Hybrid cloud image via Shutterstock

By Brian Gracely (@bgracely)

While rapid technology changes are commonplace in enterprise IT, being able to shift IT processes or adjust IT skills is much more difficult. CIOs would love to be able to adapt their use of technology to keep up with every new business opportunity, but internal processes are often bottlenecks to that success. Finding new ways to increase the pace at which IT can keep up with business demands is always at the top of CIOs’ goals.

For the last few years, we’ve heard many technology companies talk about how enterprise IT will evolve to deliver cloud computing services for their business. In most cases, these journeys to cloud evolution begin by modernizing internal data centers through virtualization and automation, creating a private cloud environment. Over time, as the need for new applications or business models emerge, a combination of private cloud and public ploud (Amazon AWS, Rackspace, Google, Microsoft Azure, etc.) services could be combined to create a hybrid cloud environment for the business.

While this model for cloud evolution has been favored by many organizations that want to continue to leverage existing skills and assets, a new wave will soon be coming at them as cloud providers (Amazon AWS, Rackspace, Virtustream, VMware, etc.) are all preparing offerings that would place their technology within enterprise data centers.

• Amazon AWS – Virtual Private Cloud (VPC) connects internal Data Center resources with public Amazon AWS resources via VPN technologies.
• Rackspace – Rackspace Private Cloud delivers similar OpenStack technology that is used in the Rackspace public offerings in a packaged bundle that can be operated within a private data center.  Rackspace provides deployment blueprints and optional support services.
• Virtustream – xStream Enterprise Cloud delivers a software/appliance for enterprises to run in existing data centers. This technology aligns to their public Cloud services offering.
• VMware – vCloud Connector – VMware currently offers the ability to connect vCloud instances from enterprise to cloud provider. In addition, at VMworld 2012, the company announced that it would soon begin shipping a version of its CloudFoundry PaaS platform that can be deployed and operated within an enterprise.
• Microsoft – Microsoft has made several announcements over the last two years regarding an on-premise version of its Azure platform, but actual details of how and when this will be available have yet to materialize.

All of these offerings are attempting to create hybrid cloud environments that can be consistently operated, regardless of where the application workload resides.  Being able to adjust from existing, siloed IT operational models to more dynamic cloud operational models has been one of the challenges for many organizations.

The public cloud offerings have gained the attention (and revenues) of development groups looking for greater agility and availability of infrastructure resources. But these moves highlight that IT organizations (as a whole) are still more comfortable with on-premise resources in this stage of their cloud evolution. Cloud providers are attempting to capture that sentiment with these on-premise offerings, and all of these offerings could significantly increase the pace at which customers move their IT organizations to adopt cloud operating models.

These new offerings will not only offer more choice, but they may significantly disrupt how the underlying technology is acquired. VARs, SIs and traditional service providers must now re-evaluate their roles in providing value to IT organizations that once looked to them to help navigate the technology and process transitions within IT.

Will these new, hybrid operational models be the tipping point for CIOs that have previously struggled to evolve their internal processes to the faster pace of public cloud computing?

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”.

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”.

On gaining buy-in when speaking to a non-technical CEO:

The first thing, according to Capellas, is to establish the agenda of the company and find those two or three things that will drive the basic mission of the company: Defining the sweet spot of what the business is trying to do. “Prioritize what’s important and then do it with incredible speed.” Also, innovate and try to be at the leading edge. “No one ever said, ‘Gee, I’m glad you brought me yesterday’s technology.’”

On security, policy and the cloud:

One of the big challenges, Kundra noted, is the difficulty of managing a cloud that spans a global grid, particularly for the U.S. government. Different nations have different laws. Complicating that is the reality is that there are countries and organizations out there using the technology for malevolent purposes. McCracken noted that security is a pre-cursor to successful cloud deployments and pointed to the use of cryptographic intelligence.

On private clouds, public clouds or hybrid:

McCracken and Kundra noted that the cloud – private or public – potentially has the ability to be even more secure than traditional enterprise applications. How it is used will largely depend upon what applications and workloads your organization will want to run. Mission-critical apps, Capellas said, will likely be private, but many organizations will use public clouds to balance workloads and for backup. “Security policy will define what’s inside or outside the firewall,” Capellas said.

On the role resellers will play in the cloud:

Partners and resellers already have a large majority of the skills necessary to deploy new applications, McCracken said, and without the partner community the cloud market wouldn’t be anywhere near where it is today. Channel partners have the opportunity to take applications from end to end and can manage multiple platforms, which are critical skills in today’s environment, according to McCracken.

On the role of professional services providers:

The cloud will significantly disrupt the professional services market, Kundra said, and will force professional services companies to raise their game to a higher level. They must be thinking about the user experience, seamless applications and fundamentally re-engineering and re-architecting systems. They will also have to work at the speed of business: “The days of waiting five years to get any value from a professional services contract are over,” Kundra said. “This will be a painful transition for the professional services industry.”

On what keeps you up at night:

“I’m very concerned about the role of global terrorism as it relates to technology,” Capellas said. He said that, at some point, there is no doubt the Internet will get shut down and could create a “catastrophic disruption.” Kundra said he is concerned with three things: (1) Cyber warfare; (2) The potential use of technology for oppression, and (3) The growing gap in use of technology by developed and underdeveloped nations. McCracken said that the biggest challenge is keeping up with the growing demand in our businesses and marketplaces.

There you have it, live once more from CA World. What are some of the big issues on your mind? Post them here and we’ll see if we can answer them.

Follow me at @The_Techster and follow @CAWorld2011 on Twitter for all the latest #CAWorld buzz.

HP Cloud Compute allows you to deploy compute instances on-demand. It lets you customize your instances to handle your unique workloads and add new instances to quickly scale.

HP Cloud Object Storage provides you with scalable online storage capacity on-demand. Object storage is ideal for archiving and backing up data, serving static content for web applications, and storing large public or private data sets, such as online files and media.

The announcement comes on the heels of Dell’s entrance into the public cloud world last week. But while Dell’s platform is built on VMware’s suite, HP plans to offer its cloud without the bonds of legacy infrastructure. HP’s VP of cloud solutions, Patrick Harr, told Derrick Harris of GigaOm in June that HP intended to compete with big name cloud providers such as Amazon Web Services and Rackspace, choosing also to focus on developers. I wonder if HP’s recent bucking of webOS – and the subsequent effects on developers – will have any bearing on the cooperation and excitement from the development community. Perhaps this will knock HP up on the scale of cloud computing vendors, but the likeliness of this ambition may be too soon to tell. HP is asking for feedback on the private beta program, crediting feedback from its first development stage for the state of the private beta offerings.

If you plan to register, I suggest doing it sooner than later to join the fun. If you do, let us know what you think!

Melanie Yarbrough is the assistant community editor at ITKnowledgeExchange.com. Follow her on Twitter or send her an email at Melanie@ITKnowledgeExchange.com.