A Guide To Finding Your Cloud Power

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  • 1. Conversations CHANGEabout A Guide to findinG your Cloud Power
  • 2. A Conversation about Change Every business has unique and dynamic needs. I am sure yours is no different. Being constantly connected yet maintaining security, increasing productivity and agility, reducing capital expenses – the demands from IT are changing. Now, it’s not just about doing the same things in a new way but about a new way of doing new things. A recent Gartner poll found that by 2012, 80% of Fortune 1000 enterprises will be using some form of cloud or off-premises computing services, and 20% of businesses will own no IT assets. We believe that the answer is in the cloud; and it’s going to change the way you do business. Consider how fast we have shifted online as users – to store data, connect with friends and using apps on our we believe personal mobile devices. Your workplace undoubtedly stands to gain by integrating with this ‘consumerisation’. that the With the most comprehensive IT solutions of the cloud on earth, we now bring you the power to take control of this change - develop and host applications with infinite scalability (Windows Azure), stay secure with your private cloud answer is in (Windows Server Hyper-V), enable productivity and real-time collaboration (Office 365) and get better customer the cloud; connection (Microsoft Dynamics CRM Online). With investments worth US $2.3 billion in cloud infrastructure, over 30,000 dedicated engineers and more than 9000 Microsoft Partners, the Microsoft cloud is Enterprise-ready.and it’s going I invite you to explore more of the cloud to experience the benefits of the change that the cloud brings - beingto change the ready for anything, but paying only for actual results; being able to scale as high or low as you want; save energy, space and yet be omnipresent. way you do As a technologist, our cloud opens up a world of choices for you. With solution-specific benefits, a whitepaper on the ‘Economics of the business. Cloud’ and business impact studies of organisations that have moved to the Cloud, this handbook will help you start a conversation of change within your organisation. This is an exciting journey for any business interested in being what’s next. we call it cloud power, and it’s yours for the taking. Warm Regards, Sanket Akerkar, Managing Director, Microsoft India www.cloudpower.in
  • 3. contentsYour Guide toNavigatiNg the CloudTHE CLOUD POWER PACK 1 - 13 RESOURCES 14 - 61Explore the areas in which IT can change your business for the better Explore and share the power of cloud in business with whitepapers and real-life case studiesSCALE Applications to near infinity 2 The ECONOMICS of the Cloud 15 - 35Build applications flexibly on the familiar Windows Azure platform Read this Microsoft Whitepaper to understand the long-term vision of the underlying economics of cloud computingCONNECT PEOPLE without making them meet 4Drive productivity by communicating with Microsoft Online Services in the Cloud CASE STUDIES of Cloud Power @ Work 36 to 61CREATE a real-time collaboration hub 6 SEAMLESS MIgRATION @ 36Enable people to work across time zones and locations with Microsoft Office 365 30,000 employees migrate to the Cloud without interrupting business or daily operationsDRIVE greater control and IT efficiency in your Private Cloud 8 Improved PRODUCTIvITY @ 44Transform IT services for greater business intelligence with Microsoft System Center A simplified user experience improves collaboration and cuts IT costs by 30%and Windows Server Hyper-V EffICIENCY in the Private Cloud @ 49KNOW what your customers want 10 120 servers become 20 with data center budgets getting cut by 40%Respond faster with better customer intelligence with Microsoft Dynamics CRM Online IT as a SERvICE @ 54What Cloud Power holds for You 12 A global company builds an online Visual Attention service application on Windows AzureBenefit from working with Microsoft Cloud Services
  • 4. the most CompreheNsivesolutioNs for the Cloud. oN earth.the Microsoft Cloud for Businesses SOfTWARE as a Service PLATfORM as a Service iNfRASTRUCTURE as a servicethe Microsoft Cloud for Consumers Windows Live TM TM Hotmail Windows Live TM Windows Messenger Update
  • 5. piCK Your fOR IT PROfESSIONALS Cloud poWer On-demand computing with the right Infrastructure to actively host, scale and manage all your services with ease and Here’s what the Cloud means for everyone in your organisation speed. Plus the choice to keep high-value With the cloud, you can create a flexible IT ecosystem that addresses needs as they arise, backed applications on-premises and move by the confidence that you always have the ability to do so. The Microsoft technologies that you commodity workloads to the cloud. have already invested in is a great place to start.SCALE Applications to near infinity | Pg 2 CONNECT without having to meet | Pg 4 fOR DEvELOPERS Easy scalability and reduced time to market for developing applications on the Windows Azure Platform. Our family of CREATE a Real-time on-demand services provides a familiar collaboration hub | Pg 6 deployment experience that helps focus on coding and reduces complexity. fOR INfORMATION WORKERS Productivity from any location from the PC, phone and web with familiar Applications, now on the cloud. Our powerful communication and collaboration tools provide security-enhanced connectivity and federated access control. TRANSFORM IT services in your Enterprise | Pg 8 KNOW what your customers want | Pg 10 1
  • 6. sCale APPliCAtionS easily scale your Applications develop without boundaries Creating in the cloud to neAr infinity means no more worries While running applications about servers, storage or Offer your developers a flexible and familiar in the Cloud, you don’t have hardware. Your developers environment to easily create and host to worry about scalability or can focus on the code with cloud-based applications with Windows Azure performance issues. If there a test bed always at hand is a sudden demand or load and go from a test server expected on the servers, the to a production server performance can be boosted almost immediately. easily by just increasing the get the poWer to processing capabilities. Cloud Power @ Work Analysts View “By running manageCarbon “Just as Windows played Cloud Power @ Work (HCL’s new carbon-data a significant part in “Windows Azure helps 3M management application) on earlier shifts, Windows customers take advantage of Windows Azure, our customers Azure is poised to take an complex algorithms that encapsulate can be up and running in important role in this new 30 years of research and get simple, one-quarter of the time that it world. If youre responsible powerful results from their browser, took with an on-premises model.” for charting your firms almost instantly.” RAjESH BABU SURAPARAjU, path, understanding and TERRY COLLIER, Marketing Manager, 3M Product Manager, HCL evaluating the Azure on creating and launching a web-Based Visual Read More> environment makes Attention service for customers on Windows Azure good sense.” Read More> David Chappell & Associates2
  • 7. Avoid training costs The interoperable Azure A Secure platform integrates with what Frameworkno more data you already have. Visual Studio Use the security frameworkmaintenance developers can start building you are familiar with many ofWith SQL Azure, you can easily applications in no time and the Windows Azure servicesprovision and deploy multiple also work across SOAP, REST, using the core .Net libraries,databases without having to XML and PHP platforms from keeping much of the securityinstall, setup, parch or manage a single location. and encryption details theany software. High-availability same. A firewall mechanismand built-in fault tolerance Cloud Power @ Work enables you to allow ormakes physical administration “The software distribution system prevent connections fromobsolete. we built with Windows Azure is 10 various sources, right down to times cheaper than our previous specifying IP addresses or IPCloud Power @ Work solution... Most of our developers range.“By using these tools to rapid are experienced with Visual Studioby build applications and services tools. That was a good argument for Cloud Power @ Workand migrate them to the Windows using the Windows Azure platform, “Windows Azure gives ITAzure platform, we will be able to because we can use the same departments, incredible flexibilityhelp our customers quickly react development environment.” and efficiency in deploying newto market changes without major ELMAR STOECKER, Director Portfolio services. As a trusted third party,capital expenditures.” Management, Siemens IT Solutions and Services VeriSign adds a layer of (online)CHANDRA SURBHAT, Global Head of Microsoft Read More> security to those environments.” Try it NowBusiness Solutions, Wipro Technologies RYAN WHITE, Product Marketing ManagerRead More> for SSL, VeriSign on adding VeriSign® SSL Certificates on Windows Azure. Read More> Know More 3
  • 8. CoNNeCt PeoPle witHout real-time meetings without the travel Connect with colleagues and An always-connected remote workforce Employees on the move MAkinG tHeM Meet engage customers in real-time can easily stay in touch with meetings, trainings or events presence, instant messaging Help information workers meet and stay on Microsoft Live Meeting. (IM), and PC-to-PC audio updated from any location with secure Interact by sharing applications and video calling with Office online communication services for email, or desktops and using the Communications Online. conferencing, chat and networking multiple video and VoIP audio Availability can also be shown capabilities. Whiteboard tools through embedded presence and high-fidelity recording also in Microsoft Outlook. poWer up help keep notes. CoNNeCtivitY With Cloud Power @ Work Cloud Power @ Work “We have improved our Analysts View “Our goal in the long term is to organizational efficiency by “Exchange Server 2010 replace many of the PBX systems. 30 percent. We have senior (is) an upgrade worth The enhanced voice capabilities management using Windows Mobile considering. Look simplify everything, cost less, and devices who needs messages ‘on for improvements in give people more functionality. I the go’, mobile users who need to three areas: back-end don’t see a downside.” access email from any connectivity improvements largely jOHN TSCHANNEN, Director of IT and User framework and sales personnel who connected to storage; Services, Energizer, on deploy the voice over work from cyber cafes and access benefits to information IP (VoIP) capabilities of Microsoft Office email using Outlook Web Access.” workers; and built-in basic Communications Online MANI MULKI, Vice President-IT, archiving capabilities.” Read More> Godrej Industries Limited Forrester Research, Inc. Read More> Read More>4
  • 9. increased emailreliability and security familiar tools thatMoving to the cloud helps your can be used by allIT team provide multiple filters Mobile access to Exchangeand virus-scanning engines Online is available from allusing Microsoft Forefront Online Seamless online email-ready phones, spanningProtection to protect from migration Windows Phone, the iPhone,spam, viruses and phishing With Exchange Online, users Android, Palm, Nokia, andscams. A central administration can acess their familiar Outlook Blackberry devices. Chooseconsole helps manage account online without needing between on-premises andsubscriptions, provision users, a VPN connection. You can online mailboxes dependingreset passwords, and configure migrate all mailbox content on what users want.services from any location with including e-mail, calendarInternet access items, contacts, and tasks. Cloud Power @ Work ”I’ve been able to provide equal orCloud Power @ Work Cloud Power @ Work better email service at a much lower”In moving from Exchange Server ”In a five-month timeframe, we cost, which is a big win for Godiva.2007 to Exchange Server 2010, the big migrated roughly 30,000 people to a We’re looking at a $250,000 annualdriver will be the changes to service hosted solution, without impacting savings from eliminating Notes.”availability…. We can design a system their business or interrupting their STEvE WHITELAM, Director of Informationthat will have a much higher level of day-to-day operations.” Technology, Global Shared Services, Godivauptime.” ESAT SEzER, CIO, Coca Cola Enterprises Chocolatier on productivity gains from moving toSTEvEN PRESLEY, IT Engineer - Staff, Qualcomm on Read More> Microsoft Online Services Know Morecutting email recovery time from 10 minutes to less Read More>than 30 secondsRead More> 5
  • 10. Create A reAl-tiMe Connecting across devices and versions Making the most of new opportunities Ensure reliability and CollABorAtion HuB Make it easy to access, edit connectivity for all users - from and share Office documents, colleagues located around Connect your information workers presentations and spreadsheets the world, to temporary across time zones and geographies to share from the PC, phone or browser employees to people from information and work together in real time using Microsoft Office 365. a new acquisition. With Users can collaborate across no server purchases or different platforms (PC or deployments on SharePoint Mac), different Microsoft Office Online, empower a small poWer up versions and even without satellite office, interim staff, CollaboratioN bY have Microsoft Office on their computers (from any web or a newly acquired business to work better together right browser). from the start. Analysts View “Cloud-based email and Cloud Power @ Work Cloud Power @ Work collaboration services will ”Infosys is going to use Office Web “Departments are getting see 10% penetration of Apps extensively, and we expect it to information out to stores faster, the enterprise email and drastically reduce the time it takes to because SharePoint Online is so easy messaging market by complete RFPs and budgets.” to use. We are excited to start using 2012 and will near 65% vIvEK BHARATHAN, Lead Technology Specialist, workflows to automate common penetration by 2020.” Infosys, on overcoming document version processes such as onboarding new Gartner compatibility across 100,000 Microsoft Office users employees.” Read More> Read More> RHONDA COBB, Information Technology Manager, REEDS Jewelers Read More>6
  • 11. enabling knowledge sharing quickly Sharing data A unified enterprise content reliably without management system can help infrastructure costs employees easily share best All documents and files saved practices and expertise with online are hosted on Microsoftwork with blogs, wikis, search, surveys servers maintained by ourwhat you know and RSS feeds. Users can also own trained experts. Patches Know MoreThe familiar interface of Microsoft easily create and maintain and security updates areOutlook and Office applications collaborative workspaces supplied in real time, ensuringis now extended online with using meeting and team site that users always work onOffice 365 for Enterprises. templates. the latest, most up-to-dateMeaning no learning curve plus versions of applications.now online productivity features Cloud Power @ Workfor your employees. “Together with Microsoft, we hit the Cloud Power @ Work overall goal in 142 days and helped “Moving to Online ServicesCloud Power @ Work Aviva achieve the deployment in will enable us to reduce our IT“The speech-to-text features will be around one half of the cost of the operational costs by roughly 30%great for our 20,000 or so mobile original budget” of what we’re currently spending.device users because they will be able TOBY REDSHAW, CIO, Aviva, on creating 1 The ability to introduce a variableto access their voice-mail messages intranet in 12 languages for 60,000 employees cost subscription model for theseeven if they can’t call into the system.” Read More> collaborative technologies allows usDEAN SEPSTRUP, Product Manager for Exchange, to more rapidly scale or divest ourBoeing on the Voice-Mail Preview that’s helping investment as necessary.”drive employee productivity ALASTAIR ROBERTSON,Read More> VP, Information Workplace Read More> 7
  • 12. traNsform end-to-end Management it SerViCeS Efficiency through Rs. Control Automation and migrating in your enterPriSe automation online doesn’t mean loss Drive efficiency through Build a flexible and efficient of control. In fact, you can private cloud infrastructure now manage your entire greater flexibility and control of IT services using Windows Server 2008 R2 IT infrastructure spanning in your own private cloud Hyper-V and System Center. physical on-premises and By automating data resources virtual cloud environments management and following from a single screen. a self-service model, you can poWer up busiNess save on operational costs in Cloud Power @ Work agilitY With physical administration and troubleshooting. “We chose Windows Server 2008 R2 Hyper-V because we have Analysts View standardized our IT setup on “For most organisations, Cloud Power @ Work Microsoft technologies. Moving to virtualisation will provide the ”We have trimmed our physical a new platform would have meant foundation and the stepping- server holdings from 120 to merely lack of predictability and increased stone for the evolution to private 20 servers. The expenses on server costs” cloud computing… Security must boxes have dropped drastically by 40 SHYAM CHANDRAMANI, Unit Manager - become adaptive to support percent of our data center budget.” Global Server Team, Mphasis Limited a model where workloads are SANDEEP gANDHI, Sr. Manager, Data Center Read More> decoupled from physical hardware Operations, KPIT Cummins and dynamically allocated to a Read More> fabric of computing resources.” Thomas Bittman, Gartner analyst Read More>8
  • 13. faster time to market With its flexibile setup, private cloud technology accelerates development Maximise your itfreedom to focus times for custom applications investmentson business and lets IT respond quickly to Leverage your existing Try it NowSimplifying IT management and changing business needs. The assets and skill sets - acrossthe assurance of security means private cloud can integrate identity (Active Directory),more time for you to focus on with existing toolsets and management (System Center)developing solutions that would provide symmetry with your and developer technologies Know Morehave not been possible before. on-premises or cloud (.Net, SQL Server and database. Visual Studio) - to work onCloud Power @ Work private and public cloud“Microsoft has invested billions of Cloud Power @ Work environments.dollars in cloud technologies, which “You simply plug in and use thegives us peace of mind... confidence relevant resources... The ability to Cloud Power @ Workat the Associated Press that our data receive these resources as a service “With Windows Azure, we didn’tis secure, even though it is made it possible for us to have to make changes to theoff-premises.” considerably speed up the process architecture of our solution to get itPRAMOD ANCHUPARAYIL, Software Architect, of reaching customers. Plus, we running. To start up quickly - that isAssociated Press on hosting its Breaking News API avoided spending US $50,000 on really big for us.”on Azure hardware and a hosting facility.” RAIK DITTRICH, Innovation Manager, T-SystemsRead More> NIR HAgSHURY, Chief Technical Officer, TicTacTi Read More> Read More> 9
  • 14. know wHAt your ensuring rapidCustomers user adoption Inflexible software and a poor Closing user experience often hamper deals faster wAnt usage of CRM applications. Microsoft Dynamics CRM Give sales professionals Strengthen customer Online provides an entire suite instant fast access to interactions, improve marketing of marketing, sales and service customer data and history and boost sales with easy when connected to the In- online access to information solutions within the familiar ternet and even when offline. interface of Microsoft Office Sales prospects and Outlook on the PC or when customers can be informed accessed online, ensuring rapid of new product and service poWer up Customer user adoption and fast results. offerings with wizard-based relatioNs bY Cloud Power @ Work communication tools. Analysts View “We know that salespeople find the Cloud Power @ Work “Microsoft Dynamics CRM new system much easier to use. The “It would have taken 70 hours a shines by offering flexibility rate of responses in our new system month to get the pre-opportunity for large and midsized has increased by 30 to 45 percent data that now is just there in the organizations… Offering over what it was in Salesforce.com.” system. Our efficiency has soared buyers the ‘Power of Choice’ AISHA THOMAS, Marketing IT Manager, Unico by well over 100 percent with so that companies may Read More> Microsoft Dynamics CRM Online.” jEff KIELY, choose how to deploy, how Vice President of Sales and Marketing, Trion to pay, and how to use the Read More> application.” The Forrester Wave10
  • 15. Generating Better informationgreat demand sharingUnderstand your customers Ensure customer loyalty withbetter and target your resources consistent, efficient service Growing with yourto the areas of highest return by empowering customer business needswith a comprehensive set of service personnel with the right Easy-to-use wizards andmarketing capabilities. Marketing information. Customer data point-and-click customizationprofessionals can increase can be made available as and tools help you customise and Try it Nowmarketing effectiveness and when needed - through the connect your CRM data withtrack key performance with user interface, online or as an existing business system dataintuitive data segmentation tools, exported web file. The intuitive in real-time. The pay-per-usercampaign management features configuration capabilities can model delivered online, makes Know Moreand marketing analytics, all be tailored to fit your business setting up quick to scale asavailable online. needs by quickly adding or required without any server modifying fields, forms, workflow setup or expensive hardwareCloud Power @ Work and reports. upgrades.“Using Marketing Automation inMicrosoft Dynamics CRM, we now Cloud Power @ Work Cloud Power @ Workdeliver over 5,000 birthday emails a “Microsoft Dynamics CRM has been “By switching to Microsoft Dynamicsday to participants, reminding them essential to helping us improve CRM Online from Salesforce.com,to celebrate their birthdays with us.” our customer satisfaction levels we’re saving nearly $13,000 eachHEATHER DORR, Senior Manager of Marketing and implement an effective sales month with 160 users.”Information Systems, Cold Stone Creamery which management process. It provides a jOEL fRIEDMAN, CIO, Century Paymentshas enrolled over 15 lakh Birthday Club participants single version of our customer data Read More>with thousands of new members joining everyday to all our sales staff.”Read More> UMAIR CHAUDHARY, COO, Barclays Bank LP, UAE and Gulf on increasing customer satisfaction by 15 percent Read More> 11
  • 16. What Cloud poWer holds for You Benefit from working with Microsoft Cloud Services - the most comprehensive set of solutions for the cloud doN’t throW aNYthiNg aWaY Move only what you want to the cloud with a hybrid model of on-premises and off-premises resources. paY for What Build on your existing IT happeNs assets and connect them to IT costs are now online services. flexible – just pay per user per month on any application as a service. Different usage models also help you accurately predict costs.12
  • 17. 15 Years of experieNCe develop faster When you work in the Build applications faster thanNo more Microsoft Cloud, you ever with a million-strongmaiNteNaNCe leverage the knowledge developer base writing toAlways use the latest and expertise of 15 years, Microsoft platforms and alWaYs availablesoftware without worrying ranging from applications more coming through our All the resources needed forabout upgrades and (Hotmail) to search (Bing) interoperability support of a robust cloud computingpatches. The cloud and platforms (Xbox Live) third-party solutions. infrastructure - a globalautomatically updates to reach, a commitment tothe latest versions. security, 99.9 percent uptime SLA with 24/7 service and support. help at haNd staY seCure Our ecosystem of 9,000 Your data is stored on aNo traiNiNg partners - spanning ISVs, global network of 200+required value-added resellers and enterprise-class data centersAll your users can easily systems integrators - choose with SAS 70 and ISO 27001 loWer Costsmove to and from the from our ecosystem to help security certifications audited No more paying forcloud, using their skill sets you in migration, hosting by an independent third hardware and facilityand familiarity with the services and creating party. expenses. Cut down onproducts they currently use. customised applications. maintenance and operationalGet a consistent experience overheads by paying foracross all devices. service. 13
  • 18. why the Cloud makes Business Sense resourCes Thousands of companies are discovering why making their IT an enterprise- ready service makes business sense. Explore more with our whitepaper and see how global companies are seeing business benefits in the Microsoft Cloud. The Economics of the Cloud | Pg 15 Seamless migration at Coca Cola Enterprises | Pg 36 Improved Productivity at GlaxoSmithKline | Pg 44 Efficiency in the Private Cloud at KPIT Cummins | Pg 49 IT as a Service at 3M | Pg 5414
  • 19. Computing is undergoing a seismic shift from client/server to the cloud, a shift similar in importance and the impact to the transition from mainframe to client/server. Speculation abounds on how this new era will evolve ineCoNomiCs of the coming years, and IT leaders have a critical need for a clear vision of where the industry is heading. We believe the Cloud the best way to form this vision is to understand the underlying economics driving the long-term trend. In this paper, we will assess the economics of the cloud by using in-depth modeling. We then use this framework to better understand the long-term IT landscape. For comments or questions regarding the content of this paper, please contact Rolf Harms (rolfh@microsoft.com) or Michael Yamartino (michael.yamartino@microsoft.com) 15
  • 20. Introduction By the 1920s the number of cars had already reached 8 million, and today there are over 600 million cars – proving Daimler wrong hundreds of times over. W hen cars emerged in What the early pioneers failed to realize was that profound reductions in both the early 20th century, cost and complexity of operating cars and a dramatic increase in its importance they were initially called in daily life would overwhelm prior constraints and bring cars to the masses. “horseless carriages”. Understandably, people were skeptical at first, and Today, IT is going through a similar change: the shift from client/server to they viewed the invention through the cloud. Cloud promises not just cheaper IT, but also faster, easier, more the lens of the paradigm that had flexible, and more effective IT. Just as in the early days of the car industry, it‘s been dominant for centuries: the currently difficult to see where this new paradigm will take us. The goal of horse and carriage. The first cars this whitepaper is to help build a framework that allows IT leaders to plan also looked very similar to the for the cloud transition2. We take a long-term view in our analysis, as this is horse and carriage (just without the a prerequisite when evaluating decisions and investments that could last for horse), as engineers initially failed to Horseless Carriage Syndrome decades. As a result, we focus on the economics of cloud rather than on specific understand the new possibilities of the new paradigm, such as building for technologies or other driving factors like organizational change, as economics higher speeds, or greater safety. Incredibly, engineers kept designing the often provide a clearer understanding of transformations of this nature. whip holder into the early models before realizing that it wasn‘t necessary anymore. In Section 2, we outline the underlying economics of cloud, focusing on what makes it truly different from client/server. In Section 3, we will assess the Initially there was a broad failure to fully comprehend the new paradigm. implications of these economics for the future of IT. We will discuss the positive Banks claimed that, The horse is here to stay but the automobile is only impact cloud will have but will also discuss the obstacles that still exist today. a novelty, a fad”. Even the early pioneers of the car didn‘t fully grasp the Finally, in Section 4 we will discuss what‘s important to consider as IT leaders potential impact their work could have on the world. When Daimler, arguably embark on the journey to the cloud. the inventor of the automobile, attempted to estimate the long-term auto market opportunity, he concluded there could never be more than 1 million Source: Horseless Carriage Thinking, William Horton Consulting 1 cars, because of their high cost and the shortage of capable chauffeurs1. Cloud in this context refers to cloud computing architecture, encompassing both public and private clouds. 216
  • 21. Fig. 2: Cloud OpportunityeCoNomiCsof the CloudEconomics are a powerful force in shaping industry transformations. Today‘sdiscussions on the cloud focus a great deal on technical complexities andadoption hurdles. While we acknowledge that such concerns exist and are Source: Microsoftimportant, historically, underlying economics have a much stronger impacton the direction and speed of disruptions, as technological challenges are fig. 3: Beginning the Transition to Client Server Technologyresolved or overcome through the rapid innovation we‘ve grown accustomedto (Fig. 2). During the mainframe era, client/server was initially viewed as a toytechnology, not viable as a mainframe replacement. Yet, over time theclient/server technology found its way into the enterprise (Fig. 3). Similarly,when virtualization technology was first proposed, application compatibilityconcerns and potential vendor lock-in were cited as barriers to adoption. Source: “How convention shapes our market”Yet underlying economics of 20 to 30 percent savings3 compelled CIOs to longitudinal survey,overcome these concerns, and adoption quickly accelerated. Shana Greenstein, 1997.The emergence of cloud services is again fundamentally shifting the economics Cloud also allows core IT infrastructure to be brought into large data centersof IT. Cloud technology standardizes and pools IT resources and automates that take advantage of significant economies of scale in three areas:many of the maintenance tasks done manually today. Cloud architectures • Supply-side savings. Large-scale data centers (DCs) lower costs per server.facilitate elastic consumption, self-service, and pay-as-you-go pricing. • Demand-side aggregation. Aggregating demand for computing smoothsThe massive aggregate scale of these mega DCs will bring considerable and overall variability, allowing server utilization rates to increase. • Multi-tenancy efficiency. When changing to a multitenant application3 Source: Dataquest Insight: Many Midsize Businesses Looking Toward 100% Server Virtualization. model, increasing the number of tenants (i.e., customers or users) lowers Gartner, May 8, 2009 the application management and server cost per tenant. 17
  • 22. Fig. 4: ECONOMIES OF SCALE (ILLUSTRATIVE) 2.1 Supply-Side Economies of Scale Cloud computing combines the best economic properties of mainframe and client/server computing. The mainframe era was characterized by significant economies of scale due to high up-front costs of mainframes and the need to hire sophisticated personnel to manage the systems. As required computing Source: Microsoft power – measured in MIPS (million instructions per second) – increased, cost declined rapidly at first (Fig. 4), but only large central IT organizations had The economies of scale emanate from the following areas: the resources and the aggregate demand to justify the investment. Due to Cost of power: Electricity cost is rapidly rising to become the largest element of the high cost, resource utilization was prioritized over end-user agility. Users‘ total cost of ownership (TCO),5 currently representing 15%-20%. Power Usage requests were put in a queue and processed only when needed resources were Effectiveness (PUE)6 tends to be significantly lower in large facilities than in available. With the advent of minicomputers and later client/server technology, smaller ones. While the operators of small data centers must pay the prevailing the minimum unit of purchase was greatly reduced, and the resources became local rate for electricity, large providers can pay less than one-fourth of the easier to operate and maintain. This modularization significantly lowered the national average rate by locating its data centers in locations with inexpensive entry barriers to providing IT services, radically improving end-user agility. electricity supply and through bulk purchase agreements7. In addition, research However, there was a significant utilization tradeoff was, resulting in the current has shown that operators of multiple data centers are able to take advantage state of affairs: datacenters sprawling with servers purchased for whatever of geographical variability in electricity rates, which can further reduce needed existed at the time, but running at just 5%-10% utilization4. energy cost. 4 Source: The Economics of Virtualization: Moving Toward an Application-Based Cost Model, IDC, Cloud computing is not a return to the mainframe era as is sometimes November 2009. 5 Not including app labor. Studies suggest that for low-efficiency datacenters, three-year spending on suggested, but in fact offers users economies of scale and efficiency that power and cooling,including infrastructure, already outstrips three-year server hardware spending. exceed those of a mainframe, coupled with modularity and agility beyond what 6 Power Utilization Effectiveness equals total power delivered into a datacenter divided by critical power – the power needed to actually run the servers. Thus, it measures the efficiency of the datacenter in client/server technology offered, thus eliminating the tradeoff. turning electricity into computation.The best theoretical value is 1.0, with higher numbers being worse. 7 Source: U.S. Energy Information Administration (July 2010) and Microsoft. While the average U.S. commercial ratesome locations offer power for is 10.15 cents per kilowatt hour, as little as 2.2 cents per kilowatt hour18
  • 23. Infrastructure labor costs: While cloud computing significantly lowers laborcosts at any scale by automating many repetitive management tasks, largerfacilities are able to lower them further than smaller ones. While a singlesystem administrator can service approximately 140 servers in a traditionalenterprise,8 in a cloud data center the same administrator can service Fig. 5:thousands of servers. This allows IT employees to focus on higher value-add RECENT LARGEactivities like building new capabilities and working through the long queue of DATA-CENTER PROJECTSuser requests every IT department contends with. Source: Press RelesesSecurity and reliability: While often cited as a potential hurdle to public cloud ongoing R&D to bear on running them more efficiently, and make them moreadoption, increased need for security and reliability leads to economies of scale efficient for their customers. Providers of large-scale DCs, for which running themdue to the largely fixed level of investment required to achieve operational is a primary business goal, are likely to benefit more from this than smaller DCssecurity and reliability. Large commercial cloud providers are often better able which are run inside enterprises.to bring deep expertise to bear on this problem than a typical corporate ITdepartment, thus actually making cloud systems more secure and reliable. 2.2 Demand-Side Economies of ScaleBuying power: Operators of large data centers can get discounts on The overall cost of IT is determined not just by the cost of capacity, but also by thehardware purchases of up to 30 percent over smaller buyers. This is degree to which the capacity is efficiently utilized. We need to assess the impactenabled by standardizing on a limited number of hardware and software that demand aggregation will have on costs of actually utilized resources (CPU,architectures. Recall that for the majority of the mainframe era, more than 10 network, and storage)9. In the non-virtualized data center, each application/work-different architectures coexisted. Even client/server included nearly a dozen load typically runs on its own physical server10. This means the number of serversUNIX variants and the Windows Server OS, and x86 and a handful of RISC scales linearly with the number of server workloads. In this model, utilization ofarchitectures. Large-scale buying power was difficult in this heterogeneous 8 Source: James Hamilton, Microsoft Research, 2006. 9 In this paper, we talk generally about resource utilization. We acknowledge there are important differencesenvironment. With cloud, infrastructure homogeneity enables scale economies. among resources.For example, because storage has fewer usage spikes compared with CPU and I/O resources,Going forward, there will likely be many additional economies of scale that we the impact of some of what we discuss here will affect storage to a smaller degree. 10 Multiple applications can run on a single server, of course, but this is not common practice. It iscannot yet foresee. The industry is at the early stages of building data centers very challenging to move a running application from one server to another without also movingat a scale we‘ve never seen before (Fig. 5). the operating system, so running multiple applications on one operating system instance can create bottlenecks that are difficult to remedy while maintaining service, thereby limitingagility. Virtualization allows the application plus operating system to be moved at will. 19
  • 24. servers has traditionally been extremely low, around 5 to 10 percent11. To meet service level agreements, capacity buffers have to be built in to Virtualization enables multiple applications to run on a single physical server account for a certain probability that many people will undertake particular within their optimized operating system instance, so the primary benefit of tasks at the same time. If servers are pooled, this variability can be reduced. virtualization is that fewer servers are needed to carry the same number of workloads. But how will this affect economies of scale? If all workloads had 2. Time-of-day patterns: There are daily recurring cycles in people‘s behavior: constant utilization, this would entail a simple unit compression without consumer services tend to peak in the evening, while workplace services tend impacting economies of scale. In reality, however, workloads are highly variable to peak during the workday. Capacity has to be built to account for these daily over time, often demanding large amounts of resources one minute and peaks but will go unused during other parts of the day causing low utilization. virtually none the next. This opens up opportunities for utilization improvement This variability can be countered by running the same workload for multiple via demand-side aggregation and diversification. time zones on the same servers (Fig. 7) or by running workloads with complementary time-of-day patterns (for example, consumer services and We analyzed the different sources of utilization variability and then looked at the enterprise services) on the same servers. ability of the cloud to diversify it away and thus reduce costs. Fig. 7: TIME-OF-DAY PATTERNS FOR SEARCH We distinguish five sources of variability and assess how they might be reduced: 1. Randomness: End-user access patterns contain a certain degree of randomness. For example, people check their email at different times (Fig.6). Fig. 6: RANDOM VARIABILITY (EXCHANGE SERVER) Source: Bing Search volume over 24-hour period 11 Source: The Economics of Virtualization: Moving Toward an Application-Based Cost Model, IDC, Source: Microsoft November 2009.20
  • 25. Fig. 9: MULTIRESOURCE VARIABILITY (ILLUSTRATIVE)3. Industry-specific variability: Some variability is driven by industrydynamics. Retail firms see a spike during the holiday shopping season whileU.S. tax firms will see a peak before April 15 (Fig. 8).Fig. 8: INDUSTRY-SPECIFIC VARIABILITY Source: Microsoft While it‘s possible to adjust capacity by buying servers optimized for CPU or storage, this addresses the issue only to a limited degree because it will reduce flexibility and may not be economic from a capacity perspective. This variability will lead to resources going unutilized unless workload diversification is employed by running workloads with complementary resource profiles. Source: Alexa Internet 5. Uncertain growth patterns: The difficulty of predicting future need forThere are multiple kinds of industry variability - some recurring and predictable computing resources and the long leadtime for bringing capacity online is(such as the tax season or the Olympic Games), and others unpredictable (such another source of low utilization (Fig. 10).as major news stories). The common result is that capacity has to be built for Fig. 10: DIVERSIFYING RANDOM VARIABILITYthe expected peak (plus a margin of error). Most of this capacity will sit idle therest of the time. Strong diversification benefits exist for industry variability.4. Multi-resource variability: Compute, storage, and input/output (I/O)resources are generally bought in bundles: a server contains a certain amountof computing power (CPU), storage, and I/O (e.g., networking or disk access).Some workloads like search use a lot of CPU but relatively little storage or I/O,while other workloads like email tend to use a lot of storage but littleCPU (Fig. 9). Source: Microsoft 21
  • 26. For startups, this is sometimes referred to as the TechCrunch effect. Enterprises large, multi-geography organizations, the majority of employees and users and small businesses all need to secure approval for IT investments well in will live in similar time zones, bringing their daily cycles close to synchrony. advance of actually knowing their demand for infrastructure. Even large private Also, most organizations do not tend to have workload patterns that offset one companies face this challenge, with firms planning their purchases six to another: for example, the email, network and transaction processing activity twelve months in advance (Fig. 10). By diversifying among workloads across that takes place during business hours is not replaced by an equally active multiple customers, cloud providers can reduce this variability, as higher- stream of work in the middle of the night. Pooling organizations and workloads than-anticipated demand for some workloads is canceled out by lower-than- of different types allows these peaks and troughs to be offset. anticipated demand for others. A key economic advantage of the cloud is its ability to address variability in resource utilization brought on by these factors. By pooling resources, variability Fig.11: is diversified away, evening out utilization patterns. The larger the pool of DIVERSIFYING resources, the smoother the aggregate demand profile, the higher the overall RANDOM utilization rate, and the cheaper and more efficiently the IT organization can VARIABILITY meet its end-user demands. We modeled the theoretical impact of random variability of demand on server utilization rates as we increase the number of servers12. Fig. 11 indicates that a Source: Microsoft theoretical pool of 1,000 servers could be run at approximately 90% utilization Industry variability results in highly correlated peaks and troughs throughout without violating its SLA. This only holds true in the hypothetical situation each firm (that is, most of the systems in a retail firm will be at peak capacity where random variability is the only source of variability and workloads can around the holiday season (e.g., web servers, transaction processing, payment be migrated between physical servers instantly without interruption. Note that processing, databases)13. Fig. 12 shows industry variability for a number of higher levels of uptime (as defined in a service level agreement or SLA) become different industries, with peaks ranging from 1.5x to 10x average usage. much easier to deliver as scale increases. 12 To calculate economies of scale arising from diversifying random variability, we created a Monte Carlo model to simulatedata centers of various sizes serving many random workloads. For each simulated DC, workloads (which are made to resemble hypothetical web usage patterns) wer Clouds will be able to reduce time-of-day variability to the extent that they successively added until the expected availability of server resources dropped below agiven uptime of are diversified amongst geographies and workload types. Within an average 99.9 percent or 99.99 percent. The maximum number of workloads determines the maximum utilization rate at which the DC‘s servers can operate without compromising performance. organization, peak IT usage can be twice as high as the daily average. Even in 13 Ideally, we would use the server utilization history of a large number of customers to gain more insight into such patterns. However, this data is difficult to get and often of poor quality. We therefore used web traffic as a proxy for the industry variability.22
  • 27. Microsoft services such as Windows Live Hotmail and Bing take advantage of Windows Azure because every frame of their movies takes eight hours tomulti-resource diversification by layering different subservices to optimize render today on a single processor, meaning it would take 272 years toworkloads with different resource profiles (such as CPU bound or storage render an entire movie. As they said, We are not that patient. With Azure,bound). It is difficult to quantify these benefits, so we have not included multi- they can get the job done as fast as they need. The result is huge spikesresource diversification in our model. in Pixar‘s usage of Azure as they render on-demand.Some uncertain growth pattern variability can be reduced by hardwarestandardization and just-in-time procurement, although likely not completely.Based on our modeling, the impact of growth uncertainty for enterprises withup to 1,000 servers is 30 to 40 percent overprovisioning of servers relative toa public cloud service. For smaller companies (for example, Internet startups), Fig 12:the impact is far greater. INDUSTRY VARIABILITY Source: MicrosoftSo far we have made the implicit assumption that the degree of variability willstay the same as we move to the cloud. In reality, it is likely that the variability • Batch processes will become real time: Many processes — for example,will significantly increase, which will further increase economies of scale. There accurate stock availability for online retailers — that were previouslyare two reasons why this may happen: batch driven, will move to real-time. Thus, multi-stage processes that• Higher expectation of performance: Today, users have become were once sequential will now occur simultaneously, such as a manufac- accustomed to resource constraints and have learned to live with them. turing firm that can tally its inventory, check its order backlog, and order For example, users will schedule complex calculations to run overnight, new supplies at once. This will amplify utilization variability. avoid multiple model iterations, or decide to forgo time-consuming and costly supply chain optimizations. The business model of cloud allows We note that even the largest public clouds will not be able to diversify away all a user to pay the same for 1 machine running for 1,000 hours as he variability; market level variability will likely remain. To further smooth demand, would for 1,000 machines running for 1 hour. Today, the user would likely sophisticated pricing can be employed. For example, similar to the electricity wait 1,000 hours or abandon the project. In the cloud, there is virtually market (Fig. 13), customers can be incented to shift their demand from high no additional cost to choosing 1,000 machines and accelerating such utilization periods to low utilization periods. In addition, a lower price spurs processes. This will have a dramatic impact on variability. Pixar Animation additional usage from customers due to price elasticity of demand. Demand Studios, for example runs its computer-animation rendering process on management will further increase the economic benefits of cloud. 23
  • 28. 365-S to assess the impact. In dedicated instances, the same activities, such Fig. 13: VARIABLE PRICING IN ELECTRICITY as applying software patches, are performed multiple times – once for each instance. In a multi-tenant instance such as Office 365-S, that cost is shared across a large set of customers, driving application labor costs per customer towards zero. This can result in a meaningful reduction in overall cost, especially for complex applications. Fig.14: Source: Ameren Illinois Utilities UTILIZATION OVERHEAD 2.3 Multi-tenancy Economies of Scale Source: Microsoft The previously described supply-side and demand-side economies of scale can be achieved independent of the application architecture, whether it • fixed component of server utilization amortized over large number be traditional scale-up or scale-out, single tenant or multitenant. There is of customers: For each application instance, there is a certain amount another important source of economies of scale that can be harnessed only of server overhead. Fig. 14 shows an example from Microsoft‘s IT if the application is written as a multitenant application. That is, rather than department in which intraday variability appears muted (only a 16 running an application instance for each customer – as is done for on-premises percent increase between peak and trough) compared to actual variability application and most hosted applications such as dedicated instances of in user access. This is caused by application and runtime overhead, which Microsoft Office 365 – in a multitenant application, multiple customers use a is constant throughout the day. By moving to a multitenant model with single instance of the application simultaneously, as in the case of shared a single instance, this resource overhead can be amortized across all Office 365. This has two important economic benefits: customers. We have examined Office 365-D, Office 365-S, and Microsoft • fixed application labor amortized over a large number of customers: Live@edu data to estimate this overhead, but so far it has proven In a single-tenant instance, each customer has to pay for its own technically challenging to isolate this effect from other variability in the application management (that is, the labor associated with update and data (for example, user counts and server utilization) and architectural upgrade management and incident resolution). differences in the applications. Therefore, we currently assume no benefit We‘ve examined data from customers, as well as Office 365-D and Office from this effect in our model.24
  • 29. Applications can be entirely multitenant by being completely written to take This raises the question: what impact will the Cloud Economics we describedadvantage of these benefits, or can achieve partial multi-tenancy by leveraging have on the IT budget? From customer data, we know the approximateshared services provided by the cloud platform. The greater the use of such breakdown between the infrastructure costs, costs of supporting andshared services, the greater the application will benefit from these multi- maintaining existing applications, and new application development costs (Fig.tenancy economies of scale. 16). Cloud impacts all three of these areas. The supply-side and demand-side savings impact mostly the infrastructure portion, which comprises over half of2.4 Overall Impact spending. Existing app maintenance costs include update and patching labor,The combination of supply-side economies of scale in server capacity end-user support, and license fees paid to vendors. They account for roughly a(amortizing costs across more servers), demand-side aggregation of workloads third of spending and are addressed by the multi-tenancy efficiency factor.(reducing variability), and the multi-tenant application model (amortizing costs Fig 16: IT SPENDING BREAKDOWNacross multiple customers) leads to powerful economies of scale. To estimatethe magnitude, we built a cost scaling model which estimates the long termbehavior of costs.Fig. 15 shows the output for a workload that utilizes 10 percent of a traditionalserver. The model indicates that a 100,000-server datacenter has an 80% lowertotal cost of ownership (TCO) compared to a 1,000-server datacenter. Source: Microsoft New application development accounts for just over a tenth of spending14, even though it is seen as the way for IT to innovate. Therefore IT leaders generally Fig 15: ECONOMIES OF want to increase spending here. The economic benefits of cloud computing SCALE IN THE CLOUD described here will enable this by freeing up room in the budget to do so. We will touch more on this aspect in the next paragraph as well as in Section 3. 14 New application development costs include only the cost of designing and writing the application and excluding the cost of hosting .them on new infrastructure. Adding these costs results in the 80% / 20% split seen elsewher Source: Microsoft 25
  • 30. a bit of a horseless carriage in that the underlying platform and tools were 2.5 Harnessing Cloud Economics not designed specifically for the cloud. The full advantage of cloud computing Capturing the benefits described above is not a straightforward task with today‘s can only be properly unlocked through a significant investment in intelligent technology. Just as engineers had to fundamentally rethink design in the early resource management. The resource manager must understand both the status days of the car, so too will developers have to rethink design of applications. of the resources (networking, storage, and compute) as well as the activity of the Multi-tenancy and demand-side aggregation is often difficult for developers applications being run. Therefore, when writing new apps, Platform as a Service, or even sophisticated IT departments to implement on their own. If not done most effectively captures the economic benefits. PaaS offers shared services, correctly, it could end up either significantly raising the costs of developing advanced management, and automation features that allow developers to focus applications (thus at least partially nullifying the increased budget room for new directly on application logic rather than on engineering their application to scale. app development); or capturing only a small subset of the savings previously described. The best approach in harnessing the cloud economics is different for packaged apps vs. new/custom apps. Packaged applications: While virtualizing packaged applications and moving them to cloud virtual machines (e.g., virtualized Exchange) can generate some Fig.17 CAPTURING savings, this solution is far from ideal and fails to capture the full benefits CLOUD BENEFITS outlined in this Section. The cause is twofold. First, applications designed to Source: Microsoft be run on a single server will not easily scale up and down without significant additional programming to add load-balancing, automatic failover, redundancy, To illustrate the impact, a startup named Animoto used Infrastructure-as-a- and active resource management. This limits the extent to which they are able to Service (IaaS) to enable scaling - adding over 3,500 servers to their capacity in aggregate demand and increase server utilization. Second, traditional packaged just 3 days as they served over three-quarters of a million new users. Examining applications are not written for multi-tenancy, and simply hosting them in their application later, however, the Animoto team discovered that a large the cloud does not change this. For packaged apps, the best way to harness percentage of the resources they were paying for were often sitting the benefits of cloud is to use SaaS offerings like Office365, which have been idle - often over 50%, even in a supposedly elastic cloud. They re-architected architected for scale-out and multi-tenancy to capture the full benefits. their application and eventually lowered operating costs by 20%. While Animoto is a cloud success story, it was only after an investment in intelligent resource New/custom applications: Infrastructure-as-a-Service (IaaS) can help capture management that they were able to harness the full benefits of cloud. PaaS some of the economic benefits for existing applications. Doing so is, however, would have delivered many of these benefits out-of-the-box without any additional tweaking required.26
  • 31. impliCatioNsIn this section, we will discuss the implications of the previously described 1. Elasticity is a game-changer because, as described before, renting 1 machine for 1,000 hours will be nearly equivalent to renting 1,000 machines for 1 hour in the cloud. This will enable users and agencies to rapidly accomplisheconomics of cloud. We will discuss the ability of private clouds to address complex tasks that were previously prohibited by cost or time constraints.some of the barriers to cloud adoption and assess the cost gap between Being able to both scale up and scale down resource intensity nearly instantlypublic and private clouds. enables a new class of experimentation and entrepreneurship. 2. Elimination of capital expenditure will significantly lower the risk premium3.1 Possibilities & Obstacles of projects, allowing for more experimentation. This both lowers the costs ofThe economics we described in section 2 will have a profound impact on IT. starting an operation and lowers the cost of failure or exit – if an application noMany IT leaders today are faced with the problem that 80% of the budget is longer needs certain resources, they can be decommissioned with no furtherspent on keeping the lights on, maintaining existing services and infrastructure. expense or write-off.This leaves few resources available for innovation or addressing the never- 3. Self-service Provisioning servers through a simple web portal rather thanending queue of new business and user requests. Cloud computing will free up through a complex IT procurement and approval chain can lower friction insignificant resources that can be redirected to innovation. Demand for general the consumption model, enabling rapid provisioning and integration of newpurpose technologies like IT has historically proven to be very price elastic services. Such a system also allows projects to be completed in less time with(Fig. 18). Thus, many IT projects that previously were cost prohibitive will now less risk and lower administrative overhead than previously.become viable thanks to cloud economics. However, lower TCO is only one of 4. Reduction of complexity. Complexity has been a long standing inhibitor ofthe key drivers that will lead to a renewed level of innovation within IT: IT innovation. From an end-user perspective SaaS is setting a new bar for user friendly software. From a developer perspective Platform as a Service (PaaS) greatly simplifies the process of writing new applications, in the same way as cars greatly reduced the complexity of transportation. These factors will significantly increase the value add delivered by IT. Elasticity enables applications like yield management, complex event processing, Fig 18: logistics optimization, and Monte Carlo simulation, as these workloads exhibit PRICE ELASTICITY nearly infinite demand for IT resources. The result will be massively improved OF STORAGE experience, including scenarios like real-time business intelligence analytics Source: Coughlin Associates and HPC for the masses. 27
  • 32. However, many surveys show that significant concerns currently exist around • Compliance and Data Sovereignty – Enterprises are subject to audits and cloud computing. As Figure 19 shows, security, privacy, maturity, and compliance oversight, both internal and external (e.g. IRS, SEC). Companies in many are the top concerns. Many CIOs also worry about legacy compatibility: it is often countries have data sovereignty requirements that severely restrict where not straightforward to move existing applications to the cloud. they can host data services. CIOs ask: which clouds can comply with these systems and what needs to be done to make them compliant? Fig 19: PUBLIC CLOUD CONCERNS While many of these concerns can be addressed by cloud today, concerns remain and are prompting IT leaders to explore private clouds as a way of achieving the benefits of cloud while solving these problems. Next, we will explore this in more detail and also assess the potential tradeoffs. 3.3 Private Clouds Microsoft distinguishes between public and private clouds based on whether the IT resources are shared between many distinct organizations (public cloud) or dedicated to a single organization (private cloud). This taxonomy is illus- Source: Gartner CIO survey trated in Fig. 20. Compared to traditional virtualized datacenters, both private and public clouds benefit from automated management (to save on repetitive labor) and homogenous hardware (for lower cost and increased flexibility). Due to the broadly-shared nature of public clouds, a key difference between private • Security and Privacy CIOs must be able to report to their CEO and other and public clouds is the scale and scope at which they can pool demand. executives how the company‘s data is being kept private and secure. Financially and strategically important data and processes often are pro- tected by complex security requirements. Legacy systems have typically Fig 20: been highly customized to achieve these goals, and moving to a cloud COMPARING architecture can be challenging. Furthermore, experience with the built- VIRTUALIZATION, in, standardized security capabilities of cloud is still limited and many PRIVATE CLOUD, AND CIOs still feel more confident with legacy systems in this regard. PUBLIC CLOUD • Maturity and Performance Cloud requires CIOs to trust others to provide Source: Microsoft. Shaded reliable and highly available services. Unlike on-premises outages, cloud checks indicate an optional characteristic outages are often highly visible and may increase concerns28
  • 33. • Private clouds move beyond virtualization. Resources are now pooled A variety of performance levels will be available in both public and private form, across the company rather than by organizational unit,15 and workloads so there is little reason to expect that one will have an advantage over another.16 are moved seamlessly between physical servers to ensure optimal While private clouds can alleviate some of the concerns, in the next paragraph efficiency and availability. This further reduces the impact of random, we will discuss whether they will offer the same kind of savings described time-of-day, and workload variability. In addition, new, cloud-optimized earlier. application models (Platform as a Service such as Azure) enable more efficient app development and lower ongoing operations costs. 3.4 Cost Trade-Off• Public clouds have all the same architectural elements as private clouds, While it should be clear from the prior discussion that conceptually the public but bring massively higher scale to bear on all sources of variability. cloud has the greatest ability to capture diversification benefits, we need to Public clouds are also the only way to diversify away industry-specific get a better sense of the magnitude. Fig. 21 shows that while the public cloud variability, the full geographic element of time-of-day variability, and addresses all sources of variability the private cloud can address only a subset. bring multi-tenancy benefits into effect. For example, industry variability cannot be addressed by a private cloud, while growth variability can be addressed only to a limited degree if an organizationPrivate clouds can address some of the previously mentioned adoption concerns. pools all its internal resources in a private cloud. We modeled all of theseBy having dedicated hardware, they are easier to bring within the corporate factors, and the output is shown in Fig. 22.firewall, which may ease concerns around security and privacy. Bringing a private Fig 21: DIVERSIFICATION BENEFITScloud on-premise can make it easier to address some of the regulatory, complianceand sovereignty concerns that can arise with services that cross jurisdictionalboundaries. In cases where these concerns weigh heavily in an IT leader‘s decision,an investment in a private cloud may be the best option.Private clouds do not really differ from public cloud regarding other concerns,such as maturity and performance. Public and private cloud technologies are Source: Microsoft.developing in tandem and will mature together.15 Aggregation across organizational units is enabled by two key technologies: live migration, which 16 Private clouds do allow for a greater degree of customization than public clouds, which could moves virtual machineswhile remaining operational, thereby enabling more dynamic optimization; enhance performance for a certain computational task. Customization requires R&D effort and and self-service provisioning and billing. expense, however, so it is difficult to make a direct price/performance comparison . 29
  • 34. . Fig 22: COST BENEFIT OF PUBLIC CLOUD In addition to the increase in TCO, private clouds also require upfront investment to deploy - an investment that must accommodate peak demand requirements. This involves separate budgeting and commitment, increasing risk. Public clouds, on the other hand, can generally be provisioned entirely on a pay-as-you-go basis. Source: Gartner CIO survey 3.5 Finding Balance Today: Weighing the Benefits of Private Cloud against the Costs We‘ve mapped a view of how public and private clouds measure up in Figure 23. The vertical axis measures the public cloud cost advantage. From the prior analysis we know public cloud has inherent economic advantages The lower curve shows the cost for a public cloud (same as the curve shown that will partially depend on customer size, so the bubbles‘ vertical position is in Fig. 15). The upper curve shows how the cost of a private cloud. The public dependent on the size of the server installed base. The horizontal axis cloud curve is lower at every scale due to the greater impact of demand represents the organization‘s preference for private cloud. The size of the aggregation and the multi-tenancy effect. Global scale public clouds are likely circles reflects the total server installed base of companies of each type. The to become extremely large, at least 100,000 servers in size, or possibly much bottom-right quadrant thus represents the most attractive areas for private larger, whereas the size of an organization‘s private cloud will depend on its clouds (relatively low cost premium, high preference). demand and budget for IT. Fig. 22 also shows that for organizations with a very small installed base of servers (<100), private clouds are prohibitively expensive compared to public cloud. The only way for these small organizations or departments to share in the benefits of at scale cloud computing is by moving to a public cloud. For large agencies with an installed base of approximately 1,000 servers, private clouds are feasible but come with a significant cost premium of Fig 23: COST AND BENEFITS about 10 times the cost of a public cloud for the same unit of service, due OF PRIVATE CLOUDS to the combined effect of scale, demand diversification and multi-tenancy. Source: Micrisoft30
  • 35. We acknowledge that Figure 23 provides a simplified view. IT for is not 3.6 The Long View: Cloud Transition Over Timemonolithic within any of these industry segments. Each organization‘s IT opera- As we pointed out in the introduction of this paper, it is dangerous to maketion is segmented into workload types, such as email or ERP. Each of these has decisions during the early stages of a disruption without a clear vision of thea different level of sensitivity and scale, and CIO surveys reveal that preference end state. IT leaders need to design their architecture with a long term vision infor public cloud solutions currently varies greatly across workloads (Figure 24). mind. We therefore need to consider how the long term forces will impact the position of the bubbles on Fig. 23. We expect two important shifts to take place. First, the economic benefit of public cloud will grow over time. As more and more work is done on public clouds, the economies of scale we described in Section 2 will kick in, and the cost premium on private clouds will increase over time. Customers will increasingly be able to tap into the supply-side, demand-side and multi-tenancy savings as discussed previously. As shown in Fig. 27 this leads to an upward shift along the Fig 24: CLOUD READY vertical axis. WORKLOADS (2010) Fig 27: EXPECTED PREFERENCE SHIFT FOR PUBLIC AND PRIVATE CLOUD Source: Microsoft Survey Question In the next 12-24 months, please indicate if a cloud offering would augment on-prmise offering or completely replace itAn additional factor is that many app portfolios have been developed over thepast 15-30 years and are tightly woven together. This particularly holds true forERP and related custom applications at larger companies who have more sizableapplication portfolios. Apps that are more isolated‘ such as CRM, collaboration,or new custom apps may be more easily deployed in the cloud. Some of thoseapps may need to be integrated back to current on-premises apps.Before we draw final conclusions, we need to make sure we avoid the horselesscarriage syndrome and consider the likely shift along the two axes (economicsand private preference). Source: Microsoft. 31
  • 36. At the same time, some of the barriers to cloud adoption will begin to fall. e-signatures became more acceptable. Today, most contracts (including those for Many technology case studies show that, over time, concerns over issues like opening bank accounts and taking out loans) can be signed with an e-signature. compatibility, security, reliability, and privacy will be addressed. This will likely also The large group of customers who are rapidly increasing reliance on public happen for the cloud, which would represent a shift to the left on Fig. 27. Below clouds—small and medium businesses (SMBs) and consumers of Software as a we will explore some of the factors that cause this latter shift. Service (SaaS)—will be a formidable force of change in this area. This growing constituency will continue to ask governments to accommodate the shift to cloud Cloud security will evolve by modernizing legislation. This regulatory evolution will make public cloud a Public clouds are in a relatively early stage of development, so naturally critical ar- more viable alternative for large enterprises and thus move segments along the eas like reliability and security will continue to improve. Data already suggests that horizontal axis toward public cloud preference. public cloud email is more reliable than most on-premises implementations. In PaaS, the automatic patching and updating of cloud systems greatly improves the Decentralized IT (also known as ‘rogue IT’) will continue to lead security of all data and applications, as the majority of exploited vulnerabilities take the charge advantage of systems that are out-of-date. Many security experts argue there are Many prior technology transitions were led not by CIOs but by departments, busi- no fundamental reasons why public clouds would be less secure; in fact, they are ness decision makers, developers, and end users – often in spite of the objections likely to become more secure than on premises due to the intense scrutiny provid- of CIOs. For example, both PCs and servers were initially adopted by end users ers must place on security and the deep level of expertise they are developing. and departments before they were officially embraced by corporate IT policies. More recently, we saw this with the adoption of mobile phones, where consumer Clouds will become more compliant adoption is driving IT to support these devices. We‘re seeing a similar pattern in Compliance requirements can come from within an organizational, industry, or the cloud: developers and departments have started using cloud services, often government (e.g., European Data Protection Directive) and may currently be without the knowledge of the IT group (hence the name rogue clouds). Many challenging to achieve with cloud withouta robust development platform designed business users will not wait for their IT group to provide them with a private cloud; for enterprise needs. As cloud technologies improve, and as compliance require- for these users, productivity and convenience often trump policy. ments adapt to accommodate cloud architectures, cloud will continue to become It is not just impatience that drives rogue clouds; ever-increasing budgetary more compliant, and therefore feasible for more organizations and workloads. constraints can lead users and even departments to adopt cheaper public cloud This was the case, for example, with, e-signatures, which were not accepted for solutions that would not be affordable from traditional channels. For example, many contracts and documents in the early days of the Internet. As authentication when Derek Gottfrid wanted to process all 4TB of the New York Times archives and encryption technology improved and as compliance requirements changed, and host them online, he went to the cloud without the knowledge of the Times‘32
  • 37. Fig 28: INCREASING ADOPTION OF SOFTWARE AS A SERVICE (SAAS)IT department17. Similarly, the unprecedented pricing transparency that the publiccloud offers, will put further pressure from the CEO and CFO on CIOs to move tothe public cloud.CIOs should acknowledge that these behaviors are commonplace early in adisruption and either rapidly develop and implement a private cloud with thesame capabilities or adopt policies which incorporate some of this behavior, whereappropriate, in IT standards. Source: Gartner.Perceptions are rapidly changingStrength in SaaS adoption in large enterprises serves as proof of changing Revisiting our horseless carriage analogy, we see that cars became a hugeperceptions (Fig. 28) and indicates that even large, demanding enterprises are success not simply because they were faster and better (and eventually moremoving to the left on the horizontal axis (i.e., reduced private preference). Just a affordable) than horse-drawn carriages. The entire transportation ecosystemfew years ago, very few large companies were willing to shift their email, with all had to change. Highway systems, driver training programs, accurate maps andthe confidential data that it contains, to a cloud model. Yet this is exactly what is signage, targeted safety regulation, and a worldwide network of fueling infra-happening today. structure all had to be developed to enable this transition. Each successive de- velopment improved the value proposition of the car. In the end, even people‘sAs positive use cases continue to spur more interest in cloud technology, this virtu- living habits changed around the automobile, resulting in the explosion of theous cycle will accelerate, driving greater interest in and acceptance of cloud. suburbs in the middle part of the 20th century. This created net new demand for cars by giving rise to the commuting professional class. This behavioralIn summary, while there are real hurdles to cloud adoption today, these will likely change represented a massive positive feedback loop that inexorably made thediminish over time. While new, unforeseen hurdles to public cloud adoption may automobile an essential, irreplaceable component of modern life.appear, the public cloud economic advantage will grow stronger with time ascloud providers unlock the benefits of economics we discussed in Section 2. While Similarly, we believe cloud will be enabled and driven not just by economicsthe desire for a private cloud is mostly driven by security and compliance concerns and qualitative developments in technology and perception, but by a series ofaround existing workloads, the cost effectiveness and agility of the public cloud will shifts from IT professionals, regulators, telecom operators, ISVs, systems inte-enable new workloads. grators, and cloud platform providers. As cloud is embraced more thoroughly, http://open.blogs.nytimes.com/2007/11/01/self-service-prorated-super-computing-fun/17 its value will increase. 33
  • 38. This future won‘t materialize overnight. IT leaders need to develop a new 5- to the JourNeY 10-year vision of the future, recognizing that they and their organizations will play a fundamentally new role in their company. They need to plot a path that to the Cloud connects where they are today to that future. An important first step in this is to segment their portfolio of existing applications (Fig. 29). For some apps the economic and agility benefits may be very strong so they should be migrated Because we are in the early days of the cloud paradigm shift, there is much quickly. However, barriers do exist today, and while we outlined in section 3 confusion about the direction of this ongoing transformation. In this paper, that many of them will be overcome over time, cloud may not be ready for we looked beyond the current technology and focused on the underlying some apps today. For tightly integrated apps with fairly stable usage patterns, it economics of cloud to define the destination - where all of this disruption and may not make senseto move them at all, similar to how some mainframe apps innovation is leading our industry. Based on our analysis, we see a long-term were never migrated to client/server. While new custom apps don‘t have the shift to the cloud driven by three important economies of scale: (1) Larger legacy problem, designing them in a scalable, robust fashion is not always an datacenters can deploy computational resources at significantly lower cost than easy task. Cloud optimized platforms (Platform as a Service) can dramatically smaller ones; (2) Demand pooling improves the utilization of these resources, simplify this task. especially in public clouds; and (3) Multi-tenancy lowers application main- This transition is a delicate tenance labor costs for large public clouds. Finally, the cloud offers unparal- balancing act. If the IT or- Fig 29: SEGMENTING IT PORTFOLIO leled levels of elasticity and agility that will enable exciting new solutions and ganization moves too quickly applications. in areas where the cloud is For businesses of all sizes, the cloud represents tremendous opportunity. It not ready, it can compromise represents an opportunity to break out of the longstanding tradition of IT business continuity, security, professionals spending 80 percent of their time and budget keeping the lights and compliance. If it moves on, with few resources left to focus on innovation. Cloud services will enable too slowly, it can put the IT groups to focus more on innovation while leaving non-differentiating company at a significant activities to reliable and cost-effective providers. Cloud services will enable competitive disadvantage IT leaders to offer new solutions that were previously seen as either cost pro- versus competitors who do hibitive or too difficult to implement. This is especially true of cloud platforms take full advantage of cloud (Platform as a Service), which significantly reduce the time and complexity of capabilities, giving up a cost, building new apps that take advantage of all the benefits of the cloud. Source: Microsoft agility, or value advantage.34
  • 39. Moving too slowly also increases the risk that different groups or individuals customer by ignoring the complexities of this transformation.within the company will each adopt their own cloud solution in a fragmented anduncontrolled fashion (rogue IT), wresting control over IT from the CIO. IT leaders At Microsoft, we are all in on the cloud. We provide both commercial SaaS (Officewho stay ahead of the cloud trend will be able to control and shape this transi- 365) and a cloud computing platform (Windows Azure Platform). Office 365tion; those who lag behind will increasingly lose control. features the applications customers are familiar with like Exchange email and SharePoint collaboration, delivered through Microsoft‘s cloud. Windows AzureTo lead the transition, IT leaders need to think about the long term architecture is our cloud computing platform, which enables customers to build their ownof their IT. Some see a new role emerging, that of a Cloud Services Architect, who applications and IT operations in a secure, scalable way in the cloud. Writingdetermines which applications and services move to the cloud and exactly when scalable and robust cloud applications is no easy feat, so we built Windows Azuresuch a move takes place based on a business case and a detailed understand- to harness Microsoft‘s expertise in building our cloud-optimized applicationsing of the cloud capabilities available. This should start by taking inventory of like Office 365, Bing, and Windows Live Hotmail. Rather than just moving virtualthe organization‘s resources and policies. This includes an application and data machines to the cloud, we build a Platform as a Service that reduces complexityclassification exercise to determine which policy or performance requirements for developers and IT administrators.(such as confidential or top secret data retention requirements) apply to whichapplications and data. Based on this, IT leaders can determine what parts of their Microsoft also brings to the cloud the richest partner community in the world. WeIT operation are suitable for public cloud and what might justify an investment have over 600,000 partners in more than 200 countries servicing millions of busi-in private cloud. Beginning in this manner takes advantage of the opportunity of nesses. We are already collaborating with thousands of our partners on the cloudcloud while striking balance between economics and security, performance, transition. Together we are building the most secure, reliable, scalable, available,and risk. cloud in the world.To accomplish this, IT leaders need a partner who is firmly committed to the Over the last three decades, Microsoft has developed strong relationships withlong-term vision of the cloud and its opportunities, one who is not hanging on to IT organizations, their partners, and their advisors. This offers us an unparalleledlegacy IT architectures. At the same time, this partner needs to be firmly rooted understanding of the challenges faced by today‘s IT organizations. Microsoft isin the realities of today‘s IT so it understands current challenges and how to both committed to the cloud vision and has the experience to help IT leaders onbest navigate the journey to the cloud. IT leaders need a partner who is neither the journey.incentivized to push for change faster than is responsible nor to keep IT the same.Customers need a partner who has done the hard work of figuring out howbest to marry legacy IT with the cloud, rather than placing that burden on the 35
  • 40. CoCa-Cola Coca-Cola Enterprises (CCE) employs approximately 72,000 eNterprises selects Microsoft SharePoint Online people in 431 facilities around the globe. Much of its workforce is mobile with 55,000 vehicles to advance productivity and 2.4 million coolers, vending machines, and beverage dispensers. With increasing OvERvIEW competition in the marketplace, Country or Region: Worldwide CCE needed a more effective way Industry: Consumer goods Retail Microsoft gave to collaborate with its employees, us an incredible to increase its productivity, to Customer Profile Solution platform that allows enable better flow of information Coca-Cola Enterprises (CCE) is the CCE implemented a Microsoft-based us to do a number and to create more time for world’s largest marketer, producer, and hosted worldwide intranet with of things, beyond sales persons to engage with distributor of nonalcoholic beverages, messaging and collaboration tools, hosting our portal. customers. Its worldwide which it delivers with the industry’s which are accessible to all employees It provides workflow presence required employees and most effective marketplace execution. from any device, enabling employees management and executives to spend numerous to boost productivity and time with team collaboration hours on the road every week, Business Situation customers. across geographies travelling to internal meetings. CCE’s increasing competition was and time zones. With Microsoft® Online Services resulting in declining revenues. Benefits JoHn key, technologies, CCE can save This required company executives • Productivity andcustomer focus Assistant Director travel expenses through online to launch a new strategic • Companywide intranet Communication meeting tools and collaboration direction, mandating a platform to • IT transformation and Collaboration platforms that span time zones communicate and engage with all • Effective remote teams Technologies, CCE and geographies. employees. • Deskless worker access36
  • 41. SituAtion Coca-Cola Enterprises faces CEO John Brock and CIO EsatCoca-Cola Enterprises strong competition from Sezer agreed that in order to(NYSE: “CCE”) is the world’s other beverage companies evolve the company culturelargest marketer, producer, and needed a way to work and improve customerand distributor of Coca- more effectively with its relationships at CCE, theCola products. Coca-Cola customers and partners. This leadership team needed theEnterprises’ growing required innovation and a ability to communicate withproduct portfolio includes new way of communicating all CCE employees, especiallythe world’s greatest brands within the corporation. In those managing day-to-dayand beverages which it 2008, CCE acknowledged that operations in the field. Mostdelivers with the industry’s its current communications of the diverse CCE personnelmost effective marketplace platforms were no longer work in a distributed manner.execution. Today, it serves enabling the innovation and Employees in manufacturing419 million consumers, collaboration required to facilities had limited access Our CEO challengedthroughout North America, take it to the next level to to the corporate network. us to find better waysthe U.S. Virgin Islands, other compete in an increasingly Its mobile, customer-facing to connect all of ourCaribbean islands, Belgium, demanding economic employees, who are on the employees…. SharePointFrance, Great Britain, environment. front line, making sales and Online addressed thoseLuxembourg, Monaco, and positioning the CCE products challenges and helpedthe Netherlands. It employs CCE required a centralized in store environments, us launch from a legacyapproximately 72,000 people platform on which to also lacked convenient infrastructure to aand operates 431 facilities, promote the company’s access to company solution which provided55,000 vehicles, and 2.4 initiatives. Its messaging content. Additionally, CCE better business value tomillion coolers, vending was based largely around needed to drive action and all of our people.machines, and beverage e-mail, which was unable information to all employees keVin flowerS,dispensers. to reach its largely mobile in its business by role. Director of Enabling workforce. Chairman and CCE’s infrastructure did Technologies, CCE 37
  • 42. not allow for this, making journey. IT considered using Communications Online, it difficult for employees to partners to address its and Microsoft Office Live locate appropriate content messaging needs and wanted Meeting, CCE consolidated in a timely manner. Kevin to expand this to include and streamlined its IT Flowers, Director of Enabling development of its corporate partnerships and enhanced Technologies, says, “John intranet. Both solutions its focus on providing Brock, our CEO, challenged needed to support mobile value to the business. CCE us to find better ways to devices to reach employees in deployed its corporate connect all of our employees. manufacturing facilities and intranet on SharePoint Online He asked us to create a the field. as its primary collaboration unified way to reach all of platform, which included the field resources for more Solution content management, We had a massive than 400 locations in the With many older systems, enterprise search, workflow, change agenda that U.S. alone. SharePoint Online CCE had several partners line of business integration, we were trying to addressed those challenges providing dozens of and rights management communicate to the and helped us launch from communication and capabilities. organization….We had a legacy infrastructure to collaboration solutions. a lot of objectives, but a solution which provided CCE saw an opportunity to In its assessment of whether the two primary ones better business value to all of optimize its infrastructure by to upgrade its current were a better way to our people.” broadening its relationship platform or transform communicate with our with Microsoft. With the company to a hosted employees while at Taking on a new project like the implementation of model, CCE considered the same time driving building a corporate intranet Microsoft Online Services, options presented by several effectiveness and was exciting yet daunting as which includes Microsoft major software and service efficiency. IT resources were engaged SharePoint® Online, providers. CCE desired a lAuren SAyeSki, on many other initiatives as Microsoft Exchange partnership where it could Communications, CCE part of their transformation Online, Microsoft Office utilize its enterprise software38
  • 43. on premises with integrated SeCurity CCE’s, gave us a great sensesoftware services in the cloud, Initially, Tim Smith, the of comfort that Microsoftand turned to Microsoft to Chief Information Security has thought of all the rightexecute upon its objectives. Officer at CCE needed to be things.”Planning for the project convinced that Microsoftbegan in mid January 2008 would provide security A fundamental shift occurredand was completed by mid measures that matched or in how CCE viewed MicrosoftMay. Microsoft Exchange exceeded CCE’s stringent services and capabilitiesOnline and Microsoft requirements. Visiting the running in Microsoft dataSharePoint Online received Tukwila data center, Smith centers, not as an outsourcing“service acceptance” by July was impressed by the arrangement, but as aand user migration for both virtual and physical security security-enhanced extension To have one sourcebegan in September. By provided by Microsoft, of CCE’s own enterprise of the truth is verythe end of 2008, 23,000 as well as the third-party network. important as teamsusers had been migrated SAS 70 audit reports that start to form across theto Exchange Online, 30,000 Microsoft uses to monitor the right information at globe. You want to beusers were on SharePoint security compliance. Tim the right time sure you always haveOnline, and 10,000 users Smith, CCE Chief Information CCE decided to use Microsoft the latest version ofhad migrated from IBM Security Officer, says, “Step integrated communication the document you’reSametime to Microsoft Office one in getting comfortable and collaboration tools to working on. SharePointCommunications Server with giving our data to streamline communication Online makes thatfor instant messaging. It Microsoft was visiting one across its entire organization. possible.added Microsoft Office Live of their data centers. To A critical component of the JoHn key,Meeting for Web and video understand the physical corporate intranet portal at Assistant Directorconferencing in April 2008. nature of what they’re doing CCE was the integration of Communications to safeguard not only their SAP user role information and Collaboration own information, but also into its on-premises Active Technologies, CCE 39
  • 44. Directory® service and ease and effectiveness of of which enable seamless its Microsoft SharePoint Collaboration collaboration across Online environment. This Seeing the business need geographies and time zones. will allow CCE to target and the ability to increase John Key, Assistant Director the right information to its communication and of Communication and the right employee based collaboration capabilities, Collaboration Technologies, on roles outlined in SAP. CCE was able to move says, “To have one source of By integrating SAP data very quickly to execute the truth is very important as into SharePoint sites, CCE the migration. Lauren teams start to form across the employees can access Sayeski, Public Affairs and globe. You want to be sure data through recognizable Communications Manager, you always have the latest Microsoft Office programs, says, “We had a massive version of the document giving employees the ability change agenda that we were you’re working on. SharePoint to make information for There was huge trying to communicate to Online makes that possible.” business operations easy excitement and the organization. We had to find, share, and update. energy around the Previously, CCE did not a lot of objectives with this knowledge Sharing and CCE partnership with have a common solution project, but the two primary Social networking Microsoft. This has that enabled document ones were a better way CCE’s executive been one of the best management. Documents to communicate with our communication prior to its IT partner projects CCE that needed to be shared employees while at the same new corporate intranet was has experienced and we with colleagues were housed time driving effectiveness historically top-down. With have the added value in shared folders on network and efficiency.” Content its Microsoft SharePoint of a longer IT roadmap drives, sent via e-mail, or management features on Online intranet solution, it with Microsoft.... stored in team rooms, all SharePoint Online include now has open dialogue with keVin flowerS, of which were limited in version management, employees communicating Director of Enabling access, version control, and workflow management, to leadership and with each Technologies, CCE searchability. and rights management, all other. Sayeski says,40
  • 45. “We focused on ways for them with the information that we can get itemployees to comment they need, where and when very quickly.”back to the organization as they need it most. Microsoftwell as communicate with SharePoint Online has been worldwide Collaborationeach other. Now we have embraced by employees CCE now has a robustthe ability to post comments across the company. Within intranet portal to supporton the intranet and create four weeks of enabling users worldwide collaboration andteam sites. We’re finding that to create team sites, there communication of corporateemployees are talking to each were over 800 requests for strategy. Sapient Consultingother and using each other’s sites focused on business and Slalom Consultingresources, sharing knowledge. priorities and customer- designed the custom intranetWe launched our first CEO facing business teams. Tom and collaboration solution onblog last year and in the first Barlow, Vice President of top of Microsoft SharePointfive minutes had more than Business Transformation, Online. Sapient created the40 responses back. That’s just N.A., says, “From a business compelling visual designthe beginning; we know that transformation perspective, with a user-based enterprisethe intranet can be so much we have a lot of projects portal workflow. Slalommore powerful as a place underway which focus on designed and developedof action.” revenue generation and cost custom SharePoint features savings. Through the use of in accordance with MicrosoftBenefitS SharePoint Online, we’re able development standards andProductivity and to educate our team so that best practices, as well asCustomer focus they can find information and provided guidance to CCEThe Microsoft solution establish interdependencies regarding the deploymentenabled CCE to bring new across the different projects. and configuration optionstechnologies to everyone SharePoint allows us to code available in SharePointin the company, providing and manage information so 41
  • 46. Online. Sayeski says, “When things like CCE’s HR process Through the intranet, CCE you have a workforce like improvement and self-service employees are eager to be ours, 72,000 strong and HR portal and provides a part of the company direction geographically dispersed, that communication platform for and dialogue. Brett Kirkland, may or may not have access CCE’s desk-based workers. Collaboration Architect, to technology, it can be a CCE has also increased says, “The SharePoint Online challenge to ensure that the employee engagement search engine is ten times message of the organization and education around better. It allows us to make is getting through with the corporate responsibility items more discoverable, to clarity and the speed that and sustainability through check them in and out, and you want it to. We focused the portal content, thereby surface particular items that SOfTWARE & SERvICES heavily on the use of video, addressing the cultural we consider pieces of content Microsoft Exchange Online particularly with our CEO, change initiative. Sayeski that should rise to the top. Microsoft SharePoint Online to ensure that some of our says, “There have been The SharePoint solution Microsoft OfficeCommunications most critical messages were some particular areas where also gives IT more control Online being captured in a way that we’ve seen that concept of and governance over what Microsoft Office Live Meeting the audience immediately two-way dialogue playing content is published and how understood. So combining out very well. One is in our it is ranked and profiled in SERvICES the power of video with the corporate responsibility search.” Microsoft Services intranet gave us the ability to and sustainability efforts touch many more people.” where employees are Key says, “Microsoft gave us PARTNERS sharing—actively sharing an incredible platform that Slalom Consulting Powerful Search with their own ideas and their allows us to do a number of Sapient enterprise Content own solutions within their things, beyond hosting our Binary Tree Management own facilities about ways portal. It provides workflow cococola The corporate intranet also they’re generating energy management and team serves as a central location for effectiveness.” collaboration across42
  • 47. geographies and time zones.” desktop voice and video for multi-user applications andthe road Ahead adding more than 10,000In phase II, CCE will be BlackBerry users.expanding the Microsoftfootprint to reach an Kevin Flowers concludes,additional 42,000 deskless “There was huge excitementworkers who work in the and energy around the CCEfield or in sales/distribution partnership with Microsoft.facilities. These employees This has been one of the bestdo not have computers but IT partner projects CCE haswill be enabled in phase II to experienced, and we havehave access to the intranet the added value of a longervia Microsoft SharePoint IT roadmap with MicrosoftOnline through computer than if CCE had built the www.slalomconsulting.comworkstations at their facilities. solution on premises. ThisAdditionally, Microsoft is project has exceeded ourco-developing a sales force expectations from an ITautomation system that will standpoint, showing howfurther take advantage of well an organization can lay a www.sapient.comSharePoint Online and enable foundation and transform thelocal merchandisers to be way people communicate in amore efficient in getting the large company.”things they need into theoutlets and stores. CCE will www.binarytree.comalso be using Microsoft OfficeCommunications Server 43
  • 48. glaxosmithKliNe leads the Way With Microsoft GlaxoSmithKline (NYE: GSK) is a pharmaceutical industry leader: supplying a quarter of Online Services the world’s vaccines, spending over $13 million each day to research new medicines, and providing many of the world’s OvERvIEW leading prescription medicines and Country or Region: Global We have chosen consumer healthcare products. It Industry: Pharmaceuticals Microsoft Online is estimated that GlaxoSmithKline Services because makes up seven percent of the Customer Profile Solution it promises to world’s pharmaceutical market, Second largest pharmaceutical GlaxoSmithKline chose to deploy deliver a simple and it is one of the few companies company in the world, GlaxoSmithKline Microsoft Business Productivity intuitive Information committed to researching vaccines supplies a quarter of the worlds Online Suite – including Microsoft® Workplace that for the World Health Organization’s vaccines and produces some of the Exchange Online, Microsoft® Office should not only three priority diseases – HIV/ leading prescription medicines and SharePoint Online, Microsoft® Office bring value to the AIDS, tuberculosis, and malaria. consumer healthcare products. Communications Online, Microsoft® company through Yet, an internal strategic review Office Live Meeting and the simplification, but of their IT systems outlined a Business Situation Microsoft® Deskless Worker Suite. provide an improved need to take a new approach to GlaxoSmithKline needed to improve user experience and collaboration, support growing collaboration with partners, to Benefits ultimately create a markets, and address costs. improve effectiveness in growing • Reduce Operational Costs more productive Illustrating its industry leadership, markets, to move away from • Drive Innovation GSK. GlaxoSmithKline found its solution customized solutions, and to lower the • Improve Collaboration Bill louV, in pioneering Microsoft Online cost of operations and investments. • Simplify User Experience Chief Information Officer, Services solutions. GlaxoSmithKline44
  • 49. SituAtion After an internal SolutionIn 2001, after the merger strategic review in 2007, GlaxoSmithKline evaluatedof GlaxoWellcome and GlaxoSmithKline recognized a number of data pointsSmithKline Beecham, several points of needed before making a decision.GlaxoSmithKline had to improvement: the ability to “The team reviewed, inintegrate two complex collaborate with external detail, what services wereIT systems. In order to partners, effectiveness at being offered at what servicesuccessfully make this supporting growing markets levels around the globe, howmerger, they chose the Notes outside of the UK and USA, our existing technologiesplatform SmithKline had a requirement to move away were used as applicationstrongly invested in over the from customized solutions, platforms,” says Ingo Elfering,Exchange platform Glaxo and a decrease in the VP of Information Technologyutilized. This provided a single operating and investment Strategy, GlaxoSmithKline,communications channel costs. The review also noticed “and how the various toolsand B2E platform across the that the current Notes worked together to createglobal company. By using platforms were reaching their an integrated collaborationseveral in-house developed refresh cycles, necessitating environment now and insolutions, GlaxoSmithKline action and renewed the future.” GlaxoSmithKlinesupported collaboration investment for the next conducted several user We wanted to buildand Lotus Notes Sametime three years. To research their studies, but the focus the business case firstfor instant messaging. In options, GlaxoSmithKline wasn’t just on the present. so that it would reallyconjunction with the Lotus constructed a cross-functional The future of changing be a slam dunk in theNotes and Domino system, team of representatives pharmaceutical user profiles, approval processGlaxoSmithKline also used from the various global IT devices, and software was Bill louV,Google’s Postini mail filtering organizations, partners in also a strong factor. Chief Information Officer,service. the business units, and major GlaxoSmithKline growth markets. 45
  • 50. In the conservative industry Online Suite – including to its entire spectrum of of pharmaceuticals, Microsoft® Exchange Online, information workers. This GlaxoSmithKline was looking Microsoft® Office SharePoint suite offers those who don’t to put together the facts. Online, Microsoft® Office have a laptop the ability While GlaxoSmithKline was Communications Online, to go to a Web kiosk. It’s a looking for a productivity and Microsoft® Office Live lighter version and a more collaboration increase from Meeting and the Microsoft® manageable option for the the switch, the first priority Deskless Worker Suite to sales force at a lower cost was to build a strong business deploy to all of its employees to GlaxoSmithKline. The case. “We wanted to build the worldwide. Everything would Deskless Worker Suite will business case first so that it be hosted by Microsoft be deployed for 15,000 of would really be a slam dunk at Microsoft data centers GlaxoSmithKline’s employees, Moving to Online in the approval process,” says around the globe. and unlike Google Apps, Services will enable Bill Louv, Chief Information this enables both the full- us to reduce our IT Officer, GlaxoSmithKline. The Through Online Services, service Online Services and operational costs approval process considered Microsoft offers the ability Deskless Worker Suite to be by roughly 30% of the risk of patient safety to have fully functioning managed in a central location what we’re currently and confidential data, but a applications with a lean determined by the spending…. A variable strong business case led to presence. The software will company itself. cost subscription model the approval of innovative operate in the same capacity for these collaborative cloud services with Microsoft. in a hosted solution as it BenefitS technologies allows us would if it were implemented The global implementation of to more rapidly scale or GlaxoSmithKline chose to on-premise. By deploying the Microsoft Online Services at divest our investment as replace the Lotus Notes, Business Productivity Suite GlaxoSmithKline is intended necessary Domino, and Postini with the Deskless Worker to have numerous advantages AlAStAir roBertSon, services with the Microsoft Suite, GlaxoSmithKline is able for the company including: VP of Information Workplace Business Productivity to offer total functionality reducing operational costs,46
  • 51. driving innovation and Information Workplace. around communicationcollaboration, expanding The difference for and collaboration toexternal collaboration, GlaxoSmithKline means Microsoft. This ensures thatand simplification of user putting more money back we can focus on our coreexperience. This solution is into the business. competencies and also thatmuch more effective than we have an ‘evergreen’ ITthe Notes and Google Apps drive innovation strategy where the latestcombination in driving lower While GlaxoSmithKline is able technologies are always atcosts, more collaboration, and to reduce costs with Microsoft our disposal via the cloud,”greater accessibility. Online Services, productivity says Elfering. is not harmed, but enhanced.reduce operational Costs Through Microsoft Online The Microsoft Online ServicesThe use of Microsoft Online Services, GlaxoSmithKline model drives this innovation GlaxoSmithKline hasServices offers a dramatic can utilize the IT department as well as allows the increased approximately 100,000yearly reduction in costs. for key projects instead of flexibility in moving forward. employees, hundreds“Moving to Online Services tasking them with managing The subscription service can of business partners,will enable us to reduce our IT the infrastructure software be tailored to fit growing and locations aroundoperational costs by roughly or servers. and changing needs. So that the world, so effective30% of what we’re currently when GlaxoSmithKline adapts collaboration is critical tospending. The ability to The model allows for to changing market, its our business. We haveintroduce a variable cost increased innovation software adapts too. chosen Microsoft Onlinesubscription model for these where it counts. “The team Services…collaborative technologies needed the ability to focus expand external Bill louV,allows us to more rapidly internal IT on driving further Collaboration Chief Information Officer,scale or divest our investment innovation that differentiates GlaxoSmithKline is GlaxoSmithKlineas necessary,” confirms GSK in the market while aggressively driving a moreAlastair Robertson, VP of offloading innovation externally collaborative 47
  • 52. business through all Simplification of User because it promises to practices: research and experience deliver a simple intuitive development, manufacturing, Moving away from Information Workplace that and sales. With Microsoft the customized should not only bring value Online Services, this solutions environment, to the company through effort can be maximized GlaxoSmithKline was looking simplification, but provide without compromises in for a simple solution that an improved user experience the security and integrity would effectively extend and ultimately create a more of sensitive information. to the many branches, productive GSK.” The information is stored regions, and employee types in the cloud, allowing internally. The company for a more direct form of needed a solution that would access than if it were stored also translate externally to directly on an internally increase collaboration and SOfTWARE AND SERvICES maintained server. Also, as the resulting innovation. That Products Louv notes, the Microsoft is why GlaxoSmithKline chose Microsoft Data Centers Services brand is more common and the Microsoft solution. SERvICES therefore easily interfaced Microsoft Exchange Online than its competitors. This “GlaxoSmithKline has Microsoft SharePoint Online supports collaboration approximately 100,000 Microsoft Office Communications between partners and employees, hundreds of Online GlaxoSmithKline, allowing business partners, and Microsoft Office Live Meeting for a more innovative and locations around the world, Online competitive business. so effective collaboration Microsoft Deskless Worker Suite is critical to our business,” says Louv, “We have chosen Microsoft Online Services48
  • 53. Headquartered in Pune, India, KPIT Cummins is an emerging leader in providing consulting, solutions Kpit servers to 20, reduces costs shrinks 120 CummiNs and services in the fields of finance, accounts and manufacturing. It is one of the world’s first few companies and cuts energy usage with virtualization to achieve the BS25999:2007, ISO9001, ISO 27001:2005,OvERvIEW CMMI- level 5 certifications. WithCountry or Region: India accumulation of servers, it wasIndustry: IT Services becoming increasingly difficult for Virtualization has the company to manage costs andCustomer Profile Solution helped to reduce the handle issues like high expenditureKPIT Cummins is a global IT To optimize the growing data provisioning time for on technology hardware, softwareconsulting and product engineering centers operations, KPIT Cummins new applications by licensing, power consumption, andpartner company focused on the implemented a virtualization solution almost 6-8 weeks physical space. Hence, KPIT CumminsManufacturing (Automotive, Industrial centered on Windows Server® 2008 helping us to deploy decided to migrate operationsand Hi-Tech) and Diversified Financial Hyper-V™ technology to consolidate applications within to Windows Server® 2008 withServices industries. hardware, minimize rack space and 4 hours on the Hyper-V™ technology to take ownership and software cost. virtualized platform. advantage of server virtualizationBusiness Situation MAndAr MArulkAr, efficiencies. With its new optimizedKPIT Cummins wanted to cut Benefits Head, Technical Infrastructure infrastructure, the company can growcapex and opex expenses, reduce • Consolidates multiple servers Management Services, KPIT faster and dramatically reduce ITthe number of physical servers it • Reduces power consumption Cummins costs. The company has virtualizedoperated, and optimize system • Reduces opex and capex cost 120 of its physical servers to 20flexibility and maintenance to best • Improves service quality servers and thus has optimized spaceserve its business requirements. and power use. 49
  • 54. SituAtion India. Besides, it has onsite operations centre that takes Founded in 1990, KPIT presence in United States, care of network and perimeter Cummins specializes in United Kingdom, Germany, security and client services consulting in Governance France, Japan, Singapore, which takes care of desktop and Regulatory Compliance, South Africa and Poland. and peripheral devices high end transactional BPO/ support. KPO and Enterprise Support KPIT Cummins operates to global customers. The multiple data centers in KPIT Cummins realized that company is focused on co- its Pune and Bangalore more than 150 servers had We have trimmed innovating domain intensive centers. To help meet the reached the end of their life, our physical server technology solutions for needs of more than 5000 they had hardware which holdings – from 120 manufacturing corporations users across the globe, the was older the 3 years. At the to merely to servers. in automotive, industrials, hi- company manages more same time, there were more Currently the entire tech verticals and diversified than 200 servers, storage than 50 servers that had less setup is running on 20 financial services. It has area networks and business than 30 percent utilisation. infrastructure servers established state of art eco applications such as SAP Initially the managers planned virtualized on Microsoft friendly facility equipped R/3 ERP, Microsoft Exchange to replace some of them by Hyper-V Server 2008. with advanced technologies, Server 2007 with unified new hardware and renew the The expenses on server processes, and equipment - communication. In addition, annual maintenance contract boxes have dropped complying with international it manages configuration (AMC) of remaining servers, drastically by 40 percent standards. management servers, project but these options required of our data center management applications, considerable capital and budget. With 4500 employees intranet and portal operating expenses. “Our SAndeeP GAndHi, worldwide and more than applications, development goal was to deploy Green Sr. Manager, Data Center 95 active global clients, the and testing servers IT solutions, reduce and Operations, KPIT Cummins company has offshore centers supporting customer projects. opex expenses by at least in Pune and Bangalore in The company has a network 15 percent and improve50
  • 55. asset utilization by 20 maintenance to best serve its The IT team at KPIT Cumminspercent,” explains Mandar business requirements. evaluated several products,Marulkar, Head, Technical including the Hyper-V™Infrastructure Management Solution technology included withServices, KPIT Cummins. “The KPIT Cummins recognized the Windows Server® 2008growing number of servers, that it could use virtualization operating system, VMware,however, was resulting in technology to reduce the and others. Consideringmore energy consumption number of physical servers in the business requirement,and increased data centre its data center, and enhance licensing model, cost factorenergy consumption.” the availability of applications and technical support and services. Shrikant available, the companyWith growing server network, Kulkarni, CIO, KPIT Cummins ultimately decided to deploythe company was incurring concluded that rather than Hyper-V as it provides all thehuge costs for technology paying for many under- functionality needed andhardware, software licensing, utilized server machines or meets all the requirements.and power consumption. less efficient server machines, By reducing the numberIt recognized that its IT each dedicated to a specific Deployment took place in of physical servers withenvironment had become workload, server virtualization Pune and Bangalore centers. the help of Microsofttoo large and complex to would allow consolidating all The process commenced Hyper-V solution, webe managed effectively and the workloads onto a smaller in April 2009 and was 90 are able to reduce theefficiently in a traditional number of more fully used percent completed by Oct power consumptionmanner. The company also machines. Not only this, 2009. The implementation enormously and thuswanted to cut back on the he convinced the business dramatically prune its physical helped the companynumber of physical servers users the benefits of this server holdings, from 120 to going green.it operated, improve server technology. 20 systems. The company can SAndeeP GAndHi,performance, and optimize now efficiently deploy, scale, Sr. Manager, Data Centersystem flexibility and and manage a virtualized Operations, KPIT Cummins 51
  • 56. server infrastructure without Management Services, KPIT system by eliminating the extra cost of a third-party Cummins. some of the servers. By solution. using Hyper-V to virtualize BenefitS servers, the company is Initially the team faced By using Hyper-V able to significantly reduce some issues to understand technology to virtualize hardware costs and decrease the technology, manage its physical servers, KPIT the hardware footprint at virtualized setups and Cummins optimized its its data centers. Now the convince the business users server environment, cut IT department can support to move the application on hardware costs and power the business with less Server virtualization has virtualized platform. But consumption, enhanced hardware, which means lower brought in significant later on, after 3-4 application server reliability and equipment costs, reduced reduction in capital migrations, the team utilization, and reduced electrical consumption for expenditure. We have was quite comfortable in maintenance and support server power and cooling, consolidated physical migrating the applications costs. and less physical space. servers by more than without any down 40 percent, reduced times and dynamically Consolidates “We have trimmed our physical rack space by allocating appropriate Multiple Servers physical server holdings 60 percent resulting in resources. “Virtualization KPIT Cummins decided - from 120 to merely 20 savings of more than 40 has helped to reduce the to use Microsoft Hyper-V servers. Currently the percent in data center provisioning time for new solution for virtualization entire setup is running on budget. applications by almost 6-8 instead of paying for 20 infrastructure servers MAndAr MArulkAr , weeks helping us to deploy many under-utilized server virtualized on Microsoft Head, Technical Infrastructure applications within 4 hours machines. Consolidations Hyper-V Server 2008. The Management Services, on the virtualized platform,” helped in running multiple expenses on server boxes KPIT Cummins says Mandar Marulkar, Head, applications on the same have dropped drastically by Technical Infrastructure server in single operating 40 percent of our data center52
  • 57. budget,” elaborates Sandeep footprint in turn giving cost “Server virtualization has The time taken in trackingGandhi, Sr. Manager, Data savings as a part of reducing brought in significant the AMCs and other issuescenter operations, KPIT energy consumption. Along reduction in capital with servers is now broughtCummins. with reduced power expenditure. We have down considerably. Fewer requirements, lesser cooling consolidated physical servers people are required toreduces Power facilities need to be deployed by more than 40 percent, mange the lesser number ofConsumption for the servers. reduced physical rack space by servers.The significant reduction in 60 percent resulting in savingsservers contributes hugely reduces opex of more than 40 percent in During the consolidationto KPIT Cummins “green” and Capex Cost data center budget,” says process, the IT team gotinitiatives. “By reducing the The operating and capital Mandar Marulkar, Head, TIMS, a chance to review all thenumber of physical servers cost of deploying new servers, KPIT Cummins. existing applications and thiswith the help of Microsoft and maintaining and running helped in deactivating someHyper-V solution, we are more than 200 servers is improves Service Quality of the old development andable to reduce the power much higher than fully “Consolidation and testing servers, thus improvingconsumption enormously and utilizing 20 servers for all the virtualization reduced the time the service. Consolidation,thus helped the company in applications. Virtualization needed to provision servers virtualisation and deactivationgoing green,” says Sandeep has helped consolidating from several months to just 4 of the applications helpedGandhi, Sr. Manager, Data practically 10 servers into a hour, restored data in 10% of in reutilisation the existingcenter operations, KPIT single virtual server. Loading the time previously required, servers more efficiently forCummins. different operating systems and created a highly reliable critical applications avoiding and applications on a single environment, improving new hardware investments.Consolidation and virtual server has resulted its quality of service,” says With reduced hardware,virtualization has aided the into improving the utilisation Mandar Marulkar, Head, TIMS, lesser operating cost, thecompany in its objective to up to 70 percent of the less KPIT Cummins. company can offer betterdeploy green data centre utilised servers. and competitive prices to itssolutions by reducing carbon customers. 53
  • 58. 3m lauNChes A recognized world leader Web-based in technology research and development, 3M wanted to visual make its decades of expertise in the workings of the human visual atteNtioN system available as a service to customers. Using the Windows OvERvIEW Country or Region: United States Industry: Manufacturing - High tech serviCeimpact to heighten design Azure™ platform, 3M created a Web-based application that gives designers the ability to invoke and electronics complex algorithms to analyze the effectiveness of a design, Customer Profile Solution based on how the human eye will With 75,000 employees and operations 3M used the Windows Azure™ Windows Azure respond. By hosting its application in more than 60 countries, 3M develops platform to deliver the VAS solution helps 3M customers in Microsoft® data centers, 3M an extensive range of consumer to customers, taking advantage of take advantage of has made an innovative service and industrial products. Well-known Microsoft® data center infrastructure complex algorithms available to a global audience, 3M brands include Scotch, Post-it, and service management to keep that encapsulate 30 while minimizing its investment in Thinsulate, and Scotch-Brite. performance high and costs low. years of research hardware infrastructure and ongoing and get simple, administration. The solution, Business Situation Benefits powerful results which permitted developers to 3M wanted to make its Visual • Easy, efficient deployment from their browser, evaluate frequent iterations of the Attention Service (VAS) available • Lower costs, high scalability almost instantly. application, helped the company to customers as a Web-based • Excellent customer solution terry Collier, speed time-to-market for its application, with high performance, Marketing Manager, 3M service and achieve higher quality scalability, and low infrastructure and results, faster than in a traditional management costs. development environment.54
  • 59. SituAtion of research that is used in make the process for designingFrom well-known brands such many 3M products - such as things that people interact withas Post-it products, Thinsulate reflective materials used in visually more science-basedinsulation, and Nexcare first roadway signage, emergency and iterative to bring aboutaid, to high-strength bonding exit markings, and display more effective results."tapes, industrial abrasives, and graphics technologies - isand traffic safety systems, the understanding of how Terry Collier, Marketing3M products are ubiquitous the human visual system Manager at 3M, adds, "In ouraround the world. Founded in works. The company’s vision market research, we found1902, 3M is a science-based scientists, working in its that designers spend a lot ofcompany and has developed corporate research labs, time creating, honing, andthousands of innovative study how the human brain optimizing their images butproducts for a broad range processes visual information they can be challenged by theof markets. The company and have developed complex fact that they don’t ever truly We knew there wasnow operates in 60 countries algorithms for predicting what know how people are seeing a a need to make theand its worldwide sales in a person will notice in a visual design before it’s completed." process for designing2008 were more than U.S.$25 scene. things that peoplebillion. 3M’s goal was to provide interact with visually Bill Smyth, Business Manager designers with predictive more science-based and3M supports more than at 3M, says, "Our job, on the measurements about how iterative to bring about40 different technology business and marketing side, their creations - from a logo more effective results.platforms and has invested is to make the most of these design, to a Web site layout, Bill SMytH,years of scientific research capabilities." To this end, to the placement of an Business Manager, 3Min developing them. In fact, Smyth and his colleagues electronic screen in a hotel7,000 of the company’s identified a use for these lobby - would be perceivedemployees are dedicated predictive algorithms. "We by their audience. Also, it wassolely to research. One area knew there was a need to critical that this information 55
  • 60. be immediately available. remember. The prototype, markings such as those seen "We needed to be able to a Web-based application on a heat map, which areas provide designers with access that was hosted on 3M data of the image were most likely to this information directly center servers, enabled users to attract a viewer’s attention. from their computer desktop, to upload photographs of a (Figure 1.) multiple times throughout the physical environment or a design process, so they could graphic design to the VAS. But 3M wanted the alter their designs in direct The application’s processing application to work efficiently response to the analyses, engine then evaluated the as part of its customers’ rather than engaging in image for its visual saliency existing design processes. To lengthy focus group sessions and returned a map of the become a viable offering, the that happen after a design image that indicated, using VAS application had to be reaches a near-final state of completion," says Collier. The similarities between The company developed a Windows Azure and our prototype of a Web-based current development application, called the 3M environment gave us Visual Attention Service a huge advantage and (VAS). The service makes made the decision easy. it possible for designers to JiM GrAHAM, test the effectiveness of their Technical Manager, 3M content using visual attention models, which are based on algorithms that predict the elements of a scene that a viewer is likely to see and to figure 1. 3M VAS image map indicating areas most likely to attract viewers’ attention56
  • 61. available to customers in real Solution Windows Azure providestime, be capable of processing 3M believed that the most developers with on-demandimages and returning near- effective approach would be compute and storage toimmediate results, of scaling to operate the VAS application host, scale, and manage Webrapidly during peak design from a "cloud computing" applications on the internettimes, such as just prior to environment, in which the through Microsoft dataholiday advertising deadlines, solution would be hosted centers.and it had to carry a low and managed on the Internetup-front investment risk for and reside in an external From its experience with3M. "Especially in the current partner’s data centers. The the Community Technologyeconomic environment, we company evaluated hosted Preview (CTP) of Windowshave to be very careful about infrastructure offerings from Azure, a Microsoft programhow we invest our capital," Microsoft and others, but, says for early adopters tosays Smyth."We didn’t want Graham, "3M has for a long experiment with prereleaseto invest in costly data center time relied on Microsoft® technology, Graham’s team SQL Azure is of greatinfrastructure and capacity tools and technologies to thought that the solution value to 3M becausethat, much of the time, would support the development was a good fit for 3M. "The it takes the databasesit idle and unused." of our technology. For similarities between Windows management piece off this reason, 3M chose the Azure and our current our plate.Jim Graham, Technical Windows Azure™ platform development environment JiM GrAHAM,Manager at 3M, adds, from Microsoft." Windows gave us a huge advantage Technical Manager, 3M"We needed to be able to Azure is a cloud services and made the decision easy,"provide a high-performance operating system that says Graham. 3M relied onapplication to customers serves as the development, the Microsoft Visual Studio®everywhere, without service hosting, and service 2008 development system todeploying data centers management environment for produce the VAS application,around the world." the Windows Azure platform. including Microsoft Visual 57
  • 62. Studio Team System 2008 Azure specifications. "We environment," explains Team Suite and Microsoft developed the whole user Graham. The VAS interface, Visual Studio Team System experience, from the ground and the Web site where 2008 Team Foundation up, on Windows Azure," users go to access it, was Server. It also used Microsoft says Graham. His team also developed using Microsoft Expression Blend™ 3 design used the Windows Azure ASP.NET 2.0, part of the software and Microsoft development fabric, which it Microsoft .NET Framework. SQL Server® 2008 data used to simulate the Windows Graham’s team used the management software. "We Azure environment on local Microsoft Silverlight™ browser saw that Windows Azure computers, making it easy plug-in to build controls into would work well with our to run and test the VAS the application that enable Visual Studio development application before users to edit and modify environment. We also saw the deploying it. images they submit to the opportunity to take advantage VAS processing engine. The We will be able to of a new technology platform VAS incorporates a Silverlight-enabled controls deploy much faster on that would allow us to deploy number of unmanaged, are embedded into the ASP. the Microsoft technology in different countries, with high-performance image- NET application framework, platform through rapid scaling capabilities processing software libraries creating a seamless experience Windows Azure than and no up-front capital developed by 3M. "The for users. "Users don’t have with any other cloud investment," says Graham. Windows Azure development to switch between different solution we evaluated. To prepare the VAS application fabric helped us perform interfaces to perform certain JiM GrAHAM, for commercial release, 3M quick iterations of code, functions," explains Graham. Technical Manager, 3M built a new user. interface. allowing us to overcome The timing coincided with many of the hurdles we The VAS application relies on the CTP of Windows Azure, might not have seen until the Access Control Service so Graham’s team developed we had deployed to a more feature of Windows Azure the interface to Windows formal staging or production to authenticate users to the58
  • 63. system, providing access to image processing engine. SQL off our plate," says Graham.various components of the Azure, as part of the Windows 3M uses Windows Azureservice based on a user’s Azure platform, provides data storage services to 3M VAS and Windowscredentials. 3M used Microsoft automated management store image files and analysis Azure will help ourSQL Azure, a cloud-based capabilities, including built-in generated by the engine, customers spend theirrelational database platform data protection, self-healing, and it uses the Queue service marketing dollars morethat is built on SQL Server and disaster recovery - crucial feature to provide users with wisely.technologies, to manage the for protecting customers’ data. high-performance and near- Bill SMytH,images that users upload. SQL "SQL Azure is of great value immediate response times Business Manager, 3MAzure also is used to deliver to 3M because it takes the even when the application isanalytical results from the database management piece inundated with high traffic during peak load times. figure 2. Diagram of 3M VAS deployed on Windows Azure In short, explains Graham, "With Access Control, we can create a pipeline from the ASP. NET-based interface, to the Queue service, to the VAS engine where the analysis is performed using the algorithms our scientists have developed." (Figure 2.) Currently, VAS helps customers evaluate any number of graphical or photographic images that they choose to 59
  • 64. upload to the application. responds. By using a cloud fully supported in Windows In future versions, 3M plans service, 3M experienced an Azure. And, the Windows to provide customers with efficient deployment and Azure development fabric the ability to create entire lowered its infrastructure costs. provided a great simulation databases of test images, The highly scalable Web- environment in which we enabling users to experiment based service will make it could see our work in progress with, for example, the content possible for 3M customers to and incorporate feedback- of an advertisement in a optimize designs in response early and often. We rapidly SOfTWARE AND SERvICES variety of design scenes - or, to scientific analysis, thereby deployed interim releases Windows Azure Platform conversely, a number of helping to make the most of to stakeholders within the Windows Azure different types of advertising their marketing dollars. company. The Windows Azure Access Control Service content in one particular development fabric has been Microsoft SQL Azure scene. 3M plans to release Easy, Efficient Deployment a significant time savings." Microsoft Server Product Portfolio a final version of the VAS The close connection between Microsoft SQL Server 2008 application running on Windows Azure and the 3M In addition, once the VAS Microsoft Visual Studio Windows Azure to customers Visual Studio development application development is Microsoft Visual Studio Team by mid-November 2009. environment helped the complete and the service is System 2008 Team Foundation company achieve a rapid made publicly available on SERvER BenefitS deployment of the VAS Windows Azure, 3M will be Microsoft Visual Team System Using the Windows Azure application. "We were able able to quickly release product 2008 Team Suite updates and enhancements. platform, 3M developed a to wrap our core technology Microsoft Expression highly innovative Web-based into Windows Azure in less "We will be able to deploy Microsoft Expression Blend 3 service that can dramatically than eight weeks. It was very much faster on the Microsoft Technologies alter and improve the process fast, "says Graham. "The tools technology platform through Microsoft ASP.NET 2.0 for designing images and and technologies we were Windows Azure than with Microsoft .NET Framework environments that rely on already using, for instance any other cloud solution we Microsoft Silverlight how the human visual system forms authentication, are evaluated," says Graham.60
  • 65. lower Costs, data from one region to viewer’s response to a scene. impact of the designs," saysHigh Scalability another, without having to "Windows Azure helps 3M Graham.With Windows Azure, 3M replicate databases, and customers take advantagecapitalizes on a pay-as-you- without all of the service of complex algorithms that "3M VAS and Windows Azureuse pricing model to minimize management we would encapsulate 30 years of will help our customers spendhosting costs and maximize otherwise have to engage in." research and get simple, their marketing dollars moreprofits. "With Windows Azure, Graham compares the time powerful results from their wisely," explains Smyth. "Inwe get a highly scalable and cost savings that result browser, almost instantly," our research, we found thatenvironment, pay only for from the use of Windows says Collier. customers value having anthe resources we need, and Azure as a cloud services analytical, science-basedrelieve our IT staff of the platform to other endeavors Graham says, "We wanted to assessment of their designs. Itsystems management and at 3M. "We have full-time make it so simple for our users takes it out of the ego spaceadministration responsibilities staff members who are solely that they didn’t even have to of subjective evaluationsof supporting a dynamic dedicated to managing our step outside of the workflow from colleagues or from theirinfrastructure," says Graham. hosted solutions. Were we they are used to. With the own clients. We believe that to host the VAS application VAS application running on with the Windows Azure -3M found SQL Azure to ourselves, we would have to Windows Azure, users can based solution, we can havebe especially beneficial increase our support staff." open a Web browser and a significant impact on thebecause it can use it to offer analyze any number of files, financial aspects of marketing-the VAS application to a excellent straight from their computer." based design."global audience, without the Customer Solution As VAS becomes an integral,expense of establishing and Most importantly, 3M used natural element of the designmaintaining regional data Windows Azure to deliver a process for 3M customers,centers. Graham explains, new technology that could the company expects to"With SQL Azure, we can change the design process "significantly reduce the timedeploy internationally without paradigm, especially in areas and cost of design iterationshaving to migrate customer where success hinges on a - while improving the overall 61
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