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Cloud Computing in the Enterprise: The Need for a Common Language for E valuation
April 2012
Adapted from Worldwide Enterprise Server Cloud Computing 20112015 Forecast by Katherine Broderick, IDC #228916, and Growth, Confusion, and Availability: Cloud Computing Attitudes Evolve in IT by Katherine Broderick and Michelle Bailey, IDC #231860

Sponsored by the Open Data Center Alliance

With virtualization now reaching the early stages of maturity, many IT groups have virtualized and consolidated all of their targeted systems and workloads. Since this major undertaking is complete, the big question for datacenter and system managers is, "What's next?" Given the need for high availability, reduced costs, and greater agility, the answer for many will be either a public cloud or a private cloud implementation, or, more likely, both. As cloud computing adoption increases, both cloud service providers and cloud subscribers need a common frame of reference for describing and evaluating infrastructure service offerings. This common way of quantifying cloud service offerings is needed to ensure that cloud subscribers can both predict performance and track the cloud services they are using. A common way of describing offerings enables cloud providers to accurately determine the capabilities of their infrastructure, price their offerings appropriately, and track those capabilities in ways that are auditable. This IDC Spotlight examines the cloud services market and discusses the role that the Standard Units of Measure (SUoM) from the Open Data Center Alliance (ODCA) can play in the adoption of infrastructure as a service (IaaS).

Cloud Computing in the Enterprise Market

As the recent recession pushed IT organizations to cut costs and consolidate, virtualization adoption increased. According to IDC research, in 2010, the number of virtual machines deployed was higher than the number of new physical servers purchased. Indeed, when IDC speaks with datacenter managers and asks them how many servers they have installed, they often respond by indicating how many virtual servers they have installed. As economic concerns continue and virtualization slowly reaches maturity, IT managers are wondering what is on the horizon. For many IT managers, the next major undertaking will be cloud computing. Cloud computing with converged systems that arrive preintegrated and ready for use (private cloud) or are offsite entirely (public cloud) offers a viable option for IT organizations to reduce complexity within their IT environment. According to IDC research, public cloud computing server hardware revenue will grow from more than $1.5 billion in 2010 to nearly $3.7 billion in 2015, representing a compound annual growth rate (CAGR) of 18.3%. Public cloud server units will grow from 491,543 in 2010 to 1,282,731 in 2015, a CAGR of 21.1%. The number of private cloud servers deployed will grow from 207,502 in 2010 to 570,532 in 2015, a CAGR of 22.4%. Private cloud computing drove $2.5 billion in server spend in 2010 and will grow to $5.9 billion in 2015, a CAGR of 18.1%.

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Not surprisingly, given these high CAGRs, the industry has experienced growing pains along the way. Public cloud service providers have experienced bandwidth constraints and subsequently performance issues, and security continues to be a top concern among potential subscribers. However, the real and perceived benefits of cloud computing are compelling. According to IDC research, the main drivers of cloud adoption are business flexibility, agility, and responsiveness. IT organizations want to be able to respond to the business faster. Often viewed as a necessary evil for the business, IT now seeks to proactively drive improved business outcomes. Ideally, cloud computing (both private and public) should enable utility-style IT where business units or IT developers can request infrastructure, platforms, or services as seamlessly as they expect the delivery of water from a faucet. This usage model would enable the datacenter to respond to business requests faster and more cost effectively and enable the company to speed time to market, respond to changing demands (by scaling back or scaling out), and, ultimately, improve customer satisfaction. It is important to note that cloud computing is not a new technology or set of technologies; in effect, the cloud is a new deployment model for delivering IT services via the Internet. As a deployment model, both public and private cloud computing options will ultimately be part of IT's overall portfolio of products and services, along with outsourcing, hosting, traditional on-premise offerings, and so on. Ideally, the appropriate deployment model would be selected on a workload-by-workload or an application-by-application basis. This is a strategic, long-term, and, in some cases, aspirational recommendation. IDC believes IT groups should consider all available deployment models, involving almost a dozen options including public cloud, private cloud, traditional IT, virtualized, outsourcing, hosting, and colocation. Different attributes of the workload and the end-user requirements will be used to select the best option for each. Ultimately, IT will end up with a portfolio of workloads scattered across different deployment models. In this scenario, it is key that a common set of metrics be employed to allow comparisons of performance and cost across these disparate environments.

Key Trends in Cloud Adoption

Private cloud continues to be more likely to be adopted over the next three years than public cloud. A comparison of IDC survey results from 2010 and 2011 confirms that enterprise IT departments are warming up to the idea of using private cloud in the next three years (36.4% in 2011 compared with only 22.8% in 2010) even faster than they are warming up to the idea of using public cloud (22.3% in 2011 compared with 20.2% in 2010). Despite the expected uptake of the computing paradigm, confusion remains in the market as to the precise definition of private cloud computing. When IDC asked survey respondents who self-identified as current private cloud users what percentage of their installed base supports their private cloud, the most common response was 75% or more. This is inconsistent with other market data IDC has gathered over the past year. IDC believes there is still confusion over the distinction between traditional virtualization and a true private cloud. The public cloud is a bit easier to understand and to recognize. There are a few workloads that organizations typically deploy on a public cloud, and the top drivers for public cloud are disaster recovery (DR) and lowering total cost of ownership (TCO). Public cloud continues to be increasingly adopted by IT departments because of these main drivers. In addition, the public cloud is used for a variety of functions related to application development and testing, collaboration, and processing capacity related to big data. As deployment model choices increase, so does the opportunity for complexity and confusion particularly related to measurement. This scenario demonstrates the need for a standard and vendorneutral method of comparison between the different options.

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Organization Profile
The Open Data Center Alliance (ODCA) is an independent organization with the mission of providing stakeholders a voice in shaping the future of cloud computing. The ODCA is developing a unified vision for cloud requirements focusing on open, interoperable solutions for secure cloud federation, automation of cloud infrastructure, common management, and transparency of cloud service delivery. Currently, the ODCA has more than 300 member companies worldwide. Membership is appropriate for both enterprise IT cloud customers and cloud service providers. To advance its mission of developing a unified vision for cloud requirements, the ODCA recently published eight Open Data Center Usage Models. These member-defined requirements document the most pressing challenges and recommended solutions for cloud deployment in four categories: Secure Federation, Automation, Common Management & Policy, and Transparency. One of the recommended usage models that ODCA created in the Transparency category is Standard Units of Measure (SUoM) for IaaS. The SUoM outlines quantitative measures for three components of IaaS that cloud providers need to consistently describe: Compute (incorporating CPU and memory) Storage Network

For compute resources, a consistent benchmark is needed so that cloud subscribers can better compare cloud offerings from the different providers. For storage, measurement units must allow comparison of capacity, performance, and quality. For networks, measurement units must allow comparison of bandwidth, performance, and quality. In addition to quantitative measures, the ODCA has outlined qualitative measures of service for IaaS. The quantitative measures take into account price, performance, and security and are designed to establish standardized measurements on four levels of service differentiation. The four proposed qualitative measures for evaluating IaaS offerings are as follows: Bronze: This represents the commodity-priced lower-end corporate requirement. Silver: This measure is a trade-off in which subscribers obtain IaaS resources for less cost compared with Gold and Platinum in exchange for lower service levels. Silver IaaS services are geared for enterprise applications. Gold: This measure is more costly than Silver IaaS and therefore comes with a higher quality of service. This level is designed for mission-critical applications. Platinum: This is the highest service level along the lines of lower-end military requirements.

The ODCA has created the SUoM to provide value throughout the service life cycle. For cloud subscribers, the potential value of SUoM is outlined as follows: Prior to use: The SUoM can be used to make informed comparisons among providers and ultimately to select the correct partner. During use: The ODCA quantitative measures can enable subscribers to evaluate service, ensure correct billing, or plan for future deployments. After use: The ODCA SUoM can help subscribers with their continuing evaluation of providers and services, especially when contemplating deploying new workloads or adding lines of business to cloud services.

2012 IDC

As cloud deployment models continue to evolve, the SUoM, as currently defined by the ODCA, will need to incorporate changes accordingly in future iterations. The success of this process will depend to a large extent on the amount of participation from industry organizations. The ODCA invites both cloud providers and cloud subscribers to contribute to the process of creating SUoM that will ultimately benefit both cloud vendors and cloud consumers.

Defining standardized quantitative and qualitative measures can eliminate much of the confusion that surrounds cloud computing. For cloud subscribers, the ability to accurately compare cloud services across numerous providers as well as weigh the cloud option in light of other IT deployment models can enable IT to select the right deployment model for the right price. The key to success is market participation in the process of defining SUoM. Employing an end user driven organization such as ODCA as the leader in this type of standards effort is a best practice to ensure extensive market participation. It is in the best interests of the customers, in this case cloud subscribers, to ensure that cloud providers, as well as the vendors that supply these providers, abide by the same rules of marketing capabilities. Once defined and accepted, standard measures can level the playing field for cloud providers and save time for customers/subscribers. Subscribers will be armed with data to devise optimal deployment models and mitigate the chance of downtime. Unfortunately, marketwide adoption of SUoM will not happen overnight, but the evolution of the SUoM is a necessary step given the growth in the cloud services market and the long-term viability of this IT deployment model.

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2012 IDC