This document discusses negotiating the next service-level agreement for cloud services. It notes the complicated cloud market with many local competitors. It also highlights both bad signs, such as power outages reducing reliability, and good signs, such as forecasts showing continued public cloud growth. The document advocates that telcos are well-positioned to provide cloud services by leveraging their communications networks. However, it cautions that telcos must focus on service management and quality to attract enterprise customers, and that companies should define their own cloud roadmaps based on workload assessments and business needs.

1. NEGOTIATING THE NEXT
SERVICE-LEVEL AGREEMENT
Telefonica España
April 2013

2. The Cloud Market Scenario is Complicated
+ local providers…
too many competitors?
2

3. Bad Signs: Gartner Hype Cycles
2008
2009
2010
2011
2012
3

4. Bad Signs: High Impact Failures
• Power Outages
• Connectivity Issues
• Data Losses
• Unauthorized Accesses
• Tricky SLAs
•…
The Scream, Edvard Munch (National Gallery, Oslo)
4

5. Good Signs: Cloud Market Forecasts
Public Cloud Services Forecast, 2Q12 Update
Gartner
5

6. Good Signs: CIO Troubles are Still There
• 75% - 80% of IT budget is needed
to maintain legacy. Only 20% - 25%
for new projects.
• The average workload is 15% of
deployed computing capacity.
• The average timeframe for regular
infrastructure deployment is 2-3
months.
Dilbert Calendar App Screenshot by Metranome Inc.
Dilbert by Scott Adams
6

7. Good Signs: Who Is Driving Cloud Adoption?
72% CIOs surveyed agreed or strongly agreed that their
business executives see cloud as a way to be
independent of IT.
Forrester CIO Research 2013
7

8. Are Telcos Prepared to Provide Cloud Services?
For telcos that have long been looking to fuse
communications technology with IT services, cloud
computing provides a model that plays to a number
of their core strengths, in particular through the
utilization of communications networks as a delivery
mechanism. As demonstrated by Apple and Google's
dominance over the consumer applications and services
market, the ability to provide a "one-stop shop" for an
enterprise's entire range of IT and communications needs
will be fundamental in attracting enterprises to a service.
OVUM “Enabling Telco Cloud Services” (OT00056-001)
8

9. Are Telcos Prepared to Provide Cloud Services?
Public /
Private
SLA
Portfolio
Data
Migration
Compliance
IT Integration
Data
Protection
Datacenter
Location
Vertical
Requirements
9

10. Are Telcos Prepared to Provide Cloud Services?
58%
36%
79%
?
Surveyed companies are running mission-critical
workloads in the unmanaged public cloud
regardless of policy
Have policies allowing IT service management
of respondents plan to support running missioncritical workloads on unmanaged public cloud
services in the next two years
Will you be there to help the CIOs?
Forrester CIO Research 2013
10

11. Cloud Standards
11

12. Cloud Standards
{
27001
20000
38500
12

13. Cloud and Process Frameworks
• CSA “Cloud Controls Matrix” consolidates the main
•
operations and security indicators to consider for Cloud
environments.
It provides the reference to major process frameworks:
CobIT 4.1, ISO 27001, NIST, PCI DSS.
(https://cloudsecurityalliance.org/research/ccm/)
13

14. More Reasons to Focus on Service Management
Bain Cloud Computing Survey 2011
Forbes.COM
14

15. Quality in a product or service is not what the supplier
puts in. It is what the customer gets out and is willing
to pay for. A product is not quality because it is hard to
make and costs a lot of money, as manufacturers
typically believe. This is incompetence. Customers pay
only for what is of use to them and gives them value.
Nothing else constitutes quality.
Peter Drucker, “Innovation and Entrepreneurship”
15

16. The Service Path to Cloud
COMPANIES NEED TO BUILD
THEIR OWN CLOUD ROADMAP
16

17. The Service Path to Cloud
1. Cloud Assessment: ad-hoc silos, virtualization, onsite, offsite…
2. Segmentation: Workloads, technologies, functionalities…
3. Define SLA.
4. Business Case Scenarios.
5. Propose a tailored solution.
6. Choose the right partners.
7. Metrics, metrics metrics.
17

18. Business Model as Usual
Per Resource Consumed
(Cost Center)








Resource
Billing
simple
Processor
Memory
Virtual Machine
Bandwidth
Storage
Vlans
Virtual Datacenters
…
Unadaptable
complex
Difficult to
understand
flat rates
Expensive for
customers
Unprofitable
discounts
18

19. Alternate Business Model
Per Service
(Profit Center)









Availability Rate
Transactions Processed
Revenue share
EASY TO
DIFFICULT TO
UNDERSTAND
IMPLEMENT
Tech Support Class
Security Level
The Creation of Adam
M. Buonarotti, Sixtine Chapel
Customer Care Tickets
QoS
Services: Integration, Backup & Restore, Optimization…
Services-aaS: CRM-aaS, Billing-aaS, Tech Support-aaS…
19

20. The Cloud Market Scenario is Complicated
More individuals are born than can possibly
survive. The slightest advantage in one
being over those with which it comes into
competition, or better adaptation in
however slight a degree to the surrounding
physical conditions, will turn the balance.
Charles R. Darwin
The Origin of Species, c. 14
+ local providers…
too many competitors?
20

21. Contact: emendezpolo@gmail.com
21

22. 22