Enterprise Cloud Computing Blog

Virtualization

P2C: A Funny Thing Happened on the Way to the Cloud

By Ellen Rubin

As IT organizations move forward with their virtualization initiatives, consolidating operations and shrinking provisioning times, the cloud has come along as an even more compelling option. In the cloud, companies can build capacity on-demand without having to own or manage the computing infrastructure. As companies review their application portfolios, they’ve started to realize that many of their not-yet-virtualized apps could easily be run in the cloud. In particular, applications that are characterized by spikey, cyclical, or seasonal usage could benefit the most from the cloud’s economics and scalability but a significant percentage aren’t even getting the benefits of virtualization.

So what’s the delay in going “P2V” (physical to virtual)? As with the cloud, virtualization has typically percolated from the bottom up. In many cases it crept into organizations, led by developers and technology evangelists who recognized the efficiency and cost advantages of virtualization and simply started using it. While many enterprise customers have started expanding their virtual footprints it can be a long and complex process. Although technically it’s quite easy to virtualize an application, using a number of well-known P2V tools such as VMWare Converter from VMware or Platespin (now owned by Novell), the harder part of the process is often agreeing which applications to virtualize and understanding the inter-dependencies between these apps and other data center services.

As corporate IT has slowly adopted virtualization as a strategic imperative, the cloud has come along with paradigm-changing flexibility and elasticity. We’re now seeing enterprise customers and prospects ask what they can do with applications that aren’t yet virtualized and are still sitting on dedicated servers, recognizing that the cloud is likely to be their ultimate home. Thus we’re seeing the emergence of a new model “P2C” (physical to cloud), with virtualization in the data center becoming a stepping stone to the ultimate destination of the cloud. As discussed in a previous blog, the cloud has become a catalyst that is prompting companies to broaden their virtualization efforts.

Customers and prospects have told us that the P2C model is far preferable to simply performing a virtualization project in a vacuum and figuring out later which applications really belong in the cloud and how to get them there. In contrast, P2C is all about planning for the cloud from the outset, starting with virtualization and moving to the cloud as a natural progression. The P2C approach can also lead enterprises to alter their virtualization strategy compared to pure P2V. In some cases, they may want to use the cloud as a temporary home for applications that need to migrate between data centers, to support satellite offices or in the case of an acquisition. In other cases, they may keep the application permanently in the cloud and be able to budget for far fewer internal resources.

Thus, we encourage customers to consider P2C as a valuable strategy, since for many applications, the cloud will deliver far greater self-service and on-demand computing power than available internally. By planning for this ultimate goal and designing their infrastructure accordingly, customers can also potentially save a great deal of time and money. Ultimately, a single integrated environment will span the virtualized data center and multiple clouds, using the same tools and providing the same simplicity of experience. CloudSwitch is working with our customers and partners to make it easy to use the cloud, regardless of the starting point.

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Data Center in a Box

By Damon Miller

Years ago I had the privilege of helping to grow Bladelogic from early-stage startup to a profitable organization of over 300 people.  In the early days one of my first challenges was figuring out how to show our product to prospective customers effectively.  I needed to show our ability to manage a large IT infrastructure but I had to do so without actually dragging a data center to each of our sales calls.  (My first attempt involved renting a fleet of trucks but visitor parking turned out to be a real challenge.)  As I look back on that situation now, I realize that CloudSwitch offers a perfect solution to this “data center in a box” problem.  In this article I’ll walk through the use case and describe a new CloudSwitch feature, Sample VMs, which makes this possible. 

The first step toward a virtual data center is to use virtualization, of course. In late 2001 VMware released the third major version of their Workstation product.  Given my demonstration requirement, I bought a copy of Workstation, found the biggest “mainstream” laptop available at the time, filled it with memory, and deployed as many VMs as it would run without completely falling over.  Depending on the end user’s patience, that number was somewhere between four and six.  While not exactly a world-class data center, the end result served us well for demonstration purposes.  It was, however, limited in capacity, slow, expensive, and difficult to maintain. 

In retrospect, what we really needed was a way to:

  1. Quickly start new servers and turn them off when finished;
  2. Use existing, internal virtual servers or public server images; and
  3. Connect to these servers as if they were on the local network.

Fast-forward nearly ten years and the first of these points—utility capacity on demand—is all but ubiquitous courtesy of providers like Amazon and Terremark.  We of course know this as “the cloud” and companies use it every day for a variety of reasons.  The second two points are more interesting.

Today’s cloud providers have implemented their platforms on a particular virtualization solution—and in many cases they’ve customized these solutions to suit the needs of their product offering.  This is of course perfectly natural, however one practical effect is that end users cannot simply take their own virtual machines and expect to run them within a given cloud provider’s environment.  The reasons vary—different virtualization solution, different underlying hardware, different capabilities—but the end result is always the same: cloud providers will not allow end users to upload custom VMs and run them.  For this, CloudSwitch is needed.

One of CloudSwitch’s fundamental benefits is the ability to run customers’ virtual servers in whichever cloud provider is most appropriate, regardless of the underlying implementation details.  After deploying our appliance, users can select virtual servers within their internal VMware environment and migrate them to a public cloud provider such as Amazon or Terremark without being forced to modify those servers in any way.  No additional software or configuration change is required for this to work.  Users literally “point and click” to migrate virtual servers from their data center into a cloud provider.

In many cases, users want to leverage the cloud but don’t want to migrate existing servers.  CloudSwitch supports this approach as well.  With the recent GA release, CloudSwitch allows customers to select from a set of public “Sample VMs” for access to cloud capacity.  Customers can use these sample VMs for a variety of purposes—evaluation, production, or anything in between. Further, since these machines have already been moved into the cloud, starting them is quick and efficient.  Current Sample VMs include a stock Centos 5.4 base image, SugarCRM, and BugZilla running on a Windows OS. We’re expanding the list of Sample VMs based on a range of customer use cases, and have plans to include many open source and partner products.

The final point—seamless connectivity—speaks to the way cloud providers offer connectivity to their instances.  Today, each provider has chosen a particular network architecture for delivery of their services.  For example, if you start a Linux instance in Amazon’s EC2 service and run “ifconfig eth0” you will likely see a 10.x.x.x IP address assigned to the interface.  This is because Amazon has chosen the 10.0.0.0/8 private address space for connectivity to customer instances.  Other cloud providers use different addressing schemes but regardless these are different and disconnected from what customers are using within their own data centers.  Further, secure connectivity to these instances is not convenient and in many cases is not possible.  CloudSwitch addresses this problem as well.

As part of the deployment process, CloudSwitch automatically creates a secure overlay network within the chosen cloud provider’s environment.  This overlay network extends a customer’s internal data center into the cloud so the cloud-based servers are part of the customer’s data center network.  When migrating existing servers into the cloud, end users see no difference; they can SSH or RDP to migrated instances without even realizing that their servers are no longer running within the data center.

So, CloudSwitch offers a way to leverage the power of the public cloud without forcing end users to change the way their infrastructure is configured.  We also offer a set of sample content customers can use if they simply want to establish a footprint in the cloud without migrating existing servers.  Finally, end users connect to cloud servers just as if they were running within the data center network.  The implication for my “data center in a box” use case is probably obvious: I could have installed the CloudSwitch Appliance on my sales engineers’ laptops, created a set of demo servers in the public cloud, and used these for field sales activity.  We would have saved money on the laptops but more importantly my team would have been more effective.

Ultimately the cloud is about better service delivery.  Better can certainly mean less expensive but in my case better would have meant more effectively expressing the value of our product to prospective customers.  Regardless of the definition, CloudSwitch offers a simple, secure, and effective way to leverage the cloud.  Since the early startup days in 2001 my goal hasn’t really changed much; I still want the opportunity to show you how our product can make you more effective.  The difference is I finally have my “data center in a box” to prove it to you (and I don’t have to take up all of your visitor parking spots).

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Private Clouds: Old Wine in a New Bottle

By John McEleney

I recently read a Bank of America Merrill Lynch report about cloud computing, and they described private clouds as "old wine in a new bottle." I think they nailed it!

The report points out that a typical private cloud set-up looks much the same as the infrastructure components currently found in a corporate data center, with virtualization added to the mix. While the virtualization provides somewhat better server utilization, the elasticity and efficiency available in the public cloud has private clouds beat by a mile.

In short, the term "private cloud" is usually just a buzzword for virtualized internal environments that have been around for years. By replicating existing data center architectures, they also recreate the same cost and maintenance issues that cloud computing aims to alleviate.

Despite their limitations, there is still a lot of industry talk about creating internal private clouds using equipment running inside a company’s data center. So why do people consider building private clouds anyway? 

To answer this question, you have to step back and examine some of the fundamental reasons why people are looking to cloud computing:

  1. The current infrastructure is not flexible enough to meet business needs
  2. Users of IT services have to wait too long to get access to additional computing resources
  3. CFOs and CIOs are tightening budgets, and they prefer operational expenses (tied directly to business performance) vs. capital expenses (allocated to business units)

In every case, the public cloud option outperforms the private cloud. Let’s examine each point:

  1. Flexibility – the ability to access essentially unlimited computing resources as you need them provides the ultimate level of flexibility. The scale of a public cloud like Amazon’s EC2 cannot possibly be replicated by a single enterprise. And that’s just one cloud – there are many others, allowing you to choose a range of providers according to your needs.
  2. Timeframes – to gain immediate access to public cloud compute resources, you only need an active account (and of course the appropriate corporate credentials). With a private cloud, users have to wait until the IT department completes the build out of the private cloud infrastructure. They are essentially subject to the same procurement and deployment challenges that had them looking at the public cloud in the first place.
  3. Budgets – everyone knows that the economic environment has brought a new level of scrutiny on expenses. In particular, capital budgets have been slashed. Approving millions of dollars (at least) to acquire, maintain and scale a private cloud sufficient for enterprise needs is becoming harder and harder to justify — especially when the "pay as you go" approach of public clouds is much more cost-effective.

There are many legitimate concerns that people have with the public cloud, including security, application migration and vendor lock-in. It is for these reasons and more that we created CloudSwitch. We’ve eliminated these previous barriers, so enterprises can take immediate advantage of the elasticity and economies of scale available in multi-tenant public clouds. Our technology is available now, and combines end-to-end security with point-and-click simplicity to revolutionize the way organizations deploy and manage their applications in public clouds. 

Sir Isaac Newton may not have dreamed about clouds, but his first Law of Motion, "a body at rest tends to stay at rest", has been a good harbinger of cloud adoption until now. It is fair to expect that people will grasp for private clouds simply because it’s more comfortable (it’s the status quo). However, the rationale for public cloud adoption is so compelling that a majority of organizations will choose to embrace the likes of Amazon, Terremark, and other clouds. As adoption increases, private clouds will be used only for select applications, thus requiring far fewer resources than they currently demand. We’re also seeing the emergence of “hybrid” clouds that allow customers to toggle compute workloads between private and public clouds on an as-needed basis.

In the end, we will have new wine and it will be in a new bottle. With CloudSwitch technology, 2010 is shaping up to be a great vintage.

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Hubs, Spokes and WANs

By Ellen Rubin

Recently, we’ve had a number of discussions with enterprises about how they’d like to use the cloud. The basic use case is around capacity on-demand (not surprisingly), but the specifics have raised some interesting issues. The companies have distributed branch offices that need the capacity for a range of applications, including dev/test environments as well as back-office and web apps. Today, these distributed groups are relying on corporate IT to meet their scaling and infrastructure needs, and they are frequently bottlenecked. This is both in terms of overall challenges in getting new capacity approved in a timely way, but also from a network bandwidth perspective. At a panel this week at Interop, Riverbed noted that 2/3 of their enterprise customers have a hub and spoke model that requires the “spokes” to backhaul to the “hub” for connectivity to the internet, and thus to cloud computing services. Only the remaining 1/3 have direct connections. At the same panel, Blue Coat agreed with the stats but commented that the branch sites are trending towards a direct-connect model as new sites are added.

All this is interesting to us at CloudSwitch since we have been hearing more and more frequently from enterprises that want more “edge” computing, and to empower the branch offices to add capacity on-demand in a controlled but self-service way. This creates a set of new requirements around cloud computing, in terms of both networking and security. In the hub and spoke model, corporate IT maintains control over all access to the cloud, which has benefits on the security and permissions side, but creates potential bottlenecks – both in terms of the need for self-service management tools to increase agility, as well as in bandwidth constraints where the backhaul traffic starts to strain the corporate networks. Backhauling also creates strain on the branch offices since it often adds significant latency to their internet connections.

Most of the vendors at the Interop panel (including Akamai, Riverbed, Ipanema and Blue Coat) claimed to be developing or are already offering WAN optimization products – increasingly in the form of virtual appliances and/or software versions – to help alleviate these bottlenecks. These will surely help, but will become even more important as the branch offices start to have more direct connectivity to the cloud. WAN optimization offerings at the “edge” will be increasingly needed, and cloud service providers are focused on building out these capabilities at their end of the network. Security in a more distributed model will also require some new thinking, since users in the branches will want to maximize flexibility and agility, while corporate IT will still need a way to limit potential threats and exposure created by opening these direct connections.

Underlying all these discussions is the fundamental issue of the laws of physics. As enterprises start to embrace the cloud model, they’ve realized that the major choke-point will be their network bandwidth. Innovation around addressing these issues, especially in the virtualized world of the cloud, will definitely be required. At CloudSwitch, we’re staying closely involved in discussions around customer requirements and vendor offerings to increase performance for workloads moving to the cloud.

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Cloud Expo 2010: Virtualization Steals the Spotlight

By Ellen Rubin

At first glance, cloud computing can appear to be “virtualization taken to its logical conclusion.” After all, if the main benefit of virtualization is to consolidate data center resources and increase the speed of provisioning, then cloud is the ultimate pay-off: don’t own the resources at all and cut provisioning down to a few minutes with instant self-service gratification.

But upon further thought, and as was highly visible at the Cloud Computing Expo this week in NYC, cloud seems to be giving virtualization a return to the spotlight. A recent Gartner study noted that cloud computing is the number 2 priority for CIOs – trumped only by…virtualization. And most of the sessions at the Cloud Expo made some mention of the benefits of extending virtualization footprints within the data center and starting to turn these into internal clouds, or at least “cloud-like” environments.

So is virtualization what’s old but new again? Remember that most enterprises have adopted virtualization in some way, but are only about 20% virtualized so far. So there’s plenty of room left to penetrate, and there’s still lots of opportunity for optimization and better management. Virtualization has primarily been used for consolidation, not for optimizing workload management and self-service. And many companies have large investments in existing hardware and virtualization licenses that they’d like to use more efficiently. In many ways, cloud computing has emerged on the scene as a disruptive force while virtualization is still an evolution in progress.

As at other recent shows, the common wisdom at the Cloud Expo was that “hybrid” environments are key to the emerging IT infrastructure. Some resources will stay behind the firewall and others can be moved to outside cloud environments. Some applications may need to be split between the data center and external clouds, especially where the database needs to stay inside. In this hybrid world, some enterprises will want to focus on growing the internal virtualization footprint and starting to build capabilities for provisioning, charge-back, orchestration, role-based access, etc. This may require significant investment in additional hardware and software. It will also require enterprise IT to develop a new perspective on managing their virt investments, learning from the cloud providers about best practices and from companies like CloudSwitch about how to combine external cloud services with their own environments securely and transparently.

It’s also true that many of the major technology vendors (as well as some IT departments) have a bias towards focusing the cloud revolution on known and existing technologies. It’s still somewhat scary to think about moving things outside the data center and cloud technologies are in relatively early stages. And external cloud services (in particular public clouds) are pushing the envelope in terms of customer expectations and placing new, challenging demands on virtualization.

But virtualization will have to step up to these demands now that the cloud revolution has raised the bar. Many of the emerging capabilities will need to be at the management plane: a broad range of self-service functions, for sure, but also the ability to route workloads to the appropriate environments based on business and technical requirements, and to federate across multiple and diverse environments both on-prem and externally. So maybe cloud computing turns out to be not only the logical extension of virtualization, but the catalyst that helps virtualization move to the next level.

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Cloud Tip: CloudSwitch Networking and ESX

By Damon Miller

As Director of Technical Field Operations for CloudSwitch, I have the pleasure of interacting with most of our customers on a regular basis.  This is an integral part of my job since I’m ultimately responsible for making sure we provide a positive experience every time someone uses our product.  The past month has provided a fantastic opportunity to do just this, as we opened our beta program to the public on March 1st.  We’ve learned a tremendous amount from our customers so I thought I’d take a moment to share some of that information to help everyone interested in using CloudSwitch.

First, there are some basic things to remember before using CloudSwitch to move servers to the cloud: 

  1. Applications need to be virtualized before they can be moved into the cloud, and you need a virtual environment in your datacenter for deploying the CloudSwitch Appliance.
  2. The virtual machines that you move to the cloud need to come from a supported version of VMware.  Today, this list includes ESX 3.5 & 4.0, VirtualCenter 2.5, and vSphere 4.0.  We can also access servers directly through a CIFS share.
  3. When running the CloudSwitch Appliance in an ESX environment, specific networking options are required for connectivity to servers running in the cloud.

The last item—ESX network configuration—has caused confusion for a few of our customers, so I thought I would also take some time to explain what specific settings we require and why they are needed.  First, though, it makes sense to provide a very quick description of how the CloudSwitch solution works.

After deploying the CloudSwitch Appliance (CSA) into a VMware environment, users select internal VMs to be migrated to a target cloud.  I’ll leave the full architectural overview for a later article, but suffice it to say that the selected VMs are then migrated securely into the cloud—encrypted in transit and at rest.  Once the migration is completed, the CSA starts the selected servers within our Cloud Isolation Technology.  This technology allows unmodified VMs to run in the cloud provider of your choice and provides secure, layer 2 connectivity to the datacenter.  A layer-2 connection—or a network bridge—means that users don’t need to change any network configuration data such as IP addresses and netmasks, since this is transparent when connectivity is established at the data link layer.

After the migration, one of two things will happen:  network connectivity will work exactly as it always has or the migrated VM will appear to be down (from a network perspective).  As you might imagine, our goal is the former.  However, in some cases VMware’s network configuration can interrupt the flow of CloudSwitch’s network traffic.  Specifically, there are two Virtual Switch Policy settings which must be enabled in order for CloudSwitch to provide layer 2 connectivity.  These are:

  • Promiscuous Mode
  • Forged Transmits

So, what do these settings actually mean?

Let’s start with Promiscuous Mode.  The name Promiscuous Mode is actually a bit confusing, though if you’re familiar with the related network interface option this will kind of make sense.  When Promiscuous Mode is enabled, ESX will send all traffic to nodes whose interfaces are placed into promiscuous mode.  Ultimately, enabling Promiscuous Mode on a virtual switch makes that switch function kind of like a network hub.  VMware has essentially provided a way to see all traffic on a given Virtual Switch or Port Group.

Ok, but why does CloudSwitch need this?  The quick answer is because without this option enabled, the CSA won’t receive traffic intended for servers it has migrated into the cloud.  If ESX’s virtual switch functioned just like a physical switch this would not be a problem.  Physical switches build up a list of MAC addresses connected to them, effectively “learning” which network interfaces are where.  Without this intelligence, a node would never be able to communicate across more than one switch.  However, ESX assumes that the VMs attached to its virtual switches are always the final destination.  In CloudSwitch’s case, this is not true:  There are other servers “behind” the CSA—cloud-based servers launched by customers.

If enabling Promiscuous Mode was acceptable in all environments, we would be in great shape.  However, some of our customers have told us that they don’t feel comfortable with this configuration for their virtual switches.  We completely understand their position, because we don’t want that extra traffic either!  We’re only interested in traffic for the servers we’ve migrated into the cloud.  Thankfully there is a quick and simple solution.  The CloudSwitch Appliance can be configured with its own Port Group and Promiscuous Mode can be enabled only for this port group.  In this configuration, the CSA will never receive traffic from any other node on its switch since Promiscuous Mode applies only to itself.

There’s one more setting we need to discuss, and that’s Forged Transmits.  With this option enabled, VMware allows virtual machines to generate traffic using a source address that is different from the network interface connected to the virtual switch.  CloudSwitch isn’t actually “forging” anything; rather, we are delivering the traffic generated by a customer’s cloud-based virtual machines into the datacenter across the secure tunnel we establish using the CSA.  All physical switches support this behavior by default because, again, without it no network consisting of more than one switch would function.  To provide traffic from migrated virtual machines to customer datacenters, CloudSwitch needs the CSA’s virtual switch to function more like a physical switch and allow this traffic to flow correctly.  Enabling ESX’s Forged Transmits option on the CSA’s virtual switch or port group makes this happen.

Both of these settings can be updated from the Virtual Infrastructure client. The process for enabling Promiscuous Mode and Forged Transmits is described in a knowledge base article available from VMware.  Note that these settings can be applied either to an entire Virtual Switch or to a Port Group.  Port Group settings override Virtual Switch settings so if you do change them on your Virtual Switch and you still don’t see the expected traffic, be sure to check the Port Group settings:  They may be overriding your switch-level changes.

CloudSwitch’s goal is to provide a simple, secure way to use cloud-based resources without requiring any change to applications or operating systems.  A few basic requirements such as a virtual environment are required to make this possible.  Additionally, when deploying the CloudSwitch Appliance under VMware ESX, two specific network configuration options are required.  Hopefully this article will help users understand what’s needed to get started, and thereby ensure a smooth, successful product experience.

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Opscamp Austin: IT Ops and the Cloud

Going to a conference focused on IT on a Saturday sounds like a really geeky way to spend a weekend, but thanks to an “alternative” venue, the “un conference” format, and a group of really good people, it was a great day.  I just got back from Opscamp Austin, a meeting of IT professionals, system administrators, tools vendors, cloud providers, and people who spend their time building and keeping the computing infrastructure of business running.  Many thanks to those who built this un-conference especially John Willis, Mark Hinkle, Damon Edwards, and all of the sponsors and presenters – you pulled together a great event.

Opscamp was created to allow an “open exchange of ideas around next generation technologies and strategies for IT Operations.”  The big topics at this meeting (as measured by both passion and interest) were Monitoring, Configuration Management, and DevOps.  I was particularly interested in these topics because we added the phrase “in cloudy environments” to the sessions.

I came away from this conference with a few conclusions:

1. IT operations is currently messy, and “cloud computing” is exposing some of the problems.  One problem is that when the cloud delivers on the notion of allocating resources in minutes, the pressure switches from raw provisioning to the speed of configuration; with the timescale compressed from days to minutes, there is nowhere to hide.  The other big issue is the dynamic nature of cloud computing – with servers, networks, and storage showing up and disappearing from your environment, it becomes difficult to model and manage.  The manual or loosely connected processes that worked because there was time while you waited for hardware to arrive no longer work in a highly dynamic environment.

2. There are very different views about what monitoring in the cloud should be – deep and consistent with current processes, or “just hide the messy parts,” to quote Amazon.  Some wanted the cloud providers to give them deep access to the “normal” monitoring data – think cpu temperatures.  Others think that the value in the cloud is getting rid of the support and detailed attention to the infrastructure, so who cares about that data, it is for the infrastructure provider to manage.  The issue is that the current cloud offerings are quite opaque about what is happening in the infrastructure.

After talking with Bret Piatt from Rackspace it seems that the problem is not collecting the data (they have to do it anyway), but storing it, processing it, and doling it out to the customers.  There is real expense here, and for those customers who don’t want it, they would have to carry the burden of the extra cost in a market that is sensitive to price.  The fundamental choice here is whether we are going to carry the current detailed monitoring practices into the cloud, or give up on the low level monitoring of the remote resources.  In order to carry forward the current models, the cloud providers will have to provide API’s to get at the internal data.  In order to change the model, developers and tool providers will have to increase the capabilities of the applications around fault tolerance and providing useful monitoring data that can be measured from the application level.

3. We are still in the early days of cloud computing.  This should not be a surprise to anyone, but since at CloudSwitch, we’ve been so fully integrated with the cloud since the beginning – with everything from our build servers, bug database, large number of QA servers, code repository and web site –it’s easy to think that everyone is already comfortable using the cloud.  What became clear in the discussions is that many of the organizations are still working though server virtualization and how to take advantage of the advanced features enabled by that technology.

What was really exciting for me was to see the people who actually have to make IT work thinking through what is needed to build a dynamic data center and integrate with cloud computing.  With these guys on the case, I know that cloud computing is taking real steps forward.

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Why Cloud is at the Top of the CIO's Priorities

In the most difficult economic climate in decades, CIOs are reevaluating their strategies and looking for new ways to reduce data center costs and overhead while improving responsiveness to business requirements. Cloud computing has emerged as a much more agile and efficient approach than what companies have done in the past: adding more compute, storage and networking capacity or trying to get more out of what they already own.

Cloud computing did not emerge from a vacuum, but has its origins in three technology "megatrends" that most CIOs are already familiar with. These developments were all born out of the same need -- to drive down costs, simplify data center operations and allow IT to be as agile as possible. As these megatrends have become pervasive, they've helped put the cloud in the CIO's strike zone:

The drive to consolidate: Consolidating sprawling data centers has become a top IT priority as companies struggle with out-of-control costs for hardware, power, administration and service. Many companies have seen their data centers grow beyond anything they ever anticipated, with the result that in many cases they're not only running out of space, they're increasingly running out of power and cooling as well. In response, they look for innovative ways to reduce their data center footprints - to move out anything that adds cost and complexity, and takes up extra real estate.

The growth of virtualization: Many organizations now operate in virtualized environments, where applications can be quickly deployed to available resources, rather than assigning them to a specific physical machine. Not only does this optimize utilization of equipment, it allows IT to become much more responsive to the needs of the business.

Emergence of SaaS: The Software as a Service (SaaS) model has become widely accepted, in which applications are hosted by outside service providers that can apply specialized expertise, the right hardware and economies of scale. The idea of running certain apps outside the walls of the organization is recognized as not only acceptable but often preferable, where an external provider delivers the service just as well (if not better) than companies trying to do it themselves.

Cloud computing builds on these megatrends, and goes several steps further, providing new capabilities for enterprise computing:

  • Not just consolidating the data center, but creating the optimum environment both within the DC and in the external cloud, to match changing demands for computing resources
  • Not just virtualizing applications across internal systems, but across whatever environment is most appropriate and cost effective
  • Not just software as a service, but enterprise applications running in the cloud on the cloud provider's infrastructure

The ability to run applications in the cloud promises to radically alter the balance sheet by which IT projects are judged, where initial capital expense and ongoing operating costs are factored against value delivered and how quickly resources become available. CIOs now have the opportunity to do something much more significant than make small incremental improvements -- particularly as new cloud deployment and management tools come to market. That's why more and more IT executives are making cloud computing a top priority as they plan their strategies for 2010 and beyond.

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Has Virtualization Solved the Data Center Crisis?

Over the past several years, many IT departments have committed to virtualization as an antidote to the spiraling costs and inflexibility plaguing corporate data centers everywhere. By running applications on virtual servers and consolidating underutilized hardware, data centers can get maximum value from their equipment. Virtualization also makes IT more responsive to the needs of the business: rather than spending weeks or months to provision a physical server, a virtual server can be launched in minutes.

Virtualization was meant to be the solution to today's data center woes - but is it? While it brings much-needed flexibility and efficiency to an environment where these qualities were sorely lacking, virtualization alone doesn't cure the underlying problem and in some ways adds to it. Companies still have large data center infrastructure footprints to maintain, plus virtualization licenses, plus management issues introduced by virtualization - ironically adding cost as they try to reduce cost. Many IT managers report that the technical and management challenges associated with virtualization are hindering them from realizing its full cost benefits. They're still paying huge energy bills (those consolidated servers are working much harder than previously). They're still running out of capacity and need to keep buying more servers and storage. And over half of them are still building new data centers at enormous cost.

We're Not Done Yet

But virtualization is one step toward a larger goal, not the end of the journey. IT is in the middle of a fundamental transition from the rigid, siloed world of traditional data centers toward a more elastic, responsive model where needs are met far faster and more efficiently. And we're not done yet. While virtualization helps companies reduce cost and improve agility, the full promise of the new model plays out with the addition of cloud computing, delivering infrastructure on demand as an easily-accessible, cost-effective service.

Rather than perpetuating a bloated data center, the new model will allow companies to get out of the computing infrastructure business where appropriate, retaining only the portion that is essential to the enterprise. As the cloud environment becomes increasingly agile and secure, provisioning decisions will be framed by asking: Should we be really be doing this ourselves, or can someone else do it better and at lower cost? The majority of companies surveyed that are either using or actively planning to run at least some apps in the public cloud have started asking themselves the same question.

Some companies - particularly larger enterprises with the skills and scale to do it effectively -- are building on their virtualized environments to create private, or internal, clouds that deliver several of the benefits of cloud computing within the enterprise. Private clouds provide users with an elastic computing resource on demand and help make better, more efficient use of existing capacity. But IT departments still face many of the same fundamental challenges - they still need to buy, manage and grow the data center infrastructure on which the private cloud depends. As Gartner Group's Tom Bittman points out, for most enterprises, the private cloud is not the ultimate goal, it's another stepping stone to services available in the public cloud as they become available.

It's All About the Application

The real issue is determining where each application truly belongs. Some apps are simply not suitable for any cloud, while others, at least for the foreseeable future, belong in the private cloud. Some applications are candidates for the public cloud, but the appropriate services aren't ready yet. And some data center applications could be moved to a public cloud now or in the very near future.

While virtualization is a key step toward moving beyond the rigid data center, cloud computing takes you all the way there - which is why it's getting so much attention. With new technology from CloudSwitch under development, it may work for your enterprise faster than you think. Stay tuned.

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