The-evolution-of-the-private-cloud

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The Evolution of the Private
Cloud

By George Gilbert

Co-Presented by:

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Prepared for George Gilbert (george.gilbert@techstrategypartners.com)

Table of Contents

Table of Contents 2

INTRODUCTION 4

Roadmap to the Private Cloud 5
Hardware 5
Software 6

The Battle for the Private Cloud 7

Economic Benefits 8

DEFINITIONS 9

FROM DEDICATED TO SHARED INFRASTRUCTURE 12

The Evolution of Enterprise Management Software 14

Extending Virtualization to Storage and Networks 16

THE EMERGENCE OF PRIVATE CLOUDS 17

Enabling Self-Service 18

Extending Private Clouds with Public-Cloud Resources 20
Software Appliances 21
Distributing Software Appliances 22

From Application-Aware Management . . . 23

. . . to Management-Aware Applications 25

Evolution of the Private Clouds © 2010 Giga Omni Media | May 2010 -2-

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VENDOR IMPLICATIONS 27

An Important Role for the Big Four 27
Integrating infrastructure layers 28
Integrating intergenerational products 28
Tying together multiple applications in an end-to-end service 29

VMware vs. Microsoft 30
The Battle for the Data Center Operating System 32
The Battle to Manage Packaged Applications 34

The Wild Card: Oracle 36

CUSTOMER IMPLICATIONS 37

ABOUT TECHALPHA 40

ABOUT GIGAOM PRO 40


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Introduction
Every 15 years or so, the IT world undergoes a tectonic shift. Technological forces
collide and grind against one another, creating an upheaval that leaves the landscape
irrevocably changed. The latest such shift is currently underway: the transition to
computing as a service, also known as cloud computing. This change promises to make
computing more like a utility such as electricity or telephony — users plug in and get
the resources they need without much manual effort on the part of service providers.

Cloud computing has brought these benefits to Internet titans like Google,
Salesforce.com and Amazon, and to their customers. Traditional enterprise IT has long
aspired to the same advantages, but with a crucial distinction. Businesses want the
option of greater control over governance, security and management that comes with
using their own infrastructure.

For the better part of the last decade, cloud computing within the enterprise appeared
elusive, short of totally replacing the hardware and software infrastructure to resemble
large public web sites. Then came server virtualization, pioneered by VMware in the
early part of the decade. At first, virtualization’s ability to tie disparate servers into a
unified pool was used only for software development and testing. But gradually, it has
become apparent that the technology was mature enough to deploy more widely.
Suddenly, private clouds began to appear realistic.

This report is neither a comprehensive recipe for building a private cloud nor a
complete review of all the products and vendors involved. Rather, it is a roadmap
outlining the technology’s likely evolution, starting with the bottom layer in Figure 1.
Readers familiar with cloud computing concepts at the infrastructure level will find the
parts of the report that review lower layers of the IT stack somewhat remedial. They
are there to set the context for the more forward-looking sections that describe how
higher-level layers are likely to evolve.


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Figure 1: IT is built in layers, each of which is evolving as cloud computing matures.

Custom
SAP
App
ISV App Mgt

Application Frameworks Mgt
JEE, .NET, LAMP, Spring
Security

Application Servers

MoM
Oracle Weblogic, Windows, IBM Mgt
Websphere, Tomcat, also SQL DBMS Manager
Of
Operating Systems Mgt
Managers
Virtualization Mgt Typically HP,
BMC, IBM, CA
Hardware
Mgt

Source: TechAlpha

Roadmap to the Private Cloud
Although server virtualization works with existing infrastructure, new products
tailored specifically for virtual environments can make it even more powerful. These
products include both hardware and software.

Hardware

On the hardware side, Cisco and HP are pioneering a new class of integrated hardware
that offers three novel capabilities:
 Each chassis contains a mix of all infrastructure components with built-in
management software that allows administrators to manage a single unit rather
than individual servers, storage and networking gear.


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 Because virtual machines (VMs), not servers, are the fundamental element of
management, the infrastructure is VM-aware. It can reconfigure itself to follow
VMs around the resource pool, something that was never necessary with
physical servers.

 The hardware is configurable on demand. This allows applications to operate as
though they were running on dedicated infrastructure tuned to their individual
service level requirements.

Software

Ultimately, though, the special sauce for cloud computing in the enterprise will be
management software. Application and infrastructure administrators will be able to
agree on an application’s required service level and then let the software configure and
operate itself with minimal intervention.

This evolution is likely to occur in several distinct steps. Today, for the most part,
systems management software has only limited control over applications running in
VMs. Administrators setting up applications to meet their service levels can only tune
the underlying infrastructure. But VMs are evolving to carry around the deployment
and operational requirements of the applications they contain, and management
software is evolving to read them. Once that change is complete, management software
will need to be able to look inside the VM, take the pulse of the application itself and
respond appropriately. At that point, the management software can be said to be
application-aware.

Ultimately, applications must be able to understand, and to some extent control, their
own operational needs. That way, they could communicate interactively with
management systems to meet their service level objectives. Such applications can be
said to be management-aware. For this to happen, both ISVs such as IBM, Microsoft,


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Oracle and SAP and custom application developers using frameworks like JEE, LAMP,
.NET and Spring will need to build manageability into their applications.

With these capabilities in place, IT would be able to operate on a self-service model.
Administrators, developers and application owners would have access to resources and
applications on demand. Hardware infrastructure teams would define how developers
or application administrators could use their resources; developers would define how
application administrators could use solutions delivered on their platforms; and
application administrators would define how end-users could use their applications.
This would bring IT closer to the point where developers, infrastructure
administrators and application administrators could agree on each application’s
necessary quality of service (QoS), and then set it and forget it.

The Battle for the Private Cloud
Two vendors, VMware and Microsoft, are actively working toward implementing these
software changes. Each is following a distinct strategy in what is shaping up to be a
David-and-Goliath battle to own the technology at the heart of the private cloud.

VMware is trying to make the traditional server OS irrelevant by redefining the layers
of the IT stack and sandwiching the OS between the virtualization layer and the
application platform. (It acquired SpringSource last August for this purpose.) This
would let VMware put a cut-down Linux OS kernel between the virtualized hardware
and the applications, making Windows irrelevant as a server OS.

Meanwhile, Microsoft aims to keep the virtualization and application layers firmly
fused to Windows. It brings significant advantages to this effort — especially a decade-
long head start in application-aware systems management through its Systems Center
technology and .NET application framework.


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But there is a dark horse in the race. Oracle is attempting to control the entire IT stack,
squeezing total cost of operations to a bare minimum. A single-vendor approach all the
way down — from application to chips and spinning disk drives — will allow the
company to make favorable trade-offs not open to other vendors.

Economic Benefits
The prospect of private clouds comes along at an opportune moment. In the first great
era of computing, roughly from the 1960s through the 1980s, enterprises relied on
mainframes for all their computing needs. This changed dramatically as a second era
dawned in the 1990s, when ever-increasing numbers of individual servers took over
tasks once performed by highly integrated mainframes. Initially, this change brought
tremendous savings in capital expenses, as businesses no longer needed to invest in
big iron, but instead could buy much more cost-effective small servers, dedicating
them to individual applications. However, as the numbers of servers grew, the task of
managing the landscape of dedicated but heterogeneous infrastructure became an
overwhelming expense. Figure 2 illustrates how overwhelming the cost of
infrastructure maintenance has become relative to investment in new applications.

Figure 2: Infrastructure maintenance cost crowds out other investments, particularly in
applications.

Source: VMware


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Private clouds promise to liberate businesses from this upward cost spiral. In its
ultimate implementation, a private cloud would deliver the efficiency of cloud
computing combined with the control and security of internal infrastructure. Users
would gain access to infrastructure, platforms or complete applications simply by
plugging into IT. The armies of administrators once necessary to manage numerous
distributed silos of specialized hardware and software would be replaced by automated
processes running on a single pool of resources. Applications and infrastructure would
largely run themselves, fulfilling most computing needs with the "lights out.”

Streamlining infrastructure operations and management costs would boost IT’s ability
to build, buy, and absorb new applications. The vision of private cloud computing
would become a very productive, cost-effective reality.

Definitions
The term cloud computing has come to encompass much of the new activity in the IT
industry, giving it different meanings depending on context. Borrowing heavily from
the definition supplied by the National Institute of Standards, this report defines cloud
computing as having several distinguishing characteristics, three service models, and
two deployment models.

Distinguishing characteristics:
 Resource pooling allows compute, storage and network infrastructure to be
shared and dynamically assigned among users and their applications.
 On-demand self-service allows a consumer, whether an IT administrator,
developer, or application user, to provision services without requiring
interaction with the provider.
 Elasticity allows services to be rapidly provisioned and scaled up or down as
needed.


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 Metering measures increments of time and capacity, allowing both service
providers and consumers to balance cost and QoS.

Service models:
 Infrastructure as a Service (IaaS) provides IT administrators and
developers with self-service access to shared pools of compute,
storage and networking resources. The consumer, whether an
administrator or developer, can deploy any software, such as operating systems
and applications. Consumers can control the software they deploy but they
don’t manage the underlying infrastructure.
 Platform as a Service (PaaS) provides a programming platform and
tools for developers, who can build and deploy applications without
having to worry about managing the infrastructure. Quoting an
excellent definition by Billy Marshall, founder of rPath, “PaaS allows
application developers to build applications in the cloud without ever having to
worry about hardware acquisition and configuration, software installation,
configuration, maintenance, scalability, backups, and so on. They just sign up
and start building, deploy with the push of a button, and pay for their usage as
they go.”
 Software as a Service (SaaS) gives consumers access to applications.
Consumers may have some ability to configure applications to fit their
requirements, but they don’t control the operation of the application or bear
the associated IT overhead. Most SaaS vendors run a single, shared instance,
which is also called multi-tenancy. However, vendors can opt to manage and
deliver one instance per customer, as Oracle does with its On Demand
applications. In this case, the vendor must take care to ensure that the cost to
serve each customer remains competitive.

Deployment Models:
 Private cloud is a term that’s often used interchangeably with IaaS. However,
it’s worthwhile to draw a distinction. IaaS refers to the hardware infrastructure.

Evolution of the Private Clouds © 2010 Giga Omni Media | May 2010 - 10 -

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A private cloud extends IaaS with software that manages performance,
availability and security via automated provisioning, deployment and
management. A private cloud is operated for the use of a single organization,
but it is not limited to the physical boundaries of an enterprise’s data center.
Rather, it operates within the security boundaries of a single enterprise,
allowing workloads to both move and grow on demand (Figure 3).
 Public cloud refers to the same arrangement when it’s owned by a service
provider and available to the broader public.

Figure 3: A private cloud runs on infrastructure enclosed within a firewall or VPN, not
necessarily within the physical boundaries of an enterprise.

Source: TechAlpha


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From Dedicated to Shared Infrastructure
Although existing applications are designed to work on either shared or dedicated
infrastructure, traditionally they have run on dedicated infrastructure. IT managers
freeze-dry each application vertically on top of its own infrastructure; i.e., they install it
on a specific set of specially configured servers, making sure they have the right data
and storage connectivity and often devoting dedicated network storage even though
the storage unit was designed to be shared.

The reason comes down to management. Freeze-drying offers the best way to ensure
that applications live up to guaranteed QoS levels. The trade-off is that dedicated
infrastructure is extremely labor-intensive to maintain. This is because the many
application silos become many management silos (Figure 4). Moreover, dedicated
infrastructure often becomes highly fragmented as many different vendors’ products
congeal into the supporting infrastructure.

Figure 4: Dedicating infrastructure to each application helps to guarantee quality of service
but results in a fragmented landscape that is very costly to manage.

Source: TechAlpha


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Shared infrastructure clearly streamlines management and reduces fragmentation,
and server virtualization has gone a long way toward hosting and isolating software on
what appears, to the software, to be dedicated and specially configured CPUs and
memory. VMware is working closely with partners such as Cisco, EMC and NetApp to
extend this functionality to storage and connectivity. As that work progresses, the
shared pool of infrastructure beneath virtualization software will continue to grow.
The transition will accelerate as the hardware infrastructure itself becomes more
homogeneous, more easily configurable and more aware of VMs.

Until that process is further along, however, many business and mission-critical
applications will remain on fragmented infrastructure in legacy silos, with traditional
management focused individually on servers, storage and networks, as shown below.

Figure 5: Pools of virtual infrastructure will grow, but some infrastructure will continue to be
dedicated to legacy applications.

Source: TechAlpha


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The Evolution of Enterprise Management Software
Managing enterprise systems has always been a challenge. The sheer complexity of the
task — dealing with endless variation of product categories, vendors within categories,
current and legacy versions of installed products, specific configurations, and
roadblocks thrown up by vendors who don’t want their products to disappear behind
someone else’s management console — has made management software the IT
equivalent of the La Brea Tar Pit. Vendors roaming that space become trapped and
sink into the morass of legacy implementations.

Moreover, management software has tended to be as fragmented as the hardware it
controls. IT administrators in large enterprises have generally organized themselves
into tribes that attended to individual parts of the landscape such as servers, storage,
networks, security, and databases and applications. Consequently, they tend to buy
management software dedicated to their specialty. It takes a heavy mix of professional
services to patch everything together and many administrators to keep it running.

Figure 6: Managing servers, storage, networks, security, and applications separately
fragments infrastructure further, adding to complexity and maintenance costs.

Legacy Silos

Apps

Servers

Network

Storage

Source: TechAlpha


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Cisco and HP are tackling the problem by building servers, storage and networks that
work together as a single unit. This makes managing infrastructure much easier.
However, it does not obviate the need for systems management. Rather, it implies that
the role of management will become broader.

A critical management issue for cloud computing has been that shared infrastructure
makes it difficult to trace a software problem to a specific piece of hardware. This issue
has held back deployment of IaaS for mission-critical applications. Better
virtualization management tools from VMware, Microsoft and Citrix haven’t yet fixed
the problem entirely. An Oracle database management system installed on a VM can
still think it’s running on hardware that supports the QoS it requires when, in fact, it’s
running on systems that aren’t configured to support that QoS level.

Some of the newest systems address this issue by making it possible to reconfigure the
hardware underlying the VMs on demand. As a result, application owners can have
greater assurance that virtualized applications are running on hardware that appears
configured and dedicated just for them. Loudcloud, renamed Opsware and later
bought by HP, actually had this ability 9 years ago. The profile for running a given
application could trigger provisioning and configuration changes across servers,
databases, load balancers, firewalls and storage. However, it stopped short of
addressing the bare metal.

When Cisco introduced its Unified Computing System (UCS), it included this
capability via a technology called Service Profiles. As part of a deepening alliance with
Cisco, EMC introduced IONIX Unified Infrastructure Manager (UIM). IONIX
manages Vblocks, which integrate Cisco’s UCS with EMC’s storage arrays. The first
release of IONIX UIM managed only UCS, but it will be able to configure and manage
EMC storage as well sometime in mid 2010.

Cisco’s UCS Manager configures all the minute details of the hardware infrastructure
one layer beneath the hypervisor (see Figure 7). UCS Manager permits an
administrator or an automated policy to change an extraordinarily broad array of


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settings including the identity, I/O configuration, MAC addresses for LAN
connectivity, WWNs for SAN connectivity, firmware versions, BIOS boot order, and
network attributes such as QoS settings, access control lists, pin groups and threshold
policies. This lets infrastructure administrators show application administrators
exactly the same settings as if the setup were freeze-dried the traditional way. Just as
important, they can do it very rapidly. The integrated hardware that was developed in
response to server virtualization now can help the virtualization layer extend more
effectively to storage and networks.

Figure 7: The management console in Cisco’s UCS Manager permits an administrator or
automated policy to adjust all the parameters normally associated with an application
running on freeze-dried infrastructure. Each unique collection of settings can represent a
distinct Service Profile to be applied to a pool of infrastructure on demand.

Source: Cisco

Extending Virtualization to Storage and Networks
Layering a hypervisor on a pool of infrastructure configured with a specific Service
Profile on Cisco’s UCS, or doing the equivalent on HP’s BladeSystem Matrix, doesn’t
fully deliver all the benefits of dedicated infrastructure. Server virtualization
technology doesn’t do as good a job with networking and storage as it does with CPUs
and memory. For example, a hypervisor can’t yet reserve and isolate bandwidth on a
LAN for multiple data and management traffic streams or for storage traffic on a SAN.

UCS has this capability. It can carry data, clustering, management, VM migration and
SAN traffic, and isolate and manage them separately without having to install separate
network cards and cables. As other vendors add this capability, it will be much easier


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for VMware and Microsoft to make various implementations look identical to software
running on their systems. VMware has said that this functionality is on its roadmap.

Having a single vendor build the servers, storage and networks as part of a single
system isn’t the only way to build the foundation for IaaS, but it can greatly simplify
matters. Infrastructure that’s designed as a single system takes less work to operate
seamlessly. On that foundation, virtualization vendors can provide the fluidity that
enables IaaS and guarantees the QoS. And administrators no longer need to tend to
isolated islands of infrastructure supporting each application. Instead, they can control
the entire system from a single management interface.

With an infrastructure that has the integration of a mainframe but the malleability of
software, customers can build the foundation for a series of huge operational
improvements. Now that the infrastructure is easily configurable, it opens up the
opportunity for IT infrastructure administrators to set policies in the systems
management software for how the infrastructure can be used. Then they can hand the
reins to application developers and application administrators, who can agree on the
required performance, availability and security for each application; dial-in those
settings; and let the system run.

This is the theory, at least. A great deal of development remains to be done before it
becomes practical. The magic will be in management software designed specifically for
private clouds; that is, IaaS deployments with an additional management layer.
VMware has been talking about the software mainframe since the introduction of
vSphere last summer. Microsoft has been talking more broadly about dynamic IT for a
decade. Both these initiatives anticipate a full realization of the private cloud.

The Emergence of Private Clouds
It used to take a fair amount of iteration and even guesswork to deliver just the right
amount of infrastructure to support an application. To borrow a phrase from EMC’s


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VP of marketing, Chuck Hollis, admins used to “have a hunch, provision a bunch.” As a
result, most applications were greatly over-provisioned.

Private clouds offer the potential to automate provisioning, making for much more
efficient resource allocation. They also offer the potential to automate operations.
Today private clouds offer modest automation. In provisioning, this amounts to the
beginnings of self-service. In operations, it’s the ability to take corrective action when
something goes wrong, mostly by adjusting the infrastructure, but increasingly by
addressing applications. In the future, management software will ask the applications
what they need and parcel out the necessary resources according to the required
service level, and the applications will reconfigure themselves in response.
Infrastructure and applications will work hand-in-hand with management to deliver
the right service levels.

Enabling Self-Service
A key goal for private clouds is to enable IT to set up a self-service catalog, a
standardized list of available infrastructure, platform, and application services. (Figure
7 illustrates a mockup of a service catalog portal.) Admins, developers and application
owners would select from the list the services they want to use. For example, an
administrator would define the QoS characteristics of a mission-critical application
and the management software would configure the infrastructure to deliver it. The
service level might allocate servers, storage and networking for 100 percent uptime
using high-availability clustering, tier-one storage for highest throughput and
resilience, mirroring to a remote site for disaster recovery and a maximum 300
millisecond response time for end users.

An application owner could choose a service level for, say, an SAP application that
included metering to measure the cost of delivering a particular QoS for departmental
chargeback. With the SAP application deployed, the application owner and IT manager
could fine-tune the management policy for performance, availability and security


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relative to the cost of the resources required. From that point, the automated policy
engine would adjust the infrastructure allocation dynamically to maintain the agreed
QoS.

This sort of operation would be a major step forward from today’s islands of
automation. However, administrators would lack visibility into and direct control over
the applications themselves. The management software wouldn’t be able to
communicate directly and automatically with the applications. The management
software would still be mostly constrained to managing applications by measuring and
metering their use of infrastructure and relying on administrator intervention for fine-
tuning.

Figure 8: Mock-up of a portal that delivers a self-service catalog of IT services.

Source: VMware

Vendors are getting closer to delivering this capability. In the coming year, private
cloud management software from VMware and others will let administrators define
the service level requirements of some applications.


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Extending Private Clouds with Public-Cloud
Resources
The services listed in a self-service catalog could come from anywhere — internal
resources or an external provider. Once a private cloud incorporates external
resources, two issues become critical, namely cost transparency and governance.

Cost transparency is an issue whenever shared infrastructure is institutionalized. With
dedicated infrastructure, it’s easy to account for the cost to support any given
application; with shared infrastructure, resource allocations are inherently ambiguous.
But the need for cost transparency becomes especially acute when part of the shared
infrastructure is housed externally. Some line-of-business managers wonder why the
estimated storage costs internally are 10 times the figure at Amazon. The IT managers
who serve them increasingly worry that internal IT must compete on price with public-
cloud service providers. Many are beginning to wonder how they will compete against
the scale and process discipline of a service provider with tens or even hundreds of
thousands of servers.

IT’s advantage is its knowledge of business requirements. Yes, CIOs will have to adjust
their tools and processes so they can provide full transparency for cost relative to QoS
just like any service provider. But one of their critical contributions will be governance.
They know best which workloads to support internally and which can migrate to a
public cloud.

Applications that are not mission-critical are prime targets to migrate, at least in part,
to external infrastructure. Mission-critical applications, especially those that need the
greatest resilience or require the finest degree of management control, such as Oracle
or SAP, will be bound to their dedicated infrastructure for the foreseeable future.
(There are exceptions — for instance, the service provider T-Systems maintains
500,000 SAP users running on virtualized infrastructure — but such operations are
not for the faint of heart.) Unless these applications are upgraded to make them more


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manageable on newer, shared infrastructure, they may become this generation’s
mainframe equivalents: They may never move.

Similarly, sensitive data tends to be stored internally, where access can be tightly
controlled. An HR program that stores social security numbers may be kept in-house
despite having less critical management requirements. Merely authenticating users
and systems and authorizing access to data isn’t enough when a private cloud extends
to public infrastructure. Typically, in public clouds, the customer can create some level
of isolation. But that’s not the same as having complete physical control of the data,
where it’s placed, and even how it’s erased in one location when moved to another.

For the time being, CIOs are justified in lacking confidence that shared infrastructure,
especially in public clouds, is as secure or resilient as dedicated, internal
infrastructure. But private-cloud security will mature. As service providers improve
their security processes, physically isolating sensitive data and giving enterprises
greater physical control over it, CIOs are likely to feel more comfortable managing data
externally. Emerging management standards eventually will make it easier to balance
cost and control.

Software Appliances

Software appliances start to address such issues by incorporating governance,
management requirements and cost instructions within a virtual container. The term
software appliance refers to a standardized software container in the form of a file that
contains the entire “bag of bits” to be deployed, including the operating system,
application, middleware and all the information required to recreate the VMs running
in concert for a given application. The current standard, Open Virtualization Format
(OVF), is backed by VMware, Citrix and Microsoft, among others.

OVF contains information that makes VMs portable across different vendors’ virtual-
machine implementations. It would be more useful if it were to include service-level


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requirements for deployment, security and operations. Deployment information might
include how to set up Web, application and database servers and how they
communicate; what type of network topology the application needs; and what storage
resources are needed, both locally and remotely. Security information might include
what VLANs are needed and where the firewalls should be. Operational information
might include a detailed format for describing how the infrastructure should grab and
release resources to maintain the application’s QoS relative to the budgeted cost.

VMware is trying to extend OVF in this direction with its own standard, called vApp.

Distributing Software Appliances

With all that information about management requirements standardized and attached,
it would be easier to move software appliances from internal to external infrastructure
and between one cloud and another. Standards are evolving to facilitate these tasks as
well. VMware’s vCloud API goes a long way toward standardizing how to move a
software appliance between internal and external infrastructure.

However, an API alone won’t be enough to make the process seamless. There are non-
obvious strings that tie down virtual appliances to their original data centers. First,
management technology must catch up with the web services architecture that enables
customers to choose which services to manage internally and which to federate
externally. Today’s technology can map out the application topology and show
dependencies and response times, but it can’t yet manage everything as a single end-
to-end service. Traditional management technology isn’t yet able to monitor and
enforce QoS across the organizational boundary. For example, even if a service
provider were able to assure the performance of a workload delivered in a software
appliance, the workload may still require connectivity to internal facilities such as
mainframes and on-site customer information systems. Today’s management
technology isn’t good at making sure the two sides can communicate reliably and
securely.


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Ultimately, the solution is to rewrite applications to understand how to run on
distributed infrastructure. There are two possibilities. They could be partitioned so the
more portable components could be sent to external service providers for capacity on
demand. Alternatively, certain components could be designed to run permanently in
external clouds. Regardless, legacy applications that are too long in the tooth to rewrite
will probably continue to be tethered to internal data centers.

From Application-Aware Management . . .
Today, management tools can look at the QoS information tied to a software appliance
and tune the infrastructure to make the associated application run at the required
service levels. But the management software can’t look inside the application, make a
determination of what has gone wrong, and then fine-tune it to run better. The next
step is to extend automated management control to applications.

Symantec has traditionally distinguished itself with backup, availability and disaster
recovery software featuring agents that control not just infrastructure but applications
as well. However, these agents have only limited control. If an SAP application server
fails but the underlying software remains in operation, a Symantec management
application can see the failure and restart SAP on the same or a different system. HP
and BMC have more advanced management tools that can see deeply into SAP
environments. They can see where bottlenecks are forming and thresholds are being
reached, but they, too, have only a limited repertoire of responses. No current
management product has enough knowledge of the context be trusted to adjust
application health and performance parameters automatically.


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Figure 9: Application-aware management systems would have visibility into and automated
control over the health and performance of applications themselves, not just the supporting
infrastructure.

Administrator

Custom App Oracle

Management
Application Platform

Virtualized Infrastructure

Source: TechAlpha

A fully application-aware management system, by contrast, would know right out of
the box about the performance of all application components. It wouldn’t need custom
agents that work only with the most popular applications. It would be aware of all the
distinct services in a Microsoft Exchange 2007 deployment including the mailbox,
client access, hub transport, unified messaging, edge transport and Blackberry
connectivity. It would know that end-to-end email service was slowing down because
the mailbox server couldn’t keep up with the client access, hub transport and
Blackberry services feeding it. The management software would either hot-add
resources to the mailbox server or fire up a new one and let the other services know it’s


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there, all without administrator intervention. This level of automation requires more
sophisticated applications.

. . . to Management-Aware Applications
Despite help from application-aware management, both packaged applications and
custom applications built on private clouds would still require some involvement from
administrators to manage their deployment, capacity, performance and security.
Private clouds will make it easier for administrators to deploy and dial-in the right
QoS, but maintaining an application’s operation still won’t be completely automatic.

Only when applications are designed from the ground up to interact with their
environment will mainstream IT achieve productivity comparable to that of large
public-cloud services such as Amazon, eBay and Google. First, deployment and
operations teams must be able to make all but the most strategic management policies
accessible to developers in a standardized format. While that day may seem far off,
thought leaders at Microsoft, T-Systems and VMware are already assessing the
requirements.

In such an environment, any application — whether SAP, a next-generation SaaS
application built by a startup, or a corporate application built on a PaaS service such as
Microsoft Azure — would need to be able to monitor itself and communicate its needs
to the outside world. It would need to be able to predict its resource requirements and
communicate them to an external management system, which would provision the
appropriate resources based on the priority of its service level agreement and confirm
what it has provisioned with the application. The application, in turn, would be able to
adjust to the new conditions.


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Figure 10: A management-aware application would be aware of its own health and
performance. It would interact with a management system to get the resources necessary to
meet its required service level.

Administrator

Custom App Oracle

Management

Virtualized Infrastructure

Source: TechAlpha

This sort of interaction between applications and infrastructure implies some degree of
standardization. For instance, an application might need to report its existing and
required number of threads or work processes, physical or virtual memory
requirements, and some standard way of measuring and accelerating critical
transactions. The external management system likely would remain the repository for
the policy engine that tells the infrastructure what resources to provide to maintain the
application’s QoS. The key change is that the application itself would be the primary
control and management node, while the external management system existed to serve
it, not run it.


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Vendor Implications
The evolution of private clouds implies the technical milestones described above. But
how they’re defined, who controls them, and the resulting industry structure are open
issues. Each vendor is using its market strengths to tilt the playing field in its direction.

The dominant providers of system management services, CA, BMC, HP and IBM, may
not seem well positioned for an emerging environment in which traditional technology
will become obsolete. However, these vendors have unique strengths that translate
handily into the era of hybrid virtual/physical and internal/external infrastructure.

Meanwhile, VMware and Microsoft will have the biggest impact on the evolution of
private clouds. They are the vendors best positioned to influence how manageability is
built into software and how it is integrated into hardware infrastructure. Oracle is
trying to sidestep the market battles at all levels by selling a complete integrated
solution.

An Important Role for the Big Four
Upon a cursory look, it appears that private clouds would diminish opportunities for
the Big Four incumbent management vendors. After all, homogeneous internal
infrastructure is easier to manage. Entirely new technology is required to manage
workloads that have been delegated to external service providers. However, no other
existing candidates can play the role described by BMC’s CTO, Kia Behnia, as “a single
point of aggregation and control.”

The Big Four have taken the initiative in bridging physical and virtual infrastructure.
But they also have skills and experience to offer in three crucial areas:


INFRASTRUCTURE


Integrating infrastructure layers

These vendors have lots of experience tying together distinct infrastructure layers to
form a vertically integrated stack. The operating system, database, middleware and
other components might come from different vendors and have their own
management capabilities built-in. There’s a need for software that manages the whole
collection. If a component fails, for instance, this software can restart the relevant
piece or the whole stack.

Integrating intergenerational products

When the entire stack of software comes from one vendor and one generation, that
vendor’s management software clearly has the advantage. But stacks from different
vendors and generations often grow up next to each other and require broader end-to-
end management. Today, no one does a better job of bridging these gaps than the Big
Four. For example, Computer Associates and BMC are expert at bridging mainframe
and server-based applications and infrastructure. HP’s Business Availability Center
excels at integrating the management of Web-based applications and earlier-
generation systems.

The technology that would manage QoS dynamically fits right into this scheme: It’s a
composite of traditional tools that control physical infrastructure, tools from server
virtualization vendors and an emerging generation of tools from the traditional
vendors that control the emerging integrated infrastructure. The first inklings of the
power of this new regime are starting to appear. BMC and HP have made strategic
acquisitions, BladeLogic and Opsware respectively, that accelerate their ability to
manage hybrid environments that include both physical and virtual infrastructure. The
resulting products address labor-intensive and error-prone IT tasks of server
provisioning, configuration and compliance. They ensure that servers receive the right
software, get patched and updated properly, and remain within guidelines for security,
regulatory and operational policies.


INFRASTRUCTURE


Figure 11: The emerging virtual infrastructure stack will need to be integrated with previous-
generation stacks into a single management framework — a specialty of the Big Four.

Custom
SAP ISV App Mgt
App

Application Frameworks Mgt Custom Sales Order App ISV App Mgt
JEE, .NET, LAMP, Spring

Application Server
Security

Application Servers

MoM
Mgt

Security
Oracle Weblogic, Windows, IBM Mgt Customer Information Control System

MoM
Websphere, Tomcat, also SQL DBMS (CICS), DB2

Operating Systems Mgt Operating System, Mgt
Virtualization Mgt Virtualization
Servers, Storage, Networks Mainframe Mgt
Mgt

Manager of Managers: single point of aggregation and control
Source: TechAlpha

Tying together multiple applications in an end-to-end service

For instance, HP has extended its expertise to helping customers source, integrate and
manage systems no matter where those systems originated; they could be a
combination of packaged legacy systems, in-house development and SaaS
applications. The technical objective is to manage end-to-end services with one all-
encompassing SLA that flows to the constituent applications. An enterprise should be
able to create a B2B commerce site comprising, say, a custom Websphere application,
an SAP sales and distribution application, and an SaaS component that would let a
multi-tier supply chain collaborate on replenishment plans that runs on Amazon.


INFRASTRUCTURE


Figure 12: Private cloud management systems will need to control end-to-end services that
might include components running at external service providers.

Service Provider Virtualized Infrastructure Legacy Silos

Private cloud management
Apps

Servers

Service Provider management
Network

Storage

End-to-End Service Management

Source: TechAlpha

The Big Four won’t develop the ability to manage an end-to-end service across
organizational boundaries overnight. It’s not yet possible for a management system to
provide visibility into and control over QoS for each component and meter everything
all the way out to those running at Amazon or another service provider. And it’s not
clear how long it will take for internal management systems to extend their reach fully
to the public cloud. Until they do, there will be a need for internal infrastructure

VMware vs. Microsoft
Despite critical contributions from hardware infrastructure vendors and incumbent
management vendors, VMware and Microsoft are driving the biggest parts of the


INFRASTRUCTURE


upheaval. They are defining the software layer that works most directly with the
hardware. They are also driving the technology for management-aware applications.

To understand their strategies and handicap their odds, it helps to understand where
they are applying leverage and how strong that leverage is (Figure X). Windows runs
on about 75 percent of servers. Forty percent run packaged applications from SAP and
Oracle at the high end, down to ubiquitous applications such as Microsoft’s Exchange,
SQL Server and Sharepoint and IBM’s Lotus Domino. Another 40 percent serve
custom applications built by developers using frameworks such as .NET, LAMP, JEE
and SpringSource. Among this group, the market can be further divided between the
development frameworks used to build applications and the application servers used
to run them. Enterprise developers are split fairly evenly between .NET-based
frameworks (which run only on Windows) and Java-based frameworks. Within the
Java market, developers are split between SpringSource, which VMware bought last
summer, and JEE, owned by Oracle. The last 20 percent of servers run IT
infrastructure tasks such as file sharing. These rough figures indicate where each
company’s assets will prove most valuable.

Figure 13: Server deployments by percentage. (20 percent is devoted to IT infrastructure
services such as directories and file sharing.)

Source: TechAlpha

VMware and Microsoft would probably find little to differ over in the layers called out
in Figure 1. However, what each layer does, how the layers work together, how they are
priced, and how the vendors take them to market are likely to differ substantially.


INFRASTRUCTURE


The Battle for the Data Center Operating System

While VMware uses the phrase “data center operating system,” it has a very different
vision of the operating system from Microsoft. VMware wants to make the operating
system a vestigial appendage of a bygone era. It aims to reduce the OS to a simple
appliance tucked between the application and management layers.

Figure 14: By integrating a virtual infrastructure management layer and an application
management layer, VMware could make the traditional operating system irrelevant.

VMware

Custom App ISV App
Microsoft

Application Frameworks Custom App ISV App
JEE, .NET, LAMP, Spring, vmforce.com
Application Frameworks
Application Platform .NET
Tomcat now: force.com, Weblogic,
Websphere, SQL DBMS, etc., future Windows Server OS /
vSphere Virtualization Hyper-V Virtualization
Servers, Storage, Networks Servers, Storage, Networks

Source: TechAlpha

A traditional operating system has two responsibilities, both of which VMware is
positioning itself to take on. First, it abstracts the hardware so all resource elements
look alike. To the software running on a data center OS as VMware defines it,
individual storage elements would melt into a uniform resource pool, leaving VMware
in control of the new generation of shared hardware infrastructure.


INFRASTRUCTURE


This development would wipe out a large part of the value of Windows. Microsoft has
gone to Herculean effort and expense corralling hardware vendors to write and test
device drivers; this is a key part of the network effect that propelled its platform to
dominance. Where Windows traditionally has managed all the hardware by itself,
VMware is horning in on the territory. Thus, as Microsoft scrambles to catch up in
virtualization, it’s in the rare position of being behind in the hardware domain. And for
all the talk of tension between VMware and EMC, the storage company gave VMware
access to its multibillion-dollar test lab to make sure VMware’s hypervisor could sit on
top of any vendor’s hardware — a tremendous hidden asset.

The second responsibility of an operating system is to provide common services to
applications such as resource scheduling, memory management or file storage. But the
boundary between operating system and applications is evolving, and VMware is
attempting to accelerate the movement of corporate and ISV developers away from
traditional operating systems and towards application frameworks. Just about all
custom and many ISV applications today are built in JEE, .NET, LAMP, Ruby on Rails
or Spring. These frameworks make it easy to build applications that talk to databases
and have rich user interfaces. The next step is to make it easy to build applications that
monitor their own health and performance, availability and security levels and
communicate resource needs to the management system.

This was the motivation behind the VMware’s acquisition of SpringSource. Nobody is
under the impression that all applications in the future will be built on the Spring
framework or deployed on the Tomcat application server. But now that VMware has all
the pieces, it can figure out how to put together a solution that lets any application
framework integrate deeply with the private-cloud management layer. At that point,
both corporate and ISV developers will be able to build management-aware
applications.

VMware just took another major step forward with its platform strategy to offer a
migration path beyond private clouds by teaming with Salesforce.com to create a joint
PaaS offering. The new product, vmforce.com, will combine the mainstream, popular


INFRASTRUCTURE


Spring framework with all the application services and data already in the Force.com
PaaS offering. In other words, Java developers can deploy Spring-based applications
and take advantage of the built-in manageability, application functionality and
customer-related data that previously required Force.com’s proprietary developer
tools. VMware's vCloud management services will be a key part of making applications
portable between vmforce.com, customers’ own premises and other service providers,
as long as the applications don’t exploit features specific to any PaaS offering.

Where is Windows in all this? It doesn’t matter. VMware can embed a tiny version of
Linux between the application framework’s runtime server and the hardware
management layer to provide the bare minimum of traditional OS services.

Today, Microsoft uses its overwhelming server OS market share to extract premium
pricing for the virtualization-enabled Windows Data Center Edition and an additional
premium for the Systems Center management platform. Virtualization is priced as a
feature. VMware, by contrast, won’t require Windows. Thus it would be able to offer a
competitive price for its runtime platform, which will support all application
frameworks, plus its management layer.

The problem for VMware is that this strategy works best for custom applications,
which account for only 40 percent of servers. It needs to overcome Microsoft’s
overwhelming advantage with the 40 percent of servers that run packaged
applications, dominated by Microsoft’s SQL Server, Exchange, SharePoint, Office
Communication Server and others. Apparently, VMware has a strategy in place to do
so.

The Battle to Manage Packaged Applications

As long as Microsoft’s server applications dominate, it will be very difficult for VMware
to redefine the platform for packaged applications. VMware’s best chance to seize that
ground may be where it appears weakest today: serving small to mid-size customers.


INFRASTRUCTURE


Although this segment is ill-defined, it probably tops out with customers that have less
than 50 servers. These customers’ ability to absorb private cloud management
functionality is badly lagging VMware’s ability to deliver it. Microsoft’s functionality,
still mostly focused on server consolidation, appears good enough. But as VMware
points out, Microsoft became dominant in servers when it overthrew Novell by offering
superior versions of the two highest-volume server applications: email and file and
printer sharing. It looks like VMware is planning to do the same thing, offering these
applications through its more than 1,500 service providers via SaaS.

On the email side, VMware’s likely strategy is to deliver Exchange server functionality
through service providers. Many observers were perplexed when VMware bought
Zimbra, but there’s no mystery. Zimbra is a substitute for Exchange, not figuratively
but literally. Companies can migrate their servers while end users continue to run
Outlook. Small IT shops can offload mail to someone else. Zimbra’s purported
attraction for service providers is that it’s designed for low-cost, cloud-scale operation.

VMware’s strategy for file sharing is more speculative at this point. The company may
combine desktop virtualization delivered as a service with a new approach to file
sharing. This, too, could be managed by service providers. The best clue is that
VMware CEO Paul Maritz spent five years leading a startup called PI (pronounced
“pie,” but short for “personal information”) that attempted to redefine how users
access, store, organize and share information. Press reports at the time suggested that
it would be a more modern and sophisticated version of Sharepoint. In 2008, he sold
PI to EMC, which has continued to develop the software in stealth mode.

VMware’s increasingly aggressive push into desktop virtualization might be related.
Desktop virtualization is about enabling a user’s environment to follow him from
machine to machine rather than being tied to, say, a single laptop. PI is part of an
effort to make a user’s environment more task- and information-centric, rather than
the current application-centric approach typified by Microsoft Office.


INFRASTRUCTURE


VMware’s best hope may be that desktop virtualization and new ways of sharing
information can break apart the two core elements of Microsoft’s business model.
First, Office’s tight and ever-expanding horizontal integration has enabled Redmond
to maintain its pricing despite selling hundreds of millions of units over 20 years. An
information- or task-centric computing experience could rupture the need for
traditional application integration. Second, every time a PC gets replaced, part of what
customers pay for is a new copy of Windows. Desktop and application virtualization
make it possible to keep using of the same copy of Windows as the environment
follows the user from machine to machine, breaking the Windows royalty pipeline.
Microsoft is in the process of loosening licensing restrictions for some of these
scenarios under customer pressure.

The Wild Card: Oracle
Microsoft and VMware are fighting to define the next-generation data center operating
system by developing the layers where they’re strongest and emphasizing the value
that would come from adopting their roadmap. Oracle is taking an entirely different
approach. It wants to redefine the scope of vertical integration. By building the deepest
integrated stack and best-of-breed management tools to bind it together, it hopes to go
further toward reducing total cost of operations and enabling "lights out" operation.

The cost of operating Oracle’s traditional applications is high. Analysts estimate Oracle
systems cost more than $1,000 per user per month including hardware depreciation,
implementation and operations. (To be fair, SAP’s price is similar.) Bringing down that
cost will likely require many of the same technologies VMware and Microsoft are
trying to develop. But a single-vendor approach all the way down from the application
to the chips and spinning disk drives does allow Oracle to make favorable trade-offs
not open to other vendors. For instance, Oracle’s Exadata database machine is
optimized for Oracle database performance in a way no other server, storage or
database appliance can match. Only Oracle can break up the core of the database
engine to achieve new performance levels. For example, it has essentially transplanted


INFRASTRUCTURE


parts of its database engine to the equivalent of the storage controller, so those parts
are much closer to where the data is physically stored on disk. This minimizes the need
to move data over the storage network, speeding up performance by orders of
magnitude.

It’s worth noting that Oracle also plans to compete aggressively in the same software
layers as VMware and Microsoft. In collaboration with Sun, it controls the JEE
application framework, which has been adrift relative to Spring and .NET. And with
BEA, it controls one of the two leading production servers for Java applications (the
other being IBM’s Websphere). And the Java applications it runs include those based
on Spring.

Technically, Oracle’s destination looks very similar to where VMware and Microsoft
are headed. However, Oracle is attempting to absorb most of the major surrounding
markets as well. It also appears to have ambitions for management software well
beyond its own virtualization platform. It lured Richard Sarwal back after his stint as
head of development VMware when VMware appeared to pivot away from trying to
replace the Big Four’s management software. Such software is critical to Oracle’s go-
to-market strategy for its Fusion applications. It aims to deliver the applications from
its data centers via SaaS with management provided remotely by Oracle on the
customer’s premises, or under customer’s control on their premises, or a combination.

Customer Implications
The cloud computing market is still very young, but it’s not too early to handicap how
customer purchases and deployments are likely to unfold. In general, despite
widespread deployment of VMware’s and Microsoft’s virtualization layers,
unified infrastructure vendors such as Cisco/EMC (Vblocks) and HP
(BladeSystem Matrix) are likely to find their first successes with large,
sophisticated shops that are building or buying applications designed


INFRASTRUCTURE


around private cloud management and need growing pools of unified
infrastructure to support them.

IT departments at large enterprises generally have the administrative scale to manage
infrastructure and applications from multiple vendors. They’re likely to retain a
conventional architecture around established applications, adopting the new
integrated infrastructure only as they build out for new applications. Small to medium-
size businesses are rarely early adopters, but their greater cost sensitivity and lack of
specialized admins make them great prospects for this new infrastructure. As larger
customers become comfortable with unified infrastructure, smaller operations are
likely to embrace it for the portion of their infrastructure they don’t outsource to
service providers.

Service providers are beginning to provide cloud services both public and private,
moving beyond traditional hosting and managed services. These operations, too, fall
into categories. The largest of them operate infrastructure that is highly tuned for
delivering standardized services such as Amazon’s virtual servers and storage and
Microsoft’s MSN and Hotmail services. They also recognize the value of standardizing
parts of their infrastructure. The new integrated infrastructure suits these operations
because it will more easily accommodate their custom management software. If they
buy it, they’ll buy enormous quantities — delivered in shipping-container size
increments.

More specialized service providers such as T-Systems and Sunguard typically require a
more heterogeneous hardware. In T-Systems’ case, that includes managing billing for
Deutsche-Telekom and on-demand SAP systems for other customers; Sunguard serves
as a failover site for disaster recovery. These providers operate highly specialized
infrastructure, which will tend to bias them against the new integrated designs. They
do need to standardize management across their organizations, but their standards are
idiosyncratic and don’t necessarily bear any relationship to the standards evolving to
support private clouds.


INFRASTRUCTURE


As for the private cloud management layer, the Big Four are destined to play a bigger
role managing end-to-end services for enterprises than in the small-to-medium size
segment or among service providers. But for application-aware private clouds and
future management-aware applications, VMware and Microsoft have the most control
over the key leverage points that integrate how the application and hardware layers
communicate. Microsoft’s dominance among small-to-medium size businesses gives it
a major advantage among customers of that size. VMware, meanwhile, has
confounded skeptics by maintaining its dominant position in the enterprise.

Finally, the growing share of customers that define themselves as Oracle shops will
resemble the IBM shops of the 1960’s through the 1980’s. Their IT landscape will be
vertically integrated across Oracle technology and other vendors will play at the
periphery. The only question is what share of all customers Oracle will claim.


INFRASTRUCTURE


About TechAlpha
TechAlpha is a management consulting and research firm that advises clients in the
technology, media and telecommunications industries across the following functional
disciplines:
 Corporate finance and strategy, corporate development
 Business unit and product strategy
 Technology evaluation
 Product management
 Marketing
 Sales and sales operations
 Business development
 Information technology

Visit http://techalpha.com

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