Download - Revolution Not Evolution-Whitepaper
-
7/31/2019 Revolution Not Evolution-Whitepaper
1/19
Sponsored By:
The Cloud is confusing well it can be, and thats where CloudU comes in. CloudU is a comprehensive Cloud Computin
training and education curriculum developed by industry analyst Ben Kepes. Whether you read a single whitepaper, watca dozen webinars, or go all in and earn the CloudU Certifcate, youll learn a lot, gain new skills and boost your resum
Enroll in CloudU today atwww.rackspaceclouduniversity.com
Revolution not evolution
Hw Cd Cmpg Dffrs frmtrada it ad Why Mars
CloudU is a service mark/trademark of Rackspace US, Inc. in the United States and/or other countries
-
7/31/2019 Revolution Not Evolution-Whitepaper
2/19
-
7/31/2019 Revolution Not Evolution-Whitepaper
3/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 2
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
A New Dawn or Just Another Day Ellison vs Benio2010 marked the escalation o the war o words between the respective CEOs
o Oracle and Salesorce.com, Larry Ellison and Marc Benio. In the words o
these larger than lie gures, we can actually see an outline o many o the themes
that will be explored in the ollowing pages. Is Cloud Computing undamentally
dierent rom what came beore? What does it mean or an organization to do
Cloud Computing? Tese are the questions that one must ask to answer the
question Is Cloud Computing a Revolution or simply version 2.0 o a continuous
series o innovations.
For his part, Oracles Ellison has a history o discounting Cloud Computing as no
more than a new name or what has gone beore. In a 2009 interview1
that hasbecome somewhat o a web cult classic, he said:
All the Cloud is, is computers in a network Our industry is so bizarre. Imean, they just change a term and they think theyve invented technology.
In some ways, Ellison is correct. Many o Cloud Computings most common
eatures-virtualization, pay-as-you-go, reduced cost and moving I responsibility
to third parties - have been around much longer than the Cloud. Yet there are
those who argue that despite the similarities to what has come beore, the Cloud is
undamentally dierent.
In this camp, the most vocal oil to Ellison is Salesorce.coms Marc Benio,
himsel a ormer Oracle executive and protg o Ellison. In what was a drama
lled keynote speech at the Oracle OpenWorld 2010 conerence, Benio outlined
his own denition o Cloud Computing:2
Our denition o Cloud Computing is multi-tenant, its aster, hal the cost,
pay as you go, it grows as you grow or shrinks as you shrink. It is extremely
ecient. Were not going to show you computers taller than you. Were not going
to show you a cloud in a box because clouds dont come in a box. Tey never
have. Tats the whole idea.
-
7/31/2019 Revolution Not Evolution-Whitepaper
4/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 3
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
Te computers taller than you reers to Oracles Exalogic Elastic Cloud, an
impressive mix o hardware and sotware designed to power web-scale enterprise
applications. Te point that Benio makes with his characteristic color is that
Cloud Computing is not about individual business buying bigger and better
hardware, what Oracle calls a Cloud in a box. Te Cloud is about businesses
giving up the cost and burden o managing and maintaining hardware all together
Tis author agrees with Benio. raditional hardware and sotware vendors,
like Oracle, have a vested interest in arguing that Cloud Computing is best
implemented by doing more o what companies have traditionally done to gain
ecacies. Buy more hardware and sotware. Buy better hardware and sotware. In
support o Benio s position, another well-known I executive, Werner Vogels o
Amazon Web Services, commented that that i you have buy more hardware justto get started it is not a Cloud3
Te Growth of the Cloud
As Ellison and Benio spar over deni-
tions and what constitutes a true Cloud
the market continues to explode.
Cloud Computing covers a range o ac-
tivities rom replacement o on-premise
inrastructure, through development
platorms and on to on-demand applica-
tions. Given such a breadth o areas that
Cloud Computing touches, statistics are
useul as a general indication o trends
rather than a source o accurate predic-
tions. While the numbers that various
analyst rms give as their estimate o the
Cloud Computing markets size dier
(see inographic below), one thing they
all agree on is the rapid growth o all
parts o the Cloud Computing market.4
0
1000
2000
3000
4000
500
1500
2500
3500
August 2009
August 2010
Number of Websites Using Cloud Providers
Amazon EC2
94%Growth
mazon EC GoGrid
188%Growth
rid
o
Rackspace CloudServers
106%Growth
Ra kspace ClS r er
Linode
146%Growth
Linode
Source: Jack of All Clouds
2007 2008 2009 20100
40,000
80,000
20,000
60,000
100,000
Amazons Virtual Computers Created per day
3 month moving average
1020Source: The Economist
-
7/31/2019 Revolution Not Evolution-Whitepaper
5/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 4
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
So just what is Cloud Computing, and why it is so dierent rom what has come
beore? Te ollowing pages will detail our main areas in which Cloud Computing
allows businesses to break rom the past:
Virtualization Te ability to increase computing eciency
Democratization o Computing Bringing enterprise scale inrastructure
to small and medium businesses
Scalability and ast provisioning Bringing web scale I at a rapid pace
Commoditization o inrastructure Enabling I to ocus on the strategic
aspects o its role
Each o these areas does not itsel create a computing revolution, virtualization
as Ellison would point out, has been around or some time, but together, they arechanging computing orever. Lets see how.
-
7/31/2019 Revolution Not Evolution-Whitepaper
6/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 5
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
From Water-wheel to Utility Power An analogy or the Cloudechnology has a way o grinding on, despite o vested interests o vendors
and industries built upon a particular way o doing things. o understand
the revolutionary qualities o Cloud Computing, it is appropriate to utilize
a well-worn, but accurate analogy that compares Cloud Computing to a
traditional utility service like water or electricity. Nicholas Carrs book he
Big Switch5 is an excellent introductory read to this subject. In a previous
article6 appearing in the Spring 2005 issue o the MI Sloan Management
Review, Carr wrote that;
...As a business resource, inormation technology today looks a lot like electric
power did at the start o the last century [when it was routinely produced by
individual businesses rather than utility providers] executives are routinely
sidetracked rom their real business by the need to keep their companys private
I inrastructure running smoothly.Noting the similarities between computing and a technology that most would
agree is best handled by specialists rather than individual rms, Carr then moves
onto a discussion about the consequences o sel provisioning inrastructure and
the resulting overcapacity that oten accompanies it:
When overcapacity is combined with redundant unctionality, the conditionsare ripe or a shit to centralized supply. Yet companies continue to invest large
sums in maintaining and even expanding their private, subscale data centers.
Why? For the same reason that manuacturers continued to install private electric
generators during the early decades o the 20th century: because o the lack o a
viable, large-scale utility model. But such a model is now emerging...Te model that Carr says in emerging is Cloud Computing. Cloud Computingprovides specic economics that are benecial under many situations especially
anytime demand is erratic, the organization is in a state o change or when
pressure comes to bear to move rom CapEx to OpEx.
While the metaphor comparing Cloud Computing to utility power helps
explain the nearly inexorable orces compelling business to adopt this new
-
7/31/2019 Revolution Not Evolution-Whitepaper
7/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 6
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
model, it doesnt position this latest technology in the more recent context
o massive technological shits. For that, we can look at the shit that saw
mainrames transormed into Clouds over the course o only a ew decades.
-
7/31/2019 Revolution Not Evolution-Whitepaper
8/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 7
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
Mainrames to Cloud A brie history o technological innovationIt is worth briefy reviewing where Cloud Computing sits in the continuum o
computing innovations, each o which were seen as revolutionary in their time. Initial
widespread corporate computing occurred within a shared resources model where
massive mainrame computers took up acres o space within dingy basements and
users would book time or both the machines themselves and the skilled technicians
who knew how to operate them. Teir use case was generally narrow business analysis
and hence computing had a very narrow sphere o infuence.
With the advent o mini computers and later the personal computer in the 1970s,
we saw the ability to utilize the benets o technology rolled out to a much
broader audience. While still relatively expensive and unctionally basic machines the personal computer put computing onto (almost) any desktop in a reasonably
well resourced organization.
Te advent o the Internet however changed things orever, both rom the
perspective o the network and the perspective o individual computers. Te
increased reliability and reduced cost o the internet (in comparison to proprietary
networks) along with the decreasing cost o computers, led to increased use o web
based applications. Tis along with the demand or application access via multiple
devices using multiple orm actors led to a rapid growth in Cloud Computing at
an inrastructure, a platorm and an application level.
It is worth drawing parallels between the resistance to adoption o Cloud
Computing, and that o adoption o the Internet generally. In his book
Management Strategies or the Cloud Revolution: How Cloud Computing Is
ransorming Business and Why You Cant Aord to Be Let Behind,7 Charles
Babcock discusses the competitive pressures that gradually lead to adoption o the
Internet. As he points out;
At one time corporations built out high-perormance proprietary networksto link dierent locations As the Internet became the deault connection
between universities, government agencies and some companies, the cost o not
having an [Internet protocol] network internally went up and up.
-
7/31/2019 Revolution Not Evolution-Whitepaper
9/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 8
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
So too will the economics o Cloud Computing render previous approaches as
increasingly cost prohibitive. Tis step change in the approach to technology will
be caused by our major shits, the rst o which is virtualization.
-
7/31/2019 Revolution Not Evolution-Whitepaper
10/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 9
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
Virtualization Te ability to increasecomputing efciencyPicture i you will a traditional server. Housed in a noisy cabinet somewhere, a
server is a computer that can generally do one thing at a time. It may ll the role
o email server, database server or web server but running multiple processes
concurrently risks reliability and eciency so typically severs are operated as
single use machines. While this may be a robust way o providing a service, it is
inecient since many times servers have excess processing capacity above what is
used by a single application.
Virtualization was developed to overcome this limitation o physical hardware as
it enables multiple pseudo-servers to be run on one physical device. Tis division
o a single physical server into multiple virtual servers containing multiple setso segregated data is the backbone o Cloud Computing as it allows or ar greater
fexibility and resource utilization. Virtualization not only brings eciency gains
in terms o processing power but also saves electric power, space and cooling
since the number o physical machines running is greatly reduced. o illustrate
this point, studies8 have ound that Cloud applications consume 90% less energy
than on-premise ones.
While virtualization is an enabler or Cloud Computing, Cloud Computing itsel
enables some major shits within organizations. Te rst o these is the tendency
or Cloud Computing to democratize technology in a way not seen previously.
-
7/31/2019 Revolution Not Evolution-Whitepaper
11/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 10
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
Democratization o Computing Bringing enterprise scale inrastructure tosmall and medium businessesCloud Computing is acilitating a seismic shit in terms o business development.
Formerly entrepreneurs who wished to start a business had to invest signicant
capital into hardware and sotware licenses. Even the simplest o businesses
required expensive sotware licenses, a server or two and the associated
administration cost o keeping it all running.
Te availability o Cloud Computing solutions has led to a massive shit in the
availability o computing power. It is now almost eortless or an entrepreneur
to set themselves up with some inrastructure and applications upon which to
run their business. With many Cloud Computing provides, a server capable orunning many o the most common web or business applications can be rented
or around $11/month. A recent study by Github9 indicates that less than 25% o
Y Combinator start-ups are sel hosting their web inrastructure. No longer is
enterprise scale inrastructure the exclusive domain o enterprises.
Tis democratization is analogous to the widespread availability o the word
processor. Formerly the creation o documents was the sole preserve o the typing
pool, an overworked shared resource which, like the mainrame, needed to be
scheduled or booked in advance and needed a skilled operator to make it work.
Oce productivity applications enabled even the least dextrous o executives to
create proessional reports and letters, all rom the comort o their own PC. Tis
move, while arguably detrimental to those who made their living working in a
typing pool, greatly increased the eciencies and timeliness o document creation.
Te ease, economics and speed o provisioning Cloud Computing resources is
enabling an entire generation o businesses to be ounded one needs only look atthe meteoric growth o question and answer site Quora.com which in December
2009 begun to experience usage spikes o 5 10 times its normal load. By
utilizing Cloud Computing or their inrastructure needs, Quora was able handle
the load with relatively ew issues.10 In the same way that most people would
consider it bizarre to have to send work away to have a document created (and to
have to wait days or the work to be done), so too will we regard computing. It is
-
7/31/2019 Revolution Not Evolution-Whitepaper
12/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 11
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
our contention that in a ew years time, the need to wait or the provisioning o
inrastructure, the need or skilled engineers to perorm the tasks and the need or
administrative sta to keep the lights on will be but a distant memory.
Tis democratization o computing is paralleled by an ability to rapidly scale
inrastructure to levels previously unobtainable by all but the largest organizations.
Case Study Encoding.com
Encoding.com11 is a company that pro-
vides video transcoding services to allow
or the integration o video transcoding
into workfows. Video transcoding is the
process o converting one video le or-
mat, like Flash, into another ormat, like
Windows Media. What this means is that
content delivery sites such as MV, PBS
and online training establishments are
able to move video processing o their
own servers and onto a third party pro-
vider that is built to allow them to scale up
their processing at will. In order to build a
scalable product, Encoding.com decided
rom the outset to reduce hardware costs
by using cloud computing to meet their
rapidly changing processing needs12
Video encoding is a very processor inten-
sive task and hence they decided to inte-
grate with two separate Cloud Computing
providers to enable video encoding with
almost limitless scale. Teyre also able to
route jobs to the closest processing centre
to the customer to increase eciency.
Tese type o activities and the growing
business that they support would not have
been possible without Cloud Computing.
-
7/31/2019 Revolution Not Evolution-Whitepaper
13/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 12
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
Scalability and ast provisioning or I at web scaleTe diagram below13 indicates the traditional boom and bust o inrastructure
provisioning. For any organization where workload is erratic, there will always be
one o two situations;
over capacity
under
capacity
CapacityRisingdemandscenario
Fallingdemandscenario
CAPEX
Time
Demand
Classic Capacity
Cloud Capacity
An over provision o servers creating unused capacity and hence1.
signicantly higher cost per process than is desirable
An under provision o servers that creates signicant impacts in terms o2.
service levels
Neither o these two situations are desirable as both result in direct economic
impacts; either through higher costs or through decreased outputs caused byservice degradation. As we have noted beore, the businesses o today are seeing
ar higher levels o volatility in their computing needs one only need look at the
inographic below detailing the relative growth o both witter and Facebook to
see that a traditional approach towards physical hardware cannot hope to keep up
with scaling demand. While most companies will not see the amazing growth that
witter and Facebook have experienced, the speed at which inormation travels
-
7/31/2019 Revolution Not Evolution-Whitepaper
14/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 13
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
around the web has created viral phenomena where company websites can
experience huge trac spikes ater being proled on a television show like Oprah
or evening the local evening news.14
Cloud Computing enables organizations to maintain inrastructure at required
levels at all times, as such it enables cost savings to be gained by virtue o the act
that, despite the per unit price rom a utility service provider potentially being
higher than an owned resource, aggregate cost can be reduced by paying only or
what is required when it is required.
Having the ability to scale is benecial, but not when it comes at the cost o
signicant administration and management. Luckily Cloud Computing also
commoditizes inrastructure which rees up I departments to ocus on their key
strategic objectives.
-
7/31/2019 Revolution Not Evolution-Whitepaper
15/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 14
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
Commoditization o inrastructure EnablingI to ocus on the strategic aspects o its roleIts hard to overstate just how much the I role is changing in the ace o Cloud
Computing. Cloud Computing vendors are oten quick to use cost reduction as
their main selling point or the Cloud, but it would appear that users are more
thoughtul than this and perceive the business agility gains to be the number one
benet o a move to the cloud. A recent SandHill report15 ound that around 50%
o respondents consider agility as their primary reason or adopting the Cloud.
A similar result came rom Inormation Week16 which ound that over 65% o
respondents cited agility to business needs as a driver or Cloud Computing
Its not hard to believe these statistics when one remembers the estimates that put I
maintenance at around 80% o total I expenditure.17
When one considers that Cloudinrastructure is still nascent and the vast majority o servers are still managed in-house,
this presents a signicant opportunity and a signicant change agent or traditional I.
Te underlying trend here is pressure upon I departments to produce greater
outputs, with less resourcing Cloud Computing oers the ability or I
departments to apply resource as, and where, they are needed.
Clearly the savings to be gained rom a move to the Cloud ree up I resources
or adding business value rather than simply maintaining the status quo this
change however will require I personnel to embrace the new world order and
learn a new set o skills that the organization will require. I departments, and
individual I personnel, will need to move rom being primarily technologists
with a modicum o business knowledge, to being truly balanced proessionals who
can equally mix technical ability with an understanding o the business drivers.
Its hard to not resort to hyperbole when discussing just how much Cloud Computing
allows organizations to ocus on their core business. Te very act that they are ableto abstract responsibility or what are essentially commodity services to a third party
drives signicantly more value to the organization than any mere nancial benet
through cost reductions that Cloud Computing can bring. Few people would argue
that I departments should be ocusing on high-level strategic work. We contend that
Cloud Computing enables this to occur more readily than ever beore.
-
7/31/2019 Revolution Not Evolution-Whitepaper
16/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 15
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
Summary2011, and the decade ater it, will go down in history as the era o the cloud in the
same way that the 60s was the era o the mainrame. Cloud Computing oers a
massive benet to organizations and it is our contention that any organization
or individual who routinely interacts with technology solutions will have to learn
how to work with the Cloud.
While some practitioners may eel threatened by this changing paradigm, we
believe the opportunities are ripe or the creation o a new breed o I worker
one who is in equal parts a technician and a business person, someone who is o
true strategic value to the organization and someone who is much more than a
simple maintainer o technology assets.
-
7/31/2019 Revolution Not Evolution-Whitepaper
17/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 16
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
About Diversity Analysis
Diversity Analysis is a broad spectrum consultancy specializing in SaaS, Cloud
Computing and business strategy. Our research ocuses on the trends in these
areas with greater emphasis on technology, business strategies, mergers and
acquisitions. Te extensive experience o our analysts in the eld and our closer
interactions with both vendors and users o these technologies puts us in a unique
position to understand their perspectives perectly and, also, to oer our analysis
to match their needs. Our analysts take a deep dive into the latest technological
developments in the above mentioned areas. Tis, in turn, helps our clients stay
ahead o the competition by taking advantage o these newer technologies and,
also, by understanding any pitalls they have to avoid.
Our Oerings: We oer both analysis and consultancy in the areas related
to SaaS and Cloud Computing. Our ocus is on technology, business strategy,
mergers and acquisitions. Our methodology is structured as ollows:
Research Alerts
Research Briengs
Whitepapers
Case Studies
We also participate in various conerences and are available or vendor briengs
through elephone and/or Voice Over IP.
-
7/31/2019 Revolution Not Evolution-Whitepaper
18/19
Revolution Not Evolution How Cloud Computing Difers rom Traditional IT and Why it Matters 17
Diversity Limited, 2011 Non-commercial reuse with attribution permitted
About RackspaceRackspace Hosting is the service leader in Cloud Computing, and a ounder o
OpenStack, an open source Cloud platorm. Te San Antonio-based company
provides Fanatical Support to its customers, across a portolio o I services,
including Managed Hosting and Cloud Computing. Rackspace has been
recognized by Bloomberg BusinessWeek as a op 100 Perorming echnology
Company and was eatured on Fortunes list o 100 Best Companies to Work For.
Te company was also positioned in the Leaders Quadrant by Gartner Inc. in the
2010 Magic Quadrant or Cloud Inrastructure as a Service and Web Hosting.
For more inormation, visit www.rackspace.com.
About the AuthorBen KepesBen Kepes is an analyst, an entrepreneur, a commentator and a business adviser.
His business interests include a diverse range o industries rom manuacturing
to property to technology. As a technology commentator he has a broad presence
both in the traditional media and extensively online. Ben covers the convergence
o technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas o
interest extend to enterprise sotware, sotware integration, nancial/accounting
sotware, platorms and inrastructure as well as articulating technology simply
or everyday users. More inormation on Ben and Diversity Limited can be ound
at http://diversity.net.nz
http://diversity.net.nz/http://diversity.net.nz/ -
7/31/2019 Revolution Not Evolution-Whitepaper
19/19
Endnotes
[1] http://www.youtube.com/watch?v=KmXJSeMaoY
[2] http://www.cbronline.com/blogs/cbr-rolling-blog/salesorcecom-res-back-at-oracles-ellison-benio-oracle-
openworld-220910
[3] http://twitter.com/Werner/status/25005220624
[4] http://www.economist.com/node/17797794
http://www.jackoallclouds.com/201%8/state-o-the-cloud-august-2010/
[5] http://www.amazon.com/Big-Switch-Rewiring-Edison-Google/dp/0393062287
[6] http://www.nicholasgcarr.com/articlesmt/archives/endocorporatecomputing.shtml
[7] http://www.amazon.com/Management-Strategies-Cloud-Revolution-ransorming/dp/0071740759
[8] Cloud Computing Emissions Comparison, Nucleus Research, 2010
[9] http://jp.github.com/domain-proler/ycombinator.html?2010
[10] http://techcrunch.com/2011/01/05/quora-surge/
[11] http://www.encoding.com/
[12] see video http://www.youtube.com/watch?v=n6l0kMLYP6c&eature=player_embedded
[13] http://www.chades.net/
[14] http://www.penn-olson.com/201%2/10/inographic-acebooks-amazing-growth/, http://blog.acebook.com/blog.
php?post=409753352130, http://socialmediatoday.com/dirktherabbit/162555/twitter%E2%80%99s-growth-doubles-
becomes-more-international
[15] http://www.reuters.com/article/idUS144602338520100818
[16] http://www.inormationweek.com/news/sotware/showArticle.jhtml?articleID=211300562
[17] http://www.gartner.com/it/page.jsp?id=497088