Cloud Computing

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0 C P 2010 2011 w k w .u BEST w rg .is .o WEB HOST paawards Welcome

EDITORIAL Editor Maxwell Cooter Managing Editor Marc Beishon Design & Layout Heather Reeves Contributors Adrian Bridgwater, Dave Cartwright, Graham Jarvis, Billy MacInnes, Lesley Meall LICENSING & SYNDICATION Welcome Licensing Hannah Heagney, [email protected], +44 20 7907 6134 Welcome to the Ultimate Guide to Syndication Anj Dosaj-Halai, [email protected], Cloud Computing – your indispensable +44 20 7907 6132 reference point to all things cloud ADVERTISING & MARKETING Advertising Manager Ben Topp +44 20 7907 6625 YOU’VE PROBABLY PICKED UP this book because MagBook Account Manager Katie Wood +44 20 7907 6689 you’ve come across the term cloud computing and Digital Production Manager heard that it’s going to be the dominant platform Nicky Baker +44 20 7907 6056 for delivering computing resources in the future. Marketing & Editorial Executive Emily Hodges +44 20 7907 6270 Research company IDC estimates that worldwide MANAGEMENT +44 20 7907 6000 cloud market expenditure will be more than $70bn MagBook Publisher Dharmesh Mistry by 2015 – that’s a 25% annual growth rate. Publishing Director Jon Westnedge Over the following pages, you will read about what Managing Director John Garewal Deputy Managing Director Tim Danton cloud computing is, what applications can run in the MD of Advertising Julian Lloyd-Evans cloud (and what can’t), how it can streamline your Newstrade Director David Barker costs and how it will change your organisation – be Chief Operating Officer Brett Reynolds Group Finance Director Ian Leggett that a major enterprise or a small business. You’ll Chief Executive James Tye see how cloud will have an impact on all aspects of Chairman Felix Dennis business life, from sales and marketing to managing a supply chain. And you’ll read about the downsides too: from handling security to managing contracts, The “MagBook”“MagBook” brandbrand is a tratrademarkdemark of licensing and breakdowns in service. Dennis Publishing Ltd, 30 Cleveland St, We’re set for a huge change in the way companies London W1T 4JD. Company registered in England. All material © Dennis Publishing operate. The parallel that is often drawn is with the Ltd, licensed by Felden 2011, and may not electricity supply and how we moved from a position be reproduced in whole or part without the consent of the publishers. where companies operated their own local power stations to using a national grid. It’s an apt parallel Liability While every care was taken during the but it doesn’t go far enough – changing the source of preparation of this MagBook, the publishers the electricity supply didn’t fundamentally change cannot be held responsible for the accuracy of the information or any consequence the way that businesses were run – cloud will. arising. All judgements are based on products The notion of offices in various locations available to us at the time. Dennis Publishing takes no responsibility for the content of supported by a dedicated IT team is going to slowly any external websites mentioned or for any disappear. What the office of the future will look like advertising within the guide. is anyone’s guess, but there is one guarantee – it will Printed by Stones be served by some form of cloud computing. The Ultimate Guide To Cloud Computing The future starts here. ISBN 9781907779831 Maxwell Cooter, Editor

The Ultimate Guide to Cloud Computing 03 Contents

The Ultimate Guide to CLOUD COMPUTING

WHATISCLOUDCOMPUTING? Andwhyit’s goingto change theface of business

HOWTO GET HOWTOSAVE STARTED MONEYUSING to Guide The

Gettingto grips CLOUD Computing £7.99 withthebasics Keepingcostslow Ultimate Cloud INSIDE

06 What iscloud? A cloud deﬁnition, history and the way the market is moving

14 Cloudconcerns Any new technology throws up worries about its impact – so what do you need to know?

22 Businesschange Here’s a strong case for cloud as a business change enabler 12

26 Publicvsprivate The differences between the two main cloud models

30 Enterprisecloud A brieﬁng for board level executives on cloud issues

38 Just forSMEs Why cloud is a great match for smaller organisations

43 Cloudcontracts Businesses must be aware of 43 the small print in cloud services

04 The Ultimate Guide to Cloud Computing Contents

50 Cloudstorage Storage is the number one app in the cloud – with good reason

54 Financeandlicensing Financial factors for the cloud; cautions on software licences

63 Greencloud Is cloud computing greener, and can we prove it? 30 68 HRandcloud How cloud applications could 76 Marketinginthecloud transform the people factor A laggard normally in IT, marketing now has power 72 Supply chain Another key area for the cloud is 80 What notto do collaborating on moving goods Not everything is suitable for the cloud, and here’s why

84 Securityinmind Data security is a top concern and a degree of trust is needed

88 Leadingplayers/glossary A who’s who of major cloud 76 players plus a glossary of terms

The Ultimate Guide to Cloud Computing 05 Introduction

What iscloud? Maxwell Cooter introduces the hot topic of cloud computing: what is it and where did it come from?

IT’S THE BUZZWORD on everybody’s vagaries, the US National Institute of lips but what does cloud computing Standards and Technology put forward a actually mean? It’s not been an easy definition that has now become widely term to define and there have been many accepted as the closest that the industry different attempts to explain what the has to a definitive answer. The NIST term means. Cloud companies have definition is as follows. been prone, like Alice’s White Knight, to “Cloud computing is a model for define the term in a way that they want it enabling, convenient, on-demand to mean. network access to a shared pool of In some ways it’s strange that the term configurable computing resources has been so slippery. Millions of us are (eg. networks, servers, storage, happy to use such cloud-based services applications, and services) that can be as Facebook, Gmail and Twitter, thinking rapidly provisioned and released with nothing of it, yet pinning down an exact minimal management effort or service definition has been as elusive as provider interaction. This cloud model grabbing a cloud itself. promotes availability and is composed In an attempt to put a stop to these of fi ve essential characteristics, three

06 The Ultimate Guide to Cloud Computing cloudpro.co.uk Introduction

service models, and four deployment models.” Difference between outsourcing The service models are types of and cloud computing offering, such as software-as-a-service (SaaS), and deployment choices include Outsourcing is widely known and used in public and private clouds. But the key technology circles. It’s when a third party performs characteristics of cloud from a an IT function or other service on behalf of its customer’s point of view are: customer. Outsourcing can be employed for a • Self-provisioning so a customer can variety of reasons – lack of expertise in-house, lack provision facilities without any human of personnel or because the resources are needed interaction purely for an individual project. • Delivery of services over a network The key differences with cloud are defined by • Ability to be accessed by a variety of the underlying technology of the cloud provider. devices, not just PCs but also by Essential to this is the use of virtualisation – all netbooks, tablet computers and cloud providers make use of virtualisation smartphones technology – and automation (the ideal cloud • Rapid ‘elasticity’ – the ability to scale service has little human intervention). The other up or scale down computing resources. key element of cloud computing is the use of From a cloud provider’s point of view, self-provisioning – one of the major benefits is the a major element of the process is the ability to make a business more agile and fl exible pooling of computing resources toserve because services can be turned up and down at will. multiple consumers, using what’s called a multi-tenant model whereby cloud services are provided to leading lights in cloud technology. customers as and when they’re needed. Millions of us around the world are One of the important factors for cloud willing to entrust our personal details and service providers is to be able to credit cards to that company believing measure usage accurately and, even they’ll be held safely – why should more importantly, to bill accurately. trusting the company’s cloud division, Amazon Web Services, be any different? Securityconcerns In many ways, a more important The factor in cloud services that makes consideration than security is the most users nervous is the level of location of the data. This is for two security within a multi-tenant model. reasons. First, there is the inherent This is a major concern. Customers are latency within the system: the further entrusting some of their sensitive data away the data is stored the longer the lag to a third party and there is, ofcourse, in accessing it. This is becoming less of a nothing stopping one of their major problem as network connection get competitors going to the same cloud faster but it still can be a factor. provider for a service. The second problem is a more serious Service providers believe that this one, particularly on this side of the concern can be easily dealt with: they’ve Atlantic. There are various EU generally had a long history of keeping regulations on where data can be stored customers data safe and have levels of – personal data cannot be held outside security that far exceed those of their the EU (within the EU itself, individual customers. Take Amazon, one of the countries have stricter guidelines still). ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 07 Introduction

This has been a problem for some cloud Virtualworld providers, as part of the appeal is that There are other elements within cloud unused resources at one data centre can computing. Virtualisation is another key be used by another. If data centres concept. It means what it says, the use outside the EU cannot store European of virtual resources instead of physical customers’ data, providers have to be ones. For example, a server within a data careful in marshalling their resources. centre may be operating at just 15% of its Allied to this is a secondary problem: capacity (this used to be a typical usage); the US Patriot Act, which compels US virtualisation is a technique where the companies to hand over personal data resources that aren’t being used by the held on their servers if requested by US server for the application that it’s driving authorities. As this applies to European (database, website or whatever) can be data held on servers located in Europe, used for something else – driving usage this has made some European rates up. Virtualisation will often go customers rather nervous. The hand-in-hand with server consolidation implications of the Patriot Act are still so it helps to reduce the number of being worked through. servers within a data centre.

08 The Ultimate Guide to Cloud Computing cloudpro.co.uk Introduction

A brief history of cloud computing

Anyone hanging around cloud vendors for any Da Vinci’s notebooks are the blueprints for the amount of time will hear one often repeated fi rst helicopter. It’s one thing coming forward mantra – “Cloud computing is not new you with the theory, it’s quite another delivering in know, cloud has been around for some time” practice. There have been plenty of false – generally from a veteran of the technology dawns before cloud computing became the industry. There’s an element of truth in this beast it has become. We’ve seen it described but, at the same time, it’s spectacularly as grid computing, computing on-demand and missing the point. utilityuti computing before the phrase cloud It’s possible to point to computingcom took hold. It’s only been widely a 1966 book by Douglas useduse since late 2007, although the term was Parkhill, The Challenge off fi rstr used in a lecture by computer scientist the Computer Utility, for RamnathRam Chellappa. the origins of cloud For cloud computing to become a reality, computing. In that book, therethe were other changes needed fi rst. Most Parkhill detailed many of importantimp of these was the availability of fast the elements of cloud and cheap broadband – the early attempts at computing – elastic cloudclo computing all foundered because of the provision, online dearthdea of such a service. Then virtualisation delivery, perception of infinite supply – needednee to become more widespread, as this it’s just taken a while for the theory to technology is the bedrock of cloud computing. become reality. Other factors are the declining cost in Saying that the theories espoused in storage, the availability of cheaper devices to Parkhill’s book are the fi rst elements of cloud access cloud services and the development of computing is a bit like saying that Leonardo automatic provisioning software.

Like cloud computing, it’s an old product but has since been adopted by concept, originating from the mainframe countless other companies. SaaS world and only becoming widely used delivery helps solve various problems after VMware, a virtualisation specialist, within an enterprise: over-provisioning, started applying it to servers. The security updates and licensing among technology has now been adopted nearly them, and is widely seen now as the universally within enterprises and the dominant method for providing software. technique of re-allocating resources As a concept, cloud computing has has made it vital for the development of grown quickly and is set to penetrate the cloud. deeper into the market. According to an We’ve spoken a lot about cloud service oft-cited Gartner report, 20% of providers but another important part enterprises will have no IT departments of the cloud is the delivery of software – by the end of 2012. While that looks to the so-called software-as-a-service be a bit optimistic (or pessimistic (SaaS) delivery mechanism. This is a depending on your view), the impetus is technique that was really pioneered by clearly with cloud. It’s a technology that’s Salesforce.com with its hosted CRM here to stay. ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 09 Introduction

Whichwayis cloudmoving?

Marc Beishon looks in detail at cloud models and where the action is in the consumer and business sectors

IT IS CERTAINLY TRUE that many The NIST model has the benefit of people, particularly in business, would simplicity, but inevitably there are many like a clear definition of cloud computing. more detailed attributes of cloud As a report and survey from industry services that are confusing people, which body CompTIA, ‘Cloud computing: is not surprising at this early stage of the pulling back the curtain’, says, both the evolution of cloud computing. But users industry and end user communities in organisations are starting to form a “crave a more authoritative, uniform consensus on what they ‘strongly definition of cloud computing to help associate’ the cloud with, says CompTIA, them determine how best to exploit namely ‘offsite’, ‘Internet centric’, it from a business and technology ‘shared’, ‘scalable’, ‘software-as-a- perspective”. service’ and ‘virtualised resource’. It too points to the definition from the What is not confusing is the sheer National Institute of Standards and scale of the projections for the size of the Technology (NIST), as discussed on cloud computing market, as the analysts page 7, and it is worth adding the full list are all agreed that, definitions aside, of characteristics and models in the users will be voting with their feet and definition (see also the glossary, page 96 fuelling a global market worth more than for explanations of most of these terms): £100bn by 2013 with a major component Essential characteristics being the use of cloud software • On-demand self-service applications such as those from Google • Broad network access and Salesforce.com, the customer • Resource pooling relationship management specialist. • Rapid elasticity One analyst, Gartner, has predicted that • Measured service 20% of all businesses will own no IT Service models infrastructure by 2012, and will be • Software-as-a-service (SaaS) virtually total cloud users. • Platform-as-a-service (PaaS) That’s particularly true for smaller • Infrastructure-as-a-service (IaaS) companies and start-ups, as the kind of Deployment models cloud services they can use to run • Public cloud operations are similar to those that have • Private cloud gained rapid ground in consumer • Hybrid cloud markets. Sole traders, small companies • Community cloud and also hobbyists and casual users are

10 The Ultimate Guide to Cloud Computing cloudpro.co.uk Introduction

all making great use of cloud platforms Mobility handset business by Google, such as eBay, Amazon and PayPal to which points in one direction only – that conduct day-to-day business with of a near future where huge public cloud nothing more than a laptop, Internet applications such as those of Google connection and a bank account. will be seamlessly available on your smartphone wherever you go. Cloudforconsumers It is no surprise that Apple, meanwhile, And even a smartphone or tablet will do planned to launch in autumn 2011 its – the cloud services that will dominate iCloud – “cloud service done right”, as in the consumer market are mobile the giant ﬁ rm says. iCloud is a applications, driven by the huge success replacement for Apple’s previous cloud of products such as Apple’s iPhone and efforts, but clearly the company now iPad, and the Android standard adopted feels conﬁdent to pitch its offering by other handset players. News that badged as a cloud service (‘MobileMe’ created much interest in August 2011 was the main earlier version for was the proposed buy-up of Motorola’s productivity applications). It has now cloudpro.co.uk The Ultimate Guide to Cloud Computing 11 Introduction

brought together all its online services – ‘always-on’ and ubiquitous access to productivity such as mail and contacts, data, entertainment and services,” it the iTunes media store, online backup says. Next, and as some may not be and storage, and access to new surprised to hear, is online gaming, applications – in one cloud that services followed by ‘voice over IP’ (ie Internet users automatically as they move around telephony services such as Skype), and (in a so-called ‘push’ way). paid music content. In terms of revenues, It’s also free to Apple customers, in the services such as email and online same way that people can already make storage barely fi gure, as they look set to use of free mail and considerable remain free or very low cost. amounts of storage with services such as Hotmail, Yahoo and Google. Apple – Cloudforbusiness which briefly became the world’s largest Patterns of use for companies and company in August 2011 – is great at organisations in the public and third engineering an almost fanatical user sectors are also becoming apparent, with experience, and it rarely gets its CompTIA, for example, noting that a marketing wrong these days, so the ‘sweet spot’ for cloud adoption is in the ubiquity of a personal computing and medium sized company sector (say media cloud is likely to be taken for between £10m and £100m in turnover). granted by many in the next few years. This is because they have similar IT What the company will have to rely on needs to large enterprises, but less cash though is a large network of partners to for on-premise systems, and so can deliver its experience, especially the deploy cloud computing instead as an mobile phone operators and their many operational expense with a more suppliers of base station equipment, predictable cost model. transmission technology Reducing capital expenditure and and customer provisioning other costs is often the number one Mobile data and billing systems. reason for moving to cloud computing, applications and Experience of the mobile but coming in second is the desire to add services are set to cloud, in particular, can be new capabilities that just aren’t available drive the growth easily scuppered if you otherwise, and this key factor must of consumer can’t get a signal at a vital surely rise to the top as more moment, or you get a organisations discover just how cloud services massive unexpected bill, transformational the cloud can be for and it’s no surprise that business processes. Indeed, in another poor customer service is now to the fore survey of SMEs alone, the benefit of as people migrate into increasing use of expanding capabilities does come out mobile data and cloud services. ahead of cost savings. That mobility is the key consumer Other factors for deploying cloud are cloud area is borne out by research fi rm the speed with which it can be rolled out, Business Insights, which predicts that simplicity, subscription pricing, an end to mobile applications will make up almost conventional software licensing, and half of the market for revenues by 2018. lower energy use. Pertinently, cutting “Mobile applications and services are set internal IT staff, while a factor for some, to drive the growth of consumer cloud is not a major reason for cloud, services, as consumers demand suggesting that these workers may be

12 The Ultimate Guide to Cloud Computing cloudpro.co.uk Introduction

better deployed on IT activities that really SMBuseof cloud help the business rather than traditional IT pursuits such as ‘firefighting’. The type of service that companies are mostly deploying are software-as-a- service (SaaS) offerings – in CompTIA’s survey, of those using the cloud 69% have a SaaS product in use, 31% IaaS and 22% PaaS, although the latter two may well be part of a SaaS solution in a managed service provider’s data centre. Indeed, a majority of user organisations plan to source their cloud computing from a third party provider, above self-service/direct from the SOURCE: SMB TECHNOLOGY ADOPTION TRENDS, COMPTIA JULY 2011 Internet, or direct from a technology vendor, suggesting that there is plenty of ahead of the pack, in particular storage scope still for skilled IT providers that and backup, and email (see also above can add value, say, by packaging cloud from an SMB – small and medium sized software into private clouds for superior business – survey). Storage is one of the and more secure service. most widely offered cloud services, As far as types of provider go, there which is not surprising given its relative are various models that include: simplicity and value in providing offsite • Public cloud provider with own data peace of mind for data. Most fi rms will centre have taken up cloud storage and backup • Private cloud specialist working with in some form in the next few years. customers to build internal clouds Email too is pretty much standard as a • Hybrid provider of private and public cloud service now, and is often coupled clouds hosted in own or third-party with value-added extras such as spam data centre and virus management. Indeed, security • Reseller of cloud services (eg. SaaS). services on the Internet is a class of cloud offering in its own right and one that has Goingit alone been a big growth area for specialist But of course there is nothing stopping providers. Extra security measures and any organisation signing up direct with a policies are vital when moving to public cloud software player such as Salesforce. cloud services, in particular. com, although it may be wise to employ Other applications are less popular a consultancy that can adapt the right now for the cloud – CRM though, company’s business processes to work as pioneered by Salesforce.com is a with the cloud offering, as it will rarely be favourite, and others such as document the case that it will go smoothly ‘out of management and collaboration have the box’ – there will be set-up operations strong showings. Content management that need to be carried out. generally – as organisations do battle As for the applications and services with growing disparate data mountains, that companies are taking up in the and increasingly mobile workforces – is cloud, there are certain offerings that are clearly a winner for the cloud. ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 13 Cloud Concerns

14 The Ultimate Guide to Cloud Computing Cloud Concerns

Areyouafraid of cloudcomputing? Cloud computing offers clear beneﬁts to many organisations, but like any new technology concept there are reservations about being an ‘early adopter’. Simon Brew ﬁ nds out if these fears are real

CLOUD COMPUTING ISN’T REALLY a organisations of all sizes – so what’s new idea that’s just sprung up over holding them back? the past few months. Rather, it’s the Plenty, as it happens. Here, we summation of a series of technologies take a look at ten of the main reasons that have been converging for some people might be holding back on time. Now, cloud computing has deploying cloud-based working, and become a solid option for how valid they are. ▲

The Ultimate Guide to Cloud Computing 15 Cloud Concerns

Infrastructure A clear requirement for effective cloud working is fast, reliable Internet access, especially for smaller organisations that 1 are using public cloud providers. You need enough bandwidth so that those who need to collaborate and work across cloud technologies are able to do so. That’s something that’s quite easy to manage when the bulk of workers are in an office – provided the Internet connection is up – but it gets trickier with remote workers and those who travel. Regular travellers will be aware of the difficulty of fi nding a workable, secure web connection. And given that one of the main benefits of cloud working is to 2 have access to fi les and applications wherever you happen to be, variable web Losingcontrolof data access quality has to be a concern. It’s not just an emotional attachment to a This of course applies equally to computer room that keeps companies people accessing in-house computers from outsourcing data. It’s the fact that over the Internet. But when everyone in there’s an inherent feeling of security an organisation is dependent on a cloud in having data under close control platform, there is an understandable (assuming there’s some kind of remote concern that there is no fall-back position backup for disaster recovery, of course). for a vital part of a company’s Removing the need for local storage infrastructure – and one that underpins clearly has some cost benefits, but for a most other operations now. generation of system administrators and support staff brought up on a different way of working, it’s a change that rings some alarm bells. One in particular is trusting an external source for working data – what happens if access drops or if someone loses the data? Even appreciating the security that cloud computing offers, there’s a leap of faith and an element of uncertainty (along with a loss of transparency), that creeps in when data management is moved out of the immediate control of an IT department.

16 The Ultimate Guide to Cloud Computing Cloud Concerns 3

Fearof change People do fear any sort of change, even in a fast moving industry such as IT. They don’t tend to fear upgrades too much – although a jump say to the latest Security Microsoft Office can mean some When data is being looked after by fi refighting – but a wholesale alteration in another party, it’s right and proper that the way systems are supposed to work is security issues are raised. Every a challenge. 4 business has confidential information It’s hard not to have some sympathy that it likes to keep behind closed with this. In many organisations, IT is a doors, and the fear that cloud tool, a means to do a job, and nothing computing could make such material more than that. There’s a strong more vulnerable isn’t one that can argument that the software industry, in simply be ignored. particular, has become adept at selling Yet recent times have seen that the upgrades and alterations that we don’t biggest source of confidential actually need, or that don’t make a document leaks is more likely to have difference to daily life. So when a change been a misplaced USB stick, using comes along that does, reticence is unsecured Internet connections and hardly surprising. less than honest employees. Persuading people to alter the way Reputable cloud service providers that they’ve done things for years, view security as pivotal to what they whether attempted via carrot or stick, offer and, with the added help of a bit of is rarely a straightforward battle. common sense, there’s a strong So persuading key decision makers argument that most businesses would and their staff to embrace cloud benefit from more robust security if computing can be a heck of a job in and they do migrate to a cloud service. of itself. Even the best-deployed cloud solution might therefore still be a bit of a bumpy ride (see also number 10 – the human factor). ▲

The Ultimate Guide to Cloud Computing 17 Cloud Concerns 5

Cloudoutage Clearly, this is a very real and sensible concern. There’s no computer network in the world that doesn’t have the risk of downtime at some point in its life. However, there’s still the comfort Payingthebill blanket of being able to yell at an IT There are some obvious economic department and get up-to-the-minute beneﬁts to adopting cloud services, from information when it’s a self-hosted a reduction in dependency on in-house computer network that’s at the heart of 6 IT, to the outsourcing of data the problem. management and security, and the What happens, though, when that’s saving, potentially, on expensive taken out into a cloud environment? software licences, and battling to keeping Who gets the ear-bashing then? And, hardware performance up to date. more to the point, what happens when Yet the future is uncertain. Technology a cloud service a business is relying on is littered with examples of new goes down, even for a short period? innovations and developments that were With localised working, even without a initially designed to reduce costs, and yet network, having some machines with many business are still investing heavily working productivity software installed in their IT budgets. at least means things can get done. Some valid questions arise about What’s often forgotten in this cloud computing, then. Is it offering value argument, though, is that a cloud for money? What guarantees are in place service stands a good chance of having that pricing won’t slide upwards as a working, operational backup called businesses become more and more into action quickly. Furthermore, one dependant on cloud services? Is this just by-product of cloud adoption is that the software companies trying to get us to maintenance and repair of problems is switch to a subscription system for also outsourced, so it may well be that licences, and so the longer term cost any problems are resolved faster than may actually be higher? an in-house team can act. These are appropriate questions, often Service providers should – and do – with no immediate answer. There’s an also have incentives to ensure element of leap of faith, and a need to maximum uptime. down a good service contract. But cast iron guarantees? They’re lacking at present, and for ﬁ rms with razor-tight balance sheets that has to be an issue.

18 The Ultimate Guide to Cloud Computing Cloud Concerns

We arenotlemmings Much of the discussion surrounding cloud computing has implicit assumptions built into it. That it’s the 78right thing to do. That it’s the logical next step in business technology. That It’s tooearly it’s a question of when, rather than if, a Even accepting the comparable maturity company should take advantage of of some elements of cloud-based what cloud computing offers. In much working (many, for instance, trust their the same way that it was once assumed email to a webmail service with little that everybody would upgrade their worry), there remains a feeling, rightly or copy of Windows within a couple of wrongly, that this is still an area of years of Microsoft releasing a new computing that’s in its infancy. Let’s not version, there’s an impression forget, too, that lots of ‘next big things’ sometimes put across that cloud have gone on to be anything but. As computing will become compulsory. such, many businesses are holding back But, of course, it isn’t. There is doubt from adopting cloud services as they that the argument that cloud is the wait to see how the assorted offerings future has been convincingly made. develop, and as they let others do the Because, while there are potentially pathfinding for them. huge benefits to what’s being offered, There’s always some sense to not there’s no one-size-fits-all mentality moving business-critical operations to here. Is cloud computing really the areas where you’d be an early adopter right option for a small business of (although cloud adoption can, and two or three people? Is it the right should, be done piecemeal), and there’s way forward for a large organisation, a feeling that the wrinkles need to be with hundreds of employees in many resolved in cloud services before more different locations? fi rms embrace the potential on offer. There are strong cases to be made in Yet, there’s a degree of obvious myth both instances that the answer is yes to the argument that the services are (again, down to the fact that you can immature – after all, Saleforce.com has choose what works for you, with public, been around since 1999, an eternity in private and hybrid cloud approaches IT terms. Rather, we are more likely on offer). But that doesn’t mean that reacting to changes in the way services the case doesn’t have to be made. are packaged and sold, although there The benefits of the cloud have to be are clear reasons to be cautious if, say, defined, be tangible, and be presented the local Internet infrastructure is rather properly. It’s the users who tumble over poor and you want to invest in a public the cliff to follow the crowd who will, cloud system. inevitably, hit problems, and fail to reap the intended benefits of what the cloud can offer. ▲

The Ultimate Guide to Cloud Computing 19 Cloud Concerns

What,actually, isit? Arguably one of the biggest challenges facing cloud computing is this: how, exactly, do you define it? Because 91already, different service providers 0 describe cloud products in very different ways. There doesn’t appear to be one Thehumanfactor widely accepted definition of what At the heart of every significant cloud computing is, and without that, problem to do with technology lies the packaging and selling the benefits same factor: people. We have seen to organisations is made that bit time and time again that you can have more difficult. an IT infrastructure that’s seemingly Furthermore, part and parcel of the tight and secure, but it’s a simple uncertainties surrounding cloud human slip that’s opened up an computing is the argument over element of risk. Furthermore, someone standards. There’s no solid, common who doesn’t fully understand, or and obvious foundation for cloud doesn’t want to understand, what it is services to build on. Like it or lump it, that they’re being presented with, will people know where they are with a always cause some degree of problem. Windows operating system, a copy of It may be straightforward to get the Lotus Notes and some variant of an MD and fi nance director to sign off on office suite. But what such common, the fi nancial benefits, but just look at unifying tools exist in the cloud? There how hard it is to get ‘buy-in’ for end are not, at this stage, obvious, dominant users to use systems such as CRM players in the market – although (customer relationship management). Amazon, Google and Salesforce.com New web-based systems in the cloud would stake claims – and for companies may pose similar problems. looking for a big brand name to trust, that Realistically, of course, every issue does have to come into their thinking. we’ve discussed here has a person at Until cloud computing can be defined the heart of it, or a fear of what in a manner that’s as understandable as someone can and inevitably will do an operating system or an office suite when given the keys to something new (and arguably, it can be defined as both), and different (and that’s just one it’s going to create some uncertainty individual: the potential dangers within fi rms as to what exactly they’re multiply exponentially when people being sold, and how it allows them to hunt in packs). work with others. It’s a big problem, and why many businesses are keen to retain the technological status quo, in that it keeps the human–technology balance in a position that it’s migrated to over a period of time. It’s important never to forget the ‘people factor’ when bringing in any new technology ■

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Howthecloud canmake your business agile

This talk of technology is all very well, but the cloud’s true potential is in transforming your business with speed and collaboration, as Marc Beishon ﬁ nds out

HANDS UP WHO remembers timesharing computers in universities? Or value-added networks (VANs) and electronic data interchange (EDI) in “Clouds are about ecosystems, about business trading networks? Or large collections of interacting services Prudential salespeople armed with including partners and third parties, Psion palmtop computers? about inter-cloud communication and Many proponents of cloud computing sharing of information through such act as though they’ve just discovered the semantic frameworks as social graphs.” kind of cloud-type business processes that organisations have, in fact, been Transformationvsutility tackling with various degrees of success This, he adds, is clearly business for many years. These advocates also transformational, whereas “computing maintain that cloud is a technology- services that are delivered as a utility driven new wave that, while bringing new from a remote data centre” are not. The business opportunities, is mainly about pioneers in VANS/EDI methods – which scaling up infrastructure in data centres, are now migrating into modern cloud with the obvious advantages of access to systems in offerings from software ﬁ rm latest technology, elimination of in-house SAP and its partners, for example – were servers and so on. able to set up basic trading data But the technology itself, while exchange networks, but the cloud obviously vital, is really a sideshow to transformation now is integrating, in realising the business transformation real-time, the procurement, catalogue, efforts that enlightened organisations invoicing and other systems across have been striving for over the last possibly overlapping and much wider 20 years or so. As Walter Adamson, an business communities. Australian-based consultant, comments: Likewise, companies struggled for a

22 The Ultimate Guide to Cloud Computing cloudpro.co.uk Business Change

But is that offering business agility beyond the IT side? A recent Business Week article, ‘The cloud: battle of the tech titans’, looks at Amazon vs the rest and focuses pretty much on the scale argument, with users renting server time to analyse sales data, for example. But it does note that time to market is a major pull. The city of Miami, for example, has quickly built a service that monitors non-emergency calls. “Local residents can go to a website that pulls up a map of the city and place pins in every spot tied to a complaint. Before the cloud, the city would have needed three months to develop a concept, buy new computing systems (including extras in case of a hurricane), get a team to install all the necessary software, and then build the service.” Such systems are unlikely to be built in the ‘conventional’ way in these long time with mobile and remote access cash-strapped days. to sales and marketing systems, as enterprise integration was often very Sandwichcourse difficult and expensive. Now the Good use of a private cloud – this time on transformation brought about by cloud Google Apps – is by food chain EAT, ecosystems such as the Salesforce.com which is improving business processes community is enabling far more than a by using Google Talk for instant mobile quotation system with data that a messages between stores when one run rep had to download using a modem outs of a popular sandwich, for instance; before he or she set out for the day. Google Forms for head office to survey And clearly, there are many individuals shop managers to capture issues and and companies, especially small fi rms, ideas; and integration with smartphones, that have happily taken to one of the for managers to access documents and world’s most complete cloud order stocks on the move, and to oversee experiences, Amazon Web Services, a number of restaurants while being which is enabling many to move from a stationed at one. static website to a fully-fledged online The received wisdom about such global shop, with everything from business cloud applications is that database management to micropayment vendors are approaching business handling. And Amazon is also a department heads, not IT managers, to frontrunner in the enterprise ‘private make sales, although not much cloud’, with major software vendors – enterprise software of any type has been including Oracle and SAP – now on its sold this way since the dot-com crash. infrastructure offering. It certainly makes sense in one of the ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 23 Business Change

hardest functions to crack, the of reps is more than useful and it’s hard salesforce, which has long put up to underestimate what this can do for a resistance to clunky CRM (customer company – Larry Ellison, the colourful relationship management) systems boss of software giant Oracle and now a foisted on them. Just because cloud convert, famously cracked the Salesforce.com’s CRM system is whip a few years ago when he realised he cloud-based does not mean it does not had no ‘dashboard’ to see what his have the adoption problems that CRM business units were doing in a timely has suffered from – incentives and good fashion round the world – and got it management tend to fi x that. But a cloud done, of course. system can greatly help with business change in hard to reach parts of a fi rm. In-housenotanoption In many companies there is a black Trying to build an in-house systems to do hole of forecasting and pipeline data on this is obviously counter-productive in sales, and it doesn’t help that most major time and money for most companies that enterprises – certainly in the FTSE 100 are not of the likes of Oracle. And where – are led by CEOs with no sales Salesforce.com also scores is in its experience. It’s an area tailor-made for brilliant decision to create the the cloud since so much knowledge is in AppExchange platform where users can silos – around departments and in the integrate and use many more functions, heads of salespeople – and best practice from an 800 long list, and that’s apart is not shared. from Salesforce’s own extras. Another function that’s benefiting Fast forwardforsales from cloud ‘agility’ is logistics, where Phil Codd, chief markets officer for provider Deltion is gaining a good deal of northern Europe at software testing fi rm success for its CarrierNet platform. SQS, chose Salesforce.com to solve a Managing director Denis O’Sullivan, major sales reporting problem – in the himself a logistics expert brought in to past, reporting was on an individual run this UK fi rm a year ago, says country basis with a complex mix of logisticians have been ‘crying out’ for a spreadsheets, emails and word of mouth long time for real-time visibility across which placed a lot of pressure on the supply chain to iron out customer accurate and timely sales forecasting. service problems, which he says Codd took advantage of Salesforce. Cadbury (now part of Kraft) is doing with com’s 30 day free trial of its Sales Cloud CarrierNet, a cloud system. 2, and then worked with consultancy Keith Newton, customer logistics SaasPoint to implement it in just 40 director at Cadbury says: “The working days – and the company now implementation has enabled us to move has a central repository of sales pipeline from a series of unlinked systems to a throughout the region in real-time, and web based interfaced solution that has all sorts of new opportunities for sharing totally eliminated a number of areas of sales best practice and leads by using failure. It links all internal logistics and tools such as Salesforce.com’s Chatter, planning teams at Cadbury, all tier one an internal social media system. third party logistics service providers, all Anything that produces more than the second tier hauliers subcontracted to sum of a notoriously self-sufficient group them, and customers via alerts, SMS

24 The Ultimate Guide to Cloud Computing cloudpro.co.uk Business Change

More business applications in the cloud

• Human resources (HR) systems are not systems. “Finally we have a central system obvious targets for the cloud but vendors for storing fi les, working on them and such as SuccessFactors are proving that retrieving them, always in real-time. Any properly managing the entire workforce in project member can access it, and most terms of skills, knowledge and structure can importantly, the latest version is always have a big impact on business performance. available,” says Alexander Gottschlich, European users such as construction global programme manager at Vodafone. supplier Hilti are big fans. • The Green House, a small Northampton- • The public sector has much to gain from the based business specialising in environmental cloud – in the NHS, County Durham and services, manages around 500,000 Darlington Foundation Trust, a consortium of scheduled collections a year through its ten organisations, is using Wax Digital’s recycling division alone. In the past, all of web3 procurement system to make it easier these transactions would have been carried for staff across the consortium to select out manually. Issues were typically sorted goods and services for purchase and place out over the telephone with multiple calls orders quickly and simply, enable routinely taking place between the company, streamlined fi nancial control and its suppliers and clients. This was a authorisation, and accelerate the supply time-consuming, resource-intensive and process to nearly always ‘next day’. expensive process. Today, the company manages all of these collections through • Project management is a shoo-in for the Salesforce.com’s Service Cloud, into which it cloud, as Vodafone is discovering with the has integrated a large number of workflows Projectplace web-based communication and approval procedures. and emails. “It is no coincidence that despatch. If there is a potential problem, since implementation we have recorded an exception alert is raised and the a number of ‘100% customer service problem managed with the customer. days’, which is a significant achievement Logistics examples are significant for a large FMCG fi rm such as Cadbury.” because they often involve the For which read – if the truck breaks ecosystems that promote more business down and no one knows, the kids don’t transformation across partners – adding get their chocolate. O’Sullivan adds that real-time bidding systems to take on large retailers are also in the market for jobs, for example, is another feature his system – which again would be O’Sullivan mentions that a client is doing. prohibitive now to try and build in-house An ecosystem also becomes apparent – and also mentions a client called Rigid within companies as they use cloud Plastic Containers (RPC) which uses systems for human resources. CarrierNet to check warehouse stock and In some cases, it is certainly the case production schedules before processing that cloud technology creates a new transport orders. If there is no warehouse business agility opportunity. In others, stock, the system checks if the ordered it’s enabling better a known need. Donald items will be produced in time for Rumsfeld had a good take on this… ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 25 Cloud Types

Should yougo private orpublic?

MUCH OF THE DEBATE about cloud computing has focused on two distinct types of operation: the public and private clouds. But although they are bundled under the convenient term of cloud computing, they are very different operational models.

PublicstartedwithAmazon Public cloud, which is simply using the Internet to access computer services of one sort or another, has its roots in the decision by Amazon in 2002 to use its vast infrastructure to offer computer facilities to customers. The company launched a range of services to developers, including storage and a development platform. Amazon’s initiative, which preceded the phrase ‘cloud computing’ itself, has been followed by the likes of Google and a selection of hosting companies as they seek to capture the interest in this approach. As if to demonstrate that there’s nothing new under the sun, this is a throwback to the concept of the computer bureau, where companies paid a monthly fee to buy time on a mainframe. It’s a business that had seemed to die a death when PCs and the client-server model came into play. Like the computer bureaux, public cloud providers charge their customers on a monthly basis – generally according to gigabytes transmitted and bandwidth. The crucial aspect is that the cloud

26 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Types

It’s not just a question of moving to the cloud; do you opt for a public or private system? Maxwell Cooter weighs up the options

provider bears the entire cost of running the infrastructure, meaning that as a customer you do not have to worry about maintenance or staffing help desks. Nor do you have to worry about investing in storage hardware, a growing budgetary strain on organisations as data storage volumes move ever upwards. Crucially, it also means that you do not have to worry about capacity planning. This can be a big headache for companies with seasonal fl uctuations, where they might have over-provisioned for peak traffic. That’s a headache that the new breed of cloud providers can deal with. So, public cloud offers a number of advantages to organisations, particularly small businesses and start-ups, both of which may have no IT department and which may be reluctant to tie up capital on an IT infrastructure. There are, however, downsides too. The main disadvantage with public cloud is that there are some security issues. Companies will have to hand over confidential data over to a third party and for many fi rms this is a move too far. There will be worries about customer data being released into the public domain, concerns about companies being held legally responsible for breaches of privacy legislation and worries about sensitive data being held on a server, particularly where two competitors might be hosted.

But if you’re starting small, public ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 27 Cloud Types

In the private cloud, you have responsibility for buying the hardware and software, maintaining it and managing storage

cloud will almost certainly be the way to infrastructure as a centralised pool of go as it will be able to handle something computing resources. as small as say a basic client contact Other features of the private cloud database for a couple of salespeople. are automation, meaning that many And many providers offer simple storage of these tasks are handled without the services for single users. intervention of an IT department, and the ability to measure and monitor Incontrolwithprivate cloud what resources have been allocated The genesis of the private cloud was very to different departments, which could different. There’s no public operator and also means companies are able to everything – hardware and software – is introduce chargeback for resources provided by you, the user. It sounds that have been consumed. little different from a more conventional In the private cloud set-up, you have data centre, where your servers and responsibility for buying the hardware applications are hosted by a specialist and software, maintaining it and provider. Indeed there are some managing storage. As such, private commentators who claim that the cloud doesn’t offer so many advantages idea of a private cloud is an oxymoron, when it comes to managing cash fl ow. and really we should be talking about But there are other advantages. You data centres. connect to public cloud providers by Proponents of private clouds maintain using Internet connections – these are, there is a difference: the main features by their very nature, slow. This means of a private cloud are a ‘virtualised’ that anyone trying to shift large fi les infrastructure coupled with software around would fi nd the experience a lot that allows IT users to treat that of slower. On the other hand, private

28 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Types

PUBLIC VS PRIVATE CLOUD: pros and cons

PUBLIC PROS PRIVATE PROS • Less expensive than private clouds • Can be secured to meet compliance • More accessible than private clouds at almost every level • Short-term or temporary • Single tenant environments eliminate commitments the possibility of other companies • Faster to deploy a single user than affecting performance private clouds • Private data centres usually accessible to IT auditors • Customisable to meet an individual organisation’s needs, rather than the mass approach of public clouds

PUBLIC CONS PRIVATE CONS • Fewer user management controls • More expensive to deploy and • One-size-ﬁts all approach (not maintain than public clouds tailored to a single organisation’s or • May have longer-term commitments user’s needs) than public clouds • Impersonal support, often via email, • May have less ﬂ exibility since chat, or FAQs only hardware is dedicated to a single • Security and uptime might not meet organisation

enterprise compliance standards SOURCE: WWW.FOGODATACENTERS.COM cloud infrastructures often use private Whynotgo hybrid? connections, offering a much speedier There’s no need to choose between experience, although there are issues for private or public, as organisations with branch ofﬁces that may need to use a more than basic needs for cloud IT slower wide area network to get access can opt for both in a hybrid approach, to the main corporate link. with some services in a private cloud, In addition, the private cloud doesn’t others in a public one. This could still have the security issues that could cause be managed by one provider and can problems for public cloud users. All data address concerns such as holding is retained by your company and you sensitive data – such as customer credit control all access over a private ‘ﬁrewall’. card details – only on a private basis. What’s important here is that not only But you may be quite happy for staff do you keep tabs on data – but you also to use say Twitter or Facebook – which know exactly where, geographically are public cloud applications, after all speaking, it’s being held. This not an – for customer communication, or any academic principle, as there are of the Google apps, such as Calendar important legal restraints on where data and Docs, or say Salesforce.com, for can or cannot be held and companies communications among groups of have to be wary of their statutory duty for staff, where ease of use is the foremost protecting customer information. consideration. ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 29 Enterprise Cloud

Board-level prioritiesforcloud

30 The Ultimate Guide to Cloud Computing cloudpro.co.uk Enterprise Cloud

CLOUD COMPUTING HAS had a short history. It was unheard of as a term before 2007 and in just four years it has risen from marketing shorthand to become the symbol of a massive change in technology. What makes cloud computing different is that it’s a technological change that touches on every part of the business. For the ﬁ nance director there are changes in the way IT services are bought; sales managers have a new way to communicate and interact with their teams and customers; the IT director will ﬁ nd his or her budget, strategy and team transformed. Above all, the CEO will have to think about the way his or her entire organisation is structured. In the future, we could be talking about a complete overhaul of the way companies are constructed, about how they consume IT, about how their accounting works and, indeed, where they’re located (see also section on business change, page 22). But those changes mean different things to different parts of the business. If we look at the way cloud services impact on different job roles, we can see that they’re going to approach these changes in very different ways.

Forthefi nancedirector Perhaps the biggest driver for the move to cloud is the need to save costs, but that move works on many levels. The change that has garnered most publicity is the move from counting IT as a capital expenditure to an operational Maxwell Cooter takes a tour one. Although often cited as a reason to through the top board jobs move from on-premise hosting to cloud, affected by what for many this is somewhat misleading. What’s really at stake is cash ﬂ ow; by going will be a major business down the cloud route, customers no change in the years ahead longer have to commit to large costs upfront. It isn’t necessarily true to say ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 31 Enterprise Cloud

that it’s always going to be cheaper, but there are other advantages. There may even be a price premium in opting for cloud, but that needs to be set aside for other considerations. The price of renting a server could initially appear to cost more than purchasing, but the fi nance director has to consider the cost of power and cooling, the cost of staff, the maintenance costs, accounting for backup and disaster recovery and various other costs. There’s also the fact there’s no longer the need to be so rigorous about capacity planning – that becomes a headache for the cloud provider, not your IT director – and companies You no longer will be more fl exible about need to be so installing new services and scaling up and down. rigorous about This is an important capacity planning aspect. Previously the IT – that becomes a department would have headache for the installed an infrastructure cloud provider, that would be able to handle the peaks of the business. not your IT This was always a grossly director inefficient way of organising IT services. It could be an infrastructure deciding which costs are set against that is geared up to handle peaks of which department. This is a fundamental traffic – perhaps around the end of shake-up: even companies that have fi nancial quarters, or around Christmas chargeback to separate departments for retailers. have often found this is little more than But those brief periods of intense an estimate of a share of the costs. activity would have an effect on IT Managers have few tools to assess a provision for the entire year – rather as real cost and have derived a fi gure from if a family of four opted for a minibus a combination of real fi gures and purely to cope with the yearly visit of informed guesses. the cousins who lived abroad. Cloud Now there’s a real way of measuring computing changes all that: for the fi rst just now much computing time the time, organisations will no longer have to marketing department has used, how plan for the periods of greatest demand. much storage the graphics department Coupled with this will be a change of has grabbed and the bandwidth needs practice when it comes to allocating of fi nance. departmental costs. Finance directors That capability, however, could lead to will now have an accurate way of some fi nely tuned judgment. When

32 The Ultimate Guide to Cloud Computing cloudpro.co.uk Enterprise Cloud

vendors have not yet grasped the transformational nature of cloud computing and their licensing models are not able to cope with this new paradigm. The fi nance director, in conjunction with the IT head, needs to assess the state of licensing within the organisation, making sure that the company isn’t overpaying. The thorniest problem of all will be the negotiation and monitoring of the service level agreements (SLAs) with cloud providers. While the IT director will probably remain the best person to check on service delivery, the fi nance director will need some understanding of the potential level of fi nancial loss suffered and the possible levels of compensation. This is a crucial area for the move to cloud computing: delivery to this sort of model will never work if the cloud provider can’t provide the desired level of service and if the customer is under-compensated. Ever since cloud computing emerged as a new catchphrase for the IT world, there have been several vendors leaping on to the cloud bandwagon and ‘cloud departments’ real costs are assessed washing’ existing products to suggest accurately there could be some a strong commitment to the cloud. resentment from those that have been There are some fi nance directors or IT undercharged in earlier years and now directors who may be tempted to follow fi nd their costs increasing (or the same path and ‘cloud wash’ their IT resentment from departments that have department. These instances will been overcharged for probably be rare but there’s certainly several years). Either way, been some resistance to the idea of The stakes the fi nance director is cloud computing from some IT are high for likely to act as the diplomat department chiefs and the fi nance businesses. smoothing over territorial director may fi nd himself as some sort It will be a rare disputes, ensuring the of cloud arbiter. company that winners don’t get The stakes are high for businesses. triumphant and the losers It will be a rare company that relies relies entirely don’t become embittered. entirely on in-house IT in future. Some on in-house IT Another key area the companies will move entirely to the in future fi nance director must keep cloud, some will move part of the tabs on is licensing. Many infrastructure, some will move none. It’s ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 33 Enterprise Cloud

a decision that’s going to require some careful assessment of the pros and cons and the ﬁ nance director will play a vital role in assessing the ﬁ nancial rationale.

FortheITdirector IT directors have a different path to cloud. They have been aware of the debate and some of the buzzwords: public cloud; private cloud; software-as-a-service; outsourcing; cloud-sourcing; crowd-sourcing. But, unusually, these terms are just as likely to have come from the board as from the IT side. For once, the majority of hardcore techies and their sources have underplayed the significance of cloud. This is partly because it’s perceived as a threat – outsource services and you’ll surely lose part of your team, is the thinking – but also because for them it’s an emergent set of trends in virtualisation and hosting: a confection, made out of pre-existing components with the key innovations happening several years ago. talking about private clouds, which is the This makes the balance of emails data centre, virtualised and shrunk, and hitting inboxes of IT directors all the made mobile (in the sense that it can stranger; a vast number of people, with move from one compute host to another, salespeople in the vanguard, are and nothing at all to do with the iPhone). attaching the word cloud to their sales IT directors who get drawn into an pitches as if it’s their road to personal early-adopter, single-purpose salvation. In this new world the cloud is cloud-badged project, could fi nd the outsourcing industry’s wholehearted themselves in great difficulty if they don’t attack on the massive budgets and check details carefully. This is because imposing empires of corporate IT. That’s the momentum of the optimistic, why less tech-savvy board colleagues ignorant and misguided can be an love it so much. It isn’t easy for an IT astonishing thing, and because the director to reject all these overtures. hosting business has very little in the way Among the ambitious Powerpoint of verification, standards, agreed presentations there’ll be a quiet voice procedures, or compensation packages from a clever guy who promises to chop for the day when something goes rather your re-investment costs by 75%, amiss. Hosting underpins cloud, and also without moving a corporate dataset wage packets if the IT director bets the outside your building. That last guy is company’s operations on it.

34 The Ultimate Guide to Cloud Computing cloudpro.co.uk Enterprise Cloud

Cloud companies that don’t present be a lot of pressure on them from rational means of running their services less ‘techie’ board members and it’s when their own platforms are offline important that the cloud option has been are scarcely credible to seasoned thoroughly investigated. technologists – so you have to be able to say, “What happens when it does Forthechief executive not work?” The modern CEO isn’t going to be The answer lies with a private cloud. short of advice in his attempt to get If sales teams are expected to do up-to-speed with cloud computing. But thousands of deals a day on an externally many of the opinions will be proffered by hosted service, then replicating that data a host of vendors, cloud providers and internally on a compatible virtualisation channel partners – all of which will have platform is an insurance policy against their own agenda. not just kit failure at the software-as-a- So, where does the CEO look to get service provider but also the sudden loss the best advice on a move to the cloud? of your own Internet connection, perhaps There are some things to focus on at traced to a telco’s engineering works in the highest level, which lower-level the street outside. managers and ‘direct reports’ won’t In all likelihood, the eventual impact necessarily have at the forefront of their of cloud concepts will be somewhat less minds. Terminology is one of those than the hopeful CEO – dreaming of things. Your irritation at technical types losing his entire IT department – babbling away using terms they don’t currently thinks. But it will also be a lot define, no matter how well-intended you greater than the scornful nerd, looking at can see they are, gets some real teeth the toolbox cloud uses for delivery and when it comes to cloud topics. There are fi nding nothing new or a multitude of definitions out there, so Cloud companies clever about it, is currently how do you sort out which is best? that don’t present able to foresee. The top priority for any CEO It’s also possible for contemplating a move to the cloud is rational means of an IT director to be in a to check the small print as if your life running services business so secure, or so depends on it – because it could be that when their closely tied to physical your business will come to depend on it. own platforms processes, or so hugely If you’re unsure, consult with lawyers. are offl ine are dependent on a specific Cloud is about delivery of services and ancient software and ensuring that cloud providers meet scarcely credible suite, that there’s no with their responsibilities. Research to technologists chance of making use of from Queen Mary College in 2010 the high-profile parts of revealed a wide disparity of wording cloud computing. Companies running a within cloud computing contracts. This factory fl oor of milling machines, or a is one area where the small print is not metro line full of ticket readers, will fi nd it to be ignored as the contract will be the difficult to run an on-demand capacity basis for the way that the company runs expansion project. – indeed it could be crucial to whether What the IT director does fi nd difficult the company survives or not if things is to show that cloud computing has don’t go quite to plan. been assessed as a possibility. There’ll What happens when a cloud provider ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 35 Enterprise Cloud

Enterprise cloud means business agility

PricewaterhouseCoopers (PwC) recommends the following:

1 Start by knowing where the organisation ever-greater levels of business efficiency stands on the cloud computing continuum. and agility Use benchmarking and gap analysis to 5 Progress systematically through the five understand where you are today levels* of cloud computing components, 2 Conceptualise and communicate a realising that not all components are compelling vision for using cloud appropriate in all situations computing to advance business objectives 6 Balance the use of private and public 3 Develop a cloud strategy and execution clouds to form a hybrid cloud that draws plan that incorporates any ad hoc on both private and public cloud resources components implemented already and as needed lays out a systematic approach to 7 Focus on automation, which is the key to moving forward efficiency, agility and scalability

4 Understand the goal, which is not to get * SET OUT IN PWC’S PAPER, ‘CLOUDS IN THE ENTERPRISE: NAVIGATING to cloud computing, but to achieve THE PATH TO BUSINESS ADVANTAGE’, AVAILABLE AT WWW.PWC.COM

is hit by a denial-of-service attack? strategy. Cloud is meant to be all about What stops a provider from moving data steering work to an available resource, to another jurisdiction for cost or legal not watching it vanish behind someone reasons? Is the provider the deﬁnitive else’s security gates. provider-of-last-resort, or is it just Cloud computing presents the CEO reselling someone else’s package? with a major opportunity to reshape and What happens if a customer wants reorganise their business. It’s not just to move providers or go back to about IT, it’s about how to use, analyse in-premise? Due diligence isn’t just a tick and improve company data and it’s box in taking up services in the cloud, it’s about using IT to have an impact on a major component of the project time. business processes. Many companies The next question for an organisation have operated on the ‘we’ve always done to consider is how closely it wants to things this way’ principle – cloud work with its cloud provider. Some will computing will offer the opportunity to be hands-off and see themselves as a do away with this thinking. facility for handling peak demands. Cloud computing may not be for every Some will be more personal and try to be business or every CEO but every one intimately involved in their customers’ should be looking at the technology. business. Be wary though: the dream The best companies will be those where of many of the upsellers in the current the board looks at the direction the wave of cloud hype is to pretend to be organisation is headed over the next ﬁ ve removable, when in fact they fully intend years and the best means for getting to hook customers for the foreseeable there. If that involves cloud, now is the future. Keeping independence is very best time to be thinking about it. If not, much a CEO-level question, as is the exit your competitors will be. ■

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Cloudandsmallfirms –agreatmatch Small organisations are obvious candidates for cloud computing – but there’s still an awareness issue and SMEs should tread carefully, says Maxwell Cooter

CLOUD COMPUTING IS an unusual cloud and SMEs. There have been some phenomenon in the IT world as it is being very enterprising small businesses who used equally by small businesses and have been happy to adopt cloud as the enterprises. Indeed, it’s the smaller backbone of their IT set-up but there’s businesses that should benefit most as also a good deal of scepticism. they are the companies that tend not to A survey in 2011 revealed some of this have large IT departments. Some small hesitancy. According to VMware, a companies have no IT departments at all provider of virtualisation software, only and are serviced by someone doing the 48% of British SMEs had begun using job in his spare time, or by a local cloud technology. While this looks services company. encouraging, the same survey found that This is not the norm when it comes to 60% of small businesses across Europe technology. The natural order of things were going down this path. Other surveys is for IT advances to start off in large have found even larger gaps in adoption businesses and work their way and one reported that 43% of SME downwards: mobile phones started as an respondents didn’t even know what the executive toy, now everyone has one; term meant. routers were part of the arcane global There are two problems with this: for a telecoms world, now people are start, there are millions of people who connected at home. are happily using consumer cloud Cloud computing has been different – services, such as Facebook and Google there are many instances of SMEs Mail, not to mention commercial cloud adopting cloud-based delivery applications such as Google Apps and wholeheartedly, while larger enterprises various smartphone apps. Second, have hesitated. Indeed, Andy Burton fi gures from analyst IDC have shown of the UK’s Cloud Industry Forum that small businesses do not appear to believes that cloud computing is the be miserly when it comes to cloud – fi rst case of a technology that started in £9.8 billion was spent on cloud small businesses and has moved to technologies in 2009 and half the fi gure larger ones. came from SME budgets, it reports. The seeming gap between the IstheUKlaggingbehind? perception of cloud and expenditure can But that’s not the complete picture. In almost certainly be explained by a lack of reality things are not entirely rosy for the understanding of what cloud is. There’s a

38 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud and SMEs

Cloud computing is thought to be the ﬁ rst case of a technology that started in small businesses and has moved to larger ones

good chance that business people are using cloud services – even if they don’t actually know it.

Software:thechoice isyours The other issue is that small companies tend not to be burdened with large legacy systems or have equipment that need to integrated in a cloud service. That’s not to say that some do not have bespoke applications and specialist computer kit that may take time to phase out. But if you’re operating a start-up, there is little need to run any sort of IT facilities at all. By opting for Google Apps or Microsoft’s new Ofﬁce 365 cloud suite, a business could have all its productivity software (word processing, calendar, email and so on) working in the cloud. The business could also use accountancy software such as KashFlow to run its ﬁ nancials, Salesforce.com to handle its customer relationships and any number of software packages to look after its HR, marketing and procurement. Higher up the scale, NetSuite offers cloud ERP (enterprise resource planning) software – the type of package that’s normally the preserve of large businesses. In fact, just about every aspect of a modern day business could be run on cloud-based software. And it’s not just new cloud vendors

that are providing options for these ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 39 Cloud and SMEs

companies: plenty of long-established not quite managed to divorce itself from software fi rms are now in on the act. its roots and Office 365 does require Accountancy software specialist, Sage, some access to elements such as has released its own cloud-based Exchange, SharePoint and Lync. Google software, ERP specialist SAP has taken does offer a 100% cloud-based, its fi rst steps down the cloud route and standalone product with Google Apps, Oracle is embracing the technology, which many companies are turning to despite CEO Larry Ellison’s initially – although the company did lose some dismissive remarks about cloud. popularity when it reduced the number The most remarkable transformation of users supported in its free version of all has been Microsoft, which is a from 50 to 10. mainstay for so many small A picture of what smaller companies organisations in all sectors of the are adopting when it comes to the cloud economy. The company’s reputation has comes from US industry association been built on boxed products and its CompTIA, which in a 2011 survey reports licensing methodology had been geared that storage and backup towards this. But in 2010, Microsoft’s Microsoft’s CEO, solutions are the most CEO, Steve Ballmer, said that the heavily used cloud company was betting its future on the Steve Ballmer, applications (71% of SMEs cloud and since then it has looked to turn said that the using the cloud), followed that vision into reality. company was by email (62%), document Office 365 is its step in that direction betting its future management (59%), although Microsoft, unlike Google, its on the cloud collaboration (56%) and rival in the productivity suite stakes, has customer relationship management (53%). About a third of SMEs, it adds, are using cloud services, and an overwhelming majority – 92% – say their experience has been positive or very positive.

Countingon costsavings But it’s not just the availability of heaps of software that’s attractive to small business. There are also fi nancial benefits. One of the biggest problems facing start-ups is cashflow, and the onset of cloud has reduced the cost of getting off the ground significantly in the last decade. The arrival of cloud has also made it easier to plan – fi nancial forecasting becomes easier – and paying for services is now more simple. There are no more visits to the bank manager trying to argue about credit arrangements: a whole IT infrastructure can be arranged by the judicious use

40 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud and SMEs

range of cloud products but its main Key issues forsmall businesses ones are EC2 (Elastic Compute Cloud) and S3 (Simple Storage Service), both • Start small and build up – don’t overprovision of which are widely used by small • The pay-as-you-go ethos is helpful but keep an eye businesses around the world. on costs, PAYG can work out more expensive than on-premise; be sensible in your planning Beware thesmallprint • Have a proper back-up and disaster recovery However, while it sounds like it could be process in place – if something can go wrong, it will a perfect match, there are still issues for • Make sure that you’re buying services from a SMEs to consider. Regardless of the size reputable supplier – there is a lot of ‘cloud washing’ of the contract, it’s still essential to get a (ie. deceptive marketing) out there contract checked to ensure that it covers • You’re still responsible for compliance – don’t pass all possibilities. the buck to your provider when it comes to Companies would have more piece of conforming to regulations mind if vendors had some form of certification: the UK’s Cloud Industry Forum offers a self-certified code of of the company credit card. practice that several companies But not only that, there’s no longer a (including Microsoft) have signed up to. need to guess what computer resources Alternatively, there’s a more rigorous are needed: a company owner can now offering in the pipeline under the banner afford to start small and build up after of another industry organisation, the revenue has come in. Eurocloud. This accreditation scheme, Having made the decision to go with the Eurocloud Star Assessment, is not cloud, the next stage is to work out the self-certified and costs the vendor a lot hardware: if you’re not going to run with more to attain. a server under your desk or tucked away After checking the provenance of a in a corner somewhere, you’re going to cloud supplier, the details of its contract, need a cloud service provider. Again, formulating a disaster recovery plan and there are a host of providers to choose provisioning the initial services, then a from, ranging from those who will company is ready to go. Many SMEs will provide you with your own remote server have used a reseller to handle this part of or a virtual server (that is, one dedicated the business, in which case it’s important to you or shared with other companies in to know what after-sales plans are in a public cloud). place. Many resellers have been The company that really kick-started suspicious of cloud but the good ones the cloud ethos for small organisations is know that it presents a new opportunity Amazon. The company realised that it and are ready to meet the challenge – had a large amount of under-used IT a helpful reseller will be invaluable in resources and it started selling some of this process. its spare computing and storage Small businesses and cloud capacity. Amazon Web Services now has computing make a natural fi t – even if a massive share of the market – in they don’t always realise it. There may be August 2011, the company announced some hesitancy out there but we’re going that its cloud division was now a billion to see most small organisations turn to dollar business in its own right. It offers a the cloud in the future. ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 41

Cloud Contracts

What to look outforin CLOUDCONTRACTS If you rely on a public cloud service you could be in for a shock if the service goes down, as Lesley Meall describes

IT’S ALL VERY WELL being charged only attention many had paid to the small for the computing power you use – as print before they signed up. As Martyn long as it is there when you want it. So Hart, chairman of the National the outage of Amazon’s Elastic Cloud Outsourcing Association (NOA), says: Compute (EC2) service in April 2011 – “Cloud computing is not like normal when some users were ofﬂine for several outsourcing,” meaning that contracts days, an eternity in today’s trading world can be far less rigorous than when – made a lot of people understandably signing up with say a payroll supplier. very unhappy. It brought a wry smile to That said, private cloud contracts, at the faces of observers who said it was least, can look a lot like traditional only a matter of time before something managed services, which in turn can be like this happened, although not because much like outsourcing as we know it. cloud computing is inherently risky. But public cloud services, which many The incredulous cries of unhappy smaller organisations are now using for Amazon users showed just how little vital parts of their business such as email ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 43 Cloud Contracts

and payments, can leave a lot to be desired when it comes to service level agreements (SLAs), which are one of the mainstays in outsourcing and services contracts. “Some providers of public cloud services don’t offer a formal SLA,” observes Craig West, a sales director at NetSuite, one of the leading business software players with cloud offerings. This is particularly so in the ‘one contract size ﬁ ts all’ world of software-as-a- service. “I think that we may be unique among software providers in offering an SLA with an uptime guarantee,” he suggests, adding that if his company doesn’t maintain its promised 99.5% uptime in any given month, then customers will have their monthly subscription returned. West freely admits that the form this takes is a credit to your account (and if you’ve lost money because of these types of relationship there is a level system downtime, this will be small of knowledge and expertise that enables recompense), but this particular remedy them to appreciate the challenge.” tends to be the norm The trouble is that cloud computing Cloud computing among software-as-a- has put the power to select, commission service providers. “The and pay for IT services into the hands of has put the power balance of power sits with people who do not always appreciate the to select IT into the service provider,” need for thorough (and ongoing) due the hands of observes Hart, and you diligence. According to Gartner, it is people who do not don’t have to wade very far essential that those planning to contract always appreciate into most public cloud for cloud services do a “deep analysis on providers’ carefully the impact and probability of the risks”, the need for due worded ‘terms of service’ mitigate for the issues that they consider diligence to see how little they most critical, and then revisit them at resemble a formal SLA. frequent intervals during the lifetime of This lack of formality is present in the contract – though understanding most public cloud services, and it’s these risks calls for more than a passing something that looms large on the radar acquaintance with contract law. of any specialist solicitor (or experienced So, what can buyers of cloud services buyer of managed services). “Some do to protect themselves? Well that organisations really understand the depends on who you ask, which type nature of what they’re entering into,” of cloud service you are using or reports Ian Marriott, at analyst Gartner. planning to use, and the size and type “If they have been involved in lots of of organisation that is both buying them

44 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Contracts

Contractssummary

Here’s a quick checklist when it comes to contracts:

• Evaluate how much you’re willing to pay to ensure your move to the cloud doesn’t end up losing you money, or your business • Review the level of service from the provider. Does it provide adequate protection? • Take appropriate steps – through your provider or otherwise – to ensure you have a disaster recovery plan that works • Consider what the provider is liable for and what has been excluded. Is this an acceptable level of risk? and providing them. At a recent recommendations. But the latter conference on cloud computing, lawyer means expending time, money and Marc Lindsey, a partner with the other resources on a risk analysis, and Washington DC law fi rm LB3, fi rmly then devoting more time, money and advised enterprises to protect resources to building resilience into themselves by “demanding” that cloud their own systems, or factoring the service providers “put their own money cost of not doing so into the cloud at risk” and offer “liquid damages for computing cost-benefit analysis they SLA violations”. should have done, but probably didn’t. In practice, this is only possible if All of which makes public clouds seem the relationship between the service a lot less appealing. provider and the buyer is an equitable Then again, maybe there’s another one, where the balance of power and option. Despite his disinclination the balance of risk are not so clearly to consider cloud computing as one-sided – as is the case with most outsourcing, Hart at the NOA has some public cloud service providers and advice on contracts and relationships smaller fi rms that is typical of their that could stand future SME buyers of customer bases. An SME user of a public public cloud services in good stead. cloud service that is unhappy with what’s “Think about the balance of power when being provided (or not provided) has you choose your supplier,” he suggests, little ammunition. and try to match the size of their With little negotiating power, they business to the size of your business. appear to have a choice between voting “You don’t want to be a small fi sh in a with their feet or following Gartner’s giant pond.” ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 45 Cloud Contracts

ONCE YOU’VE MADE the decision to On the other hand, cloud companies move away from computer systems that may point out that having an IT are physically located within your infrastructure in-house does not organisation, there’s another problem to necessarily mean that your servers or solve, and that’s the contract you need network are more reliable. They will say to have with a provider. that managing data centres is their core The type of contract that you have business and will claim that they’re with the cloud provider (or a reseller of much better at managing this the cloud provider’s service) is crucial. infrastructure than user organisations. Get this part wrong and your business However, while it’s true that cloud could be looking at some serious providers will tend to have more robust fi nancial consequences. and better managed infrastructures, you There are three main areas to need more reassurance than that. It’s concentrate on: reliability, security and vital that all the fi ne details are built into liability, and you should be paying keen the service. And the type of cloud attention to a cloud provider’s policy on provider is important here – one factor all of them. to bear in mind is that buying a standard package from a larger operator will Isit reliable? leave very little room to manoeuvre, Reliability is about the technical while customising an offering from a performance of the cloud provider’s smaller reseller could offer a more service. Do their servers go down? What fl exible experience. mirroring options do they have in place? What monitoring systems do they have in place? You should be prepared to carry out due diligence on the cloud companies and assess their performance. Look at the company’s past performance – does it have a good reputation? CONTRACTS what to focuson

Frank Jennings, a senior partner at DMH Stallard, gives an overview of the main areas to look at when entering into a cloud computing deal

46 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Contracts

Besecure legally necessary but it does give added There are a couple of factors to consider peace of mind. when it comes to security. If you are in Although you as the customer are fi nancial services you have to conform ultimately liable, there are steps that can with the Financial Services Act and all be taken. You must include in the companies will have to consider the contract where the data is Data Protection Act and the scrutiny of held and who it can be the Information Commissioner. And Liability for released to. There should offending organisations can be hit by big any breaches also be an indemnity fi nes: the FSA fi ned HSBC £3m for losing of security lies clause that stipulates that data, for example. with you. Be the cloud provider has To be blunt, the liability for any concerned about taken all possible breaches of security or privacy lies with precautions to avoid you – so you need to be concerned with the consequences security breaches and the consequences of handing over of handing data takes legal responsibility information to a third party. It’s very to a third party for any losses. important to ensure that cloud providers Ultimately, however, are taking proper steps to protect data. market forces will come Are they keeping it in the EU, as they’re into play. If a company loses data, then legally obliged to do, rather than sending its reputation will suffer – cloud it over to India? Some insist that UK companies are going to stand or fall by data is housed in the UK – that’s not their reliability and a few security breaches will quickly destroy that.

Whois liable? The third factor to look at is liability – what happens when things go wrong with the day to day service? Again, levels of compensation need to be placed in the contract but money will be of little satisfaction to a customer that has gone bust. Some cloud providers try to exclude liability, rather in the same way that insurance companies will look not to pay out on their policies – although you could get around this by taking out your own insurance. Another option is that cloud providers will offer some sort of protection but this will involve paying a higher fee for a gold or platinum service. This could mean that the cloud company is offering a more robust service, say at a high quality data centre with better monitoring facilities. Or it could be ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 47 Cloud Contracts

IN DEPTH: top nine contract areas to watch

Analyst ﬁ rm Gartner suggests the following contract issues to consider when signing up with a cloud computing provider:

1 Uptime guarantees – Gartner says it has customer data. You should ensure there is seen many contracts that have no uptime access to your own back-up measures or performance service-level guarantees where necessary 2 Service-level agreement (SLA) penalties 6 Data privacy conditions – no personal data – these should be ﬁ nancial and ideally sharing should take place but contracts money-back and not credits can be complex where there are multiple 3 SLA penalty exclusion – look carefully at suppliers (eg. both a software and platform exclusions to penalties, such as ensuring a provider is used) downtime calculation starts exactly when 7 Suspension of service – best to have an the downtime starts agreement that payments in any current 4 Security – Gartner says the provider’s legitimate dispute should not lead to a security practices should be at the same suspension of service, says Gartner level as, or exceed, your own practices, 8 Termination – provider contracts often especially for national privacy-related have 30 day termination clauses – look to regulations. It recommends negotiating extend this where possible SLAs for security breaches 9 Liability – Gartner recommends aiming for 5 Business continuity and disaster recovery better liability protection than just a return – contracts rarely contain any provisions of yearly fees.

for disaster recovery, says Gartner, and SOURCE: IT PROCUREMENT BEST PRACTICE: NINE CONTRACTUAL some providers take no action to back-up TERMS TO REDUCE RISK IN CLOUD CONTRACTS – GARTNER

based on the fact that the cloud by signing a pass-through contract company is prepared to pay more if where the reseller supplies a service things go wrong. from a named supplier such as Amazon Bear in mind too that you may sign or Microsoft. up not with the cloud service provider There’s no doubt that the market will but with a reseller, which could consolidate over the next few years as introduce another level of complication. the poorer providers are found out and You will be signing on the smaller cloud companies will be taken reseller’s terms but there over. While that’s happening, look to could well be a clash with Due diligence sign up with an accredited cloud the cloud hosting work needs to provider, a company that has been company – the cloud be carried out endorsed by the Cloud Industry Forum company could be or ISO, for example. providing a bronze level up-front – there is But one thing is certain: the due of service while the little opportunity diligence work needs to be carried out reseller could be offering for comeback up-front – there is little opportunity for a gold one. after a problem comeback after a problem, whether it’s a One way round this is security breach or a service issue. ■

48 The Ultimate Guide to Cloud Computing cloudpro.co.uk

Cloud Storage

DATA STORAGE INTHECLOUD –nowanyfirmcanbenefit

Offsite data backup has long been multiple, geographically distributed servers. Not only does this signiﬁcantly a staple of enterprise disaster cut the chances of all your data being recovery strategy but has been too lost, it also brings the same disaster expensive or complex for smaller recovery strategies used by large enterprises within reach of much organisations. That’s all changed smaller companies. now, as Davey Winder explains Complexity costs money, both in terms of infrastructure (such as tape drives, virtual machines, offsite storage Thebenefi tsaresignifi cant… and technical staff to maintain it all) and It doesn’t take a genius to work out also business downtime (if you have that multiple copies of your data, stored data on tape drives at offsite storage and across disparate servers, is much safer need to restore servers, the time to than having all your data eggs in one recovery becomes stretched). Keeping basket. But that can cost a lot of money it simple in the cloud allows smaller if it’s your own hardware, so look to the organisations to budget for business cloud where a service provider will be continuity, with the added value of able to duplicate your data across virtually instant data recovery.

50 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Storage

…but watchoutforpitfalls The biggest pitfall of a cloud-based cloud storage provider. No matter how disaster recovery strategy is that you contractually watertight your SLA is, if may be at risk with a single supplier. things go wrong all it actually provides is While the ability of the cloud to provide legal leverage. Ensure, therefore, that data redundancy across multiple and your SLA explicitly details an agreed disparate servers gives a huge amount of remediation process in event of failure so conﬁdence, you also have to allow for the that your business does not suffer unduly worse case scenario: your cloud provider while waiting for compensation to arrive. going out of business and taking timely access to your data with it. So to Gettheprioritiesright guarantee business continuity, retaining Asking the right questions of a cloud a full backup on your own servers or storage provider is essential if both the contracting a secondary cloud service transition to a cloud-based disaster might be wise. recovery process and its effectiveness Service level agreements (SLAs) are a once in place are to be trouble free. vital part of any cloud contract, but they Proper investigation is vital when it are not a magic bullet that can save your comes to determining if a provider can business if things go pear shaped at your meet the needs of your business in terms ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 51 Cloud Storage

If a cloud provider falls at any of the other due diligence hurdles then it is unsuitable to be trusted with your data

of compliance, security, data handling and recovery. In fact, the specifics of the data recovery aspects of the service are probably the last things that you should investigate and for good reason: if a cloud provider falls at any of the other due diligence hurdles then it is unsuitable to be trusted with your data. Remember that cloud-based storage services are still relatively immature, and with companies keen to jump on the bandwagon before the wheels start wobbling it is vital to ensure that any service provider you contract with has an established track record. You will want to know how long they have been trading and how fi nancially stable they are. It’s not that start-up companies are definitely off the radar, but be sure to take into account the impact on your data should a small company be bought cannot, or is unsure, then it’s not worth out by a larger one that you may have asking any more questions. If it can, then already discounted for whatever reason. move on to matters of security. Ask So be sure to properly investigate how obvious question such as how your data easy it is to move your data to another is encrypted, and less obvious ones such provider should you want to terminate as who holds the encryption keys. your contract at any point. Ask about who has access to your data and what controls are in place to prevent Securityandcompliance both accidental and intentional abuse, If your industry is covered by specific but also ask about physical security at regulatory requirements then your next the data centres. If your service provider question must be whether the provider is unable or unwilling to answer your can adhere to them. Obviously, if it security questions, fi nd one that is.

52 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Storage

CLOUD STORAGE – benefitssummary Cloud storage can address many challenges that physical storage doesn’t:

• You are not dependent on a single server • There is no direct dependency on any hardware • You don’t have to buy more disk space than you initially need to accommodate future data growth • Business continuity is provided in the event of a site disaster • A ‘virtual’ storage container can be provisioned that is larger than the physical space available • You can drastically reduce over-provisioning in a pay-as-you-go model • You can access your entire storage pool from a single point. SOURCE: WWW.I365.COM

SLA, be sure also to ask the provider for full details of its own data protection, recovery and auditing procedures, and don’t be afraid to prod them all with your What abouttheworsecase due diligence stick. scenario? We’ve already mentioned SLAs, but even What,whereandhowmany? though an agreement will not save your This is data storage and disaster data if everything goes wrong, a properly recovery we are talking about, so be sure negotiated one could save your business. to ask appropriate questions of any Ask about business critical issues provider such as how many copies of such as availability, security and your data sets are kept, where they are compensation from the start. Deal only located geographically and how far back with a service provider that is willing to your archive stretches. Don’t be afraid enter into detailed negotiations about to get technical and ask about the the SLA. frequency of data veriﬁcation tests and To mitigate any need to resort to the availability of veriﬁcation reports. ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 53 Cloud Finances

Crunching thenumbers

Would you weigh up the ﬁ nancial beneﬁts of the cloud? Or is it a ‘no brainer’? Lesley Meall asks the right questions

WE ARE ALL AWARE of the need to factor fi nancial considerations into any technology-related decision-making process – but this doesn’t make it easy to do. So although accounting concepts such as net present value (NPV), return on investment (ROI) and total cost of ownership (TCO) are routinely used to estimate and compare IT costs, as Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants points out, there is plenty of room for interpretation, and “you could have a situation where two accountants end up with different fi gures”. It’s not hard to understand why. Whether you are considering using software-as-a-service (SaaS), or comparing alternatives such as public clouds and private clouds, or totting up the bill for maintaining the status quo, “It’s difficult to work out the cost there are many cost-related factors to associated with any technology consider. These range from set-up, purchasing decision, but cloud service and training, to overheads such computing is more challenging,” says as fl oor space and electricity, to less Roy-Chowdhury, citing barriers such as tangible costs such as those associated not being able to compare like with like. with security breaches and their impact “You pay forever to use cloud services,” on reputation. he observes, which adds up to some Then there are the implications of pretty big TCO numbers. But as he adds: cloud computing for tax and fi nancial “Being able to access information and reporting, and the great CAPEX vs infrastructure any time and from OPEX debate. anywhere is very advantageous, and the

54 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Finances ▲

cloudpro.co.uk The Ultimate Guide to Cloud Computing 55 Cloud Finances

short-term benefits of cloud computing may outweigh the long-term cost.” All of which helps to explain why some cost-related decisions on cloud computing seem to have more to do with gut feeling than hard numbers. “We didn’t do any detailed analysis fi nancially before deciding to run the business in the cloud,” says Gary White, chief executive of White Springs, which is both a provider and user of cloud computing services. But even though the fi nancial analysis was done only “at a high level” he says “the decision was a no-brainer, because the benefits of subscribing to Salesforce.com [the customer relationship management provider] versus buying and owning the hardware and software were absolutely clear”, and the gains weren’t just to do with cost.

Cross-companyvisibility White Springs is a fast-growing UK company with operations in Europe and the US, so it was obvious to White that may draw a line around public clouds putting in his own infrastructure would (such as Amazon Web Services) and require huge resources, and impede the decry private clouds and hybrid clouds development of the business. “I wanted as oxymorons, but once these terms my staff to focus on growing the fi rm, not entered the marketing-speak of vendors on running the infrastructure,” he says, such as Cisco and IBM, cloud computing White Springs did start with a PC was further redefined, so businesses accounts system, but as soon as may as well acknowledge this and FinancialForce.com (accounting that consider the relative costs of all the runs on Salesforce.com) was available, it available options. switched. “Gaining greater functionality The decision-making process is not and visibility of customer and fi nancial necessarily a private data centre and an information across the company was on-demand data centre (ie. IaaS). It’s a more important than the long-term cost more complex choice that also includes of doing it,” he adds. all sorts of hosted and managed services While the benefits of SaaS may be so (many of which you will fi nd described as great that the long-term fi nancial costs types of cloud). It’s not an ‘all or nothing’ seem like an irrelevance, things are less choice either, because there is the straightforward in the world of virtual possibility of combining on-demand data centres and infrastructure-as-a- public resources with those provided by service (IaaS), from the point of view of your own data centre (whether that’s technology and fi nance. Cloud purists software applications, computing power,

56 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Finances

Somebody has to be responsible for monitoring, managing and patching your on-demand infrastructure. There are software tools designed specifically to help you do all of this, and with minimal technical knowledge and no programming skills, but while some One of the big organisations are comfortable doing this benefi ts of SaaS themselves, others prefer to hand it over is its capacity to to a third party. That’s one of the reasons relieve the user of why a variety of hosted, managed service and outsourced solutions are being all of the burdens labelled and marketed as private clouds, associated and one of the reasons why there are so with software many possible approaches to fi nancing maintenance all of these different types of cloud. and upgrades For example, in a private cloud where you pay for the software licences and you own the computer servers, there are various ways to avoid taking the hit up front. Financing options include contract hire, hire purchase, loans and various types of lease. A private cloud can’t exploit the buying or fi le storage – which may or may not be power of the public cloud, so the costs managed in-house, or hosted – or may be higher, and unless you invest in outsourced, if you want to split hairs), in some very big servers, you aren’t going what’s often described as a ‘hybrid to have the elasticity of the public cloud cloud’ solution. (though you may think you’re never going to need it). But you can exploit Upsanddownsof IaaS virtualisation to better use the computing The decision on which to opt for may not resources you do have in a private cloud. be as much of a ‘no brainer’ as choosing SaaS over the on-premise alternative. No room forinternalIT Although IaaS can provide you with Silverdell, an asbestos removal and ‘elastic’ access to computing power, management contractor, considered all memory and storage, and is charged on these factors when it was contemplating a pay-as-you-go basis only for the the sorry state of its IT infrastructure. resources used (without installing new “After a series of acquisitions we had equipment or waiting out the hardware three operating divisions at 25 locations procurement process), there is a and a hotchpotch of systems,” explains downside. One of the big benefits of chief fi nancial officer, Ian Johnson. SaaS is its capacity to relieve the user of “When we reviewed the IT infrastructure all of the burdens associated with and support we quickly realised we software maintenance and upgrades; weren’t big enough to support our own IaaS requires a little more attention. internal IT team,” he says, and after ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 57 Cloud Finances

Financial benefits of cloud computing andservices

Factor On-premise Cloud computing

Expenditure type Capital expenditure (capex) Operating expense (opex) Operating expense (opex)

Cash ﬂow Servers and software are Payments are made as the purchased upfront service is provided

Financial risk Entire ﬁnancial risk Financial risk is taken monthly is taken upfront, and is matched to return with uncertain return

Income statement Maintenance and Maintenance expense only depreciated capital expense

Balance sheet Software and hardware Nothing appears on the are carried as a long-term balance sheet capital asset

SOURCE: TALKING TO YOUR CFO ABOUT CLOUD COMPUTING, FORRESTER RESEARCH

considering various options, Silverdell support, in an arrangement that is decided that a private cloud and virtual backed up by a custom service level desktops were the most cost-effective agreement (SLA). solution. These are rare among providers of Silverdell owns its own servers and public cloud services, but if you don’t pays for traditional software licences, but factor the terms of your SLA into your Johnson says: “For what one competent cost-beneﬁt analyses, you could end up IT head would have cost us, we were able paying for services you can’t use, or have to get a hosted solution.” This provides no intention of using. web-based access to processing power Which is what happened to one and applications, and the desktops have software engineer who didn’t read his been virtualised for the three Silverdell Amazon Web Services contract well operating divisions – also using the most enough to know what he would be billed cost-effective solution. for; when the meter would be running; “We considered Citrix and Microsoft and when it would stop. “I put some test desktop virtualisation, but 2X [another virtual machines on the servers of AWS, virtual desktop player] offered the best and for a while my bills were just a few price-performance ratio,” says John pennies each, so when I got a monthly Abrahams, technical director with IT bill for $40 I was a bit surprised,” says Managed Services, which manages Adam Ramsay. “Turns out, when I Silverdell’s software licences, ﬁ nished the tests, I forgot to turn off the infrastructure maintenance and staff network.” ■

58 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Finances

It’s been hard to enough making sense of traditional software licenses – now the cloud means things may get more complicated, warns Lesley Meall SOFTWARELICENCES astateof flux

FREEDOM OF CHOICE can sometimes lose the will to live trying to work out how feel like a mixed blessing. Take the to license all of this or estimate how recently released Microsoft Office 365, much it is eventually going to cost you. the software giant’s new cloud service In the time-honoured tradition of the that combines its productivity offerings software industry, licensing for Microsoft such as Word and Powerpoint. On the Office can be rather opaque, particularly one hand, you can now choose from for enterprise users. You may be able to numerous variants of Microsoft-hosted fi gure out which variant you would need Offices (P1, K1, K2, E1, E2, E3, E4, and so if you were radical enough to want to on), and you can use them instead of, or access Office 365 from somewhere such mixed with, other approaches to as an airport kiosk or an Internet café providing remote and local access to MS (not all subscriptions allow this). But if Office tools; on the other hand, you could you already have a traditional Office ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 59 Cloud Finances

deployment, and you want to understand cases, the vendor won’t have given their the differences between licensing Office position this much thought. Konary’s as a ‘software product’ and as a research indicates that many are ‘subscription service’ you face a currently deciding their policies ‘on the challenge of a different order. fl y’, and that very few have yet to come According to Microsoft, “the volume up with ‘cloud-friendly licensing’. licensing of software makes it easier and Software vendor CCH, an accounting more affordable to run software on specialist, is not untypical in being in a multiple computers within a single state of fl ux. “In the US we are moving purchasing organisation”. Yes, well. very strongly towards on-demand The enterprise volume licensing cloud-based offerings,” says Simon arrangements for MS Office Professional Crompton, executive director of CCH UK. But in the UK, some of its software products are available only via traditional Working through software on-premise installations, despite being licensing issues requires a available as both on-premise and lot of upfront planning and on-demand offerings in the US. “We are moving to the cloud doesn’t very open minded and pragmatic about necessarily make this easier the cloud,” he adds. “If clients ask for something we look at it and consider the commercial implications.’” Plus for Office 365 are so complex that So what happens if a UK client wants explaining them requires a seven page to build their own private cloud and document, which is not an easy read. virtualise some CCH applications? Well, This level of complexity is not unique the software licensing is based on the to Microsoft. “Working through software traditional ‘concurrent users’ model and licensing issues requires a lot of upfront the minimum contract term remains one planning,” warns Amy Konary, an analyst year, which isn’t very fl exible. “We have at IDC, “and moving to the cloud doesn’t used temporary licences to support necessarily make this easier.” Licences clients during peak processing periods in for subscription-based public cloud the past,” recalls Crompton, but he’s services are relatively uncomplicated, talking about years ago, when a change but when organisations are trying to in legislation created some one-time migrate some or all of their applications ‘seasonal spikes’ that affected lots of or infrastructure into hybrid or private CCH users. At the moment, he says: clouds (hosted by the enterprise or by “There isn’t a demand for this.” third parties), licensing is more complex. “Negotiating with software vendors Hybridlicensing that have varying degrees of interest Meanwhile Unit4, a business software in cooperating with you can be player, has gone further, as Ton Dobbe, excruciating,” says Konary, and not just vice president of product management because you may have to go through explains. “We have put in place the negotiation process on multiple integration between Agresso Business occasions. “Attitudes may depend on World and FinancialForce.com,” he says, your company’s monetary and strategic adding that these are both owned by value,” she suggests, though in some Unit4, and provide customers with mixed

60 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Finances

access to on-premise and on-demand versions of products. “We already have Software licensing fact find some organisations doing this with Agresso,” says Dobbe, where most of the Few organisations know what software they system is licensed and accessed in the are using traditional manner, but applications such The vast majority of organisations have only partial as expenses and payroll are licensed on knowledge of the software that they have deployed. a subscription basis. A significant proportion have no monitoring tools in Unit 4 also supports other approaches place capable of auditing what software is deployed, to software licensing and subscription. and even fewer have accurate information on “This reflects the needs of the public and what is actively in use. The result is significant private sector, vertical markets, and operational risk and overspend. different countries,” says Dobbe. So pricing may be based on the number of The proliferation of licensing mechanisms is citizens in a city, active users, or levels of aggravating the problem functionality. Facilities have also been User, server, processor, site, enterprise and a built into Agresso so that users can see number of other commercial licensing schemes are what their ‘active consumption’ of in common use, with organisations large and small software licences is, whether they have often managing a complex mix of arrangements. an on-premise installation and are Open source licences may or may not be used under mixing this with on-demand (hosted by subscription/support contracts. Unit4), or have their own private cloud (hosted internally or externally). Use of software-as-a-service (SaaS) is rising, but beware contract inflexibility Benefi tsof a‘true-up’model While ‘utility’ SaaS offerings such as hosted email But in general, licence management is are used the most, there is evidence of SaaS starting one of the biggest challenges of creating to be adopted for both core and departmental hybrid or private clouds. “In the absence application needs. While this delivery option is still of cloud-ready software licensing in the early stages of market acceptance, it looks set models, a negotiated approach with a to take its place in the mainstream. Many, however, true-up model is generally preferred,” report that SaaS is not always as fl exible as reports Konary, with IT departments providers would have us believe. opting for an annual true-up approach over quarterly or monthly comparisons Many licences and subscriptions are based on the – though more automation may change ‘ratchet’ principle of commitment this. (A ‘true-up’ model is moving up to a On site or in the cloud, most commercial software usage band with, say, a higher set fee if arrangements appear to scale only one way – up. you are consistently going over a limit Reducing commitment is too often costly, difficult and incurring extra costs.) or even impossible. This artificial restriction on “Tools that help monitor licence use to fl exibility is perceived to exist to the benefit of make the true-up process less onerous suppliers, and potentially stands in the way of are desired,” she adds, as is a more dynamic cloud based models being used to deal cloud-friendly approach from many with fl uctuating demands. vendors. Meanwhile, freedom of choice can sometimes feel like a bit of a SOURCE: SOFTWARE LICENSING AND SUBSCRIPTION, FREEFORM DYNAMICS, mixed blessing. ■ WWW. FREEFORMDYNAMICS.COM cloudpro.co.uk The Ultimate Guide to Cloud Computing 61

Environment

Isthe cloudgreen?

Is cloud computing a greener way to go with IT? Yes, says Maxwell Cooter, but it’s a complex calculation to prove it in detail

SOMETHING STRANGE HAS happened discussion on whether the technology is in the last decade: green issues – which energy efficient or not. So how does a used to be the preserve of hippies and company interested in maintaining its environmentalists – have quietly invaded green credentials go about deciding the mainstream. One can scarcely look at whether to go the cloud route or not? a new service for anything these days After all, you may need to show what without being reminded of its green your IT is consuming as part of a credentials. New car? Fewer emissions. statutory carbon audit, especially in New boiler? Energy efficient. New larger companies. Regulation on energy lightbulb? Eco-friendly. use can only increase in the future. Needless to say, this philosophy has It’s not an easy question to answer. On permeated the IT industry too with much one hand, we have a school of thought more attention being paid to the energy that says because cloud computing data rating of servers and PCs than there has centres are not adding to the actual been in previous years. computing power, but are using servers Cloud computing has been a key part more efficiently, then they are, by of this debate and there’s a long-running definition, the greener option. There are

The Ultimate Guide to Cloud Computing 63 Environment

opponents, however, who say that there are some big questions to be answered fi rst and that the blanket statement that CAPGEMINI cloud computing is greener is a misleading one. It’s getting to be a heated debate – with both sides brandishing the fi gures to support their case. The latest entrant in this form of climate war is research company, Verdantix, which released a report in 2011 claiming A move to the that American companies cloud in the US could drastically cut CO2 emissions by turning would deliver to cloud computing. CO2 reductions According to the report, a of 85.7m tonnes wholesale move to cloud each year, the delivery would deliver CO2 equivalent of emission reductions of 85.7m tonnes each year, nearly 200m the equivalent of nearly barrels of oil 200m barrels of oil. That translates into energy savings for organisation with a vested interest in US businesses of $12.3bn in the next ten promoting green measures. And it wasn’t years if they adopt cloud services. The long before dissenters were rounding on Verdantix research predicts that the the research fi ndings and fi nding fl aws in fi nancial benefits from energy reduction the argument. and increased IT efficiency in 2011 alone would reach $824m by the end of the What’s theenergysource? year in the US. One of the main critics of the survey, Meanwhile market research fi rm GreenMonk analyst Tom Raftery, pointed Pike Research has predicted that cloud that there had been some rather dubious computing will lead to a 38% reduction assumptions. “The mistake here is in worldwide data centre energy presuming a direct relationship between expenditures by 2020. Microsoft too has energy and carbon emissions. While this said that the cloud can cut energy might seem like a logical assumption, it consumption and carbon emissions by is not necessarily valid,” he wrote. 30% or more, as the scale and use of “If I have a company whose energy virtualisation in the cloud just makes retailer is selling me power generated computing more efficient, while primarily by nuclear or renewable computer makers are busy making sources for example, and I move my components such as memory and applications to a cloud provider whose processes more efficient too. power comes mostly from coal, then the The Verdantix survey was sponsored move to cloud computing will increase, by the Carbon Disclosure Project – an not decrease, my carbon emissions.”

64 The Ultimate Guide to Cloud Computing Environment

providers have indeed been rather secretive about their operations, and to try to get an idea of how energy efficient their servers are would prove to be impossible. But data centre specialists themselves – those that host many clients – are currently vying with each other for the accolade of running the world’s greenest facilities, with all sorts of design and supply innovations in the way they are built, located and fuelled. The problem is that even with an overall rating for the efficiency of data centres, the actual usage of a set of servers by a client is much more difficult to assess, and detailed breakdown of the rating by factors such as the energy type can make comparisons less valid.

Location,location... A good case in point has been an argument made by Greenpeace about a data centre run by Facebook in Oregon, This is the key to many of the which takes much of its power from arguments: what is the source of the coal-fired sources. But in fact it is said to power that is driving those data centres? be one of the world’s more efficient It was a question raised by Greenpeace facilities, because the cool climate in the in 2010 when it published a report, ‘How state allows it to run without mechanical dirty is your data?’, pointing out that chillers, one the biggest energy hogs in a there were serious concerns about some data centre. of the big players in cloud computing. One organisation that is trying to Gary Cook, the lead author of that improve the way in which sustainable report, said that the problem was the lack computing is reported is the Green Grid, of transparency from some of the cloud a non-profit consortium of end-users, companies – the secretive nature of policy makers, technology providers, fi rms such as Google and Microsoft has facility architects and utility companies made it difficult to assess the claims they looking to improve the efficiency of make. He agreed, however, that data data centres. centre and server design innovation can Ali Moinuddin at data centre player, greatly improve efficiency and reduce Interxion, is also the European overheads in energy demand and that communications committee co-chair of more in the sector were comfortable with the Green Grid and is aware that there sharing best-practice data, but that needs to be a better standard of without more transparency, such efforts assessment. “The green data centre is were not worth much. at the heart of the whole movement Cook has a point and some cloud towards sustainable computing. We need

The Ultimate Guide to Cloud Computing 65 Environment

Who’s the greenest of them all?

The ultimate in green data centres could be reducing carbon dioxide emissions. We need Icelandic cloud provider, GreenQloud, which to change the energy sources to renewables; uses geothermal energy to power its data it’s that simple.” centre, with a lot of hydroelectric power And in a lesson to other providers, the thrown in for good measure. company records all energy use and carbon Of course, there aren’t many cloud emissions made by each customer and makes providers that are sitting in a geographic the data freely available to them. region with millions of litres of naturally There are certainly other providers that heated water on tap. The company uses would claim equal credentials with 100% renewable energy drawn from the GreenQloud. In the UK, Capgemini’s Merlin Icelandic grid, which is 30% geothermal data centre, in Swindon, is said to be setting a and 70% hydro. global standard for energy efficiency, with a CEO Eirikur Hrafnsson says that data power usage effectiveness (PUE) rating of just centres that claim to be green base the claim 1.08 (1 would be perfect). Next Generation on spurious reasoning. “When big players talk Data (NGD) Europe, based in Newport, Wales, about their ‘greenness’ all they are saying is is claiming to be the fi rst in Europe to run on that their data centres are now more efficient 100% renewable energy. And Telehouse takes in cooling IT equipment. Energy efficiency of waste heat from a centre in London’s East End data centres and servers cannot keep up with to pipe hot water to 1,000 local homes, free future energy needs and be effective in of charge.

to move beyond just • What metrics does it use to measure considering power usage The Green Grid energy efficiency? effectiveness [PUE – a has developed a • What measures has it taken to reduce standard metric for data model that has power consumption? centres], to carbon usage • What temperature does it run its data effectiveness (CUE) and clear goals for centre at? water usage effectiveness improving energy • If the cloud provider describes itself as (WUE),” he says (water is effi ciency green, what criteria has it deployed often used for cooling). (planting a few trees outside isn’t going “It makes environmental to cut it)? and business sense to evaluate these • What information does it provide to its metrics. Now the Green Grid has own customers when it comes to developed the Data Center Maturity energy consumption? Model that sets goals for improving Energy consumption has really only energy efficiency and sustainability been debated for a few years now, so it’s across all aspects of the data centre.” not surprising that there’s confusion Meanwhile, there is a range of around. But it’s not an issue that’s going questions for a company interested in to go away – a lot of companies are cloud and green issues to ask a provider: interested in energy saving measures and • What’s the energy source of the data cloud providers are going to have to get centre? used to the idea of being more open. ■

66 The Ultimate Guide to Cloud Computing

Cloud and HR

Unlockingyour organisationaltalent

Human resources could be one of the most important cloud applications, thanks to its key organisational role, says Billy MacInnes

68 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud and HR

ADOPTING CLOUD SYSTEMS holds the between what they wanted to do for the promise of giving HR executives access business and what they could do with the to systems that enable them to improve systems. A more recent survey returned their roles by applying a more analytical to the same issues and found, if anything, and strategic approach to their work. It that the gap is getting worse in some also gives them a new way meet changes areas, such as acquiring and retaining in the business. The increasing adoption key talent, developing key talent and of mobile technology and mobile working building leadership capabilities. practices in many companies, for All of which suggests HR professionals example, is putting an emphasis on would like systems that do a better job of employee self-service and accessibility supporting them in fulfilling their that is often easier to deliver from a objectives for the business. Cloud cloud-based system than an onsite one. software could help to bridge the gap. Businesses are evolving and adopting If the cloud means they are no longer new working practices and styles, putting hamstrung by the performance pressure on HR to meet and support constraints that affect their in-house IT those changes. With budgetary resources, HR professionals should be limitations on IT expenditure, cloud better placed to concentrate on strategic software can be an attractive way of issues such as talent management, keeping pace with such changes without building leadership capabilities and being constrained by in-house IT. supporting organisational innovation There’s no doubt this is a welcome and change. development. A global survey of more than 200 HR executives by Saugatuck Thesecurityobjection Technology, a cloud consultancy, But one big objection is of course identified significant limitations in the security. A specialist provider of effectiveness of their existing systems to cloud-based human resources (HR) meet their priorities for the organisation. software, HR Locker, recently noted how The survey identified a number of areas the issue of hosting HR data was raised HR executives were most concerned as a security concern during a customer about their ability to fulfil: meeting. So the customer was asked where the company’s existing HR • Acquiring and retaining key talent software was installed and was shown • Developing key talent a server in the corner of the office: “It • Aligning employee performance with was accessible to everybody and there business results and compensation were four USB ports staring invitingly • Building leadership capabilities out at us.” • Supporting organisational innovation The HR Locker team asked whether and change. the customer felt this was secure and the reply came back that he wasn’t sure When they were asked to rank the because “the IT guy” looked after it. ability of their HR systems to deliver It then emerged that the company had these priorities, it became clear the employed three of these “IT guys” in as systems did not measure up as well as many years. they would like. In most cases, there was While this anecdote concerns one a difference of 30 points or more company, it’s probably indicative of HR ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 69 Cloud and HR

operations in many organisations. How or why should anyone in HR know where the HR data is stored and how secure or not it is? That’s the responsibility of the IT guy. This level of ignorance about the security of data internally is not confined to HR but very likely applies to most, if not all, functions of the business. But data security is a major concern when it comes to the adoption of cloud computing, most particularly when it applies to employee information. A recent Cloud Industry Forum survey found that when it came to using cloud services, respondents were most reluctant about moving employee information to the cloud, ahead even of accounts and fi nancial data services. The survey also revealed that data security (64% of respondents) and data privacy (62%) were the most significant concerns about the adoption of cloud in their business.

Debunkingtheobjection This highlights what could be an intriguing contradiction in the shift to cloud computing, namely that one of the Centre. Why? “Initially, we tried to host most prominent causes of anxiety in any Cintra iQ ourselves,” says CEO Carsten potential adoption of cloud-based Staehr, “but our on-premise solution software may also be one of the demanded huge upfront costs to strongest beneﬁts it can deliver. HR purchase the required equipment, build Locker, for example, uses Microsoft’s the infrastructure, add the necessary $500m data centre outside Dublin to disaster recovery capabilities and host its service, which provides much maintain the necessary high levels of greater resilience and data security than data security to store our clients’ anything its customers might have sitting sensitive HR and payroll data.” in a corner. All of the reasons cited by Staehr for But if suppliers are conﬁdent enough opting to use the Cloud Computing to use hosted providers to deliver their Centre as a host apply equally to HR and products and services, shouldn’t IT departments. Removing or assuaging customers feel the same? HR and payroll concerns about security is one of the services provider, Cintra, recently ways in which the cloud can help HR announced that its Cintra iQ offering professionals to concentrate more on the would be hosted by the Cloud Computing core functions of their job. And as we

70 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud and HR

personal development objectives onto a single system. But rather than going for one of the larger, well-known enterprise suppliers, it opted for a cloud approach with US provider SuccessFactors. The system covers more than 400,000 employees in 190 countries – so the size claim is well justiﬁed. SuccessFactors published research last year that claimed businesses that took a strategic approach to HR, using systems that capture, measure and present information for analysis about the workforce, outperformed the average. It found companies that beneﬁted from this better business intelligence The largest increased the time they cloud computing spent on strategic deployment in priorities by 40% and the world is at project completion rose by 67% through better Siemens – its understanding of their human capital talent and putting the management right people on the right system projects. The larger operators are starting to get in on have seen, despite professed concerns the act too. In a recent interview with about security, most parts of the eCRMGuide.com, Gretchen Alarcon, vice business are completely unaware of the president of Oracle Fusion HCM strategy, level of security (or lack thereof) revealed that HCM (human capital currently being provided in-house. management) and CRM (customer relationship management) have HRhasthebiggestcloud been drawing the most interest from And if HR executives want reassurance customers looking for cloud apps. She that cloud is not just pie in the sky, they also highlighted the better business can look to the fact that the largest cloud intelligence provided by these types of computing deployment in the world is at systems, which could be used to Siemens – its human capital enhance the work of the HR department. management system. That, surely, is the heart of the matter: When the company set out to align if they can use systems to deliver better its human resources operations more intelligence about the business, HR closely with the strategic objectives departments can strengthen their role of the business, Siemens decided to within an organisation and enhance standardise all its global recruitment and their effectiveness. ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 71 Supply Chain

SUPPLYCHAIN ahotspotforthecloud

Because the supply chain involves manufacturing has been outsourced to different partners, often in the Far East, a lot of fast moving complexity it bringing added complexity to transport will benefit greatly from the cloud, and logistics. as Billy MacInnes explains In turn, with so many companies being called on to provide different links in the overall supply chain for a product or ONE OF THE MOST important processes service and engaging with it at different in business – and one tailor-made for the points, the pressure has grown on cloud – is the supply chain, which has systems to be able to handle and become more complex and turbulent in interact with a diversity of suppliers or recent years. Manufacturers have been sub-suppliers. among the fi rst sectors to act to make IT solutions have typically been their businesses more ‘agile’ in the face deployed to make the supply chain more of difficulties in forecasting demand and dynamic and to make engagement with avoiding stockpiling products that aren’t the different links in the chain less selling, while pressures on the supply complex. In 2010, analyst fi rm Gartner chain itself have intensified as published a survey entitled ‘Significant

72 The Ultimate Guide to Cloud Computing cloudpro.co.uk Supply Chain

beneﬁts realised with supply chain extended to “the trading partner management in the cloud’, which found ecosystem”. Gartner suggests this is not that 95% of those surveyed were either surprising because companies have using or considering using cloud-based spent billions on ﬁ nancial ERP systems supply chain applications. It found 52% that were designed mainly were using cloud or software-as-a- Pressure has to provide visibility service for CRM, 44% for supply chain grown on systems internally. One company execution, 43% for supply chain to handle and told Gartner it was planning, 43% for B2B/B2C attracted to the e-commerce, 42% for ERP (enterprise interact with cloud-based approach resource planning) and 39% for sourcing a diversity of because it was “tired of the and procurement. suppliers or long installations of ERP In all those areas, another third or so sub-suppliers and upgrades when other of respondents were evaluating using businesses are reaping cloud technology. The major focus was value such as quicker time to on partner applications that addressed productivity, greater return on the connectivity and collaboration investment and lower costs”. requirements when processes are This comment highlights the ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 73 Supply Chain

Cloud computing systems could lead to a revolution in the way supply chain services are provided

disruptive force cloud computing is Of course, cloud computing makes it expected to unleash on many areas of easier for other companies involved in the business landscape, including the the supply chain to engage with different supply chain. For example, start-up links in the chain and access systems companies could disrupt the established without major upheaval to their own landscape without signiﬁcant investment processes or additional costs to make in infrastructure, and new competitive them compatible. Sharing a common threats will emerge to existing players. platform means there are no concerns Product and service lifecycles will be that a supplier may be providing access shortened further, forcing companies to its internal IT to a partner that could be with infrastructure-intensive supply a competitor tomorrow. Standardised chains, such as the company quoted by applications and processes should also Gartner, to add cloud-based supply strip away much of the technical support chain solutions to enhance their and maintenance requirements competitiveness. associated with bespoke systems. Potential problem areas in using cloud Again there are potential pitfalls as not computing in supply chain management many companies own or operate their are pretty much the same as they are for entire supply chain internally, so any any area of the business. In a recent decision about using cloud technology is article, supply chain experts at Accenture likely to involve multiple partners. The suggest companies may have Accenture experts believe this could established sophisticated supply chain create “complexities and sensitivities management systems to give them a between the participating organisations”. competitive edge against competitors, But it may also help remove some of the but cloud computing relies on existing complexities in their current applications and processes that are not supply chain. customised. It’s up to companies to Additionally, if those organisations decide how those cloud applications and engage with other businesses, it would processes can deliver. make life a lot simpler and more ﬂ exible

74 The Ultimate Guide to Cloud Computing cloudpro.co.uk Supply Chain

if those engagements could take place using cloud-based systems. According to Preparing for the cloud Accenture, adoption of cloud computing systems could “lead to a revolution in the • Decide which processes can be provided by a way more supply chain services are cloud-based supplier and which need to be provided” by supplanting the current retained in-house contracted outsourcing model with more • Work to a detailed return on investment and risk fl exible, transaction-based models. analysis with prospective suppliers to quantify This should lead to a model based on anticipated benefits based on total cost of fl exible collaboration rather than a more ownership formal, rigid, top-down approach. The • Agree definitions for success: in addition to cost, issue at the moment is how willing include areas such as fl exibility, scalability and companies are to take this route and how speed to market quickly they do it. Michael Higgins, senior • Keep up to speed with developments in the cloud vice president for IT at Advanced computing market Innovations, an electronics supply chain • Collaborate with supply chain partners and specialist, is someone who has already involve them in decision making made the shift to the cloud. He believes • Evaluate frequently to ensure the hoped for anybody can do it “if they are willing to benefits are being achieved put the effort in and to overcome the typical fear, uncertainty and doubt”. Hotspots for thesupply chain And Advanced Innovations didn’t • Planning and forecasting – capturing spend change its ERP system: it simply data, performing basic analytics, planning deployed it in Amazon’s cloud platform. manufacturing runs and executing statistical This has made access to the fi rm’s demand forecasts systems “more robust and available to • Logistics – applications such as network our partners”, enhancing ability to sit strategy, inventory management, warehousing between customers and the supply and transportation are appearing; global trade chain. The company uses the Oracle compliance, replenishment planning, order E-Business Suite but has written its own processing, transportation load building, fl eet web services platform, which has made it management and transportation route planning easier, for example, for a small transistor are likely candidates maker in China with a laptop to deal with • Sourcing and procurement – the cloud gives a the company through a browser. “Our great opportunity to cut the total cost of philosophy is if you can buy a book from ownership, as cloud tools are inherently Amazon.com, you can manage your collaborative and accessible supply chain with us,” Higgins adds. • Service and spare parts management – many He argues the cloud is a “brilliant companies underperform in this area, despite platform on which to build standards”, their often high contribution to the bottom line. adding that “the days of bespoke Tools such as warranty validation are available business processes are hopefully now, and applications for returns processing, drawing to an end”. He believes the cloud inventory pooling and distribution are on their could be a big advantage for ‘tier two’ way, says Accenture players. “Players like us are leading larger players into the next generation SOURCE: ACCENTURE. SEE ALSO ITS PAPER, ‘SIX QUESTIONS EVERY SUPPLY supply chain,” he comments. ■ CHAIN EXECUTIVE SHOULD ASK ABOUT CLOUD COMPUTING’ cloudpro.co.uk The Ultimate Guide to Cloud Computing 75 Marketing in the cloud

Agreatlead formarketing

Cloud-based systems for marketing profitability, with particular attention to functions are booming but marketers company priorities, which are likely to include customer retention in current have much to do still in integrating tough trading conditions. data, fi nds Graham Jarvis Analyst fi rm Gartner has a good picture of the most popular cloud-based and on-premise marketing solutions. It ALTHOUGH MARKETING (and its regularly produces ‘magic quadrants’ to counterpart, sales) have traditionally analyse where certain vendors and their been among the last functions to receive the full attention of the IT department, the rise of the multichannel world, in which customers are much more in the driving seat, has elevated marketers in the pecking order. Not only do they have more budget to spend, but it’s an area where they often have a good deal of autonomy on buying decisions, especially now the cloud is opening up applications to non-technical audiences. Applications that are on the agenda include marketing automation solutions to track marketing campaigns, webinar and web conferencing services such as WebEx, as well as the various array of social media and direct mail and email management tools. A key driver is that today’s online world allows marketers to track almost everything a customer does, because so much is now done on the Internet. But it is not so easy to fi nd out what applications are likely to be the best fi t for an organisation. It’s important to think about which cloud and on-premise solutions will improve a marketer’s ability to increase an organisation’s sales, customer loyalty, revenue and

76 The Ultimate Guide to Cloud Computing Marketing in the cloud

‘best of breed’ products are positioned solutions are best of breed for in the market, including quadrants multi-channel campaign management, for ‘CRM multichannel campaign and so you would look at systems from management’ and ‘social CRM’ companies such as Unica, SAS and (CRM being customer relationship Teradata,” says Laurence Buchanan, management, of course). head of CRM at Cap Gemini. These top There is a huge choice of CRM systems are though mainly aimed at software and the term can mean many enterprise customers, and there is now a things to different marketers, but great choice of cloud systems that cater marketing does need a wide range of for many niche marketing functions and tools to fulfil many activities, such as also integrated solutions – but email marketing, social CRM, search integration does remain a big challenge. engine marketing, mobile marketing, social media, e-commerce, customer Whythecloudisvital services and lead generation. According to Arthur Sweetzer, chief “If you look at Gartner’s Magic marketing officer at 89 Degrees, a US Quadrants, you will see that on-premise marketing agency, “many marketing executives are struggling to gather and leverage marketing intelligence across disparate addressable marketing channels”, and only a third of marketers have integrated their CRM systems into operational marketing systems such as profile- and behaviour-driven email. He gives four reasons why cloud systems can accelerate time to market, promote relevance to prospects, and improve marketing revenue by as much as a third over a year. First, as few have integrated the marketing ‘data warehouse’ with email marketing applications, he suggests using a cloud marketing intelligence database instead, and second, the sheer speed of getting such a cloud system running means that disparate data silos can quickly be brought together. Then Sweetzer notes that marketers can pick and choose the functions they need much more easily from cloud providers than from traditional managed services companies, and fi nally that a key goal is to look at the insight that centralising multichannel marketing data can give. “Cloud based marketing can help you ▲

The Ultimate Guide to Cloud Computing 77 Marketing in the cloud

navigate successfully through the sea company that is fi rst suggested is of data smarter, faster, and at a lower Salesforce.com. There are many others cost than ever before,” he says. now, such as Microsoft Dynamics CRM, and NetSuite, RightNow and Cloud-basedcategories SugarCRM offer alternatives to the Here’s a listing of current cloud larger CRM players. Salesforce.com marketing categories and a brief has a huge range of add-on selection of providers. applications from third parties that can • CRM solutions: Whenever one meet almost any marketing need. mentions cloud-based CRM, the • Email marketing: Two of the leaders in this fi eld are ExactTarget and Responsys, and most of these solutions Top marketing buying tips are now cloud-based. ExactTarget has grown on the back of Salesforce.com, Before marketers rush out to buy any of these offering high-volume email solutions, and considering that there are so many management solutions. different cloud software offerings on the market, • Data quality and marketing take note of these tips: automation: Marketo, Eloqua, Aprimo and Informatica are all recommended. • Don’t be blinded by the features of any given • Web and data analytics: SAS is often solution, but make sure that it meets your key the fi rst to be mentioned in most business requirements conversations about analytics, but • Be clear about how you are going to measure the marketers might also wish to look at success of implementing cloud-based marketing the cloud-based solutions of QlikView, solutions Google, Microsoft, Yahoo and others. • Ensure that each solution is integrated to capture Google tends to lead the market customer data and track online behaviour for CRM whenever it comes to cloud-based web purposes analytics. Omniture is a company said • Recognise that the market has changed, and how to offer a strong web analytics, testing people buy has altered too: solutions that were and targeting tool. effective in the past might not be today • Business information: Hoover and • Look for cloud-based solutions that are affordable, OneSource are commended as being easy to use and adopt best of breed by Fergus Gloster, • Invest in quality training and make sure that you try managing director of the EMEA region out and test the cloud-based applications before at Marketo. you are committed to them • Social media management: Radian6 • Do it because it will drive benefits like being able was recently acquired by Salesforce. to react more quickly to changes in the market, com, and so has a strong position in the reduce the time-to-market of a campaign, and lead market. “If you have a look at the role of to revenue growth managing social interaction to fi nd out • Get going now. There’s no point in waiting as the what’s happening in the social media technologies to make marketing more efficient and sphere, it probably has the best effective are there, and wasting six months testing platform for doing that,” says Gloster. each application won’t help anyone, so learn by The key task is to be able to integrate trial and error CRM solutions, for example, with Facebook, Twitter, Linkedin and other

78 The Ultimate Guide to Cloud Computing cloudpro.co.uk Marketing in the cloud

What organisations use CRM for – and what they add on

What do people use CRM for? Add-ons that companies are using (in order): Overwhelmingly, of course, it’s for contact • Customer record lists/data cleaning service management (94% in a recent survey). • Customer reference system The top applications/areas are (in order): • Customer satisfaction surveys/monitoring • Contact management • Extra reporting/analytics • Opportunity management • Business intelligence services/ • Sales analytics/forecasting market research • Telesales/inside sales • Call centre systems • Customer service • Relationship mapping tools • Lead generation • Web analytics.

• Mobile working SOURCE: INSTITUTE OF SALES AND MARKETING MANAGEMENT/ • Territory management. ONESOURCE CRM SURVEY 2011

social media platforms to create be used by marketers to hold webinars meaningful online conversations and and meetings with colleagues and relationships with customers. customers from any location in the • Multichannel campaign management: world. These tools are available in the Eloqua, Marketo, Responsys, Alterian cloud. Another big player is Citrix. and ExactTarget can also be found • Customer reference management: within Gartner’s magic quadrant. Cap This is a growing area that aims to Gemini, for example, is working with standardise customer success Royal Mail, which has decided to use stories and related material to help Eloqua. The reasons behind the choice salespeople with replicable sales include speed of deployment, ease of processes. Providers include a US fi rm use, its range and mix of capabilities called Boulder Logic. and ability to drive consumer and By considering also the top tips (see business-to-business campaigns. box), and working collaboratively with IT, Another driver was the ability to marketers should be able better to prove integrate Eloqua with Salesforce.com. their value to their organisations – it has • Inbound marketing: Laurence long been difficult to show return on Buchanan suggests that HubSpot is a investment from marketing, but cloud solution that’s worth examining here. tools should improve this aim. • Marketing research: Clive Longbottom, Certainly, with the cloud, marketers services director at analyst research can achieve many of their objectives fi rm, Quocirca, suggests Survey today without waiting for a suitable Monkey and Google Forms as options solution to be developed for them by here. Another offering is Confirmit. their IT departments. • Web-based audio and Start with a budget in mind, but don’t videoconferencing: Two big offerings overly focus on cost; the cloud is are Cisco WebEx and Microsoft Live scalable, and even small organisations Meeting. Both allow companies to can gain access to secure and scalable reduce the need to travel, and they can enterprise level applications. ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 79 Cloud Exceptions

What not to do inpublic

There is a lot of industry hype on what we should do with the new powers offered by public cloud computing. Adrian Bridgwater provides a reality check

IF WE CAN AGREE on what not to do simply by keeping the data in question inside the cloud computing model of IT on a private server. delivery we should be steered towards areas where the cloud does excel. So CONSISTENT24x7 here are ten issues to consider in your 3 WORKLOAD cloud computing strategy as exceptions If an application workload is fl at and to the rule of the new order in IT. unchanging, then public cloud computing is hardly a best practice HEAVYWEIGHTINPUT/ choice for maximising fi nancial benefits. 1OUTPUTAPPLICATIONS According to Nigel Beighton, chief Let’s start with a good solid truism. technology officer at cloud infrastructure Software systems such as databases player, Rackspace: “Public cloud that require high performance in terms computing, with utility PAYG [pay as you of communications traffic are, generally go] charging offers immense fl exibility, speaking, not best suited to shared but if your workload is constant and public clouds. There is always the unvarying then the ‘usage charge’ model potential with any shared infrastructure is unlikely to be advantageous.” that you will be competing for the same He adds: “A fl at and unchanging IT hardware performance. requirement logically means that you can buy the appropriate amount of COMPLEX,SENSITIVE on-premise hardware to fi t the bill. 2MISSION-CRITICALDATA Using the cloud in this instance is not A software application that is built necessarily a problem, but it is really not around the need to collate and manage prudent or efficient. For example, if you sensitive data is not best suited to shared know you need a car seven days a week, multi-tenancy cloud computing. Yes the you don’t go out and hire one every public cloud is very safe and there are morning now do you? security controls and fi rewalls that will “It is the same concept. The cloud is provide customers with adequate levels there to help cope with unpredictability of protection, but you will be introducing and changeability, not computing additional risk that could be mitigated scenarios characterised by stability.”

80 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Exceptions

STRINGENTAUDITand ASOFTWARELICENCE 4 COMPLIANCE 5 BRICKWALL Some data regulations and compliancy It’s a plain and simple fact that far too rulings require the auditing of where a many software licences have still not customer’s data and processes actually evolved to accommodate cloud sit. By this we really mean ‘where’ – computing. Nathan Marke, chief street address, ﬂ oor, server room technology ofﬁcer of 2e2, an IT services number, blade rack and disk partition. provider, suggests that existing But the public cloud is a virtual world, maintenance, support and managed where it is often not possible to identify service contracts can act as a barrier to (or the public cloud provider cannot moving IT services into the cloud. He disclose) which physical server or disk cites recent research that found that that hosts processes and data. 57% of organisations said such contracts ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 81 Cloud Exceptions

would lead to delays in deploying some on-premise or in the cloud. cloud services and Marke says that this He adds: “But scalability is not the only isn’t surprising considering that often benefit of cloud. There are other good organisations will have three to fi ve year reasons, such as rapid provisioning or fi xed-term contracts. agility, for moving something into the “Organisations do need to be wary of cloud even if the application itself does migrating to the cloud when they may not scale linearly.” still be committed to legacy contracts that they won’t now use,” he says. AVOIDCLOSEDSOURCE 7 CLOUDS CLOUDGROWTHIS Evangelists of open source IT argue that 6HORIZONTAL,NOT the core issue of escalating expenses VERTICAL associated with any vendor is inherently Applications that can only scale from caused by lock-in to that provider. If we increasing the performance of the server accept this as true, then there are they are running on are not really able to ramifications for the cloud, says Aram exploit the fundamental benefit of cloud, Kananov, a product marketing manager which is horizontal scale – we need the at open source specialist, Red Hat. right vehicle for the job in hand. “Don’t “We see such tactics adopted by a use a helicopter when you need a majority of vendors that base their Hercules,” says Stephen Eveleigh, technology on closed proprietary product marketing manager at Star, software and proprietary standards,” he an on-demand computing and says. “This is why all major players in the communications company. emerging cloud space often base their “Multi-tenanted/public cloud has its ‘stacks’ on open source software and place, but will not meet all business open standards to prevent any particular requirements,” he says. “Some vendor dictating their future technology applications need to be integrated and decisions. This is also the reason why the tailored to company needs – with a vast majority of public cloud service dedicated, private cloud you can achieve providers run their infrastructures on the this. The new breed of cloud-savvy IT Linux operating system. Indeed, the new directors understand business emerging cloud applications are requirements and make business- extensively using open source software.” focused decisions on whether public, private or hybrid are the right choice for CRITICALSEPARATION each application.” 8 SITUATION Michael Newberry, Windows Azure Just as application performance needs to lead at Microsoft UK, points out that exploit the inherent cloud feature of since multicore computer processor ‘scale through replication’, so does became mainstream, performance application resiliency. A single instance growth has generally come from the on any public cloud can be vulnerable to adoption of concurrency. Applications all the aspects of a shared public service, that cannot scale concurrently, those as Star’s Steve Eveleigh comments. “A that are ‘single-threaded’ for example, cloud-savvy IT director will work with will not run faster with more cores cloud services providers who ‘get this’ regardless of whether those cores are and will work to mitigate this risk.”

82 The Ultimate Guide to Cloud Computing cloudpro.co.uk Cloud Exceptions

STANDARDBUILDGOOD, strong, but we still need to have strong IT 9 CUSTOM BUILDBAD foundations on the ground if we are to Cloud computing does not necessarily look skywards. This means that it’s not a suit a computing environment where a great idea to move to the cloud if your customer has an extremely complex underlying network is a fl aky, archaic ‘custom-build’ job for certain software collection of resources built around applications. “Cloud computing legacy applications that are closely environments have much lower running tied to obsolete equipment – and costs in part because they are disentangling them might be a tough ask. standardised,” says Microsoft’s Michael If you’ve got a Roman ruin here on Newberry. “So applications that require Earth, then not even Jupiter, Zeus and non-standard hardware will not Apollo can get you into the cloud. necessarily benefit from the same Equally, if your legal team has not been economies of scale. able to ratify the holy scriptures of your “Software designers need to consider cloud agreement’s small print, then you extensibility and configurability when may well fi nd that your IT department they design applications so software quickly becomes a bunch of can service individual customer non-believers. requirements without necessarily Analogies aside, the small print needing to be a custom build. This governs the precision-engineered enables them to take advantage of elements of whether a cloud migration standardised infrastructures.” with enjoy fl uid portability – and at this time, we are still in need of hard and CRUMBLING fast standards. From portability of 10 FOUNDATIONS, cloud-to-cloud applications, to bringing PALTRY PORTABILITY cloud-based workloads back into the The cloud may be ‘up there’ and the new enterprise data centre if circumstances computing resources it offers may be change, portability is paramount. cloudpro.co.uk The Ultimate Guide to Cloud Computing 83 Security

Theweakestlink: howsecureisthecloud? Cloud security is the number one concern for most users, and as Adrian Bridgwater discusses, we may have to wait for trust to build

WE CURRENTLY APPEAR to be at a really the application itself that needs to stage where confidence in cloud be locked down? The greatest data risks computing security is (if you believe the to any organisation come from within; surveys) still very much in question. This susceptibility to data damage from perception appears to be driven at least employees’ own use of a network, in part by the ‘distance’ between the whether via premeditated or accidental customer and the cloud provider – action, remains the biggest security inevitably, having much of your vital IT issue of all. applications and data not under your This ‘insider threats’ message is own roof does raise concerns. But this repeated by anti-virus vendors again and does not inherently mean that cloud again; enterprise-level applications may application security risks are more be inherently insecure, whether they sit difficult to curtail than running all your on the corporate network, in a private systems in-house. cloud data repository of some making, or So where should we draw the lines ultimately, out in the public cloud. The around cloud applications and data cloud itself is not insecure: what you put security? A good starting point is a in the cloud may well be insecure. If you Ponemon Institute cloud security survey, accept this basic truism, then we can which found that only 36% of the 925 move on. respondents questioned believed their And if we have been this worried about organisations are vigilant in conducting cloud security, then surely there should audits or assessments of cloud have been some kind of governing body computing resources prior to established to oversee cloud security deployment. More specifically, the fundamentals? This is of course what the survey found that IT practitioners Cloud Security Alliance (CSA) sets out to (at all levels) lack confidence in their do. The CSA’s Certificate of Cloud employer’s ability to secure data and Security Knowledge (CCSK) aims to set applications deployed in cloud a professional bar for what we tend to computing environments (especially call ‘practitioners’, but we should public clouds). perhaps just call users, software developers and IT managers. Theroot of theproblem The Cloud Security Alliance describes So it is important to stand back at this itself as a not-for-profit organisation with point and question whether it is the cloud a mission to promote the use of best that is at risk of being insecure, or is it practices for providing security

84 The Ultimate Guide to Cloud Computing cloudpro.co.uk Security

assurance within cloud computing. should approach the deployment of any The organisation is clearly having some application (from a simple email client influence on the industry; its corporate application to a mission-critical member list doubles as a handy who’s database) without security software who of the cloud industry, and this year’s controls in place. CSA Summit drew in Vivek Kundra, chief Encryption layers, fi rewalls, information officer at the White House, anti-malware suites and spam fi lters all as a keynote speaker. have a purpose – but this is not the place for a complete list of security controls. What cancompaniesdo to So take it as read that if these protection stay secure? mechanisms are needed on the ground But at a lower level than industry body in your organisation, then they are edicts and infrastructure standards, what needed in the cloud in equal measure. kind of thing can companies to do At a deeper level still, fi ne-grained address security issues in the cloud? access controls can help. This is the level First, no right-minded commercial entity at which users should only be able to ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 85 Security

access the ‘rows’ or table values in (for application layer to provide real-time instance) a cloud application database visibility of clients’ most important that they are authorised to have access websites and applications. to. For example, a sales rep using a What this means is that customers cloud-based application and its will get performance management tools corresponding data store may only be and a ‘web-scale’ engineering team on able to view their own sales – and not the a fi ve-minute ‘notification of events’ fi gures of their colleagues or their service level agreement (SLA) to department or company as a whole. address sensitivities. When cloud users want security analysis reviews for Thevendor’sviewpoint applications, infrastructure and Cloud providers themselves are of architecture, with this service they can course best placed to handle customers’ have it. As the cloud computing evolves, security concerns because they this kind of SLA is likely to become themselves sit closest to the data. In an increasingly prevalent. effort to share some of Echoing this ‘proximity’ message is People have this ‘proximity’, cloud Michael Newberry, product manager infrastructure provider for Windows Azure at Microsoft UK. trusted their Rackspace recently “Cloud providers uniquely understand money to banks launched its so-called their platform and are best placed to for years, but may ‘extreme’ mission critical describe the controls customers can only have had cloud offering, known as use to achieve their required level of cloud for months Critical Sites. This service security, so customers can then is said to drill into the determine if the capabilities and controls

86 The Ultimate Guide to Cloud Computing cloudpro.co.uk Security

are suitable for their own requirements,” he explains. Top five cloudsecurity tips Again resonating with the assertion that the cloud is “only as good as the 1 Encryption equality – Application encryption on application”, Newberry continues: “While the ground should equal application encryption responsibility for compliance with laws, in the cloud. Firms need to initiate this process regulations and industry requirements by fi rst performing an inventory analysis of all remains with Windows Azure customers, cloud resources to be managed, and then Microsoft’s commitment to providing assessing the business risk associated with each fundamental security capabilities is key element of the IT ‘stack’. Appropriate levels of to our customers’ success with the encryption can then be applied. offering.” So the word ‘trust’ is key. 2 Mission-critical omissions – All applications are Takenon trust not the same. So-termed ‘extreme’ (or high risk) We often use the analogy of banking mission-critical cloud-based applications are when it comes to cloud security. As different, so there will always be some data that individuals, we entrust our money to our you don’t host in the cloud. This could be data bank on the understanding that other relating to national security, business intellectual customers don’t get to see our details property or sensitive customer account data. and transactions. This is not dissimilar to the cloud model in some ways; we 3 SSL and VPN is the ‘ABC’ – Look to see that your place our data and applications with cloud provider has basic secure sockets layer “reputable” cloud provider brands, safe (SSL) and virtual private network (VPN) layers in the knowledge that these companies in place. This should be among the ‘ABC’ fi rst will honour the sanctity of the SLA and principles of cloud security best practice, so data privacy agreements that we that information in transit has a core level of customers sign. encryption. Whether this trust ever needs to be brought into question is still a moot 4 Policing policy practice – Formalised security point for many IT directors who are and access control policies are a prerequisite to considering cloud migrations. But as Jon using the cloud securely. Whether your fi rm Honeyball, who writes for Cloud Pro, has produces a one-page document or conducts said, people have trusted their money to formal in-house training, policy controls are the banks for many years, but may have only bedrock of cloud security best practice. had cloud for months in some cases. As we now move forward, we may 5 Transparency, clarity and visibility – Constantly need to endure the natural passage of auditing your cloud provider’s service for true time before we collectively assign the visibility is crucial. The Ponemon study found same levels of trust to cloud computing that half of all respondents recognise that many as we might do today to say corporate cloud resources are not evaluated for security banking. From this point we may then prior to deployment. In practice, the process experience a level where the cloud of pre-evaluation, re-evaluation and audit actually makes data more secure analysis with a view to achieving application than if left unmanaged. Will this and data transparency, clarity and visibility ultimately happen? “It can and it will,” is essential. is Honeybull’s prophecy. ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 87 A to Z of Providers

Who’swho incloud computing

There are hundreds of companies active in the cloud computing space – we pick the top movers and shakers in the industry

IT’S IMPOSSIBLE TO LIST all the many Akamai companies active in cloud computing – so Akamai is a Hawaiian word meaning here’s a list that includes most of the big intelligent or wise. The company players plus a selection of smaller ﬁ rms. provides a distributed computing Cloud providers come in all shapes and platform that mirrors content from sizes, but key categories are: customer servers on its global platform • Infrastructure players, which provide the of servers. Web Application Accelerator data centres and management tools to is Akamai’s infrastructure-as-a-service host public, private and hybrid clouds offering, designed to speed up the • Platform players, which allow many performance of web applications different application vendors to supply without the client requiring additional a service infrastructure. • Application software ﬁ rms, which have cloud-based systems such as sales, Amazon WebServices accounts and so on Amazon Web Services was established • Operation management providers, which in 2006 and yes, it’s part of the offer services such as remote storage. multi-billion dollar online bookseller. In Some companies are active in several fact, AWS uses Amazon.com’s global categories and the lines are blurred in any computing infrastructure – which is the case – this is one of the fastest ever moving backbone of the retail business and sectors in IT. transactional enterprise – to provide

88 The Ultimate Guide to Cloud Computing cloudpro.co.uk A to Z of Providers

scalable and secure cloud on and makes them computing infrastructure available as if they were to clients. Amazon is one stored locally. of the giants in the cloud and its offerings are billed BeyondTrust on usage. BeyondTrust is an • EC2 is an American company infrastructure-as-a- specialising in privilege service offering that authorisation stands for Elastic management, access Compute Cloud. It operates on a simple Telcos control and security solutions for web service interface, which allows like BT virtualisation and cloud computing are natural clients to obtain and conﬁgure capacity cloud environments. The company’s offerings readily, and provides developers with players are designed to strengthen security, tools to build resilient applications. drive compliance and eliminate the • S3, or Simple Storage Service, is risk of intentional, accidental and Amazon’s storage offering, and indirect misuse of privileges on desktops provides a simple web services and servers. interface that can be used to store and retrieve any amount of data at any BT time, from anywhere on the web, using BT, the major British telecoms company the cloud. of course, now provides cloud computing • Elastic Beanstalk is Amazon’s services including products such as deployment and management service. Salesforce.com and NetSuite. BT’s It allows users to quickly deploy and Virtual Data Centre offers a range of manage applications in Amazon’s cloud capabilities, including both public cloud. Users upload applications and and private cloud systems. Elastic Beanstalk automatically handles capacity provisioning, load balancing, CATechnologies auto-scaling and application health CA Technologies is an IT management monitoring. and software solutions company • AWS CloudFormation gives developers operating across all IT environments and systems administrators an easy from mainframe to the cloud, including way to create a collection of related both public and private cloud computing Amazon cloud resources and provision solutions. In 2010, CA Technologies them in an orderly and predictable acquired Nimsoft, a provider of IT fashion. performance and availability monitoring solutions that can be used in cloud Apple applications. Apple has enjoyed extraordinary success in recent years with the iPhone, iPad and Canonical the Mac computer range, and has Canonical is a UK software ﬁ rm that recently trialled a new cloud offering, not offers cloud computing services through surprisingly named iCloud, which is its Ubuntu software, which allows users aimed at consumers and stores music, to create a private cloud within their own photos, applications, documents and so IT infrastructure or to deploy a cloud with ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 89 A to Z of Providers

one of Canonical’s partners, including Amazon, Microsoft and RedHat. It is ﬂ exible – enabling customers to switch between clouds – and features frequently updated security procedures.

Cisco Cisco is a multinational systems company providing communications and networking technology. It’s cloud offerings include: • Secure MultiTenancy – owned collectively by Cisco, VMware and NetApp, this cloud-hosting infrastructure-as-a-service offering uses pre-tested and validated CloudShare concept and IT training and certiﬁcation. computer ‘stacks’ and fault-tolerant enables you CloudShare Enterprise is the main to create architecture virtual data infrastructure-as-a-service offering, and • WebEx – Cisco’s collaborative suite centres other products include CloudShare Pro, that combines real-time desktop using a a free, individual version of the platform self-service sharing and phone conferencing, and platform that enables individuals and small allows the sharing of documents, teams to manage complex virtual IT presentations and applications across environments in the cloud. PCs, Macs and mobile devices. Up to six webcams can be streamed at once. Commensus A UK provider of a cloud platform known Citrix as C-VIP, which operates across ﬁ ve data Citrix provides cloud services such as centres, three in London, and one each in server and desktop virtualisation, Paris and Frankfurt. It backs its service software-as-a-service, conferencing, with a 99.999% uptime service-level open source products and networking. agreement. The company has data centres around the world including the UK, India and Dell Australia. It acquired XenSource in Dell is known mainly as a PC maker, October 2007. Citrix OpenCloud is the but it also provides cloud computing, main cloud computing platform. consulting and data storage services. Offerings include infrastructure CloudShare management, virtual integration and Previously known as IT Structures, mobile management services. CloudShare is a California-based cloud provider founded in Israel. It offers a ElasticHosts self-service platform that enables ElasticHosts is a London-based cloud organisations to create virtual data provider. The company stands out centres for a range of business functions mainly because it charges by the including application development and resources required, such as memory, testing, demonstrations, proofs of disk, processor and network, as separate

90 The Ultimate Guide to Cloud Computing cloudpro.co.uk A to Z of Providers

entities, allowing customers to create GoGrid virtual machines with any configurations GoGrid is a California-based cloud they choose. Its scalable infrastructure- infrastructure service provider that fi rst as-a-service offerings can run on any OS. began offering cloud solutions in 2008. The company offer cloud solutions EMC hosted by Linux and Windows virtual EMC is a long-standing data management machines. GoGrid Cloud Storage is a giant that delivers cloud services such as fi le-level back-up service for Windows Atmos, a large-scale storage system. It and Linux servers. recently announced ProSphere, a storage resource management offering “designed Google from the ground up specifically to address California-based multinational Google is the rapidly evolving needs of enterprises best-known for its leading search engine as they migrate to highly virtualised, but also provides cloud computing cloud-based computing models”. solutions and other Internet-based services and products. It was founded Fasthosts in 1998 to “organise the world’s Fasthosts is a leading UK web hosting and information” and runs more than a cloud solutions provider. As well as million servers in its data centres. It offering a comprehensive range of web operates the well-known Gmail email hosting, email and server products, service, web browser Google Chrome, Fasthosts is at the forefront of developing the Google Talk messaging application innovative cloud solutions for the SME and even produces operating systems market including virtual servers, for mobile telephones. software-as-a-service, secure online • Google Apps is the company’s storage and back-up. Fasthosts developed software-as-a-service offering, its own virtual server platform, called providing customisable versions of DataCenter on Demand, as the foundation Google’s own products, including of its virtual solutions. This year the Gmail, Docs, Talk, Google Groups, Sites company has won the Microsoft Hyper-V and Google Calendar. It provides Cloud Partner Award 2011 and Microsoft’s services for business and education Hosting Partner of the Year Award. (the latter is free). • Google Cloud Storage enables Fujitsu developers to store and access data Fujitsu is a major provider of IT systems, on the company’s data centre services and products in the UK. Its infrastructure. All data is replicated to infrastructure-as-a-service offering uses Google: a secure data centres with the resilience fi rm that’s and performance levels required for organised business systems hosting. Client data to work in a is hosted in the original country, cloud maintaining data privacy and legal jurisdiction for business information. Fujitsu’s platform-as-a-service offering enables software vendors to reach markets on a pay-per-use basis. ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 91 A to Z of Providers

multiple US-based data centres, has Intuit individual and group-based access The company produces fi nancial and controls and key-based authentication. taxation software to service the small business and the accountancy industry. HP Its fl agship products are Quicken, HP, or Hewlett-Packard, is the world’s QuickBooks and TurboTax. Intuit now largest computer maker, producing offers cloud-based versions of its servers, laptops, mobile phones, printers applications. and scanners, and has entered the cloud market. Iomart • Enterprise Cloud Services-Compute UK fi rm Iomart has fi gured highly in offers computational services using global rankings of cloud providers. It HP’s data centres. The service is a offers managed hosting and private/ pre-built, off-premise cloud designed to hybrid cloud computing based on its run core applications with scalability. data centre estate in the UK, and runs • CloudService Automation is HP’s data centres in London, Maidenhead, software-as-a-service offering, and Glasgow, Nottingham and Leicester. offers a package of cloud-building hardware, software and services. It Joyent allows systems to be integrated with Founded in 2004 and headquartered in Enterprise Cloud Service-Compute so San Francisco, Joyent is a software, users can jump between their private virtualisation and IT services company cloud and HP’s. specialising in the cloud. It offers cloud services for large online clients, including IBM social networking site LinkedIn (it was IBM has joined other well-known IT also the original host of Twitter). The brands in offering cloud services, such company is also active in the online as LotusLive, a cloud-based enterprise gaming industry. networking and collaboration tool integrating email, social networking Microsoft for business, fi le sharing, instant Microsoft has dominated many aspects messaging and data visualisation, of computing and has now entered the integrated with Skype, LinkedIn and cloud with Microsoft Cloud Power, and Salesforce.com. has a number of software and platform Computing offerings that use familiar Microsoft giant IBM interfaces: has recently • Office 365 is an evolution of Microsoft launched LotusLive Online Services and combines Microsoft Office with the advantages of the cloud. Users can access email, documents, contacts and calendars from anywhere with an Internet connection • Windows Azure is both a software and platform service provided on a pay-for-use model. It offers multiple

92 The Ultimate Guide to Cloud Computing cloudpro.co.uk A to Z of Providers

application development tools, multi-subsidiary operations automated service management and a • SuiteAnalytics, which provides global data centre presence real-time business intelligence using • Microsoft’s Business Productivity Suite real-time dashboards. It uses the cloud delivers the company’s familiar suite of to give real-time views of company services from the cloud, including 25 performance, fi nance, sales, marketing gigabytes of mailbox storage, and and service fulfilment. access through a variety of mobile devices to key services such as email, Nimbus calendar and shared content Nimbus offers business process • SharePoint is Microsoft’s collaboration management software to help its clients platform, bringing together familiar capture, manage and deploy their Microsoft interfaces and using the operational processes and supporting cloud to provide a single, integrated information to their workforce, wherever location where employees can work they are, using the cloud. The company with their team members, share is a Microsoft Gold Certified Partner knowledge and fi nd organisational and a partner with SAP, Oracle and resources and information. Salesforce.com.

Microsoft’s Ofﬁce apps Novell are now Novell is a US multinational software and making a services company that offers platform cloud move cloud services, including Cloud Manager, which automates complex provisioning workﬂows, from requests and approvals to creating and employing new business services, and Cloud Security Service, which improves security if a company uses more than one cloud application, through a secure, single password log-in.

Oracle NetSuite Software giant Oracle delivers both NetSuite is a provider of cloud private and public cloud computing computing business management solutions. Clients pay for what they use software. Key offerings include: and have a choice of deployment models • NetSuite’s business software using Oracle’s scalable cloud incorporates everything from infrastructure. Offerings include: accounting and fi nancial resource • Oracle Exalogic Elastic Cloud – a planning (ERP) to customer platform for enterprise-wide data relationship management (CRM) centre consolidation on any scale, from • NetSuite OneWorld, a cloud-based small departmental applications to on-demand system to deliver real-time large and demanding mainframe global business management and applications fi nancial consolidation to mid-sized • Oracle On Demand – a fl exible companies with multinational and deployment model for applications. ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 93 A to Z of Providers

Parallels Parallels provides virtualisation and automation software across all of the main operating systems. The company is working with a group of independent software vendors and service providers to expand their cloud products for customers of all sizes, including helping large companies to develop in-house clouds.

PlanB Plan B is a specialist IT disaster recovery business based in the UK. It says it provides ‘near instant recovery’ of working systems on its Rescue Cloud of Red Hat’s variety of vendors. Its philosophy is that remote virtual servers. Enterprise you should be allowed to use and Virtualisation platform manage those assets as one cloud rather Rackspace is ideal than being locked into one vendor and it Rackspace has been hosting website, for heavy delivers a number of cloud solutions demand applications, email servers, security and including its Enterprise Virtualisation storage since 2001. It makes a big deal of platform for businesses with heavy cloud what it calls the “fanatical support” it demands. offers to customers and has several levels of hosting services in both the RightScale public and private clouds. Offerings RightScale is a cloud computing include: management company that offers an • Cloud Files, which provides unlimited automated platform for on-demand online storage with easy upload and cloud services. Products include the speedy fi le transfer Cloud Management Platform for • Cloud Servers, which allow you to reducing administration and the choose your own operating system, complexity of managing cloud choose a server size and only pay for deployments, while still giving fl exibility, what you use control and portability. • Cloud Sites, which spreads your traffic across a cluster of servers Salesforce.com • Jungle Disk and Cloud Drive, which Salesforce.com specialises in CRM allow small business and personal (customer relationship management) users to securely store, back-up and applications. It started as a CRM share fi les in the cloud at low cost. software-as-a-service provider, and has now expanded into the wider cloud and RedHat social enterprise arena. Services include: Red Hat is an open source and cloud • Sales Cloud 2, the main CRM cloud provider which recognises that each application client’s IT infrastructure is likely to • Service Cloud 2, a customer service comprise hardware and software from a platform

94 The Ultimate Guide to Cloud Computing cloudpro.co.uk A to Z of Providers

• Chatter, a private social network, like 2e2 Facebook, which can be used internally 2e2 describes itself as an IT “lifecycle in a company services” provider, and the UK fi rm is • Force.com, a cloud platform for active in cloud infrastructure business applications, allowing deployment. It says: “We believe that developers to create applications that various hybrid strategies – marrying are hosted on Salesforce.com’s existing dedicated IT investments infrastructure. with either public or private cloud technologies – are the inevitable answer Savvis for at least the next fi ve years as the Savvis offers a fl exible, scalable and cloud market evolves and stabilises. easy-to-use cloud interface. It provides Cloud should mean reduced costs and public and private network connectivity rapid deployment of innovative and has 31 data centres across the applications, but never at the expense of world, including in Europe, the US procurement difficulties or piecemeal, and Asia. indifferent support levels.”

Star Unisys UK-based Star was founded in 1995 and The company has focused on what it pioneered a cloud-based spam and virus considers to be the three challenges scanning system for business email that that need to be addressed for cloud eventually evolved into MessageLabs, a computing to be viable, namely security, messaging and web security specialist. compliance and application rewrites, An IT and communications services and migration. It offers solutions across provider, Star offers email, telephony, many business areas including ﬁ nance, hosting and networking, and now budget planning, HR, payroll, email, delivers a range of cloud computing collaboration, analytics and data solutions, including WorkLife, which storage. Offerings include Virtual brings together email, telephony, instant Ofﬁce-as-a-Service, which provides messaging, document management, hosted ‘desktops’ using Unisys’s secure conferencing and collaboration cloud infrastructure on a subscription technology. basis. It is designed to simplify desktop maintenance, reduce support costs and SunGardAvailabilityServices improve security compared with The company provides IT operations traditional desktop PCs. support including integrated disaster recovery, managed services, IT VMware consulting and business continuity VMware offers virtualisation systems management software. It offers an and cloud infrastructure from the enterprise-class private cloud service, a desktop to the data centre. The company back-up service called Replication-as-a- provides private cloud and public/hybrid Service, Electronic Vaulting, for cloud solutions with safeguards and encrypted and secure storage of data governance compliance, and clients can that links directly to a recovery system, build applications that are portable and a cloud-based continuity between the clouds within a common management solution. management framework. ■ cloudpro.co.uk The Ultimate Guide to Cloud Computing 95 Glossary

Glossaryto cloud computingterms

Agility Cloud bursting Can refer to faster, simpler steps for Cloud bursting is a common practice provisioning IT and also wider business within hybrid clouds to provide additional processes. resources to private clouds as and when they’re needed CAPEX Capital expenditure – the traditional way Cloud infrastructure to purchase IT equipment. Large Consists of servers, storage area investments are made in one fi nancial networks (SANs), networking year to benefit the business over the components and virtualisation software lifetime of the hardware which would that combine to provide a fault tolerant, typically be three to fi ve years. This is in fl exible and scalable system. Cloud contrast to OPEX. infrastructures are housed in data centres. Cloud Simply the global internet, the network Cloud pyramid beyond your own building. A picture of cloud computing layers by functionality, such as infrastructure, Cloud backup platform and application. Backing up data to internet-based storage systems. As well as being a Cloud service provider simple way to backup data it has the A company that provides cloud services added benefit of keeping a copy of data over the Internet. Large data centres are offsite. Disadvantages can potentially used to run applications and store data in include the amount of time to backup fault tolerant configurations. The long list and restore fi les, particularly where data of providers includes Amazon, Google, changes frequently and internet Microsoft and Salesforce.com. bandwidth is limited. Zmanda, Carbonite and Mozy provide services in this area. Cloud storage Storage of fi les on Internet based Cloud broker systems. Cloud storage can be used as An organisation that acts as a liaison part of a SaaS solution where the between multiple cloud service providers application and storage are both located and customers, by selecting the best on the cloud. Another option is to use it provider for particular services. as a store for data that can be transferred

96 The Ultimate Guide to Cloud Computing cloudpro.co.uk Glossary

to or from the local network via a web Amazon and Rackspace both offer browser or locally installed application. services in this area. Companies offering cloud storage solutions include Amazon, Rackspace Mash-up and Microsoft. Combining input from multiple sources in a web application. Cloud washing A tactic by vendors, especially software Multi-tenancy companies, to rebrand their offerings as A single instance of an application used cloud computing but without true cloud for many customers, with each customer functionality. only able to access their own data. Customers may be able to customise Community cloud aspects of the software for their data, but A cloud that is shared by a number of only within the limitations imposed by organisations with some common the developers. interests and aims. OPEX Data centre Operational expenditure costs incurred Buildings that house cloud for services within a fi nancial year. infrastructures including servers, storage As cloud computing is charged on a systems and networking equipment. subscription basis, it marks a shift from Also known as cloud centres. CAPEX to OPEX, making budgeting for IT a simpler process. Elasticity Cloud computing can scale up and down Platform-as-a-service (PaaS) depending on demand. Service that provides a framework for developers to run their own code and so Hybrid cloud can be used for in-house applications. A system that uses a combination of This service is particularly useful when private and public clouds. SaaS solutions don’t meet the particular business needs. Publishing applications Internal cloud can be greatly speeded up by using this See Private cloud. type of service as the hardware and required components are set up by the Infrastructure-as-a-service (IaaS) provider. Services such as Force.com A service that provides access to and Microsoft’s Windows Azure fi t into virtual servers. In the case of a public this category. cloud, this service would be hosted by a third party and accessed over the Public cloud internet. It’s important to be aware of Cloud services provided across the licensing implications when using this internet by third-party providers. type of service. Services are normally Virtualisation technology is used to billed on the consumption of resources provide fault tolerant, fl exible and such as processor and memory. expandable systems that can be divided ▲ cloudpro.co.uk The Ultimate Guide to Cloud Computing 97 Glossary

up to provide isolated services on a Service provider lock-in subscription or usage basis. Companies The fear that organisatiions opting for providing services include Amazon, cloud services will be stuck with their Salesforce.com, Microsoft and Google. original provider and unable to move the data to an alternative provider. Various Private cloud organisations are looking to create Uses virtualisation technology to provide common standards for cloud, the Open similar functionality to a public cloud, Cloud Initiative is probably the best but is owned and managed by a single known of these. user company. Private clouds may be more suitable than a public cloud when Storage service highly sensitive information is stored. See Cloud storage. The large manufacturers such as Cisco, Dell, HP and IBM provide hardware Utility computing tailored for private clouds. Providing computing services and charging on a usage basis in much the Storage area network (SAN) same way as utility bills. This is a shift A fault tolerant storage system that can from traditional networks where servers be accessed through fast network need to be purchased and then replaced technologies to provide storage to according to a schedule schedule. multiple servers. SANs work with virtualisation technology, enabling virtual Virtual Private Cloud servers to be moved between physical Similar to the long-familiar concept of servers on the fl y. the Virtual Private Network (VPN). Allows organisations to create clouds Software-as-a-service (SaaS) that look private, from a security point of A service that provides access to view. software across the internet, including office applications, email services and Virtualisation customer relationship management Technology used for cloud computing (CRM) systems. The hardware and that divides physical servers into software is managed by the provider, so multiple smaller virtual servers that each there is little requirement for local IT staff contains their own fully functioning for this type of service. Providers include operating system. Virtual servers can be Salesforce.com, NetSuite and Google. migrated between physical servers and resources, such as processor and Service level agreement (SLA) memory, and can be increased or Defines the level of service that a decreased as required. VMware, Citrix supplier will provide, normally including and Microsoft provide virtualisation the percentage of uptime and levels of solutions. ■ compensation offered if the supplier doesn’t meet their stated fi gures.

98 The Ultimate Guide to Cloud Computing cloudpro.co.uk Secure hosting

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