Cloud

A simple guide to Cloud Computing, IaaS, PaaS, SaaS, BaaS, DBaaS, iPaaS, IDaaS, APIMaaS

Cloud computing is something that I find many people still questioning the value of.

peopleclammoring

http://www.newscientist.com/blogs/onepercent/2012/01/letting-gamers-experience-the.html

What is Cloud computing?

I don’t know if this qualifies as the “dumb aaS” guide but it is the simplest way I can explain the benefits of Cloud Computing and what all the fuss is about, what these terms mean and simplify it for the average business person.

All the aaS’es (:)) provide a similar set of functionalities:

—Low initial cost to deploy
—Incremental cost as your usage grows
—Automated deployment
—Management built in
—Self service
—Best Practices embedded
—Lifecycle built in
—Re-use
—Resource sharing
I will explain what these qualities mean in detail below.
TERMINOLOGY:
In each of the aaS’es there is a different thing being specialized in doing these “qualities.”
IaaS – for hardware, network and physical resources
PaaS – for applications developed for your benefit
SaaS – for applications that others provide to you
BaaS – for mobile application back-ends
IDaaS – single sign on and similar services around identity
iPaaS – for making things work together
DBaaS – for databases and data
APIMaaS – for API Management or services you provide to others
TaaS – for taxis :)
you get the idea…
Each of these 9 qualities of aaS’es are critical and each provide insight into why these things will become or are being successful.   With any aaS you can go with the cloud (public) and use a provider or you can buy software and do the work of the provider yourself (private).   You will not gain all these advantages if you run it yourself but you will gain the advantage that you are in control which for many companies is still important and you will gain a large number of benefits above not doing aaS at all.    In many cases the “private” version of these services are highly automated embedding many of the qualities above to make it easier for you to operate the service.  In many cases the advantages of self-service, re-use, resource sharing, automated deployment are tremendous and make the move to aaS whether public or private a necessity in today’s fast moving world.
Now here is the meat of what these things are.

Low initial cost to deploy (COST SAVINGS)

Public:  A lot of the drive to aaS’es is because you can spend very little money, try out an idea, get started with little capital.  This is important to small businesses but also important in big companies.   The agility in larger organizations is limited by the decision making time.  The decision making time is frequently related to the $ to be spent on the initiative.  If you need 40 machines and 6 months, 20 people it may take 6 months to get approval.   Having to order lots of whatever aaS you are interested in without an aaS entails risk, time to acquire the service and commitment.  The lower this initial cost the easier the organization can move forward.  For smaller companies it means the difference between having to raise additional millions in capital which can take huge amounts of time and reduce the benefit for the entrepreneur who now has to share his stock with others taking capital risks that are unnecessary.   This is a huge benefit for startups.
Private:  This feature is largely lost if you deploy yourself.   However, in a large corporation operating this as a service within the company can provide similar kinds of benefits as a public provider if you can amortize the cost over many divisions and users.

—Incremental cost as your usage grows (COST SAVINGS)

Public and Private:  Many companies have been derailed because they could not afford, did not have the time or capability in some way to grow the aaS as needed.  For one company I started before the aaS’es we could not grow the infrastructure fast enough to meet demand.  We won the DEMO conference with a consumer product.  The New York Times and Wall Street Journal gave my product rave reviews.  10s of thousands of customers poured into our website and our download locations to try the product.  The downloads were not scalable to that level quickly at the time (in the early 2000s).  Our servers quickly reached a peak load as we gained tens of thousands of customers a day.   Many complaints were heard about inability to download, the system careened under the load.   Lost customers, dissatisfied customers can hurt a startup or any company.   If I had started that company today we would have been so much better off.

—Automated deployment (FASTER TIME TO MARKET)

Public and Private:  Todays applications are complex aggregations of many services.  It is not atypical for a modern application to consist of dozens of servers with different components. Even without this growing complexity the cost of configuring and deploying applications or whatever aaS can take a huge amount of time and slow down agility. Users today expect upgrades and fixes to be propogated in days not months.  The cycle of software development is not doable with the old way of deploying applications.

—Management built in (COST SAVINGS, FASTER TIME TO MARKET)

Public and Private:  Instrumenting an application or service so that you can monitor and manage it is expensive tedious, usually involves buying additional software and is generally another impediment to agility.  Having the management built in so that you can see the status and manage the service as you need is critical.

—Self service (FASTER TIME TO MARKET)

Public and Private:  This also goes along with the idea that there is a reduced cost of acquisition and time to acquisition.   I don’t have to get on the phone to talk to anybody.  I don’t have to wait for someone to do something for me to start.   I can evaluate a product, try it out, gain whatever information I need by myself or have the other stakeholders and interested parties do the same thing.   I go to a self-service web page, log in, order what I want and start work immediately.  That is unbelievable when we used to spend months talking to dozens of vendors and negotiating prices, running the rigamarole of the traditional acquisition process in large companies.

—Best Practices embedded (LOWER RISK)

Public: Let’s face it.  Almost NO companies really have a core competence for operating technology.   Let’s talk hardware.  What kind of hardware should you buy?   What networking equipment?  What are the best security policies?    How often should you upgrade?   How many companies feel they are doing these things using the best practices?  How can you even know this?  Are you expert in hiring qualified people to do these things?  How do you know that?  Can you evaluate their skill?  Can you be sure they are doing everything to the level of the top of the industry practices?   If you are, then you should ask yourself is this really something you should be investing your time and money in?   Is your business running computer equipment, databases, development infrastructure?  Or is your business finance, making toys, making drugs or something else?   You can’t be completely ignorant of these things in order to buy aaS’es but for the vast majority of companies it is a completely stupid waste of their capital to be investing in technology and technology management.
Private:  Most of the private aaS’es have some built-in best practices but some of the operational aspects are things you will have to become expert in.  You may already have some skills in this area.   The aaS’es make it easier to implement best practices that may be hard to achieve without the automation and other facilities provided by a private aaS capability.

—Lifecycle built in (LOWER RISK)

Public: How many companies really know how to manage the lifecycle of technology assets?  Do they know what the most efficient tradeoff to replace technology?  Do they know what technology to buy at what point in the lifecycle and do they know how to maintain that technology to provide the best aaS’es at whatever time they need it?  Comapnies doing these aaS’es primary skill is in figuring out where to put the service, when to upgrade, fix or not fix something.  They know how to backup things.  If they don’t that is a failure but how do you know you won’t have the same failure?  You have even less reason to be vigilant on these fronts?  Not all aaS’es are going to provide the same level of service.   You have to choose the aaS vendor that gives you the level of service you want.  You have to see if they have a record of providing the service and if they can demonstrate they are following the best practices.  They should be able to wow you with their story.  If not, select someone else but once you have picked one you should be happy that this is not something you have to take responsibility for.   Many people ignore issues like lifecycle.  They never consider in the costs of whatever they are buying or doing themselves what the true cost of something is when you have to fix it down the road.   When you factor in the true lifecycle costs many companies face the real core of the problem.  Outdated technology, outdated infrastructure that costs a fortune to upgrade that you never planned on.    A change in a law comes along and suddenly you have to change stuff you don’t even know how it works anymore.   The people who built it aren’t around anymore or the cost to fix is prohibitive.  Then you need to look at a radical step.  Risky changes that put your whole company at risk at times.
Private:  Usually a private aaS will provide you automated tools to help you with the lifecycle issues.  You will still have the costs of the lifecycle and the bumps that you should plan for but it should be easier with a private aaS.

—Re-use (LOWER COST)

Public: Have you considered what to do with the “thing” you are thinking of doing yourself when you no longer need it?   Many companies have lots of equipment or applications, infrastructure that they paid good money for that is no longer being used for the original purpose it was intended.  That stuff remains fallow frequently.   Oh well.  We spent 5 million on that application but we’re not using it as much anymore.  We bought that hardware and now it’s just sitting in the data center sucking power or space.  Can you sell it?  Unlikely.    An aaS provider handles the ups and downs of demands and spreads that among all the tenants.   If some tenants aren’t using the services they are able to reuse and cut your costs.
Private: A private aaS should provide multi-tenancy which will allow you to re-use assets.  If you have multiple tenants (either divisions or users in your company or external partners or customers could be tenants) then you should be able to take advantage of Re-use of a private aaS.

—Resource sharing (LOWER COST)

Public: Frequently you aren’t using a service 24×7.   Frequently you aren’t making full use of the service during the times you are using it.   There may be parts of the service you aren’t using as much that others could use.  When you own the service entirely yourself you have to buy for your peak demand.   When you aren’t using that peak demand you aren’t gaining any benefit from the excess capacity.   Some companies buy 3 times the hardware they need.  They have to buy all that equipment to support fault tolerance by having redundant servers.   They need extra machines for peak load times.  They need to buy hardware in anticipation of planned growth which may or may not happen.  Or the growth may happen even faster than expected which is another problem.   If you need a peak capacity because of a special promotion you are running, an extraordinary turn in the market that benefits you like in my case above some really excellent publicity that sparks massive demand.  The same thing works in reverse.  Why pay for stuff (whatever aaS) we are talking about when you don’t need it.  Let others benefit and you save cost.
Private: You may or may not be able to take advantage of this with a private aaS depending on if you have different applications or tenants that could use the resources provided in your private aaS.

Summary

In summary you should be able to see why the cloud is a $100 billion business in a few short years.  The advantages of these aaS’es is tremendous.    They help you defray or eliminate capital costs, reduce operational costs, drastically cut time to market, reduce risk in many categories.  The benefits of the cloud are simply indisputable and companies which aren’t doing this are putting their heads in the sand.  If technology costs are a significant part of your budget then you have to consider either public or private cloud computing.
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5 replies »

  1. […] 3. At the same time Amazon realized that it could sell infrastructure as well as books, toys and toiletries.  :)  They were driven to this because they had chosen a different approach than Ebay in how to extend their value.   Amazon embraced the problem of facilitating its partners to rent infrastructure.  Internally Amazon was structured differently.  Ebay had a problem in early days where they were put out of business for 2 days in a row.  They solved that major outage by choosing to centralize their technology and keeping strict control.  Amazon had a looser philosophy and saw the opportunity to rent infrastructure sooner.  This is a surprising development to come from Amazon but it happened.  I think this is fascinating how this happened.  Jeff Bezos was obviously a critical factor in Amazon creating the cloud.  To have a simple explanation of cloud technology read this article. […]

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