Sunday, August 07, 2011

Cloud Computing: Hype vs. Reality

This article, written by Mohit Manchanda, Managing Director of Services for FiberMedia Group was originally published as a 3-part series. The article, in its entirety below, focuses on the challenges faced by small and mid-size enterprises to adapt business applications and processes to utilize the obvious benefits promised by cloud technology and service providers (scalability, availability, low up-front investments, lower costs etc.).


As more and more large enterprises begin to utilize the power of the cloud – computing power as a pay per use utility delivered at a distance with inherent benefits of scalability and resilience – small and mid size enterprises see the need to utilize these services even more. However, lacking the resources to make large investments in developing or migrating applications and business processes that can truly leverage this new technology, they are faced with seemingly insurmountable practical challenges.

The advent of the cloud has been made possible by exponential growth (and lower costs) of high speed communication services. Compute capacity has been following Moore’s law with compute capacity doubling every two years (with an even greater increase in compute capacity per $ due to lowering costs). Storage capacity and costs have been following the same trends as compute capacity. All this has led to large compute utilities becoming a reality just like the 20th century saw the dawn of the electricity utility.

CIOs need to identify managed service providers who are focusing on providing enterprises the ability to run their existing applications on the cloud without having to make changes to the underlying application code.


Computing trends from legacy client server to cloud are easily described using the ice water metaphor – A few years ago we built application to run on discrete pieces of server hardware – typically web/ app/ database. Picture them as discrete ice cubes providing compute capacity. Utilization was in the 5-10% range since each server was sized for peak load.

Then came virtualization – offering better utilization since each virtual node could draw needed capacity from the physical server during peak load. And since every virtual node did not peak at the same time, you could run more applications from the same physical server. Just like crushed ice (denoting the smaller virtual nodes) providing quicker cooling (i.e. better utilization of server capacity).
The cloud, in concept, is like a glass of water where water molecules (compute resources) are available to be drawn through a pipe (bandwidth) over a distance. In addition, the capacity is scalable, with more water available to be drawn from a reservoir.

There are challenges of course. Migrating existing applications and business processes to cloud based infrastructure is the single biggest challenge faced by CIOs. With limited resources, enterprises are not in a position to rewrite their application (like many web 2.0 businesses did having started out creating their business using cloud services). Then is there are issues related to data privacy and security that are especially daunting.

CxOs are realizing that their dependence on IT infrastructure has increased manifold over the last few years with a majority of business processes assuming uninterrupted availability. Corner offices converted to server rooms don’t allow internal IT units to effectively offer uninterrupted services to their customers. Colocating in a secure data center, that was often looked at as an avoidable expense is now an imperative to meet compliance requirements and avoid costly downtime. Server and compute infrastructure needs to be more resilient too. Cloud technology offers resilience, since compute pools are built using redundant discrete physical infrastructure with load balancing – technologies that required large investments and highly skilled (read expensive) manpower to build and manage these environments.

Security is a huge concern, and rightly so. Ice cubes (discrete servers), and even crushed ice (virtual nodes), with their inherent discrete nature, allowed for walls to be built around with data flow and access controlled. Most public clouds do not allow a layered architecture to be built – requiring a rewrite of the application code if data needs to be secured (when does it not?!). Cloud offerings from industry leaders VMware, and emerging providers like Moolex offer layered architecture capabilities. Private managed cloud providers are helping small and mid size enterprises meet their security needs with these technologies.


The benefits of cloud computing are easy to grasp. While the initial set of services (from Amazon and a host of startups) was targeted for the developer community that took the existing platform and built new applications to take advantage on scalability, low up-front investments and truly variable cost structures. Businesses are demanding cloud services that are geared to run existing business applications as-is and a new breed of managed services providers are gearing up to fill that need.

There are few small and mid size enterprises effectively utilizing cloud technology and services. Private cloud services offer a realistic alternative where these businesses can start deriving the benefits of added resilience and scalability, while minimizing migration efforts. Private cloud solutions built using the products like VMware vCloud , offer seamless migration for the many who have already virtualized their environments. For those who have not, it offers an even more compelling ROI to migrate from physical to private cloud solutions.

CIOs need to decide on the level of outsourcing their organizations are best suited for, providing the best value to the business. Self provisioning and metering allow IT organizations that are comfortable performing managed services internally. As service level expectations from the business grow more demanding, fully managed private cloud solutions offer compelling value with 24x7 operations to augment stretched internal resources.

For more information about FiberMedia and its Managed Data Center-as-a-Service Solutions, visit or email

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