MS Cloudeconomics

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MS Cloudeconomics

  1. 1. ECONOMICS OF THE CLOUD Michel N’Guettia Business Group Lead micheln@microsoft.com Slide 1
  2. 2. TRANSFORMATIE VAN IT Today | Cloud 2000s | Web 1990s | Client / Server 1970s and 80s | Mainframe
  3. 3. HOW MICROSOFT VIEWS THE CLOUD Nieuwe Principe's Schaalbaarheid Betalen naar gebruik Hoge beschikbaarheid Keuze Locatie Infrastructuur Business model Eigendom Management Multi-tenancy
  4. 4. SUPPLY SIDE ECONOMICS OF SCALE Larger datacenters have almost 50% lower TCO per server MAIN DATA CENTER COST BUCKETS • • Server hardware costs (~45%) Facility & operations (~25%) Hardware labor costs (~15%) $5,000 TCO/Server • ANNUAL TCO/SERVER DECLINES W/SCALE $4,000 $3,000 $2,000 $1,000 $0 • Power costs (~15%) 1k Server DC Server Hardware Facility 100k Server DC Hardware Operations Power
  5. 5. DE MICROSOFT CLOUD Monolithic design and construction effort Typical large datacenter = 11 football fields High Investments $$$ Typical construction costs = $10M to $15M per Megawatt Long lead time 18 to 24 months from design to online
  6. 6. DE MICROSOFT CLOUD Microsoft has more than 10 and less than 100 DCs worldwide Chicago Quincy Dublin Amsterdam Japan Boydton Des Moines Hong Kong San Antonio Singapore Multiple global CDN locations Quincy, Washington 27MW 100% Hydro power San Antonio, Texas 27MW Recycled water for cooling Chicago, Illinois Up to 60MW Water side economization, Containers Dublin, Ireland Up to 50MW Outside air cooling, PODs "Datacenters have become as vital to the functioning of society as power stations." The Economist
  7. 7. SUSTAINABLE ECONOMICS • Improved Efficiency  Energy savings and Sustainable Environment • Reduced TCO for supply of cloud services • Relentless focus on PUE reduction Less Raw Materials • Lower cost passed on to customers Less Wasted Power • Competitive Advantage Less Idle Equipment Less Carbon Less Empty Space Less e-Waste Satisfied Customers PUE Ojective: 1.125
  8. 8. SHIFT TO ULTRA-MODULARITY • Pre-manufacture the entire datacenter • Low initial capital investment • ITPAC  Modular Server Building Block • Airside Economization PAC with adiabatic cooling • Extremely efficient  PUE of 1.05 - 1.2 • 400 to 2500 servers at a time
  9. 9. DEMAND SIDE ECONOMIES OF SCALE Average server utilization rates are 5-10% 100% CPU Utilization 75% 50% 25% 0% Time
  10. 10. UNCERTAIN GROWTH Uncertainty about future demand requires overprovisioning of resources. Pooling uncertainty dramatically reduces this inefficiency
  11. 11. MULTI-TENANCY BENEFITS Multi-tenant applications share resources between users and organizations SINGLE-TENANT APPLICATION Client Client Instance Instance Instance Admins Admins Admins Resources Resources Resources
  12. 12. MULTI-TENANCY BENEFITS Multi-tenant applications share resources between users and organizations MULTI-TENANT APPLICATION Instance Instance Instance Admins Admins Admins Resources Resources Resources
  13. 13. CLOUD OPERATING SYSTEM Multi-tenant Cloud OS
  14. 14. PUBLIC VS. PRIVATE CLOUDS $8,000 CLOUD SCALE BENEFIT TCO/Server $6,000 $4,000 $2,000 $0 100 1,000 Cloud Size (# of Servers) 10,000 100,000
  15. 15. SERVICE MODELS Service Categories Platform Infrastructure Applications Applications Applications Applications Data Data Data Data Runtime Runtime Runtime Middleware Middleware Middleware Middleware O/S O/S O/S Virtualization Virtualization Servers Servers Storage Storage Networking Networking Higher Control & Higher Cost Managed by vendor You manage Runtime You manage (as a Service) Virtualization Servers O/S Virtualization Servers Storage Storage Networking Networking Lower Cost & Higher Agility Managed by vendor (as a Service) Managed by vendor (as a Service) You manage (On-Premise) Software
  16. 16. CLOUD SERVICES FOR BUSINESSES BUSINESS APPS BUSINESS USERS PLATFORM
  17. 17. THE VALUE OF CLOUD COMPUTING http://www.mckinseyquarterly.com/Business_Technology/BT_Strategy/How_IT_is_managing_new_demands_McKinsey_Global _Survey_results_2702?gp=1
  18. 18. THE HORSELESS CARRIAGE SYNDROME
  19. 19. THE HORSELESS CARRIAGE SYNDROME Customers "If I had asked my customers what they wanted, they would have said a faster horse." - Henry Ford Analysts “The horse is here to stay but the automobile is only a novelty, a fad.” - Bank analyst Engineers …designed whip holders into the automobiles for the first 67 years, even though there was no horse… Forecasters “There will never be more than 1 million units because of the limited availability of good drivers” - Daimler Company (there were 8 million by 1918, over 600 million today)
  20. 20. © 2010 Microsoft Corporation. All rights reserved. Microsoft, Windows, Windows Vista and other product names are or may be registered trademarks and/or trademarks in the U.S. and/or other countries. The information herein is for informational purposes only and represents the current view of Microsoft Corporation as of the date of this presentation. Because Microsoft must respond to changing market conditions, it should not be interpreted to be a commitment on the part of Microsoft, and Microsoft cannot guarantee the accuracy of any information provided after the date of this presentation. MICROSOFT MAKES NO WARRANTIES, EXPRESS, IMPLIED OR STATUTORY, AS TO THE INFORMATION IN THIS PRESENTATION.

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