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Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
Cloud Hosting: Lessons from the trenches
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Cloud Hosting: Lessons from the trenches

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OnApp Keynote presented at WHD 2011 by OnApp CVO Carlos Rego

OnApp Keynote presented at WHD 2011 by OnApp CVO Carlos Rego

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  • 1. Lessons from the trenches(and how to build a profitable cloud hosting business)<br />Carlos Rego, Chief Architect, OnApp<br />@nullmind<br />linkedin.com/in/carlosrego<br />carlos@onapp.com<br />facebook.com/carlos.rego<br />
  • 2. What is OnApp? <br />Cloud deployment &amp; management software for hosting providers<br />
  • 3. What does OnApp do?<br />Commodity hardware<br />Elastic cloud<br />On demand resources<br />End users<br />VM Deployment<br />VM Management<br />VM HA/Failover<br />User management<br /> Utility Billing<br />
  • 4. Company info<br />50+ employees in US and EU<br />Build as internal project for VPS.NET (UK2Group)<br />60,000+ VMs live on OnApp<br />120+ client clouds deployed<br />Adding 1-3 clouds per day<br />
  • 5. With OnApp you…<br />Get online in less than 48 hours<br />Use your existing hardware<br />Get the first 100 cores for free<br />Only pay $10/core after<br />Get free 24/7 support<br />Are fully integrated with WHCMS/UBER/Hostbill<br />
  • 6. What is OnApp? <br />Cloud Deployment Scenarios<br />
  • 7. Different deployment scenarios<br />By-the-hourpublic cloud hosting<br />Cloud VPS hosting<br />All working out of the box…<br />Hybrid cloud hosting<br />Private Clouds<br />
  • 8. By-the-hour cloud hosting<br /><ul><li>Sell Virtual Machines to customers who pay hourly for cloud resources
  • 9. Set different prices for RAM, CPU and storage (incl. IOPS), VMs, IPs etc.
  • 10. Set up different availability zones with different pricing
  • 11. Competing with AWS/Rackspace</li></li></ul><li>Cloud VPS hosting<br /><ul><li>Group cloud resources into nodes that you can sell on a monthly plan basis
  • 12. Your customers use nodes as the building blocks for their VMs
  • 13. The node-based approach makes cloud hosting extremely simple for end users
  • 14. Competing with VPS.NET/Slicehost/Linode</li></li></ul><li>Hybrid cloud hosting<br /><ul><li>Allocate hypervisors on a 1:1 basis: each customer gets a dedicated hypervisor for their hosted service, centralized storage
  • 15. Failover is provided by the rest of the cloud (for example, one HV might act as failover for 5 &quot;live&quot; HVs)
  • 16. Competing with SingleHop/StormOnDemand/Iweb</li></li></ul><li>Virtual private clouds<br /><ul><li>You can group hypervisor, network and storage resources into a single private cloud resource
  • 17. Customers get all the benefits of a private cloud, backed by the resources of the whole cloud
  • 18. This brings the cost of private clouds down for customers, too
  • 19. Compete with the likes of Amazon Web Services...and enterprise service providers</li></li></ul><li>So, what have we learned...<br />…from 100+ cloud deployments ?<br />
  • 20. Vendor &amp; analyst chatter<br />EC2<br />Azure<br />Cloud OS<br />Cloudware<br />Interoperability<br />Cloud Oriented Architecture<br />Cloud Storage<br />Portability<br />Consumption Based Pricing<br />
  • 21. This is what they told us…<br />
  • 22. They’ll tell you that it is very expensive…<br />
  • 23. Or very complicated…<br />=<br />=<br />
  • 24. That it will solve all problems<br />
  • 25. Or that cloud is just the same old same old…<br />
  • 26. What we thought hosts cared about<br /><ul><li>Security
  • 27. Interoperability
  • 28. Compatibility</li></li></ul><li>What hosts actually care about<br /><ul><li>Low entry costs
  • 29. Time to market
  • 30. Density/profitability</li></li></ul><li>What challenges do cloud hosts face?<br />Storage:<br /><ul><li>#1 concern
  • 31. 100+ clouds, close to 50 different storage configs
  • 32. Ability to use multiple tiers of storage
  • 33. Billing for IOPS</li></li></ul><li>What challenges do cloud hosts face?<br />Traditional storage vendors<br /><ul><li>Not always a fit for mass-market hosts
  • 34. The industry is crying out for storage innovation</li></li></ul><li>What challenges do cloud hosts face?<br />Infrastructure:<br /><ul><li>Ability to use existing infrastructure
  • 35. Capitalizing on depreciated hardware
  • 36. Ability to mix ‘old’ &amp; new gear</li></li></ul><li>What challenges do cloud hosts face?<br />Billing:<br /><ul><li>New billing structures
  • 37. Charging per hour, per minute
  • 38. Or should they?</li></li></ul><li>What challenges do cloud hosts face?<br />Support:<br /><ul><li>Finding, hiring, training staff for cloud hosting services
  • 39. “Support us like we support our clients”</li></li></ul><li>What challenges do cloud hosts face?<br />Cloud hosting business plan:<br /><ul><li>Hosts need to pay attention to their cloud business strategy
  • 40. ...even more so than usual</li></li></ul><li>Business plan – ARPU &amp; Profits<br />With the cloud:<br />Potential revenue/cab increases – at a higher margin too – BUT with lower ARPUs<br /> &gt;&gt; KEEP AN EYE ON CPAs &lt;&lt;<br />Host<br />Client<br />
  • 41. Business plan – higher entry barriers<br /><ul><li>Hardware cost of bringing your first dedicated server client live: $2,500
  • 42. Hardware cost of bringing your first cloud server client live: $25,000</li></li></ul><li>Cloud – the end of overselling?<br />Shared hosting: 540 seat Jumbo jet = 700 passengers<br />Dedicated server hosting: 540 seats = 540 passengers<br />Cloud hosting:540 seats = 4-500 passengers <br />Underselling??<br />
  • 43. What does the future hold?<br />
  • 44. OnApp New Features…April 14th<br /><ul><li>Autoscaling
  • 45. Let client VMs scale up and down (and out) automatically
  • 46. Firewalls
  • 47. Control a VM’s firewall settings from the GUI
  • 48. Very granular metering, tiered storage and IOPS billing
  • 49. Loadbalancers
  • 50. Offer your clients free Loadbalancer.org VMs (£995 value). Fullyintegrated in GUI
  • 51. SSLs
  • 52. Offer your clients free Globalsign SSL certs for 1 year. One-Click-Installs!</li></li></ul><li>Cloud – 3 phases<br />The Cloud is cool and sexy<br /><ul><li>High margins, high conversions, low CPAs</li></ul>2. The Cloud is commoditized<br /><ul><li>ACPU is a CPU is a CPU = transparency = price erosion
  • 53. Focus on de-commoditizing your offering</li></ul>3. The Cloud is no longer the cloud<br /><ul><li>It’s how stuff is done…</li></li></ul><li>How should cloud hosts compete?<br /><ul><li>De-commoditize the cloud offer
  • 54. Add value with partner deals
  • 55. Target specific niche markets</li></li></ul><li>In summary<br /><ul><li>Cloud is here to stay
  • 56. It isn’t as complex or expensive as you might think
  • 57. The time to act is now – late arrivalswill face a much tougher market</li></li></ul><li>Thanks!<br />Don’t be a stranger<br />@nullmind<br />linkedin.com/in/carlosrego<br />carlos@onapp.com<br />facebook.com/carlos.rego<br />

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