Enterprise IT Watch Blog

September 10, 2012  9:53 AM

Opportunity Cost: The Real Way to Measure Cloud ROI

Ben Rubenstein Ben Rubenstein Profile: Ben Rubenstein

Image of cost-benefit signs pointing in different directions

Cost-benefit image via Shutterstock

By Brian Gracely (@bgracely)

Somewhere in the last two or three years, between various industry definitional debates about “cloud computing,” we seem to have forgotten how to think about costs for this emerging operational model.

Initially, there were two discussions that focused on cost savings. The first was focused on server virtualization and cost-savings from consolidating applications on under-utilized server resources. The immediate savings came from reduced spend on rackspace, power, cooling and infrastructure. This discussion tended to focus on internal data centers, or what evolved to be called ‘private cloud.’ The second looked at the on-demand costs of public clouds (e.g. Amazon AWS) and how developers didn’t have to wait for new infrastructure to be provisioned before their could create new applications. Savings for this use-case came from the elimination of capital expense (CAPEX) for internal data center resources.

Then as competition between vendors intensified, the cost discussions began to blur between CAPEX, operating expense (OPEX) and opportunity costs. Some vendors claim that costs could be reduced with private cloud but not public cloud. Other vendors claimed the exact opposite. How could this be possible?

As experience and usage of cloud computing evolves, we’re beginning to see a much clearer cost picture emerge. Cloud costs tend to follow these guidelines:

  • It’s possible to reduce CAPEX and OPEX costs by deploying virtualized and converged technologies, along with the ability to automate the operations of those technologies.
  • Those CAPEX and OPEX savings often return to normal levels as the delivery of optimized IT services tends to create more demand for new IT services, as business users see faster response times to new requests.
  • As businesses begin to expect technology to deliver greater advantages in the market, and require IT services, it is expected that IT costs will rise over time, in some cases significantly. The additional costs are focused on impacting the topline (revenues) of the business.
  • The cost to deploy new IT services on public cloud resources are often significantly lower (CAPEX and OPEX) over short periods of time (days, months).
  • When compared over longer timeframes (2-3 years), the costs to deploy applications on private cloud (internal) vs. public cloud (external) are often fairly equal.

When viewed holistically, cloud computing has the greatest potential to impact opportunity costs for the business, delivering increased agility when new market opportunities arise. These opportunities may be short-term or long-term, so it’s important for business leaders and IT organization to create technology strategies that can respond to both types of new opportunities. Failure to be prepared will negatively affect the business’ ability to compete in a given market.

While many companies are looking to deploy operating models that resemble the largest cloud computing environments to reduce costs (CAPEX or OPEX), I would suggest that the more important ROI they should measure is the one based on opportunity costs from potentially missed business opportunities. Access to available IT resources, either via public cloud or private cloud is just to plentiful to miss a great business opportunity because the IT organization can’t properly manage ALL the available resources.

Brian Gracely is Director of Technical Marketing at EMC. He is a 2011/2012 VMware vExpert, holds CCIE #3077, and has an MBA from Wake Forest University. Brian’s industry viewpoints and writings can also be found on Twitter (@bgracely), his blog “Clouds of Change,” and the weekly podcast “The Cloudcast”.

September 7, 2012  10:40 AM

Lumia smartphones and Java flaws: The week in IT quotes

Michael Tidmarsh Michael Tidmarsh Profile: Michael Tidmarsh

Smartphone image via Shutterstock

From new smartphones to remaining CEOs, check out this week’s best quotes from around the IT industry.

“When the time is right, my successor will be named.”
– EMC CEO Joe Tucci after announcing he will remain as chairman and CEO into 2013 at the request of EMC’s board. It looks like he could be around for much longer; the company decided to extend Tucci’s contract through February 2015.

“The world’s most innovative smartphone.”
– Nokia CEO Stephen Elop talking about the new Lumia 920 and 820 Windows 8 devices. However, blogger Ron Miller believes the new smartphone won’t be able to compete with the giants of the mobile world, Google and Apple.

“There are still not -yet-addressed, serious security issues that affect the most recent version of Java 7.”
– Security Explorations Founder and CEO Adam Gowdiak expressing his disappointment over Oracle’s recent emergency upgrade to fix flaws in Java 7. If you still feel uncomfortable using Java 7, here are some tips on how to assess a site’s trustworthiness or to disable Java altogether.

“I was amazed to discover that enterprise technology professionals had no place to go to get online product reviews and connect with real users before making such an important purchase. ”
– Co-founder and CEO Russell Rothstein talking about the launch of his site, IT Central Station, a new free social network for enterprise technology professionals. Would you use it? Offer your take on the new site on the Data Center Apparatus blog!


September 6, 2012  10:39 AM

YouTube IT video of the week: Andy’s computer

Michael Tidmarsh Michael Tidmarsh Profile: Michael Tidmarsh

Whoops! Since we’re a day late this week, we’re bring you a special clip for our ‘YouTube IT video of the week’, looking at how some employees are (ab)using their computers. (SPOILER: This particular employee goes by the name of Andy Bernard.)

Disclaimer: All videos presented in the “YouTube IT Video of the Week” series are subjectively selected by ITKnowledgeExchange.com community managers and staff for entertainment purposes only. They are not sponsored or influenced by outside sources.

September 4, 2012  2:02 PM

This week in tech history: ARPANET transmission

Michael Tidmarsh Michael Tidmarsh Profile: Michael Tidmarsh

Internet image via Shutterstock

On September 2, 1969, Leonard Kleinrock and his research team managed to transmit data over ARPANET, clearing the way for the birth of the Internet, which came on October 29 of that year. We’ll give 100 Knowledge Points to the person who can tell us the first word transmitted over the internet.

Each Tuesday, the ITKE team will take you back in time, as we take a look at the events that have changed technology history. Have a tip for us? Email mtidmarsh@techtarget.com or find us on Twitter (@ITKE).

Disclaimer: All posts presented in the “This week in tech history” series are subjectively selected by ITKnowledgeExchange.com community managers and staff for entertainment purposes only. They are not sponsored or influenced by outside sources.

August 31, 2012  1:22 PM

Gartner leads the way for IT events in September 2012

Michael Tidmarsh Michael Tidmarsh Profile: Michael Tidmarsh

Orlando? San Francisco? London? There are so many places to choose from with all the events in September. Make sure you check them out!

1. SecureComm 2012 (September 3-5, Padua, Italy)

2. Gartner Enterprise Architecture Foundation Seminars North America (September 9-11, Orlando, Florida)

3. Gartner Outsourcing & Strategic Partnerships Summit (September 10-12, Orlando, Florida)

4. ASUG SAP BusinessObjects User Conference (September 10-13, Orlando, Florida)

5. BioIT Cloud Summit (September 11-13, San Francisco, California)

6. DataFocused Cloud Applications – BioIT (September 12-13, San Francisco, California)

7. Gartner IT Financial, Procurement & Asset Management Summit (September 12-14, Orlando, Florida)

8. 2012 UNITED Security Summit (September 12-14, San Francisco, California)

9. Gartner Supply Chain Executive Conference (September 17-18, London, England)

10. HR Excellence Summit 2012 (September 18-19, Washington DC)

11. Dreamforce ’12 (September 18-21, San Francisco, California)

12. Trading Architecture Europe 2012 (September 19-20, London, England)

13. Gartner Portals, Content & Collaboration Summit (September 19-20, London, England)

14. Gartner Security & Risk Management Summit (September 19-20, London, England)

15. DeNormalised NoSQL Roadshow (September 20-21, London, England)

16. SOA, Cloud and Service Technology Symposium (September 24-25, London, England)

17. 4th International Conference on Mobile Networks and Management (September 24-26, Hamburg, Germany)

18. Microsoft Exchange Conference (September 24-26, Orlando, Florida)

19. 2012 ClearEdge IT Solutions MapReduce for Programmers (September 24-26, Jessup, Maryland)

20. Onshore E&P Technology Summit 2012 (September 25-26, Houston, Texas)

21. Digital World Expo 2012 (September 27-29, Las Vegas, Nevada)

22. Predictive Analytics World (September 30-October 4, Boston, Massachusetts)

We’ll be sharing IT events each month here on the Enterprise IT Watch blog. Got an event to add to our list? Let us know via Twitter (@ITKE) or email. Going to one of these events? Share your takeaways (and photos) with us!

August 31, 2012  10:09 AM

Sword prices and Trojan horses: The week in IT quotes

Ben Rubenstein Ben Rubenstein Profile: Ben Rubenstein

Image of trojan horse Trojan horse image via Shutterstock

Much of the IT action was in San Francisco this week as VMworld 2012 was in full swing, but there’s a whole other world out there, and plenty of cloud and big data hype to fill it. Here are some of the week’s best quotes from around the industry.

 “Is this an honest maneuver? Do they want to drive OpenStack forward? Or is it a Trojan horse?”
– Piston Cloud Computing CEO Joshua McKenty, assessing VMware’s surprise move to join the open-source cloud service as a Gold Member this week. OpenStack has long been seen as a competitor to VMware, but some think the company has realized its less than ideal standing in the cloud market.

“I don’t even know what the ballpark number for a server is — for me, it would be like knowing what the price of a sword is.”
– Daniel Gross, co-founder of Cue, one of many companies using Amazon Web Services for its computing needs and apparently saving a lot of money in the process. The company got some major love for its cloud services from the New York Times this week, and recently introduced reserved instances to add to its established on-demand model.

“The reality is that people’s expectations of what is needed are rapidly maturing.”
– Outgoing VMware CEO Paul Maritz, talking about how the virtualization game has changed (and Microsoft is still behind) during VMworld 2012. See more of what he had to say about why his company is still the leader in this VMworld video – and read more meaty virtualization quotes from the show over at SearchVirtualDesktop.com.

“It’s like asking people in 1995 if they think that this newfangled ‘Internet’ thing is inflated or not.”
– Laura Teller, chief strategy officer for Opera Solutions, LLC, on whether the hype around big data is justified. Her take: That’s the wrong question to ask.


August 30, 2012  10:20 AM

IT infographic: Schools moving to the cloud

Michael Tidmarsh Michael Tidmarsh Profile: Michael Tidmarsh

This infographic from Online Colleges shows how more schools are finding ways to adopt cloud computing while companies such as Adobe, IBM and Microsoft are making it easier for schools to access them. Do you think cloud-optimized schools are the way of the future?

Going to the Cloud
From: OnlineColleges.net


August 29, 2012  10:13 AM

YouTube IT video of the week: Paul Maritz on VMware vs. Microsoft

Michael Tidmarsh Michael Tidmarsh Profile: Michael Tidmarsh

This week’s video captures outgoing VMware CEO Paul Maritz discussing how his company’s virtualization products compare to Microsoft’s Hyper-V.  His take: Server virtualization is no longer “good enough.”

Follow the SearchServerVirtualization team as they cover the latest news from VMware’s annual conference.

Disclaimer: All videos presented in the “YouTube IT Video of the Week” series are subjectively selected by ITKnowledgeExchange.com community managers and staff for entertainment purposes only. They are not sponsored or influenced by outside sources.

August 28, 2012  11:36 AM

All the VMworld 2012 resources you’ll need

Ben Rubenstein Ben Rubenstein Profile: Ben Rubenstein

VMworld 2012 entrance

VMworld 2012 entrance (Instagram photo by colinsteele)

If you hadn’t noticed, VMworld 2012 is in full swing, and it’s kind of blowing up the interwebs (at least, the tiny corner of the interwebs that we inhabit). It’s not a challenge to find information about what’s happening in San Francisco, but finding the best information? That’s another story. To ease the virtual pain, we’ve cobbled together a list of what we think are the best VMworld resources. Got one to add? Let us know in the comments.

VMworld2012.com – A one-stop shop for official event info, social feeds, pictures and more. Make sure to check out the official blog feed, which includes missives from various bloggers around the world who are covering the event.

SearchServerVirtualization.com – News, analysis, tweets and videos from the TechTarget team onsite at the Moscone Center. It’s all here – and be sure to check back for the results of the Best of VMworld 2012 awards.

VMworld 2012 Twitter list – Face it, it’s nearly impossible to keep up with the barrage of tweets using the various event hashtags (#vmworld, #vmworld12, #vmworld2012). Stop trying, and instead follow our curated list including only the best tweeters from the event. Let us know (@ITKE) if there are great accounts we’re missing; we’ll be creating a list of the best tweets/quotes from the event at the end of the week.

August 27, 2012  10:53 AM

IT Presentation of the Week: VMware View best practices

Michael Tidmarsh Michael Tidmarsh Profile: Michael Tidmarsh

As VMworld 2012 opens, we thought we’d take a look back at one of the more popular presentations from last year’s event. What’s been your experience with VMware View?

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