1. Cloud Computing—Is It Ready for You, and Are Your Ready for It?
Gartner Keynote: Web and Cloud Computing — How to Ride the Wave and Avoid a Wipeout
Cloud Computing—Is It Ready for You, and Are Your Ready for It?
Gene Phifer
Application Architecture, Development and Integration
December 7-9, 2009
Caesar's Palace
Las Vegas, NV
David Cearley and Gene Phifer
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2. Where Did Cloud Computing Come From
Strategic Planning Assumption: Cloud computing is a new style of computing that has evolved from advances in data center design, computing and application architectures, utility computing models, and Web 2.0.
Focus on "the Cloud"
Focus on "Computing"
Data Center Design
Web 2.0 and Mashups
Virtualization
Automated
Provisioning
Subsidized Applications
Cloud
Services and Web API/
Architecture
Web
Real-Time Infrastructure
Googleplex
Internet
Information
and Browser UI
Web Platforms
Grid
Global-Class
Consumer
Applications
Connectivity
Management Discipline
1980
1990
2000
2010
2020
Utility Models
SaaS
From the Web
From the Enterprise
The hype around cloud computing continues to grow. Vendors are increasingly using cloud computing as a marketing label for old technologies and offerings, devaluing the term and trend. This is understandable, because cloud computing is a natural evolution of enterprise and Web-based technologies and trends. However, it is a mistake to relabel these older technologies as "cloud computing." Cloud computing emerges from the synergistic intersection of elements of these trends and technologies. This new computing model drives revolutionary changes in how solutions are designed, built, delivered, sourced and managed. Cloud computing is not defined by one product or technology. It is a style of computing that characterizes a model in which providers deliver IT-enabled capabilities to consumers.
A revolutionary approach emerging from evolutionary change

3. A Strategic Model for Cloud Computing
Strategic Imperative: Establish a project team that includes representatives from across IT, as well as key business constituencies, to establish an overall approach to cloud computing and to evaluate the opportunities and risks associated with this new style of computing.
Gartner defines cloud computing as "a style of computing where scalable and elastic IT-related capabilities are provided 'as a service' to customers* using Internet technologies."
Internet Technologies 5
Metered by Use 4
Shared 3
Scalable and Elastic 2
Service-Based 1
5 Attributes That Support Outcomes
3 Focal Points for Cloud Projects
Consuming Cloud Services 1
Implementing Private Cloud Computing Environments 2
Developing Cloud-Based Applications and Solutions 3
During the past 15 years, IT industrialization has grown in popularity. IT services delivered via hardware, software and people are becoming repeatable and usable by a wide range of customers and service providers. This is partly because of the commoditization and standardization of technologies, virtualization and the rise of service-oriented software architectures, and (most importantly) the dramatic growth in popularity/use of the Internet and the Web. These things, taken together, constitute the basis of a discontinuity that amounts to a new opportunity to shape the relationship between those who use IT services and those who sell them. The discontinuity implies that the ability to deliver specialized services in IT can now be paired with the ability to deliver those services in an industrialized and pervasive way. The reality of this implication is that users of IT-related services can focus on what the services provide them, rather than how the services are implemented or hosted.
Just as utility companies sell power to subscribers, and telephone companies sell voice and data services, IT services such as network security management, data center hosting or even departmental billing can now be easily delivered as contractual services. The buying decision then shifts from buying products that enable the delivery of some function (like billing) toward contracting to someone else delivering those functions. This isn't new, but it does represent a different model than the licensed-based, on-premises models that have dominated the IT industry for so long. Names for this type of operation have come into vogue at different times. Utility computing, SaaS, application service providers all have their places in the pantheon of industrialized delivery models. However, none has garnered widespread acceptance as the central theme for how any and all IT-related services can be delivered globally.
* Public cloud computing refers to the delivery of cloud services by a third-party provider to external customers. In private cloud computing, IT acts as the provider of services to internal customers.

4. What are the Benefits and Challenges of Public Cloud Computing?
Tactical Guideline: Approach cloud computing concerns similarly to the way you approach all off-premises concerns. Demand no less from the cloud.
Significant Potential Benefit
But Tough Problems Remain
Speed, Flexibility, Agility
User self service
Rapid deployment & change
Address highly and/or unpredictable resource demands
Financial Benefits
Cost savings (perceived & real)
Move from capital to operating expense
Pay for use & "free" software
Simplicity and Convenience
Procurement (transaction, contract, service levels)
Encourages use of standardized resources/applications
Access (browser, menus, simple APIs) and global reach
Capabilities
New solutions not feasible before
Superior security and reliability for smaller companies
Data/Process Location & Isolation
Security, privacy & ownership
Regulatory, Compliance & Policies
Limits, e-discovery, investigations
Portability between Providers
Lack of standards, vendor lock-in
Provider Trust Management
Transparency to provider operations
Immature vendors and certifications
Uncertain Failure Remediation
SLA guarantees, redundancy
Integration and Process Integrity across the cloud
Technical & Support issues
Bandwidth & Latency
Accessing or integrating "clouds"
Licensing Issues
Uncertain Financial Models
Key Issue: How will cloud computing evolve to become a key sourcing strategy for the enterprise?
A number of challenges exist whenever a company moves data or processing outside the enterprise to be hosted and/or managed by a third party. These include but are not limited to: Service availability, capacity and performance guarantees; outsourcer security, privacy, and disaster recovery policies and procedures (e.g., privileged user access); service metrics, reporting and analysis; support for e-discovery and legal investigations; data ownership, recovery and migration; integration with on-premises systems; minimum or maximum use requirements; setup, training and integration fees; difficult to customize; difficulty changing providers; and the governance of the sourcing process.
This list focuses on issues related to all off-premises "utility," "hosting" or "as a service" offerings in which the provider of the service owns, specifies and controls the off-premises execution environment (off-premises outsourcing models in which the consumer specifies the details of the execution environment that the vendor runs). The list does not include every term and condition that should be considered when evaluating an off-premises service. Rather, it is focused on the unique concerns raised by an off-premises vs. on-premises implementation. The special cloud concerns focus on additional issues that result from the unique characteristics of cloud computing (elastic scale, strict "as a service" delivery, global-class design and use of Internet technologies).

5. Cloud Computing Services: A Range of IT Capabilities
Strategic Imperative: Develop unique and appropriate selection criteria and governance models for each layer of the cloud computing service hierarchy, but combine them into an overall cloud computing strategy.
Offload Business Process Execution?
The consumer accesses, configures and/or extends the service and builds everything needed above the service boundary — or just uses the service.
Offload App. & Info. Mgt.?
Service providers can be service consumers at the same time.
Offload Middleware Mgt.?
Offload Data Center Mgt.?
Business Services
Information Services
Application Services (SaaS)
Mgmt. and Security
App. Infrastructure Services (PaaS)
Cloud
Enablers
System Infrastructure Services (IaaS)
Cloud solutions and applications, as with any solutions and applications, rely on a platform — the cloud platform, in this case. The cloud platform is the technology foundation on which cloud applications and solutions are built and deployed. It is a collection of all programmable and programmatically accessible resources in the cloud, as well as development and management support. Cloud is organized into communities (akin to traditional vendor "ecosystems"). Community/ecosystem management is another element of a cloud platform.
Application infrastructure is the collection of technologies that enable applications in the cloud; analogously, there is application platform as a service (APaaS). Some of the key elements of application platforms are the application server, integration suite, business process management technology, database, SOA support and development tools.
APaaS is a development and execution environment, available as a service to developers and used to host business applications and application services in the cloud. It is analogous to an application server (and development tools) on-premises, but it is equipped with SaaS/cloud capabilities and is offered as a running environment, as opposed to a software library for custom in-house deployment.
The provider optimizes everything below the service boundary, and hides complexity from the consumer.

6. Microsoft Cloud Offerings
Key Issue: What are cloud-based alternatives for portal, content and collaboration solutions, and what is the impact of consumerization.
Microsoft entered the cloud-based portal/content/collaboration space in 2008 with its Business Productivity Online Suite (BPOS). This suite is comprised of:
Exchange Online
SharePoint Online
Office Communications Online
Office Live Meeting
These are multitenant, cloud-based versions of the popular on-premises content, collaboration and portal products. BPOS is priced at $10/month/user, which is a recent significant price reduction.
Existing desktop tools (for example, Outlook) may be used with BPOS, along with a Web browser. Microsoft also offers a Deskless Worker Suite for an additional $3/month/user.
BPOS will be attractive to existing users of Microsoft technologies. It could provide a lower-cost alternative to existing or new on-premises deployments. It will also be popular with new clients looking for the trust engendered with a long-standing IT vendor like Microsoft.

7. Google GAPE GAPE = Google Apps Premier Edition
Market: Product offerings that started in the consumer world are starting to challenge long-established collaboration and communication vendors.
GAPE = Google Apps Premier Edition
Enterprise packaging of consumer-grade tools
Gmail and Google Calendar
Google Docs and Google Sites
Google Video
25GB/account for mail; 10GB + 500MB/user for storage
99.9% uptime guarantee
Ready for prime time?
Acquisition of Postini provides mail security and archive
Migration and integration support
Multiple outages during the past year
Many curious — only a few taking the plunge
Future role for iGoogle?
Key Issue: What are cloud-based alternatives for portal, content and collaboration solutions, and what is the impact of consumerization.
Long-standing vendors, such as Microsoft, IBM, Oracle, Novell and Open Text, dominate corporate strategies for office productivity, team space and capabilities. Products such as SharePoint, Outlook/Exchange and Lotus Notes are pervasive inside the enterprise. However, these products have little to no presence in the consumer world.
Vendors such as Google and products such as Google Docs have become quite popular in the consumer world. These consumer-grade products are being enhanced and packaged for enterprise consumption.
Why would an enterprise take the chance? The cloud-based delivery model of these products allows rapid provisioning, with no need for on-premises hardware, software or support personnel. But the biggest reason that enterprises are attracted is cost. For example, Google's offering here, GAPE, costs $50/user/year, significantly lower than transition to on-premises deployment of traditional products.
Not to be outdone, vendors such as Microsoft and IBM are entering the market with cloud-based versions of their on-premises products. But Google's price points are still the most aggressive in the industry.
Is Google ready for the enterprise? Some say yes, but most are taking a cautious approach as Google learns to support the enterprise.

8. Developing Cloud Based Solutions
Tactical Guidance: Familiarize yourself with the trade-offs of different development approaches, and develop a plan for where and how you will use each. Don't let vendor marketing and hype dictate your strategy.
Multiple Approaches
Cloud Service Configuration and Mashup
Cloud-Hosted Application
Cloud-Optimized Application
Build it all or use APaaS
Enterise app or cloud service
Cloud Tools, Techniques and Skills
Design for linear scalability, parallel processing and distributed data
Application Platform as a Service
Social Computing integration
Coordinate Web design and application development
Multi-tenancy for externalization
Global Class & WOA are critical
Developer
Browser/RIA
or Traditional Client
System Infrastructure
Sys./App. Infra.
Application
Consumer
Enterprise-
Class App.
Access and Configuration
Global-
Class App.
Cloud-based services can be exploited in a variety of ways to develop an application or solution. The least-disruptive approach is to continue using traditional development tools and techniques, and exploit the cloud as a virtualized pool of compute and storage services. A slightly more sophisticated model would be to build a program on internal systems that will uniquely exploit cloud-centric distributed and parallel processing capabilities, and run the resulting program in the cloud. Developers can also create and execute applications internally, and simply access external application, information or process services via a mashup model. The result of the external service is brought to the internal application. An extension of this approach would allow for a degree of configuration and extension to the external service being accessed. Full exploitation of the cloud means that external resources are used for building, storing, running and managing the application. This approach is being championed by a new crop of RAD and database vendors that provide turnkey environments (e.g., application platform as a service [APaaS]) that build on the scalability of cloud-based infrastructures. None of the approaches will be sufficient for the full range of application needs for the typical enterprise. Most users will employ a hybrid model that uses all three techniques.
There is a fundamental tradeoff between using cloud system infrastructure and cloud application infrastructure to create cloud optimized applications. Using cloud system infrastructure the developer is given maximum control over the environment but must build linear scalability, distributed data management and multitenancy (if needed) into the application themselves. Most IT groups do not have the skills to accomplish this. By using application infrastructure services (e.g., Application Platform as a Service) the developer can insulate themselves from this complexity but at the expense of control over every aspect of the environment.
Web development tools have reached a point where they can address most enterprise use cases. Users should avoid religious debates on the superiority of one scripting language over another and focus on how well the tool or framework supports developer productivity to construct and maintain the application.
In addition to consuming cloud services enterprises will increasingly act as cloud providers and deliver application, information or business process services to customers and business partners. The first step in this direction is often tied to a companies web site with elements of the web site being made more "mashable" by exposing information and capabilities of the web site using RESTful APIs, RSS feeds and other WOA techniques. A second step entails exposing other business processes and information sources that are not currently part of the companies formal website using the same mechanisms. Best Buy is one example of a company pursuing this approach.

9. Who's Who in Application Platforms for Cloud Computing
Decision Framework: When evaluating APaaS, understand the nature of the project. Simple, short-term applications can be deployed on nearly any offered platform, and enjoy productivity and other benefits of cloud computing; but more complex longer-term applications require one or more of the harder-to-find full set of cloud platform capabilities (e.g., multitenancy, elasticity, XTP)
Enterprise Players
Cloud Natives
Adobe
Appistry
Aptana
Cordys
GigaSpaces
IBM
Intuit
Kovair
maat G
Magic Software
Micro Focus
Microsoft Azure .NET
Oracle
Progress
RackSpace
Red Hat
SpringSource (VMware)
Sun Zembly
Tibco Silver
WaveMaker
Apprenda
Archer Technologies
Bungee Labs
Caspio
Corent
EngineYard
Express Dynamics WorkXPress
ForeSoft dbFLEX
Google AppEngine
Heroku
OrangeScape
Qrimp
Relationals LongJump
Rollbase
salesforce.com Force.com
SiteMasher
Smallthought Systems DabbleDB
Stax
Vertical Solutions
Zoho
RAD 2.0
4GL/Scripting
Graphical Tools
Metadata Driven
Rapid Development
Proprietary Lang. and/or Runtime
Reduce Development Complexity
The opportunity to compete in the emerging software market of APaaS has inspired a number of vendors. Most are in the earliest stages of development (beta or early deployments). Force.com is the undisputed leader in the space with the largest ISV and early customers community. However, even Force.com is less than two years old. Google is the largest overall vendor, in the market with its AppEngine, though the product is still in beta and so far limited in enterprise appeal without support of relational database model. Of the smaller vendors dbFlex is longest in the market, but has achieved minimal name recognition. Rollbase and BungeeLabs (both still in beta) are differentiated by offering their platform technology as a software product (not just as a service). Bungee also offers an open source option where the buyer can fork the platform code and develop their own APaaS using Bungee core. Rollbase, LongJump and Bungee use third-party data centers (OpSource, RackSpace or Amazon).
Most vendors offer development tools aiming at mass-market productivity. Bungee in contrast aims to attract advanced programmers and advanced projects. It is one of the few with a computationally-complete programming language. Not a single service offers standard Java or Java EE programming model (although most are written in java and use Java EE Servlet model). Some use OS virtualization to instantiate tenants and others have built multitenancy into the platform. The market is likely to run into an early conflict of objectives: the main focus on ease-of-use and productivity for modestly demanding projects vs. the essential requirement for high-end performance to support a growing community of tenants. Some of the early vendors may fail to meet both of these requirements.

10. The Spectrum of Cloud Computing Services: From Public to Private
Closed Private
Open Public
Enterprise A
Enterprise A
Enterprise A
Enterprise A
Enterprise B
Enterprise A
Enterprise B
Company X
User Z
Enterprise
Private Cloud
Managed
Private Cloud
Virtual
Private Cloud
Community
Public Cloud
Public
Cloud
Enterprise Owned
Enterprise Operated
Dedicated to One Enterprise
Maximum Control & Minimum Leverage
Enterprise Owned
Provider Operated
Dedicated to One Enterprise
Maximum Control With Skills Leverage
Provider Owned
Provider Operated
Dedicated to One Enterprise
Strong Control With Skills & Modest Asset Leverage
Provider Owned
Provider Operated
Available to an Exclusive set of Consumers
Modest Control With Skills & Strong Asset Leverage
Provider Owned
Provider Operated
Open to any Consumer
Minimum Control & Maximum Leverage
There are two relative dimensions that determine how "private" or how "public" a cloud service really is:
Service control/ownership: There are two ends of a spectrum here — complete implementation ownership, and complete lack of ownership and control of implementation. However, there will be many examples in between of partial control, shared ownership and others.
Service access: There are two ends to this spectrum — at one end, usage is extremely exclusive, while at the other end, anyone who chooses can access the service. Again, there will be many examples in between of limited access, industry-only access, controlled partner access and others.
These two dimensions are coupled at the extremes, but there are many variations in between. Each has different security/privacy, cost, customization and elasticity attributes.
Many of the cloud services that will emerge during the next few years will fall somewhere in the middle (consider the customers choosing Exchange Online Dedicated, or paying for Reserved Instances from Amazon.com). Understanding the trade-offs and options is critical.

11. Enterprise Use Cases 2009-2012: Leading-Edge to Early Mainstream
Strategic Planning Assumption: By 2012, 80% of Fortune 1000 enterprises will be using some level of cloud computing services, and 30% will use cloud computing system and/or application infrastructure services. A
Prototyping/Proof of Concept
Unpredictable and/or volatile workloads
Rapid provisioning
User self-service
Avoid asset/people cost
Leverage economies of scale and grid execution
Manageable data risk
Simple connection to internal applications
Service licensing in place B
Development/Test and Projects C
Web Application Serving D
SaaS (Analytics, , Collab) E
Departmental & Workgroup Apps. F
Simple, Parallelized Workloads
There are five questions that you should ask yourself when considering a deployment on cloud system or application infrastructure:
Do you need a flexible amount of capacity? You have a need for flexibility if you will use this infrastructure for less than a year, if you have seasonal swings in demand, or if you do not have the ability to accurately project how much capacity you will need during a 60-day rolling window.
Do you need management services? If you need management of the operating system or middleware, or have a complex environment requiring significant customization, you need management services.
Do you need a pool of capacity that can be dynamically reallocated between multiple applications? If you need to be able to use a Web-based GUI to create new application infrastructure on demand, for instance, if you have multiple developers sharing a test and development environment, you need pooled capacity.
Can this application be Internet-facing? If it's acceptable for your users to access this application over the Internet, rather than over your private enterprise WAN, you will have a greater range of hosting options.
Are you using a popular application framework, such as Ruby on Rails? If you are using one of these frameworks, you may be able to use an APaaS provider that specializes in providing cloud-based hosting for that framework.
+ Targeted Private Cloud Computing Infrastructure

12. Enabling Technologies
The Long-Term View: Service Providers, Ecosystems, Brokers and Supply Chains
Strategic Planning Assumption: By 2014, ecosystems will evolve from their current horizontal, provider-centric focus to a vertical orientation with federation across cloud ecosystems. Cloud brokerage will grow in importance, but broad interoperability standards will not mature until at least 2019.
Service Providers
Full stack
Ecosystem participant
Ecosystems
Infrastructure foundation
Standards and interfaces
Service assurance
Marketplaces
Products and services for provider implementation
Brokers
Integration
Intermediation
Aggregation
Enterprise as Provider
Private cloud services
Public cloud services
Enabling Technologies
Building public/private
Service
Provider
Service
Provider
Ecosystem
Sys. and App.
Infrastructure
Or Marketplace
Service
Provider
App. and Information
Broker
Service
Provider
Mgmt. and
Security
Service
Provider
Broker
Private
Cloud
Service
Provider
Cloud computing is a style of computing where scalable and elastic IT-related capabilities are provided "as a service" to customers using Internet technologies. A cloud service provider is someone that provides. A cloud service provider is an entity that delivers one or more these IT-related capabilities to one or more consumers. Where the cloud service provider controls and masks all the underlying technologies used to implement the service, it is considered a "full stack" service provider. A cloud service provider may also elect to participate in a cloud ecosystem. Cloud ecosystems exist where an entity not only delivers services to end consumers, but also provides an environment that facilitates the business of other service providers. At a minimum, the service provider will use the hosting services of the cloud ecosystem and may use any of the additional platform services to build and deliver its services.
Where other cloud services are used as part of the implementation, but hidden from the consumer, the underlying service is considered part of the providers supply chain. In this case, the service provider takes responsibility for and may elect to change the underlying service. In a cloud brokerage situation, the relationship is somewhat different. A broker negotiates relationships between providers of cloud services and the service consumers and may enhance the base services by managing access to the services, providing greater security or even creating completely new services by extending or combining existing services. However, in a brokerage situation, the consumer has awareness of and may interact with the original service. Cloud solution providers combine service provider and broker capabilities to create complete end applications for the consumer.
Much of the focus in cloud computing is the emergence of public cloud computing in which external providers deliver services to consuming enterprises. However, enterprises will also create private cloud computing environments in an attempt to improve the agility, efficiency and economics of internal systems and enable them to expose selected enterprise systems as public cloud services to their customers and partners. This will drive enterprise hardware, software and services vendors to embrace cloud computing.
Consumer
Consumer
Enabling Technologies
HW/SW/Net Vendor

13. Integration as a Service
From Where Will the Brokerages Come and What Services will be Provided?
Strategic Planning Assumption: Through 2014, cloud service brokerage will grow from less than $50 million in revenue to more than $5 billion.
Potential Players
Broker Value Add
Brokerage
View
B2B, B2C, C2C Marketplaces
Managed File Transfer
Business Process Outsourcers
Integration Service Providers
System Integrators
Carriers
Telcos
Cloud Ecosystems
Aggregation
Arbitrage
Integration
Enhancement
Governance
Customization
Insurance
Integration as a Service
Consumer
View
Provider
View
Brokerage: Where a 3rd party is working on behalf of the consumer of one or more cloud services to add value to the service being consumed and where the third party may or may not have a relationship with the provider of the service.
Key Issue: What vendors, markets and industries will be transformed by the cloud computing phenomenon?
An intermediation broker provides a service that directly enhances a given service delivered to one or more service consumers. It essentially adds value on top of a given service to enhance some specific capability. An intermediation broker is basically a VAR for cloud services. The broader opportunity will be for intermediation-style brokerage service providers to exist independently of the original service provider. These CSBs offer enhancements to the original service (for example, Akamai provides network enhancements beyond what the Internet provides). CSBs will offer intermediation for multiple services of any kind. Examples include identity management or access management, such as the governance that Sonoa or IBM WebSphere DataPower might offer as a service rather than an appliance. Intermediation-type brokers will be very commonplace because they're the most familiar to enterprise customers. Individual cloud service consumers will acquire these intermediation services through some consumer-focused service provider, such as AT&T, Verizon, Telstra or Virgin Media.
An aggregation brokerage service combines multiple services into one or more new services. It exists as a means of bringing together services that were created separately but need to work together. These services often come from completely different service providers. This will become the new packaged application vendor option as service providers realize there's an opportunity to create a whole new generation of composed applications based on cloud services.
Cloud service arbitrage is similar to cloud service aggregation. The basic difference between them is that the services being aggregated aren't fixed. In fact, the goal of service arbitrage is to provide flexibility and opportunistic choices for the service aggregator.
Broker: A broker is a provider of brokerage in the form of professional services (i.e., people), a piece of technology that provides brokerage functions or a combination of the two.

14. Wipro — Private First, Public Later?
Case Study: Cloud computing allowed Wipro to significantly improve time to delivery and at the same time improve utilization of assets.
Reduced provisioning time for projects and COEs
Driver to cloud — Traditional provisioning for new projects and COEs was excessive
Solution — Private cloud
Self-service portal for automation of server provisioning
Benefits
Internal server provisioning: 46 days to 35 minutes
Utilization: <10% to 40%
Reprovisioning of assets: nil to reduced capex 30%
Average server cost: $800 to $2,000
Improved license management, network bandwidth utilization and energy costs
Key Lesson: Time to delivery can be improved while utilizing assets more effectively.
Wipro is a global systems integrator, based in India. They were hindered by excessive cycle times in deploying new computing resources for new project and their Centers of Excellence (COEs).
Their solution was to implement a private cloud. Additionally, Wipro adopted a SOA services approach for rapid SaaS enablement of applications. Wipro's private cloud includes the following features:
Dynamic provisioning
Multitenancy with network isolation
Accounting, auditing and metering
Performance and fault monitoring
Policy-based SLA management.
Wipro learned that cloud computing can add management complexity, requires a perspective of service delivery, requires additional integration, increases the complexity of reliability and recovery, and that a standard reference architecture has to be created for implementing clouds in multiple locations.
Wipro has enjoyed significant benefits, reducing provisioning time from 46 days to 35 minutes, removing a huge hurdle for new projects and COEs.
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15. Eli Lilly Less-expensive, rapid, seamless access inside/outside
Case Study: Eli Lilly reduced provisioning cycle time several orders of magnitude via the use of cloud computing.
Less-expensive, rapid, seamless access inside/outside
Drivers to cloud
Traditional infrastructure deployment was inhibiting business
Desire to move from fixed-cost to variable-cost model
Solution
Multiple cloud providers
Google for consumerization
Benefits
Reduced provisioning cycle time
New server: 7.5 weeks to 3 minutes
New collaboration environment: 8 weeks to 5 minutes
64-node Linux cluster: 12 weeks to 5 minutes
Key Lesson: Time to delivery is paramount
Eli Lilly is a large, global manufacturer of pharmaceuticals. It was pushed to reduce its fixed IT costs, while delivering new capabilities much more rapidly.
Eli Lilly used a multiprovider model to allow rapid provisioning of new computing resources:
• Collaboration — Google Apps
• Data sharing — Amazon SQS, S3, SimpleDB
• Data access — Amazon Data Transfer, S3
• SaaS — Alexa, Drupal, Sourceforge.net
• Basic platform services — Amazon EC2
Eli Lilly also has plans to expand its use of the cloud computing services to additional vendors, such as Nirvanix, Rackspace, XCalibre and GoGrid.
Eli Lilly has enjoyed a several-orders-of-magnitude reduction in the time to provision new computing resources. This has allowed new research and drug projects to start up significantly faster, reducing the time to deliver new drugs to the market. Eli Lilly has also enjoyed significant cost savings through its use of cloud computing. Finally, it has moved a large portion of fixed-cost capital investments to variable-cost operational expenses. 14
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16. Presidio Health — Move it All to the Cloud
Case Study: Presidio Health moved its apps. to the cloud, but kept its HIPAA-compliant data in traditional databases.
Driver to cloud — Rapid business growth restricted by infrastructure
Solution
Appistry for software; GoGrid for platform
Homegrown apps. for physician performance management and point-of-service collections
No rearchitecting of on-premises apps. facilitated by front-ending apps. with message broker
Transient data in cloud; sensitive permanent data in traditional database
Benefits
PCI & HIPAA compliance
No unscheduled downtime
Flat costs for 50% more capacity
Key Lessons: The cloud is ready for apps but perhaps not for sensitive data.
Presidio Health is a small healthcare technology provider that was preparing for rapid business growth over the next few years. It had a collocation relationship with GoGrid, but the traditional provisioning model being used would not facilitate the planned business growth. Presidio Health's application base was written in Java and used the Spring framework. It was able to port the applications over to a cloud model, still using GoGrid, but with the addition of Appistry for the APaaS layer. While Gartner's recommendations generally are not to simply port existing applications to the cloud, in the case of Presidio Health, significant benefits were gained.
Being in the healthcare industry, Presidio Health has requirements for compliance with PCI and HIPAA requirements, and they had to assure that the target cloud platforms were able to meet these requirements. One way that they have achieved this is to store no persistent data in the cloud — it is instead stored in traditional hosted databases. High availability was also a requirement. Presidio Health was able to get an SLA guaranteeing 100% planned uptime, and so far, its cloud providers have been able to deliver this.
Both Presidio Health and its cloud providers learned many things in this endeavor, including the fact that management tools are quite unsophisticated,and that they had to write their own pub/sub software. But most aspects of this endeavor have been positive, with lower cost per transaction, rapid deployment of new capacity, and high reliability leading the benefits. Presidio Health plans to move all its core applications to the cloud in 2010. 15
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17. Author Solutions — Running the Business in the Cloud
Case Study: Author Systems learned that hybrid cloud/on-premises solutions are complex to create, but that they absolutely work.
Requirements/Challenge
Automate self-publishing workflow for authors and publishers
Integrate disparate back- and front-office systems into a complete solution
Process/Solution
Created an end-to-end self publishing application using salesforce sites, force.com and Amazon services
Integrates with existing on-premises systems including crystal reports, Microsoft Dynamics, Great Plains
Result/Benefit
Developed application in significantly less time and for lower cost than that estimated for a traditional custom in-house application
Lower ongoing operational costs
50%-75% reduction in time and cost to modify workflow and add products
Key Lesson: Hybrid cloud/on-premises solutions are complex, but they work.
Author Solutions helps customers publish trade-quality books. They wanted to automate the publishing production workflow between authors and publishers to enable their customers to create high-quality books more quickly and at a much lower cost. Other key business goals included improving the visibility into the self-publishing process and lowering overall costs. They wanted to build a system that could generate revenue by being resold to other publishers looking to achieve similar results. The company also faced a number of IT challenges. Multiple, and often incompatible, systems were difficult to scale and update as the business grew and there was no central content management system
Using Force.com code and pages and with development and integration assistance from Appirio Author solutions created a customized application for its iUniverse self-publishing business. The application automates workflow from editorial through marketing and distribution. It is integrated with existing on-premises applications and other third-party services to create a solution with publishing rules, production workflow, file management, e-commerce, and relationship management elements. The application was developed and put into production in less than 6 months versus an estimated three years to develop the same functionality using a traditional in-house client/server model. The company migrated over 40,000 International Standard Book Numbers (ISBNs) and approximately 2,000 in-flight projects to the new operating environment. Sales, marketing production, publishing services, and author support now all run on the cloud-based application.

18. David Allen Company — Business Critical Cloud Services
Case Study: David Allen Company learned that is isn't always feasible to pick up existing infrastructure and applications and simply drop them into the cloud.
Background/Driver
Needed to build a more unified CRM system to process complex projects
Replace numerous disparate legacy systems including a notes-based CRM element
Needed to be able to adapt system quickly and easily
Did not start with a desire to move external
Process/Solution
Provided operational specifications to a variety of APaaS vendors to develop proof of concepts. Selected a Longjump based system
Running the business on a cloud-based CRM application with customizations for all groups that touch customers.
Result/Benefit
Significant development savings compared to traditional development.
Lower operational cost compared to internal systems
Developed and deployed system in a few weeks. Ongoing updates can be implemented rapidly. More flexibility to match the system to changing needs
Key Lesson: Its not always feasible to pick up existing infrastructure and applications and simply drop them into the cloud.
To improve business efficiency and support a new sales model, the David Allen Company determined that it needed to bring together a number of legacy systems that dealt with customer information into a single unified CRM system to be used by all employees that dealt with customers. Before examining technology options, the company brought all key stakeholders together and developed a detailed model for the optimized business process which was used as a foundation for their request for proposal. David Allen Company did not start with a desire to use cloud-based services. It had an internal infrastructure that it believed was stable, and it believed internal hosting of the application would not be a problem. The primary interest was an platform that would address its requirements and provide easy, rapid development, deployment and ongoing maintenance. It evaluated a number of options and had vendors provide a working demonstration based on their specifications. After choosing Longjump a few additional weeks of development were applied to create and deploy the final system. According to David Allen Company CIO Robert Peake "we spent more time preparing training materials than tweaking the core system Longjump provided as a proof of concept demonstration." Data conversion from existing systems also took some effort. Although it initially was considering internal hosting — an option it could have pursued with Longjump — its financial analysis quickly led the David Allen Company to an external cloud-based deployment. Benefits include elimination of upfront outlay of capital, elimination of many operational costs and flexibility to meet future needs.
David Allen Company has an extensive Web site that it uses to connect to its customers and conduct e-commerce. It is beginning to examine virtualization technologies and cloud offerings to support this function. However, when considering basic system infrastructure services such as Amazon, it determined that the specialized hardware and software stack that it had created could not simply move to cloud-based infrastructure. Load balancing, management of the persistent data store and the lack of visibility into and control of the infrastructure implementation requires them to rearchitect their solution to ensure adequate capability and performance.

19. SaaS Vendors Use the Cloud
Case Study: HRAnswerlink learned that the cloud can be used to deliver highly customizable services to customers.
Driver/Challenge
Business identified need to deliver a number of HRIS applications in a SaaS model, but a traditional approach would take 24 months to deliver
Process/Solution
Private implementation of Longjump APaaS
Built cloud application services for HR to be delivered through their partner channel.
Result/Benefit
Developed in 4½ months vs. 24 months
Able to provide a highly customizable service to their customers
Focus development on application design instead of infrastructure, database and security model design
Key Lesson: The cloud can be used to deliver highly customizable services.
HRAnswerlink delivers subscription-based HR support services for small and midsize businesses (SMBs). The company itself is an SMB with revenue of less than $10 million and fewer than 50 employees and delivers its services through partners, which private label the HRAnswerlink services. Partners include banks, CPAs, insurance brokers, HR and business consultants and service bureaus. HRAnswerlink services include HR expertise and advice including, employee handbook templates, articles on HR issues, topical Q&A databases and connections with HR professionals for more-sophisticated questions. The company was approached by its partner network to extend HRAnswerlink applications and services to cover additional HRIS domains and the company identified a number of applications it wanted to build to expand its business. These new applications would be delivered as cloud-based SaaS. After examining its internal IT capabilities, the company determined that it would take up to 24 months to do the ground work (e.g., multitenant architecture, security and data model design) before it could build the application. As a result, it searched for existing SaaS enablement tools that could shorten the development time and provide a higher level platform upon which to build its solutions. It examined a number of APaaS options and selected Longjump in April The first phase of the new cloud application services was announced on 17 August 2009, and now approximately 40 companies are in active implementation of the new services. The company expects approximately 100,000 users on the system by the end of next year. The current implementation uses Longjump as a service enabled application platform (SEAP) running on infrastructure owned and operated by HRAnswerlink.

20. Four Things You Can Do About Cloud Computing Today
Action
Outcome
Compare your cost of capital expenses with cloud providers
Step 1: Savings
Determine potential savings or cost increases
Find three workloads with which you can experiment
Step 2: Portfolio
Determine usage scenarios
Wrap existing applications to dump into the cloud
Step 3:
Migrate
Jump-start your efforts, but don't stop there
Step 4: Use
Consider cloud and collaboration
Immediate impact and feedback
Key Issue: How will enterprises adopt cloud based solutions for portals, content and collaboration?
Steps into cloud computing need not be risky. We recommend a few things as best practices:
Conduct a "cost of capital goods" study to understand how your costs will be affected by removing capital budget and replacing it with operating budget (which is used to pay for cloud services).
Migrate workloads to cloud services, rather than migrate entire platforms to the cloud. This is because you might not want to trust all your workloads from a platform to just one cloud provider.
Adopt a quick-start strategy by wrapping existing applications to move to cloud services without change. This, however, should be only the first step. Applications will need to be designed to work on cloud platforms.
Consider easy opportunities by adopting cloud and applications for some parts of your company.
These steps and more can help experimentation with the cloud and result in better understanding.

21. Lessons Learned and Best Practices
Today's Cloud Computing Environment is Best For
Applications that do not have much interaction with back-end systems
Web servers
Apps. where demand varies dramatically over a cycle (periodic peaks)
Short-term use (AD, evaluations, QA, campaigns)
Rapid ramp up required (minutes/hours vs. days/weeks)
Principles for early-adopter environments
Use a risk-based approach for security
Reuse existing processes/policies/learnings
Automate where practical
Consider differentiated support options
Keep it simple for the user/customer
Consider managing risk by with hybrid architectures that spread load across multiple providers with a layer of abstraction.
Issues Remain
Security
Data location, privacy, potential loss, portability
-abilities
Management/governance
Vendors

22. Your Action Plan
Today
Understand the benefits of cloud computing and look for short-term opportunities.
Assess your current risk profile and compare that against the risks of the offerings and vendors, identifying where benefits outweigh risks.
Near Future (Next 12 Months)
Track maturization of cloud computing and its vendors and reassess opportunities/risks at least quarterly.
Build cloud computing into your IT strategies planning: buy vs. build vs. outsource vs. cloud.
Align with the business to assure that any cloud computing efforts are coordinated with IT.
Longer Term (1-3 Years)
Look to move selective mission critical workloads into the cloud.
Plan for selective implementations of private clouds.

23. Cloud Computing—Is It Ready for You, and Are Your Ready for It?
Gartner Keynote: Web and Cloud Computing — How to Ride the Wave and Avoid a Wipeout
Cloud Computing—Is It Ready for You, and Are Your Ready for It?
Gene Phifer
Application Architecture, Development and Integration
December 7-9, 2009
Caesar's Palace
Las Vegas, NV
David Cearley and Gene Phifer
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