Cloud Common Sense

In amongst all the vendor pimping and teenage overexcitement there are folk talking common sense about Cloud Computing. So I am hijacking this blog post that was originally just about the McKinesy report on Cloud and I'm transforming it into a thread of Cloud Common Sense, as picked by the IT Skeptic and you, gentle readers. Feel free to add your own picks but be warned: vendor hype or wide-eyed gushing will be treated mercilessly.

So the first example of Cloud Common Sense was the original post:

Regular readers will know that I hold McKinsey pretty highly amongst that dubious rabble of thinly disguised marketing outsourcers known as 'analysts', those peddlers of meaningless twaddle passed off as research. So when McKinsey say "cloud computing could cost more than twice as much as a traditional IT setup", I'm listening.

According to Forbes:

McKinsey & Co. analyst William Forrest on Wednesday plans to present a report aimed at debunking cloud computing's appeal for large businesses.

While he admits that the idea of piping in computing power from an external service holds appeal for small and medium-sized businesses with fast-growing and unpredictable needs, Forrest calculates that big companies could end up paying more than twice as much for those services as they would to own the same computing resources in-house...

big businesses are less likely than small companies and startups to need those variable offerings, Forrest says. And in cases like the Christmas shopping season, when large numbers of businesses ramp up their IT use simultaneously, cloud computing providers would face the same peaks as their customers--a situation that Forrest says would raise the provider's prices and erase any savings.

None of that renders cloud computing useless, Forrest argues. In fact, he admits that it offers real breakthroughs for small- and medium-sized businesses.

But given its massive hype--he cites a Merrill Lynch report last year claiming that the technology could make business applications "three to five times cheaper"--the economics of cloud computing need a dose of reality.

A fellow skeptic indeed. Of course, as a good analyst he has used no rigorous research just dodgy extrapolations from ad hoc data, and many of his assumptions are highly questionable. I'd expect nothing else, even from McKinsey. But some of his points are still valid. I look forward to more next week. I'm now a McKinsey Premium subscriber.


More Cloud common sense

Three more reasons not to trust the Cloud, from RWW:

Amazon shut down Wikileaks without means of appeal

Yahoo is shutting down Delicious despite millions following. "if you use the Web as a place to store information then it kind of hurts when a service closes"

Youtube shuts down all sorts of people who make a living from it

Conclusion? the Cloud providers are establishing a record of violating customer trust.

Richard Stallman

If you want a healthy dose of skepticism ("Cloud computing is stupidity") try the musings of GNU and FSF founder Richard Stallman. He's on the Orwellian end of the spectrum.

the cost of getting your cloud back

Even more cloud common sense, from CIO

Cloud providers make it easy to upload data. Unfortunately, each provider uses proprietary data definitions and data structures. In addition, they offer no simple tools for downloading bulk data. So, what goes up may not come down. Most customers are forced to use an Internet connection, often at unacceptably slow data-transfer rates. At 100Mbit/sec., it takes one to two days to export 5TB. Worse, it can be extremely expensive; Amazon charges 10 cents per gigabyte, or $100,000 per petabyte, to download data from its S3 storage service.

That's just the best of several points

Cloud is NOT a utility

Even more cloud commonsense from The Troposphere (clever name BTW):

Data is unique. It’s not a commodity. One datum of information does not equal another. You don’t care if your neighbor washes his dishes with water drop 1 or water drop 2 – but you’re sure going to care if he’s using your data set instead of his to make money, however.

Five Lessons from the Dark Side of Cloud Computing

From Five Lessons from the Dark Side of Cloud Computing (thanks Peter Kretzman)

five lessons from the presentations at Black Hat.

1. Cloud offers less legal protection

2. You don't own the hardware

3. Strong policies and user education required

4. Don't trust machine instances

5. Rethink your assumptions

#1 is the biggie for me. Inadequate legal framework (yet) = Wild West

SERIOUSLY good cloud common sense

SERIOUSLY good cloud common sense from CIO: Busting the Nine Myths of Cloud Computing

Wherever you turn, someone's ready to tell (or sell) you something related to cloud computing. Cutting through the myths is essential to deciding whether, when, and how the cloud is right for you

Read it.

Forrester has security concerns over Cloud

Who doesn't? Forrester join the chorus

Early adopters have run into a number of road blocks, including not knowing where their data resides, what happens to the data when a decision is made to change services and how the service provider guards customer privacy.

What the hell is cloud

I do love my soon to be new boss' take in cloud

Sort of reflects the pragmatic view of clouds.

The McKinsey report got alot of press around here, but mostly on the completely narrow view of clouds and the gaping holes in the data. But as you say, thats normal fair for the analyst communities. Within the scope of the discussion he draws some relevant conclusions.

The reality is, if you take a pragmatic view, Cloud represents a set of requirements from IT that have always existed and will always exist. Its the Holy Grail of IT Services infrastructure management. Including, most notably;

* The illusion of infinite computing resources available on demand, thereby eliminating the need for users to plan far ahead for provisioning.
* The elimination of an up-front commitment by users, thereby allowing companies or internal projects to start small and increase hardware resources only when there is an increase in their needs and not have the growing pains of rearchitecting.
* The ability to pay for use of computing resources on a short-term basis as needed (e.g., processors by the hour and storage by the day) and release them as needed, thereby rewarding conservation by letting machines and storage go when they are no longer useful.

Then the ownership models of public, private and hybrid add a dimension to the McKinsey comments that are glossed over. A private cloud just represents an internal deployment model that at least at an infrastructure we have always wanted.

A few technologies in the virtualization and the distribute data models space have created a tipping point that have moved us a step closer to this reality, but it is still a large leap for man kind away from uptopia.

So my view is its 80% the stuff we have always had, and 20% some interesting new technologies which we must adapt our process frameworks (TOGAF, ITIL, Prince2, RQ, Scrum, RUP etc..) to accomodate.


Brad Vaughan

10 ways to manage your risk with Web applications

This article talks about web apps and SaaS but it is applicable to the broader Cloud:

Web apps are becoming popular, but there are legitimate concerns about security and reliability. Learn how to address potential risks and choose the right vendor...
Many organizations, especially at the enterprise level, worry about offloading corporate data to a third-party vendor. Will security risks increase? What happens when reliability begins to suffer? How can they access critical data/systems during an outage? These are valid questions, but many experts actually think that your data is safest with a credible third-party whose business in effect is (or should be) managing the security and reliability of data across many customers.
After all, if a vendor screws up, it will lose revenue, customers, and market share in a heartbeat.
Still, due diligence is imperative for any SaaS implementation. Here are 10 risk management factors to consider when offering Web-based software to your employees...

Read them, they're all good.

one of the shortest hype cycles of all time

With the possible exception of Twitter, the Cloud must be going through one of the shortest hype cycles of all time. This from Cloud Computing Magazine itself, barely been founded and already putting a damper on:

While cloud computing is a great fit for some applications, and/or other architectural components, it typically won't be a fit for all applications and/or architectural components. There will always be some data, services, processes, and complete applications that you want to keep within your firewall for a number of reasons, including: Compliance, privacy, fear, control, and cost.

Forbes makes sense about the Cloud

Here's another discussion that made sense to me from Mike Schnaffner:

SMEs are more likely to go to the cloud because it is likely their best practical choice. It allows them to scale up their operations without having to add assets or staff. Culturally, SMEs are more nimble and readily accepting of new concepts; the IT culture and bureaucracy is not as firmly entrenched there as it is in large enterprises... the IT groups in SMEs would no doubt prefer to run their own operations rather than go to the cloud. IT has a love affair with the hardware. We want to be able to see it, to touch it and to control it, even though technology has for the most part eliminated the need for this. For SMEs, however, the advantages of the cloud will quickly outweigh this cultural bias, especially since the decision likely will be made by people outside of IT. In large enterprises, this bias is alive and well and thriving...
If you agree with Forrest's analysis, it would be logical to expect cloud computing to make inroads within SMEs but not large enterprises. This is the exact same conclusion we came to earlier but from an entirely different approach... I'm a little surprised that a McKinsey report didn't bring up issues such as whether or not data center operations are a core competency of your company and strategy.

Although I like most of the thinking, I don't agree that culture is the #1 barrier to Cloud adoption in large enterprise. There are serious issues that are not just in the mind: security, privacy, re-testing legacy, lock-in, escrow... SMEs take risks that larger organisations - quite rightly - won't contemplate.

Common sense defense of the Cloud against McKinsey

Here's a great post from Cloud Ave answering McKinsey but also calling in the more zealous Cloud proponents

Many people have written extensively debunking McKinsey’s claims and the report also had support for its claim from pundits who make a career talking about traditional software world. Of all the analysis, I was impressed by the model put forward by Joe Weinman. He correctly pointed out to the role of Cloud Computing in the enterprise IT, at least, in the near future. "If McKinsey had studied, say, automotive transportation, the conclusion they might have come to would be that, since enterprises and “cloud service providers” — rental car companies — use the same infrastructure components — cars — there really aren’t any economies of scale and the service provider premium then makes rental cars financially unattractive..."

...On the Cloud evangelist side, let us be clear about certain aspects of enterprise adoption. It is totally unreasonable for us to expect the enterprises to give up all their past investments and jump into enterprise bandwagon overnight. If anyone thinks that enterprises will immediately embrace the Cloud Computing because of the advantages it offers, they are fooling themselves... there are those companies with huge investments on datacenters and related infrastructure. We cannot expect them to write off all these investments and embrace Cloud Computing... This will be the normal evolution of enterprise IT and any expectations to accelerate the process is unreasonable.

Common sense about the Cloud

great common sense here "Is there any subject in IT today with more promise — or more confusion — than cloud computing? Here are six commonly held views that, while not wrong, are just not entirely accurate"

Another cloud skeptic Tim Bajarin at PC Magazine.

vandals cut fiber-optic cables at an underground station 3 miles south of my home in San Jose. The cables were owned by AT&T but also affected Verizon landline and cell phones, since Verizon leases these lines from AT&T for the South Bay Area. Because I reside north of this cable cut, my service wasn't affected, but my son and his family live in Morgan Hill. All of his phone and Internet connections were down for most of the day. Underground cables were also cut in San Carlos, 20 miles south of San Francisco, and that ended up affecting thousands of people. In fact, even some big companies lost their Internet connections... it has revived fears about overdependence on cloud computing. We're already dependent on the Internet for information, communications, and commerce, and we're starting to rely on it for real-time delivery of applications. And now we're putting all of our digital bits in one Internet basket and becoming more reliant on the cloud

Tim's arguments are just as applicable to outsourcing and supply chain management and EDI and all the other links that run external to our organisations, and one likes to think that large corporations have more external networtk redundancy than consumers do, none the less this is a salient reminder of a basic issue.

presentation of McKinsey Cloud report

This from Uptime appears to be a presentation of the report. It is an excellent read, highly recommended.

“Cloud computing” is approaching the top of the Gartner Hype-cycle...
Cloud computing can divert IT departments’ attention from technologies that can actually deliver sizeable benefits; e.g., aggressive virtualization...
A recent study has found 22+ definitions of clouds...

Definition: Clouds are hardware-based services offering compute, network and storage capacity where:
Hardware management is highly abstracted from the buyer
Buyers incur infrastructure costs as variable OPEX
 Infrastructure capacity is highly elastic (up or down)

most customers of clouds are small businesses...

The cost of cloud must come down significantly for outsourcing a complete data center to make economic sense...

Rather than create unrealizable expectations for “internal clouds,” CIOs should focus now on the immediate benefits of virtualizing server storage, network operations, and other critical building blocks

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