Cloud Computing Jonathan Weitz Bus: 550 June 3, 2013.
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Transcript of Cloud Computing Jonathan Weitz Bus: 550 June 3, 2013.
Agenda
Scope of case file(s)
Case 1: What is Cloud Computing?
Modeling the Cloud
Cloud Economics
Case 2: Economics of Cloud Computing US Gov.
Thoughts, Comments, Questions
Cases
Modeling the Economic Impact of Cloud Computing Australian Information Industry Association Lays a foundation of what cloud computing is , how it is
constructed and the potential economic costs and benefits of a shift in ideology from traditional computing to “Cloud Computing”
Economics of Cloud Computing Addresses the economic implications of US government
mirgration to a Cloud Based network for Information Technology
What is the Cloud?
Cloud computing relies on sharing resources in order to achieve economies of scale and gain greater coherence.
Maximizes the effectiveness as compared to traditional computing.
Example idea: Cloud facility which serves European users during European
business hours with a specific application (eg. email) while the same resources are getting reallocated and serve North American users during local business hours with another application (eg. web server).
Modelling the Cloud
Cloud computing has four deployment types: Private – Exclusive use by a single organization (may be
outsourced to a 3rd part provider, but sole use is for the single org.)
Public – For use by multiple organizations on a shared basis nad hosted by a 3rd part provider (Amazon & Google Apps)
Community – For use by a group of related organizations Hybrid – A single oganization adopts a private and blupic
model cloud to use the benefits of both applications
Service Models for Cloud Computing
Software as a service – Google Apps
Platform as a service – Microsoft Office 365
Infrastructure as a service – Amazon EC2 & S3
Cloud Computing Economic Benefits
Most identifiable economic benefit of cloud computing is direct cost savings, which occur from changes within the organization and the data centers that house the IT infrastructure. Supply Side – Large scale data centers lower cost due to
superior buying power Demand Side – Allowing multiple users across varying
industries regions & time zones allowing for server utilization Multi-user efficiency – Increasing # of users lowers server
cost per tenant Data center efficiency – Advanced data center designs
reduce power loss and improved cooling
Case Study: Economics of Cloud Computing US Gov.
Public Cloud Adopters: most likely early adopters Department migrates to an IT public cloud Low level of mission, bureau, (Dep of Commerce, Labor, EPA, Dep. of transportation) Assumptions: Transition will occur over 3 years, workload is constant
Hybrid Cloud: middle adopters Department builds a private cloud solution to handle majority of its IT load but uses
a public solutions for low sensitivity apps Dep of Agriculture, Dep of Education, NSF 75 % of the IT server workload will migrate to private and 25 % will be transitioned
to public cloud steadily over 3 years
Private Cloud: Late adopters Department or agency build own private solution or joins in an interagency cloud Broad mission sensitivity Transition will occur over 3 years, workload is constant
Case Study: Economics of Cloud Computing US Gov.
Economic analysis to investigate potential savings of the federal plan by focusing on a proprietary cost model of United States Government IT programs
Metrics used for Analysis: Benefit-to-cost ratio’s (BCR) Net present value (NPV) Discounted payback period (DPP)
Case Study: Economics of Cloud Computing US Gov. Cont.
Benefit-to-cost ratio’s (BCR) Calculated by each cloud scenario’s discounted net benefits less
the cloud’s discounted one-time investment costs. (Absolute metric)
Greater then 1.0 indicates the economic benefit vs. the SQ (status quo environment)
Net present value (NPV) calculated as each cloud scenario’s discounted net benefits divided
by its discounted investment costs. (Relative economic metric)
Discounted payback period (DPP) Reflects the number of years it takes for each scenario’s
accumulated annual benefits to equal its total investment costs.
Economics of Cloud Computing
Net benefits and payback for agencies for hybrid is more similar to private cloud then public.
Based on the 75/25 percent previous assumption.
Sensitivity Analysis
Primary factors driving economic benefit: Reduction in hardware Length of cloud migration schedule Public cloud benefit continues to increase BCR as servers
migrated
Impact of Migration Schedule on Economics
Better to group smaller existing data centers into a larger cloud rather then several smaller clouds
As BCR decreases, DPP increases with transition time.
Take Home: Economics of Cloud Computing US Gov
Cloud computing offers potentially significant savings to federal agencies by reducing their expenditures
Benefits come with risks and practicalities to consider: Will take 2-3 years for most agencies to transition Once implemented, it could take as long as 4 years to
reach enough savings to offset initial investments
Only an estimate, not based on a reliable estimate of government spending of an overall dollar figure
Question 1
What are the types of service models for cloud computingA. Software as a service
B. Platform as a service
C. Infrastructure as a service
D. All of the Above
Question 2
Early adopters are more likely to be grouped into which deployment cloud typeA. Public
B. Hybrid
C. Private
D. Community