Amazon• Understanding the underlying technologies of Data Centers and Virtualization• Understanding the role of operators and web service providers• Deploying Software as a Service (SaaS) to optimize productivity and collaboration• Deploying Platform as a Service (PaaS) to streamline application deployment• Examining the cost benefits of deploying Infrastructure as a Service (IaaS)• Understanding implementation issues across security, compliance and business continuity• Integrating multivendor cloud products and services• Focusing on the first two steps, initial business case and pilot project6/2/2011 © 2010 Alan Quayle Business and Service Development 2
  3. 3. Outline• Cloud Computing Introduction o Defining cloud computing o Definitions: IaaS (Infrastructure as a Service), PaaS (Platform as a Service), SaaS (Software as a Service), BPaaS (Business Process as a Service) o The benefits of cloud computing o Cloud computing components o Suppliers and market size o Types of clouds: public, private, hybrid, community o Cloud trends and vendor solutions o Emerging standards and regulations• Understanding the Components: Data Center History and Economics o History and the drive for efficiency and availability o Changes and pressures on DC – drive for DC management o Capex and opex DC costs o DC economics drives cloud computing © 2011 Alan Quayle Business and Service Development 3
  4. 4. Outline• Understanding the Components: Data Center Types and Comparison to Google’s Data Center o Reviewing the 3 types of DC (Data Center) o DC Environment o Internet DC Architecture o Enterprise DC Legacy / Current o Google perimeter and DC Overview o Comparison• Understanding the Components: Virtualization Technology o Understanding the role of Virtualization in terms of Commercial or technology o The life cycle of Virtualization’s components and key technology o Technology Hotspot analysis of Virtualization• Understanding the Components: Customer needs and Virtualization o Analyze the pain points and key requirements (reduce the cost through servers consolidation; Dynamic scheduling to save energy; Increase the efficiency of management, etc...) in Virtualization o Analyze the opinion of customers in Virtualization, like usage, maturity... o The technology trend for customers to choose Virtualization, like VMware, Hyper-v, Xen, KVM... © 2011 Alan Quayle Business and Service Development 4
  5. 5. Outline• Understanding the Components: Virtualization Competitive Analysis o How many main competitors (VMware, Citrix, Microsoft, Oracle, Redhat) we have? o What about their business models? o How to win a profit of Virtualization? o Each competitor’s plans to construct their Virtualization platform? o SWOT analysis• Understand the Internet Companies Drivers in Cloud Computing o Mapping Force, Google and Amazon’s offers o Cloud Economics, definitions, taxonomy and market size o Comparison to total IT market o Cloud Business Case• Understanding Web Service Providers Focus on Cloud / DCs o Cloud Hype o Industry requirements o Industry Transition o Data Center Operating System o DC programming models (PaaS) o Example providers, PaaS services and pricing o Deep dive on Force.com, Google App Engine and Microsoft Azure o What it all means © 2011 Alan Quayle Business and Service Development 5
  6. 6. Outline• Implementing SaaS o Minimizing administration costs o Improving productivity and collaboration o Replacing capital investments with pay-per-use• Implementing IaaS o Leveraging on-demand servers o Eliminating software license costs with preconfigured servers o Migrating existing machine images to the cloud o Cost-effective, scalable and reliable data storage with Amazon Simple Storage Solution (S3)• Implementing to minimize risk o Immediate response to market demands o Elastically scaling infrastructure capacity to meet organizational demands o Evaluating operating systems and software with pay-per-use• Implementing Security in the cloud o Analyzing security concerns o Maintaining privacy of proprietary data o Achieving acceptable reliability and service-level agreements o Overcoming the risks of public clouds o Scoping the role: SaaS, PaaS, IaaS © 2011 Alan Quayle Business and Service Development 6
  7. 7. Outline• Implementing Virtual Private Cloud (VPC) o Simulating a private cloud in a public environment o Google secure data connector o Amazon VPC o Industry-standard, VPN-encrypted connections• Implementing cloud governance o Retaining responsibility for the accuracy of the data o Verifying integrity in stored and transmitted data o Demonstrating due care and due diligence o Supporting electronic discovery o Preserving a chain of evidence• Implementing compliance with government certification and accreditation regulations o HIPAA, Sarbanes-Oxley and the Data Protection Act o Following standards for auditing information systems o Negotiating third-party provider audits• Implementing business continuity o Avoiding vendor lock-in o Exploiting multiple cloud providers for cross-platform interoperability o Evaluating the impact on employee skill requirements• Implementing cloud computing in your organization o Building a business case o Selecting a pilot project © 2011 Alan Quayle Business and Service Development 7
  8. 8. Cloud ComputingIntroduction
  9. 9. What is cloud computing?
  10. 10. We Live in Hyped Times!• “Amazon and PSN outages wont halt cloud revolution.” source The Register• “SURVEY: Future-proofing the cloud.” source Network World• “Virtualization, cloud computing to dominate Interop.” source Network World• “Is Your Data Center Ready for Cloud Computing?” source Web Buyers Guide• “Demystifying the Cloud – A Conversation with Dell’s CIO and CTO!” source Baseline Briefing• “Cloud-enabled Wi-Fi: Less Dollars, More Sense” source Network World• “Apple’s new services are expected to include a "digital locker" solution enabling consumers to store their iTunes music, movie and television libraries on Apple servers for access on multiple iOS-based devices.” source Fierce Mobile Content.• “Brocade Unveils CloudPlex cloud architecture, an open framework for building virtualized data centers, and offered a look at new technologies coming up in the near future to help make such data centers possible. “ source CRN• “CenturyLink goes from local to global player with Savvis acquisition.” source Fierce Free Software Foundation founder Richard Stallman called cloud computing, “worse than stupidity.” Bottom-line: If you’re systems are down or you loose customer data its not the Cloud Provider that suffers / goes out of business – they just issue a credit for the disruption.
  11. 11. First Phase of Cloud Consolidation• Verizon acquired Terremark, a Infrastructure / Platform as a Service (I/PaaS) provider, for $1.4 billion, to provide IT infrastructure services targeting the enterprise market.• Dell spent more than $2 billion in six months acquiring cloud technologies, including PaaS provider Boomi, and is investing another $1 billion in a group of global data centers.• IBM acquired Cast Iron, Boomi’s competitor.• Time Warner Cable acquired NaviSite.• CenturyLink acquired Savvis• Microsoft and Toyota forged a strategic partnership to build a global platform for Toyota Telematics Services using Windows Azure.• CA Technologies and Unisys entered into a joint venture that combines CA’s virtualization and service management products with Unisys’ virtualization and cloud advisory, planning, design and implementation services.Likely see further consolidation as Telcos realizes their weaknesses in selling Cloud into enterprise – particularly small medium enterprise
  12. 12. Telstra spending $600M on cloud-based UC forbusinesses• Telstra said it plans to invest $600 million to upgrade communications options for 90 percent of the countrys businesses and, in partnership with Microsoft and Cisco, provide them with cloud-based unified communications.• The QoS upgrades will encompass 1,6000 exchanges and take the telco until September to complete.• The Digital Business package will cost businesses $120 a month and include a basic ADSL2+ connection to businesses, a Cisco Router and a Cisco digital phone. Customers can pay an additional $15 a month to have their Internet and voice connection switch over to the Telstra NextG network automatically if the ADSL connection fails.• Telstra said VoIP service would likely follow the QoS upgrade, once it "can give all the reliability and also the technical backup we think the product needs, then we will bring it to market." Everything becomes labelled as Cloud. Really the $600M is on a network upgrade…
  13. 13. Evolution• Cloud computing has evolved through a number of phases which include grid and utility computing, application service provision (ASP), and Software as a Service (SaaS).• But the overarching concept of delivering computing resources through a global network is rooted in the sixties. Those Sixties!!!
  14. 14. John McCarthy, 1961“computation maysomeday beorganized as apublic utility.”
  15. 15. The Dream of Cloud Computing Integrated Circuit Utility Computing Foundries • Semiconductor Fabs Expensive • New Datacenters Very Expensive – Typically > $1 Billion – Only a Few Companies Can – Too Much for Most Designers Afford Huge Datacenters • Fabs Take Outside Work • Utility Computing  Datacenter – Fabs Amortize Cost Owners Amortize Costs – Other Designers Make Chips – Utility Computing Users Get Advantages of Elasticity • Allowed Explosion of Designs – Datacenter Resources Shared – More Players Afford Rented Fab Across Many Users But a private cloud doesn’t deliver scale?
  16. 16. What is Cloud Computing?• Wikipedia - Cloud computing is Internet (Cloud) based development and use of computer technology (Computing). The cloud is a metaphor for the Internet (based on how it is depicted in computer network diagrams) and is an abstraction for the complex infrastructure it conceals[1]. It is a style of computing where IT-related capabilities are provided “as a service”[2], allowing users to access technology-enabled services from the Internet ("in the cloud")[3] without knowledge of, expertise with, or control over the technology infrastructure that supports them[4]. According to the IEEE Computer Society "It is a paradigm in which information is permanently stored in servers on the Internet and cached temporarily on clients that include desktops, entertainment centers, table computers, notebooks, wall computers, handhelds, etc."[5]. “• No Consensus in the industry for a good definition of “Cloud computing” . Today anything and everything internet will come with a cloud computing logo• Simple Definition: If the time difference between - your application needs more capacity and gets more capacity is greater than instantly it is not cloud computing. i.e. if there is no programmatic way to provision hardware, no pooled capacity and even worst a purchase order to get new hardware/software.• The Bottom-line o Changes the economics of Computing from being a Capital investment to Utilities (You buy electricity you don’t buy generators ) o Changes the way software is developed – Hardware provisioning , Deployment and Scaling now part of developer lifecycle as a Program / script as compared to a Purchase order o Automates a whole bunch of infrastructure related tasks and activities leading efficiencies and cost savings
  17. 17. What is Cloud Computing? • A user experience and a business model o Standardized offerings o Rapidly provisioned o Flexibly priced • An infrastructure management and services delivery method Banking o Virtualized resources o Managed as a single large resource o Delivering services with elastic scaling IT • Similar to Banking ATMs and Retail Point of Sale, Cloud is Driven by: o Self-Service o Economies of Scale Retail o Technology Advancement19 IBM Confidential
  18. 18. The NIST Definition of Cloud Computingo Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This cloud model promotes availability and is composed of five essential characteristics, three service models, and four deployment models. Characteristics 1. On-demand self-service Service models 2. Broad network access 1. Cloud Software as a Service (SaaS) 3. Resource pooling 2. Cloud Platform as a Service (PaaS) 4. Rapid elasticity 3. Cloud Infrastructure as a Service (IaaS) 5. Measured service Deployment models 1. Private cloud 2. Community cloud 3. Public cloud 4. Hybrid cloud
  19. 19. Why Now? From T-Systems, who has delivered SAP dynamic services since 2004
  20. 20. NIST 3 Cloud Service Models• Cloud Software as a Service (SaaS) o Use provider’s applications over a network• Cloud Platform as a Service (PaaS) o Deploy customer-created applications to a cloud• Cloud Infrastructure as a Service (IaaS) o Rent processing, storage, network capacity, and other fundamental computing resources• To be considered “cloud” they must be deployed on top of cloud infrastructure that has the key characteristics 22
  21. 21. Service Model Architectures Cloud Infrastructure Cloud Infrastructure Cloud Infrastructure IaaS Software as a Service PaaS PaaS (SaaS) SaaS SaaS SaaS Architectures Cloud Infrastructure Cloud Infrastructure IaaS Platform as a Service (PaaS) PaaS PaaS Architectures Cloud Infrastructure IaaS Infrastructure as a Service (IaaS) Architectures 23
  22. 22. Mapping the Cloud TypesI use this to simply show the lock-in nature of PaaS / SaaS providers model – Amazon is more focused on a business model based on scale.
  23. 23. IT Cloud Services Taxonomy IT Cloud Services Cloud Applications (Apps-as-a-service) App Dev/Test App Deploy Cloud (Application) Platforms (Platform-as-a-Service) Cloud Infrastructure (Infrastructure-as-a-Service)
  24. 24. Cloud Computing Technologies Technologies Cloud Services Applications SaaS Dev Platforms Multi-Tenant, PaaS + Support Deployment & Cluster services (Storage, DB, Management Security, Aggregation) Virtualization, Infrastructure Management and Grid Engines IaaS Processing HardwareI use this to simply show technologies associated with each layer – when we discuss data center design and architecture we’ll come back to these components.
  25. 25. The NIST Cloud Definition Framework Hybrid CloudsDeploymentModels Private Community Public Cloud Cloud CloudService Software as a Platform as a Infrastructure as aModels Service (SaaS) Service (PaaS) Service (IaaS) On Demand Self-ServiceEssential Broad Network Access Rapid ElasticityCharacteristics Resource Pooling Measured Service Massive Scale Resilient ComputingCommon Homogeneity Geographic DistributionCharacteristics Virtualization Service Orientation Low Cost Software Advanced Security 27
  26. 26. Benefit 1) Elastic Capacity
  27. 27. Predicting Infrastructure Needs Actual Usage Customer DissatisfactionCompute Power Predicted Usage Waste Time
  28. 28. Elasticity, Risk, and User Incentives Services Will Prefer Utility Computing to a Private Cloud When: Demand Varies over Time Demand Unknown in Advance Provisioning for Peak Leads to Web Startup May Experience a Underutilization at Other Times Huge Spike If It Becomes Popular Pay by the Hour Pay as You Go Does Not Require (Even if the Hourly Rate is Higher) Commitment in Advance The Value of Cost AssociativityUserHourscloud × (revenue – Costcloud) ≥ UserHoursdatacenter × (revenue – Costdatacenter ) Utilization
  29. 29. Cloud Is Mostly Driven by Money Economics of Cloud Computing Are Very Attractive to Some UsersCloud Computing Will Predicting Application Track Cost Changes Growth HardBetter than In-HouseInvestment Risks May In-House, You Must Be Reduced Provision for Peak
  30. 30. Benefit 2) Faster time to market
  31. 31. Benefit 3) No initial investment (No CapEx)
  32. 32. Benefit 4) Pay as you go, pay for what you use
  33. 33. Benefit 5) Focus on your business
  34. 34. The 70/30 switch 30% 70%On-Premise Your Managing All of theInfrastructure Business “Undifferentiated Heavy Lifting”
  35. 35. Cloud’s goal: flip this equation 30% 70%On-Premise Your Managing All of theInfrastructure Business “Undifferentiated Heavy Lifting” ConfiguringCloud-Based More Time to Focus on Your CloudInfrastructure Your Business Assets 70% 30%
  36. 36. Companies have different motivations for leveraging cloud Analytics & Time to Value Employee Risk & Security Productivity ComplianceOperations support 9major commands, Creates an Enable collaboration 34,000-employeenearly 100 bases, & ecosystem for PayPal across 300K global bank deploying a700,000 active military 3rd Party developers employees as well as its private cloud frompersonnel around the network of customers, IBM to centralizeworld. Design secure Reduces developer partners and suppliers. management ofcloud infrastructure for effort to deploy a work Saving 30 minutes per desktops via andefense & intelligence environment with day or 120hr per year enterprise class datanetworks; insights seamless PayPal Test per person. center rather than atabout cyber attacks, Sandbox access the user stations,network, system or IBM LotusLive has 18 Gets greater remoteapplication failures, million users in 99 flexibility withoutwhile automatically countries sacrificing control topreventing disruptions. improve efficiency.
  37. 37. Gartner view: hype cycle
  38. 38. Why Be a Cloud Provider? Huge datacenters cost 5-7X less for computation, storage, and Make a Lot of networking. Fixed software & deployment amortized over many users. Money Large company can leverage economies of scale and make money.Leverage Existing Web companies had to build software and datacenters anyway. Adding Investments a new revenue stream at (hopefully) incremental cost. What happens as conventional server and enterprise apps embrace Defend a cloud computing? Application vendors will want a cloud offering. For Franchise example, MSFT Azure should make cloud migration easy. Attack an A large company (with software & datacenter) will want a beachhead Incumbent before someone else dominates in the cloud provider space. Leverage For example, IBM Global Services may offer a branded Cloud Customer Computing offering. IBM and their Global Services customers would Relationships preserve their existing relationship and trust. Become a Facebook offers plug-in apps. Google App-Engine… Platform
  39. 39. Full Cloud Taxonomy Level Of SharingPublic IaaS PaaS SaaS BPaaS PURECloud CLOUD@ Global MARKETProviderVirtualPrivate Dynamic Integration- Dynamic DynamicCloud Infrastructure as-a-Service Apps BPO@Dedicated Services Services ServicesProvider EXTENDED CLOUD Infrastructure Middleware Apps BP MARKETPrivateCloud Virtualization Virtualization Virtualization Virtualization@ In-house Tools Tools Tools ToolsData Center Infrastructure Middleware Applications Business Business Processes Value
  40. 40. Terminology on XaaS: SaaS, PaaS, IaaS, CaaS and EaaS• SaaS a.k.a Software As A Service (wikipedia): o “software that is deployed over the internet and/or is deployed to run behind a firewall on a local area network or personal computer. With SaaS, a provider licenses an application to customers as a service on demand, through a subscription or a "pay-as-you-go" model.”• SaaS can be seen as the end user consumable service, and what is usually meant by “cloud computing”.• Microsoft classifies SaaS into four "maturity levels," whose key attributes are configurability, multi-tenant efficiency, and scalability.• The SaaS model maturity is usually vendor specific.
  41. 41. IaaS: Infrastructure As • IaaS is scalable IT infrastructure readily attached toA Service a suitable communication media (Internet in case of “public cloud” or corporate network in case of “private cloud”), controlled through appropriate APIs, and is available to its users in form of an on- demand service typically with “pay-per-use” charging model • IaaS is a provision model in which an organization outsources the equipment used to support operations, including storage, hardware, servers and networking components. The service provider owns the equipment and is responsible for housing, running and maintaining it. • The consuming entity does not manage or control the underlying cloud infrastructure but has control over operating systems, storage, deployed applications, and possibly limited control of select networking components (e.g., host firewalls). • IaaS: Amazon EC, IBM computing on demand, Rackspace
  42. 42. IaaS bases on scale• IaaS customer promise is about CAPEX and OPEX avoidance, streamlined operations, lower TCO and lower entry barrier: o Margins as per offered resources are usually pretty thin o Revenue is generated by scale and volume o Scale requires capability to economically cater for low-traffic customers and subsequently scale up to high volumes o Business processes for infrastructure operations and management needs to streamlined and mature o Capability to obtain and cater for scale requirements issues a relatively high entry barrier for a new entrant in IaaS offering business due to needed investments.• Usually (but not necessarily always), IaaS players do have existing business, of which IaaS is a by- plot: o CSPs, ecommerce, SaaS providers, data-center and hosting business. o The target is to create revenue from existing under-utilized data center resources.• Additionally, with the ever-tightening legislation, competition, technology requirements, efficiency requirements etc., operating own data center requires more and more of specific competences (e.g. design for energy efficiency, design for compliancy, ...) o Capability development requires investments and takes focus out of the core business of the company.
  43. 43. PaaS: Platform as a Service • PaaS: a capability provided to the user to deploy onto the cloud infrastructure user- created or acquired applications created using programming languages and tools supported by the provider. • All cloud computing characteristic apply. • Usually PaaS model includes an application level framework, e.g. plug-ins for IDE o Easier application development o Implied lock-in with the provider • Focus of PaaS is the developer and respective ecosystem: Successful PaaS offerings have tendency of attracting loyal, open communities of developers. • PaaS implies leverage of domain specific value, e.g. business applications and force.com. • Example: Google Apps, force.com, Facebook
  44. 44. PaaS: an outsourced application server platform?• It appears that the PaaS providers offering holds similarities to what an application server stands for o Obviously, an application server platform is part of PaaS, despite the proprietary nature of implementations.• PaaS can be seen as a service, where as an application server (“platform”) is a technology to implement that service.• PaaS can be regarded as a application development ecosystem: o Implementation approach can vary and is not the core consideration: JEE, .NET, LAMP, Python, Ruby... o Middleware and connectivity services, elasticity, multi-tenancy o Collaborative and integrated supporting ecosystem for the applications that are deployed on PaaS platforms and need to be offered as services to the customers/consumers.• IaaS scales the infrastructure, whereas PaaS scales the application development ecosystem.• For PaaS a key consideration is the risk of lock-in.
  45. 45. CaaS and EaaS• CaaS a.k.a Communications As A Service (zimbio.com) o “Delivering telecommunications, instant messaging etc. as a service over the Internet. Telephony as a service, also known as “Voice as a service”, employs VOIP (Voice Over Internet Protocol). Software and hardware can be provided as a service by providers.” o CaaS is specialized SaaS.• EaaS a.k.a Everything As A Services o Another buzz-word, and to some extent even more marketing spin: SaaS, PaaS and IaaS bundled together as multiple instances.
  46. 46. More Scoping
  47. 47. Framing for cloud computing delivery model User interface layerinstancesApplication management application Partners’ Third party Third party Shared Customized Applications standard standard customized applications applications applications applications Application integration layer SAAS Platform abstraction layerplatformMiddleware Platform O&M Content Web Identity Dev. Protocol UI BPMS etc. services portal services tools stacks frame. tools High availability framework PAAS Application server containers and database management systemsInfrastructureComputing Operating system management IAAS Computing and storage virtualization System tools Physical computing and storage environment Connectivity and access The service models are separate: e.g. creating a SaaS offering by no means requires bundling IaaS or PaaS with it.
  48. 48. Some Myth’s and perceptions• Isn’t it all about hardware provisioning? o Not Really – It is also about changing of Software Development Lifecycle with scaling up , hardware provisioning and deployment all under the control of developer written programs• What about Security and Enterprise Adoption ? o Two answers • Private Clouds – Starting seeing the adoption of the cloud computing paradigm come into the corporate data center. Big iron vendors are selling Private Cloud Products and Hybrid Solutions. • The Question: “Just as Banks became a safe place to keep your money away from your safe-box in your grandfathers home , The Cloud will become the default place to keep your data in the future.” – an analogy I prefer is home security, you can outsource to ADT, but in the limit you still need to do some of it yourself.
  49. 49. Some Myth’s and perceptions• Isn’t this similar to Time Sharing? o Yes to some extent. o But it is not all about sharing of resources. It really boils down to cost savings as a result of automation and changing the software development lifecycle• How is it different from ASP? o The ASP value-add was the typical value you get from an outsourcing company. Leverage knowledge base, trained manpower and some shared infrastructure to guarantee reliability of operations and potential cost savings o Cloud Computing is taking the ASP concept to the next level with zero to little amount of “People Services” and focus on the computing as a utility.
  50. 50. Public Clouds• Public Clouds are good when o Have low bandwidth and latency requirements o Starting with test or development workloads o Running collaboration applications o Don’t have an upfront capital budget Committing tightly to a• Not so good when single provider without a o You need strict performance SLAs proper plan B is a no-go. o Uptime is critical – no control over recovery o Privacy or security is a concern, i.e. • 3rd party has your data, auditors complain • Can you review vendor’s security procedures? o Costs per CPU hour can be larger than that of in-house server deployments.
  51. 51. Internal Private Clouds• Positives of internal private clouds • Negatives vs. public clouds o Anticipated reduction of TCO o Requires up front capital o Better hardware capacity expenditure due to IT investments utilization in own CAPEX o Elasticity o Not as useful for small and • Easy self service provisioning medium businesses and • More efficient system management departmental solutions due to o IT retains control of SLAs needed investments • Data security and privacy • High performance • High availability • Negatives vs. dedicated hardware o Capability to provide spot-on o Performance tax chargeback reports as per need o Not capable for massive parallel processing
  52. 52. Cost elements: SaaS versus traditional on-premises SW• On-premises / in-house • SaaS o License payments at acquisition o Configuration and systems phase and recurring fees integration costs o Customization and systems o Business process adaptation costs integration costs o Sign-up fees o Implementation and deployment o Recurring subscription fees costs for roll-out o Care and support fees o Local IT and systems support o Training costs (of a standard arrangements, either own head- application) count or outsourced o Training costs for end users o Internet connectivity costs o Computing, storage, backup and o (undefined price tag for potential network costs strategic transition costs) o Support and maintenance costs
  53. 53. Cloud service provider space remains fragmented Cloud native players Amazon, Salesforce; Google Telecom IT Service providers Cloud providers AT&T, BT, FT, DT/ T- based Accenture, Systems, services Capgemini, Wipro Verizon Large tech vendors Cisco, Dell HP, IBM
  54. 54. Why CSPs have a strategic fit for cloud computing• Shared infrastructure • CSPs have long history of infrastructure, which is networked and interoperable via well-defined interfaces.• Managed and hosted IT and communications services • For a longer time CSPs have relied on vendors’ managed services type of professional services, which means that there is no inherent fear of outsourcing operative responsibilities.• Data centers • Data centers operations have been for long time the core of CSP production machines.• Security, data integrity and trust • These are the traditional key characteristics of telco business.• Managed network services and end-to-end SLAs. • CSPs are familiar with end-to-end SLA thinking and KPI based operations.• Communications as a service • Communications and connectivity is the bread and butter of CSPs.• SME customer base • The customer base of CSPs does cover SME, which means that they are familiar with the problems and issue within the segment.
  55. 55. What is Cloud Computing For Telcos New consumer- centric Cloud Services Delivery Cloud Strength of trusted Computing Infra- structure services e.g. Billing Engagement Network- Centric for Telcos Where Is The Cloud Opportunity For Mass Telcos? Adoption Consumer Reach CONSUMER vs ENTERPRISE
  56. 56. Telco’s Enterprise – Consumer Pendulum Consumer Enterprise • 65’s: Mainframes in Data Centers 75’s: • Enterprise drives Tech Awareness ISDN Telephony 1st Gen. Remote Home Workers • 80’s: PC on corporate desktop 90’s: • IT education of workingMultimedia PCs, Cell Phones generationDigital Kids, Consumerization IT • 2005’s: Cloud Computing/SaaS 2010’s: • Tech. Populism, Pay/Use, Web 2.0 Managed Devices, Media Convergence • 2015’s: Managed Desktops, X-Internet Enterprise 3.0 Collaborative Business Models Cloud federated master data and Innovators distributed business transactions  Converged Personas  Mass Adoptors Consumer  Specific Personas  Enterprise
  57. 57. Implementing Security
  58. 58. Security is the Major Issue 60
  59. 59. Security Trend – Virtual Firewalls and Additional Procedures Part 1• Virtualization is essentially adding an operating system. – So there are now two operating systems to monitor and patch, instead of one. This increases the chances of patches not being up to date creating security risks – Procedures within the data centers running cloud services must be stricter then regular data center procedures• Traditional intrusion detection doesn’t work on virtual servers. – Intrusion detection (and intrusion prevention) monitors network traffic (between physical servers) and raises a red flag if there’s a traffic spike or type of traffic not explained by legitimate operations. – But there’s no way to monitor traffic between virtual servers on one physical host, - emergence of virtual firewalls• Malware can spread among virtual servers. – Traditional intrusion detection is blind to activity between virtual servers, it’s easy for a virus or other malignant software to spread from one virtual server to another. – And beyond -- because virtualization is often used in conjunction with clustering that moves data and applications among two or more physical servers, to provide load- balancing and “failover” in case one server in the cluster encounters a problem. – A network monitoring system can not analyze this threat. Emergence of virtual firewalls that protect virtual servers. – VMWare and Citrix have created Hypervisor based solutions that work with existing security vendor solutions• Confidential data can be compromised because there’s no way to monitor traffic flow between virtual servers sharing the same physical server, – There’s no way to tell whether confidential or legally protected data (such as medical records or credit card numbers) have been compromised. – Today this is managed by segregating data on a separate physical sever – and generally not allowed outside of the internal corporate cloud.
  60. 60. Security Trend – Virtual Firewalls and Additional Procedures Part 2• Malware is now virtual-aware. – “Virtual-aware” viruses can tell when they’re running in a virtual environment. Though they’ve mostly used this knowledge to hide so far, they could easily be adjusted to attack virtual servers’ vulnerabilities instead. – According to research by the antivirus company ESET, more than 200,000 virtual-aware malwares were at large in November 2008.• Other methods of security management include structuring the resource pools to match network segments, and force traffic among pools to pass through the existing network security infrastructure. – Generally use virtual LANs to achieve this, which results in lower resource utilization and less flexibility in matching workloads to resources.• VM Ware publishes security guidelines – Limiting VM functionality to only those capabilities required by the application – General access controls to virtual console and management functions – Quite complex and generally push operators towards partnering with an established IT integrator in the virtualization space, e.g. HP or IBM• A Cloud Service is only as strong as its weakest link – Must ensure all VMs implement extra protections – recent Gartner surveys show less than 20% of enterprise implementations include additional protections for security in virtualization implementations
  61. 61. Security Standards: SAS 70• SAS 70 is the most commonly adopted security standard among cloud service providers.• Roughly 67 percent of cloud service providers follow SAS 70 (Statement on Auditing Standards No. 70), which is an internationally recognized auditing standard developed by the American Institute of Certified Public Accountants (AICPA) that defines the standards an auditor must employ in order to assess the contracted internal controls of a service organization like a hosted data center, insurance claims processor or credit processing company, or a company that provides outsourcing services that can affect the operation of the contracting enterprise.
  62. 62. Security Standards: PCI DSS & SOX• PCI DSS o About 42 percent of cloud service providers follow the PCI DSS (Payment Card Industry Data Security Standard) standard, a global security standard that applies to all organizations that hold, process or exchange credit card or credit card holder information. o The standard was created to give the payment card industry increased controls around data and to ensure it is not exposed. It is also designed to ensure that consumers are not exposed to potential financial or identity fraud and theft when using a credit card.• Sarbanes-Oxley o Sarbanes-Oxley (SOX) is a security standard that defines specific mandates and requirements for financial reporting. SOX spanned from legislation in response to major financial scandals and is designed to protect shareholders and the public from account errors and fraudulent practices. o Administered by the SEC, SOX dictates what records are to be stored and for how long. It affects IT departments that store electronic records by stating that all business records, which include e-mails and other electronic records, are to be saved for no less than five years. Failure to comply can result in fines and/or imprisonment. o About 33 percent of cloud service providers follow SOX.
  63. 63. Security Standards: ISO 27001 and Safe Habor• ISO 27001 o About 33 percent of cloud service providers adhere to ISO 27001, a standard published in 2005 that is the specification for an Information Security Management System (ISMS). o The objective of ISO 27001 is to provide a model for establishing, implementing, operating, monitoring, reviewing, maintaining and improving ISMS, which is a framework of policies and procedures that includes all legal, physical and technical controls involved in an organizations information risk management processes.• Safe Harbor o About one-fourth of cloud service providers adhere to Safe Harbor principles, a process for organizations in the U.S. and European Union that store customer data. o Safe Harbor was designed to prevent accidental information disclosure or loss. Companies are certified under Safe Harbor by following seven guidelines: Notice, through which individuals must be informed that their data is being collected and how it will be used; choice, that individuals have the ability to opt out of data collection and transfer data to third parties; onward transfer, or transfer data to third parts that can only occur to organizations that follow adequate data protection principles; security, or reasonable efforts to prevent loss of collected data; data integrity, that relevant data is collected and that the data is reliable for the purpose for which it was collected; access, which gives individuals access to information about themselves and that they can correct and delete it if it is inaccurate; and enforcement, which requires the rules are enforced.
  64. 64. Security Standards: NIST and HIPAA• NIST o National Institute of Standards and Technology (NIST) standards, originally designed for federal agencies, emphasize the importance of security controls and how to implement them. The NIST standards started out being aimed specifically at the government, but have recently been adopted by the private sector as well. o NIST covers what should be included in an IT security policy and what can be done to boost security, how to manage a secure environment, and applying a risk management framework. The goal is to make systems more secure. About 25 percent of cloud service providers adhere to NIST standards.• HIPAA o The U.S. Health Insurance Portability and Accountability Act (HIPAA) is followed by roughly 16 percent of cloud service providers. o The HIPAA standard seeks to standardize the handling, security and confidentiality of health- care-related data. It mandates standard practices for patient health, administrative and financial data to ensure security, confidentiality and data integrity for patent information.
  65. 65. Security Standards: FISMA and COBIT• FISMA o FISMA, or the Federal Information Security Management Act, was passed in 2002 and created process for federal agencies to certify and accredit the security of information management systems. o FISMA certification and accreditation indicate that a federal agency has approved particular solutions for use within its security requirements. In its research. About 16 percent of cloud service providers have obtained FISMA certifications.• COBIT o Control Objectives for Information Related Technology is an international standard that defines the requirements for the security and control of sensitive data. It also provides a reference framework. o COBIT is a set of best practices for controlling and security sensitive data that measures security program effectiveness and benchmarks for auditing. The open standard comprises an executive summary, management guidelines, a framework, control objectives, an implementation toolset and audit guidelines. About 8 percent of cloud service providers follow the COBIT security standard.
  66. 66. Security Standards: Data Protection Directive• The Data Protection Directive is a directive adopted by the European Union that was designed to protect the privacy of all personal data collected for or about EU citizens, especially as it relates to processing, using or exchanging that data.• Similar to Safe Harbor in the U.S., Data Protection Directive makes recommendations based on seven principles: Notice, purpose, consent, security, disclosure, access and accountability. About 8 percent of cloud service providers adhere to the Data Protection Directive.
  67. 67. In Some Ways, "Cloud Computing Security"Is No Different Than "Regular Security"• For example, many applications interface with end users via the web. All the normal OWASP (Open Web Application Security Project) web security vulnerabilities -- things like SQL injection, cross site scripting, cross site request forgeries, etc., -- all of those vulnerabilities are just as relevant to applications running on the cloud as they are to applications running on conventional hosting.• Similarly, consider physical security. A data center full of servers supporting cloud computing is internally and externally indistinguishable from a data center full of "regular" servers. In each case, it will be important for the data center to be physically secure against unauthorized access or potential natural disasters, but there are no special new physical security requirements which suddenly appear simply because one of those facilities is supporting cloud computing
  68. 68. Bitbucket, DDoSd Off The Air
  69. 69. Maintenance Induced Cascading Failures
  70. 70. Its Not Just The Network: Storage Is Key, Too See http://www.engadget.com/2009/10/10/t-mobile-we-probably-lost-all-your-sidekick-data/ However, see also: Microsoft Confirms Data Recovery for Sidekick Users http://www.microsoft.com/Presspass/press/2009/oct09/10-15sidekick.mspx 73
  71. 71. And Lets Not Forget About Power Issues 74
  72. 72. Implementing in YourOrganizationProject Plan
  73. 73. Today’s IT infrastructure is under tremendous pressure and isfinding it difficult to keep up…It will reach a breaking point In distributed computing Percentage of executives who report environments, up to 85 percent a security breach and aren’t confident of computing capacity sits idle they can prevent future breaches 70 percent is spent on Percentage of CIOs who want maintaining current IT to improve the way they use infrastructures versus adding and manage their data new capabilities76
  74. 74. Create a roadmap for cloud as part of the existing IToptimization strategy Standardize and automate  Standardize services Virtualize  Reduce deployment cycles  Remove physical  Enable scalability resource boundaries  Flexible delivery Consolidate  Increase hardware  Reduce infrastructure utilization complexity  Reduce hardware  Reduce staffing costs requirements  Simplify deployments  Manage fewer things better  Lower operational costs
  75. 75. Adoption of cloud computing will be workload driven• Workload characteristics determine standardizationTest for Standardization Examine for Risk Explore New Workloads Web infrastructure  Database  High volume, low cost applications  Transaction processing analytics Collaborative infrastructure  ERP workloads  Collaborative Business Development and test Networks  Highly regulated workloads High Performance  Industry scale “smart” Computing ... applications... ...
  76. 76. Workloads ready for cloud computing • Analytics • Desktop and devices – Data mining, text mining or – Desktop other analytics – Service/help desk – Data warehouses or data marts • Development and test – Transactional databases – Development environment • Business services – Test environment – Customer relationship • Infrastructure management – Application servers (CRM) or sales force automation – Application streaming – E-mail – Business continuity/ – Enterprise resource planning disaster recovery (ERP) applications – Data archiving – Industry-specific applications – Data backup • Collaboration – Data center network capacity – Audio/video/Web conferencing – Security – Unified communications – Servers – VoIP infrastructure – Storage – Training infrastructure – Wide area network (WAN) capacity Source: IBM Market Insights, Cloud Computing Research, July 2009.
  77. 77. Public and Private Clouds are preferred for different workloads Top private workloads Top public workloads  Data mining, text mining, or other analytics  Audio/video/Web conferencing  Security  Service help desk  Data warehouses or data marts  Infrastructure for training and  Business continuity and disaster recovery demonstration  Test environment infrastructure  WAN capacity, VOIP Infrastructure  Long-term data archiving/preservation  Desktop  Transactional databases  Test environment infrastructure  Industry-specific applications  Storage  ERP applications  Data center network capacity  ServerDatabase- and application-oriented Infrastructure workloadsworkloads emerge as most appropriate emerge as most appropriate Source: IBM Market Insights, Cloud Computing Research, July 2009. n=1,090
  78. 78. There is a spectrum of deployment options for cloud computing Third-party Third-party hosted operated and operated Enterprise Enterprise Enterprise Enterprise Enterprise Users A B data center data center A B Private cloud Managed Hosted private Shared cloud Public cloud private cloud cloud services services Private Hybrid Public IT capabilities are Internal and IT activities / provided “as a service,” external service functions are over an intranet, within delivery provided “as a the enterprise and methods are service,” over the behind the firewall integrated Internet
  79. 79. There is a spectrum of deployment options for cloud computing Third-party Third-party hosted operated and operated Enterprise Enterprise Enterprise Enterprise Enterprise Users A B data center data center A B Private cloud Managed Hosted private Shared cloud Public cloud private cloud cloud services services Private  Third-party  Third-party  Mix of shared  Shared Implemented operated owned and and dedicated resources on client  Enterprise operated resources  Elastic scaling premises owned  Standardization  Shared facility  Pay as you go Client runs/  Mission critical  Centralization and staff  Public Internet manages  Packaged  Security  Virtual private applications  Internal network (VPN) access  High network compliancy  Subscription or  Internal network membership based
  80. 80. Security is among a top concern with cloud computing...Security Framework provides a structure to address this concern Application and process People and identity Help keep applications secure, Mitigate the risks protected from malicious or associated with user fraudulent use, and hardened access to corporate against failure resources Network, server and end point Optimize service availability by Data and information mitigating risks to network Understand, deploy and components properly test controls for access to and usage of Physical infrastructure sensitive data Provide actionable intelligence on the desired state of physical infrastructure security and make improvements Professional Managed services Hardware and services software
  81. 81. Movement from Traditional Environments to Cloud Can bein One Step or an EvolutionClients will make workload-driventrade offs among functions such assecurity, degree of customization,control and economics
  82. 82. Businesses that implement cloud computing are seeingsignificant results Reduced IT labor cost by 50 percent in configuration, operations, management and monitoring Improved capital utilization by 75 percent, significantly reducing license costs Reduced provisioning cycle times from weeks to minutes Improved quality, eliminating 30 percent of software defects Reduced end user IT support costs by up to 40 percent Simplified security management
  83. 83. Concluding Remarks
  84. 84. Gartner view: hype cycle
  85. 85. But it does make sense for some functions within some organizations….
  86. 86. The NIST Cloud Definition Framework Hybrid CloudsDeploymentModels Private Community Public Cloud Cloud CloudService Software as a Platform as a Infrastructure as aModels Service (SaaS) Service (PaaS) Service (IaaS) On Demand Self-ServiceEssential Broad Network Access Rapid ElasticityCharacteristics Resource Pooling Measured Service Massive Scale Resilient ComputingCommon Homogeneity Geographic DistributionCharacteristics Virtualization Service Orientation Low Cost Software Advanced Security 89
  87. 87. Elasticity, Risk, and User Incentives Services Will Prefer Utility Computing to a Private Cloud When: Demand Varies over Time Demand Unknown in Advance Provisioning for Peak Leads to Web Startup May Experience a Underutilization at Other Times Huge Spike If It Becomes Popular Pay by the Hour Pay as You Go Does Not Require (Even if the Hourly Rate is Higher) Commitment in Advance The Value of Cost AssociativityUserHourscloud × (revenue – Costcloud) ≥ UserHoursdatacenter × (revenue – Costdatacenter ) Utilization
  88. 88. Cloud Is Mostly Driven by Money Economics of Cloud Computing Are Very Attractive to Some UsersCloud Computing Will Predicting Application Track Cost Changes Growth HardBetter than In-HouseInvestment Risks May In-House, You Must Be Reduced Provision for Peak
  89. 89. Cloud’s goal: flip this equation 30% 70%On-Premise Your Managing All of theInfrastructure Business “Undifferentiated Heavy Lifting” ConfiguringCloud-Based More Time to Focus on Your CloudInfrastructure Your Business Assets 70% 30%
  90. 90. IBM Cloud Business Model ROI Analysis Impact: Reduction of Total Cost of Ownership of Data Center Infrastructure New100% Development Liberated Reduced Capital Expenditure funding for - Improved utilization reduces requirement for Software new new capital purchases Costs development, Strategic transformatio Change Reduced Operations Expenditure n investment Capacity - Lower facilities, maintenance, energy, IT Power or direct service delivery and labor costs Costs saving Additional Benefits Deployment (1- - Reduced risk, less idle time, more efficientCurren time) use of energy, acceleration of innovation t IT Labor Costs projects, enhanced customer service Spend (Operations Software and Costs Maintenance) Business Case Results Power Costs Hardware, labor & Annual savings: $3.3M (84%) (88.8%) power from $3.9M to $0.6M Hardware Labor Costs savings Costs ( - 80.7%) reduced Payback Period: 73 days (annualized) annual cost Hardware Costs of operation Net Present Value (NPV): $7.5M ( - 88.7%) by 83.8% Internal Rate of Return (IRR): 496% Note: 3-Year Depreciation Period with 10% Discount Return On Investment (ROI): 1039% Rate
  91. 91. CSPs and cloud computing• The large CSPs have long history in running large scale data-centers and respective operations.• Hence, it is natural for CSPs to offer services via cloud paradigm, and enter into the domain of providing enterprise grade cloud computing services. o From history perspective the focus has been in IaaS. o This will most probably continue, since the infrastructure services continue to be a lucrative necessity.• Analyst (e.g. Ovum) reports indicate that SaaS/CaaS roadmaps are evolving within major telco CSPs. o This is logical growth path, as cloud computing model leverages the telco core competences. o CSPs already have strong foothold on connectivity, which is essential for XaaS. o Trend seems to be that IaaS remains the core focus, and SaaS is developed in an opportunistic way, i.e. develop a solution to a problem, and see whether it could be reapplied for a general business case according to SaaS.• Most often CaaS appears to represent communication as a service or collaboration as a service or unified communications as a services.
  92. 92. Why CSPs have a strategic fit for cloud computing• Shared infrastructure • CSPs have long history of infrastructure, which is networked and interoperable via well-defined interfaces.• Managed and hosted IT and communications services • For a longer time CSPs have relied on vendors’ managed services type of professional services, which means that there is no inherent fear of outsourcing operative responsibilities.• Data centers • Data centers operations have been for long time the core of CSP production machines.• Security, data integrity and trust • These are the traditional key characteristics of telco business.• Managed network services and end-to-end SLAs. • CSPs are familiar with end-to-end SLA thinking and KPI based operations.• Communications as a service • Communications and connectivity is the bread and butter of CSPs.• SME customer base • The customer base of CSPs does cover SME, which means that they are familiar with the problems and issue within the segment.
  93. 93. Workloads ready for cloud computing • Analytics • Desktop and devices – Data mining, text mining or – Desktop other analytics – Service/help desk – Data warehouses or data marts • Development and test – Transactional databases – Development environment • Business services – Test environment – Customer relationship • Infrastructure management – Application servers (CRM) or sales force automation – Application streaming – E-mail – Business continuity/ – Enterprise resource planning disaster recovery (ERP) applications – Data archiving – Industry-specific applications – Data backup • Collaboration – Data center network capacity – Audio/video/Web conferencing – Security – Unified communications – Servers – VoIP infrastructure – Storage – Training infrastructure – Wide area network (WAN) capacity Source: IBM Market Insights, Cloud Computing Research, July 2009.
  94. 94. Enterprise Cloud Computing Consumption, EA & DCA Portfolio of Planning, Standards & Improvements Policies Virtualized System Lifecycles APPLICATION Private Clouds Hyperlinked Models RESOURCES IT OPS MGT APP ARCH & Metadata Improved End-to-End Policies Service Delivery OPS Policy-Based IT Design with with Control Flexibility  Dynamic Availability Public Clouds  Efficient Consumption Metering Servers Application & Billing Storage VMsIT-CONTROLLED CLOUD COMPUTING• Accelerate application delivery• Improve IT service management• Business obtains flexibility while IT maintains control Treat Cloud just like any IT project: focus, dont believe the hype, and take it step by step
  95. 95. Mind the SLA Gap! Data Center SLA MPLS SLA
  96. 96. Beware Lock-In
  97. 97. Conclusions Business Applications Mobile CRM Analytics Data Center VPN Email Infrastructure Desktop SoftwareIts what your mother told you, “Don’t put all your eggs in one basket”

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