Q: Is it time to start talking to my small and medium customers about cloud computing? And what is there to talk about?
—Brendan from Durham, N.C.
A: Brendan, cloud computing is a new and improved variation on an older theme. Remember back in the days of mainframe computing? We had a big computing resource used by numerous people for various applications.
Computing costs were high in those days and a business had to maximize the utilization rate of the computing assets if it wanted to make an acceptable ROI on its investment.
Today, new challenges drive us to a new computing paradigm. Computing resources are relatively cheap and the utilization rate of computing assets is fairly low. Take a look at all those dormant PCs and servers sitting around.
Imagine shared computing assets, managed in way to increase utilization rates and balance peak demand. Here’s where cloud computing makes its entry. Yankee Group defines an offering as cloud computing if it meets the following seven characteristics:
- Scalable – The cloud service has the ability to add or remove computing resources including bandwidth, storage and compute power, as the applications or users need. Not that cloud services have unlimited scalability. Cloud computing service providers, particularly as the cloud business model becomes more popular, likely will price their cloud-based offerings with a resource threshold, in order to establish and meet SLAs.
- Virtualized – Information services, including servers, storage and applications, are virtualized. The users are shielded from the details of the underlying architecture and work with virtual resources allocated to their enterprise or application.
- On-demand – The compute resources and applications can be allocated or removed within seconds of user request.
- Internet powered – The layer three wide area network (WAN) communications protocol is IP and the service is accessible via the World Wide Web or Internet.
- Multitenant-capable – The resources (e.g., network, storage, and compute power) can be shared among multiple enterprise clients, thereby lowering overall expense. Resource virtualization is used to enforce isolation and aid in security.
- Service level assured – The cloud service provider ensures a specific guaranteed server uptime, server reboot, network performance, security control and time-to-response to the customer, with agreed upon service provider penalties if those service level agreement (SLA) guarantees are not met.
- Usage priced – There is no up-front cost to the user. For cloud-based infrastructure services, the pricing model is on a per-use basis for bandwidth, storage and CPU. The cloud service provider assumes all capital costs. Some services are billed on a subscription basis per user, per month.
