Welcome!

Apache Authors: Pat Romanski, Liz McMillan, Elizabeth White, Christopher Harrold, Janakiram MSV

Related Topics: @CloudExpo, Microservices Expo, Containers Expo Blog

@CloudExpo: Blog Feed Post

About that ‘Unassailable Economic Argument’ for Public Cloud Computing

Turns out that ‘unassailable’ economic argument for public cloud computing is very assailable

Turns out that ‘unassailable’ economic argument for public cloud computing is very assailable

quote-badgeThe economic arguments are unassailable. Economies of scale make cloud computing more cost effective than running their own servers for all but the largest organisations. Cloud computing is also a perfect fit for the smart mobile devices that are eating into PC and laptop market. -- Tim Anderson, “Let the Cloud Developer Wars Begin”

imageAh, Tim. The arguments are not unassailable and, in fact, it appears you might be guilty of having tunnel vision – seeing only the list price and forgetting to factor in the associated costs that make public cloud computing not so economically attractive under many situations. Yes, on a per hour basis, per CPU cycle, per byte of RAM, public cloud computing is almost certainly cheaper than any other option. But that doesn’t mean that arguments for cloud computing (which is much more than just cheap compute resources) are economically unassailable. Ignoring for a moment that it isn’t as clear cut as basing a deployment strategy purely on costs, the variability in bandwidth and storage costs along with other factors that generate both hard and soft costs associated with applications must be considered .

MACRO versus MICRO ECONOMICS

The economic arguments for cloud computing almost always boil down to the competing views of micro versus macro economics. Those in favor of public cloud computing are micro-economic enthusiasts, narrowing in on the cost per cycle or hour of a given resource. But micro-economics don’t work for an application because an application is not an island of functionality; it’s an integrated, dependent component that is part of a larger, macro-economic environment in which other factors impact total costs.

The lack of control over resources in external environments can be problematic for IT organizations seeking to leverage cheaper, commodity resources in public cloud environments. Failing to impose constraints on auto-scaling – as well as defining processes for de-scaling – and the inability to track and manage developer instances launched and left running are certainly two of the more common causes of “cloud sprawl.” Such scenarios can certainly lead to spiraling costs that, while not technically the fault of cloud computing or providers, may engender enough concern in enterprise IT to keep from pushing the “launch” button.

quote-badgeThe touted cost savings associated with cloud services didn't pan out for Ernie Neuman, not because the savings weren't real, but because the use of the service got out of hand.

When he worked in IT for the Cole & Weber advertising firm in Seattle two and a half years ago, Neuman enlisted cloud services from a provider called Tier3, but had to bail because the costs quickly overran the budget, a victim of what he calls cloud sprawl - the uncontrolled growth of virtual servers as developers set them up at will, then abandoned them to work on other servers without shutting down the servers they no longer need.

Whereas he expected the developers to use up to 25 virtual servers, the actual number hit 70 or so. "The bills were out of control compared with what the business planned to spend," he says.

-- Unchecked usage can kill cost benefits of cloud services

But these are not the only causes of cost overruns in public cloud computing environments and, in fact, uncontrolled provisioning whether due to auto-scaling or developers forgetfulness is not peculiar to public cloud but rather can be a problem in private cloud computing implementations as well. Without the proper processes and policies – and the right infrastructure and systems to enforce them – cloud sprawl will certainly impact especially those large enterprises for whom private cloud is becoming so attractive an option.

While it’s vastly more difficult to implement the proper processes and procedures automatically in public as opposed to private cloud computing environments because of the lack of maturity in infrastructure services in the public arena, there are other, hotter issues in public cloud that will just as quickly burn up an IT or business budget if not recognized and addressed before deployment.  And it’s this that cloud computing cannot necessarily address even by offering infrastructure services, which makes private cloud all the more attractive.

imageTRAFFIC SPRAWL

Though not quite technically accurate, we’ll use traffic sprawl to describe increasing amounts of unrelated traffic a cloud-deployed application must process. It’s the extra traffic – the malicious attacks and the leftovers from the last application that occupied an IP address – that the application must field and ultimately reject. This traffic is nothing less than a money pit, burning up CPU cycles and RAM that translate directly into dollars for customers. Every request an application handles – good or bad – costs money.

The traditional answer to preventing the unnecessary consumption of resources on servers due to malicious or unwanted traffic is a web application firewall (WAF) and basic firewalling services. Both do, in fact, prevent that traffic from consuming resources on the server because they reject it, thereby preventing it from ever being seen by the application. So far so good. But in a public cloud computing environment you’re going to have to pay for the resources the services consumed, too. In other words, you’re paying per hour to process illegitimate and unwanted traffic no matter what. Even if IaaS providers were to offer WAF and more firewall services, you’re going to pay for that and all the unwanted, malicious traffic that comes your way will cost you, burning up your budget faster than you can say “technological money pit.”

This is not to say that both types of firewall services are not a good idea in a public cloud environment; they are a valuable resource regardless and should be part and parcel of any dynamic infrastructure. But it is true that in a public cloud environment they address only security issues, and are unlikely to redress cost overruns but instead may help you further along the path to budget burnout.

HYBRID WILL DOMINATE CLOUD COMPUTING

I’ve made the statement before, I’ll make it again: hybrid models will dominate cloud computing in general due primarily to issues around control. Control over processes, over budgets, and over services. The inability to effectively control traffic at the network layer imposes higher processing and server consumption rates in public environments than in private, controlled environments even when public resources are leveraged in the private environment through hybrid architectures enabled by virtual private cloud computing technologies. Traffic sprawl initiated because of shared IP addresses in public cloud computing environments alone is simply not a factor in private and even hybrid style architectures where public resources are never exposed via a publicly accessible IP address. Malicious traffic is never processed by applications and servers in a well-secured and architected private environment because firewalls and application firewalls screen out such traffic and prevent them from unnecessarily increasing compute and network resource consumption, thereby expanding the capacity of existing resources. The costs of such technology and controls are shared across the organization and are fixed, leading to better forecasting in budgeting and planning and eliminating the concern that such essential services are not the cause of a budget overrun.

Control over provisioning of resources in private environments is more easily achieved through existing and emerging technology, while public cloud computing environments still struggle to offer even the most rudimentary of data center infrastructure services. Without the ability to apply enterprise-class controls and limits on public cloud computing resources, organizations are likely to find that the macro-economic costs of cloud end up negating the benefits initially realized by cheap, easy to provision resources. A clear strategy with defined boundaries and processes – both technical and people related – must be defined before making the leap lest sprawl overrun budgets and eliminate the micro-economic benefits that could be realized by public cloud computing.

Read the original blog entry...

More Stories By Lori MacVittie

Lori MacVittie is responsible for education and evangelism of application services available across F5’s entire product suite. Her role includes authorship of technical materials and participation in a number of community-based forums and industry standards organizations, among other efforts. MacVittie has extensive programming experience as an application architect, as well as network and systems development and administration expertise. Prior to joining F5, MacVittie was an award-winning Senior Technology Editor at Network Computing Magazine, where she conducted product research and evaluation focused on integration with application and network architectures, and authored articles on a variety of topics aimed at IT professionals. Her most recent area of focus included SOA-related products and architectures. She holds a B.S. in Information and Computing Science from the University of Wisconsin at Green Bay, and an M.S. in Computer Science from Nova Southeastern University.

@ThingsExpo Stories
Recently, REAN Cloud built a digital concierge for a North Carolina hospital that had observed that most patient call button questions were repetitive. In addition, the paper-based process used to measure patient health metrics was laborious, not in real-time and sometimes error-prone. In their session at 21st Cloud Expo, Sean Finnerty, Executive Director, Practice Lead, Health Care & Life Science at REAN Cloud, and Dr. S.P.T. Krishnan, Principal Architect at REAN Cloud, will discuss how they bu...
SYS-CON Events announced today that Dasher Technologies will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Dasher Technologies, Inc. ® is a premier IT solution provider that delivers expert technical resources along with trusted account executives to architect and deliver complete IT solutions and services to help our clients execute their goals, plans and objectives. Since 1999, we'v...
SYS-CON Events announced today that TidalScale, a leading provider of systems and services, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. TidalScale has been involved in shaping the computing landscape. They've designed, developed and deployed some of the most important and successful systems and services in the history of the computing industry - internet, Ethernet, operating s...
Enterprises have taken advantage of IoT to achieve important revenue and cost advantages. What is less apparent is how incumbent enterprises operating at scale have, following success with IoT, built analytic, operations management and software development capabilities – ranging from autonomous vehicles to manageable robotics installations. They have embraced these capabilities as if they were Silicon Valley startups. As a result, many firms employ new business models that place enormous impor...
Coca-Cola’s Google powered digital signage system lays the groundwork for a more valuable connection between Coke and its customers. Digital signs pair software with high-resolution displays so that a message can be changed instantly based on what the operator wants to communicate or sell. In their Day 3 Keynote at 21st Cloud Expo, Greg Chambers, Global Group Director, Digital Innovation, Coca-Cola, and Vidya Nagarajan, a Senior Product Manager at Google, will discuss how from store operations...
Nordstrom is transforming the way that they do business and the cloud is the key to enabling speed and hyper personalized customer experiences. In his session at 21st Cloud Expo, Ken Schow, VP of Engineering at Nordstrom, will discuss some of the key learnings and common pitfalls of large enterprises moving to the cloud. This includes strategies around choosing a cloud provider(s), architecture, and lessons learned. In addition, he’ll go over some of the best practices for structured team migrat...
SYS-CON Events announced today that Taica will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Taica manufacturers Alpha-GEL brand silicone components and materials, which maintain outstanding performance over a wide temperature range -40C to +200C. For more information, visit http://www.taica.co.jp/english/.
SYS-CON Events announced today that MIRAI Inc. will exhibit at the Japan External Trade Organization (JETRO) Pavilion at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. MIRAI Inc. are IT consultants from the public sector whose mission is to solve social issues by technology and innovation and to create a meaningful future for people.
As hybrid cloud becomes the de-facto standard mode of operation for most enterprises, new challenges arise on how to efficiently and economically share data across environments. In his session at 21st Cloud Expo, Dr. Allon Cohen, VP of Product at Elastifile, will explore new techniques and best practices that help enterprise IT benefit from the advantages of hybrid cloud environments by enabling data availability for both legacy enterprise and cloud-native mission critical applications. By rev...
Join IBM November 1 at 21st Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA, and learn how IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Cognitive analysis impacts today’s systems with unparalleled ability that were previously available only to manned, back-end operations. Thanks to cloud processing, IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Imagine a robot vacuum that becomes your personal assistant tha...
SYS-CON Events announced today that Datera will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Datera offers a radically new approach to data management, where innovative software makes data infrastructure invisible, elastic and able to perform at the highest level. It eliminates hardware lock-in and gives IT organizations the choice to source x86 server nodes, with business model option...
With major technology companies and startups seriously embracing Cloud strategies, now is the perfect time to attend 21st Cloud Expo October 31 - November 2, 2017, at the Santa Clara Convention Center, CA, and June 12-14, 2018, at the Javits Center in New York City, NY, and learn what is going on, contribute to the discussions, and ensure that your enterprise is on the right path to Digital Transformation.
Infoblox delivers Actionable Network Intelligence to enterprise, government, and service provider customers around the world. They are the industry leader in DNS, DHCP, and IP address management, the category known as DDI. We empower thousands of organizations to control and secure their networks from the core-enabling them to increase efficiency and visibility, improve customer service, and meet compliance requirements.
Digital transformation is changing the face of business. The IDC predicts that enterprises will commit to a massive new scale of digital transformation, to stake out leadership positions in the "digital transformation economy." Accordingly, attendees at the upcoming Cloud Expo | @ThingsExpo at the Santa Clara Convention Center in Santa Clara, CA, Oct 31-Nov 2, will find fresh new content in a new track called Enterprise Cloud & Digital Transformation.
SYS-CON Events announced today that N3N will exhibit at SYS-CON's @ThingsExpo, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. N3N’s solutions increase the effectiveness of operations and control centers, increase the value of IoT investments, and facilitate real-time operational decision making. N3N enables operations teams with a four dimensional digital “big board” that consolidates real-time live video feeds alongside IoT sensor data a...
SYS-CON Events announced today that NetApp has been named “Bronze Sponsor” of SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. NetApp is the data authority for hybrid cloud. NetApp provides a full range of hybrid cloud data services that simplify management of applications and data across cloud and on-premises environments to accelerate digital transformation. Together with their partners, NetApp emp...
Smart cities have the potential to change our lives at so many levels for citizens: less pollution, reduced parking obstacles, better health, education and more energy savings. Real-time data streaming and the Internet of Things (IoT) possess the power to turn this vision into a reality. However, most organizations today are building their data infrastructure to focus solely on addressing immediate business needs vs. a platform capable of quickly adapting emerging technologies to address future ...
SYS-CON Events announced today that Avere Systems, a leading provider of hybrid cloud enablement solutions, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Avere Systems was created by file systems experts determined to reinvent storage by changing the way enterprises thought about and bought storage resources. With decades of experience behind the company’s founders, Avere got its ...
SYS-CON Events announced today that Avere Systems, a leading provider of enterprise storage for the hybrid cloud, will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Avere delivers a more modern architectural approach to storage that doesn't require the overprovisioning of storage capacity to achieve performance, overspending on expensive storage media for inactive data or the overbui...
SYS-CON Events announced today that IBM has been named “Diamond Sponsor” of SYS-CON's 21st Cloud Expo, which will take place on October 31 through November 2nd 2017 at the Santa Clara Convention Center in Santa Clara, California.