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A Study Deciphering Benefits, Risks and Recommendations


Cloud Computing
By 1. Tarvinder Singh R. Research Associate (IT) ITM Business School Kharghar, Navi Mumbai 2. Sneha Joshi B.E( Computers) Abstract: Cloud computing means using number of computer servers through a network, which appears as as they are one single coherent computer. Cloud computing in recent times is one of the fastest emerging technology trend. The goal behind opting for Cloud computing is to save huge costs on building IT infrastructure. This papers elaborates the evolution of Cloud computing and how the cloud computing has been adopted by various enterprises. Cloud computing has been adopted in almost all the enterprise in todays world. This paper also explores on the technical description of the Cloud computing and the way it is different from Software as a Service (Saas). Key Words: Cloud computing, Saas, Components of Cloud Computing. 1. Introduction: Cloud computing can also be refferd to as the practice of using a network of remote servers hosted on the Internet to store, manage, and process data, rather than a local server or personal computer. Cloud computing can benefit and organization by saving costs on IT infrastructure, Scalability, Automatic updates, Remote access, Reliability, Skilled vendors etc.

Figure 1: Inter-relation between Cloud and Saas Source:

Cloud Computing refers to both the applications delivered as services over the Internet and the hardware and systems software in the datacenters that provide those services. The services are termed as Software as a Service (SaaS). The datacenter hardware and software is reffered to as Cloud . As per a Forrester Report (Dec 2008) more than 70% of IT budget is spent on maintenance of current IT infrastructure instead of adding new one. Inorder to better utilize the IT budget companies are opting for cloud computing. Cloud computing differs from the client-server model by providing services from a server that are executed and managed by a client's web browser, with no installed client version of an application required. Centralization gives cloud service providers full control on the versions of the browser-based applications provided to clients, which removes the continuous need for version upgrades or manage individual licenses of client computing devices.

Figure 2: The diagram shows various features of Cloud. Source:

The phrase "Software as a servive" (SaaS) is sometimes used to describe application programs offered through Cloud computing. SaaS has been lucrative, because it removes all complex activities like installation, deployment, maintenance, and it is globally accessible and affordable. SaaS resides in the cloud and takes care of the traditional worrrysome problems of VPNs . SaaS was the first progress towards Cloud computing. The main drawback of SaaS is that the data is not completely yours .The vendor can also move our data from one physical location to other which may result in increasing the latency. SaaS is vendor controlled. The SaaS vendor has control over it. SaaS service can be used for single user also by paying license cost for 1 user. Cloud software builds on Cloud Infrastructure. Similar to SaaS, Cloud Software provides instant scaling, taking mere minutes to configure and run.Depending on the vendor, Cloud Software is as easy to maintain and update as SaaS, and is globally accessible. The main difference is that, your data and applications reside on the servers that are controlled by you. Global Delivery models have changed to an extent over the years. In the beginning we had Application Development done in a Global Delivery Model (GDM) and as systems and processes improve, packaged applications were also done in a GDM. The next phase of GDM involves Cloud Computing. Cloud computing is here, and hopefully will move consumers' towards Global Virtualized Enterprises, where outsourcing and computation are integrated. While there are many definitions of Cloud, let us however start with one that we all can agree on to an extent. Consumer products and business products, services and solutions, delivered and consumed in real-time over the Internet.

National Institute Of Standards and Technology (NIST) defines Cloud computing as a model for enabling convenient, on- demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction.

Figure 3: General View of Cloud Source:

Cloud infrastructure services or "Infrastructure as a Service (IaaS)" provides computer infrastructure, virtual environent as a platform, as a service. Rather than spending money on buying servers, softwares, data center place or network elements, clients buy those resources as a service as per requirement.

2. Benefits of Cloud:

Figure 4: Comparisons of various Infrastructure solutions Source:

2.1 High availability Any web application should be available to legitimate visitors from across the globe. An efficient Cloud creates and spans multiple access points at various geographic locations around the globe. The Cloud provider must effectively receive and route incoming requests to the appropriate virtualized application on the cloud on behalf of its customers. Google and Microsoft replicate each application instance to multiple physical locations. AT&T Synaptic Hosting spans multiple locations for its enterprise customers. 2.2 Service on demand Cloud enables service on demand. We have use resources for as small as couple of hours and pay for them accordngly. This the key advantage of the Cloud. Example: Lets consider the case of a University website. The web site doesnot expect much traffic normally. But during the display of the exam results, the traffic may increase exponentially. But the increase of traffic happens only once or twice a year during the results so it is not wise for the management to buy huge infrastructure. In such a situation Cloud could really help where the university can hire infrastructure for a weeks time and just pay a small cost. 2.3 Security Security could improve due to centralization of data, increased security-focused resources, etc. As the Cloud is maintained by the Cloud provider enterprises need to be involved in security. The Cloud provider has the professionals who would further secure the Cloud. SME's may not be able to hire highly paid security profesionals, so its better for them to hire resources on Cloud.

2.4 Maintenance Maintenance cloud computing applications is not difficult, since they need not to be installed on user's computer. Due to this it is easy to support and to update because the changes can be done to clients instantly. Cloud infrastructure services or "Infrastructure as a Service (IaaS)" provides computer infrastructure as a virtual platform, as a service. Rather than purchasing servers, software, data center space or network equipment, clients instead buy those resources as a fully outsourced service. 2.5 Reduced Costs: Users of cloud need not to pay any upfront amount. They have to pay incrementally for the services they use, saving huge costs. 2.6 Flexibility and Automation Cloud computing offers more flexibility that traditional methods. Cloud is able to to change rapidly in response to the different need to different users. 3. History The term Cloud computing originates from 1960, when John McCarthy said "Computation may someday be organized as a public utility"; indeed it shares characteristics with service industry of 1960's. The term Cloud was used as a Metaphor for Internet. The actual term "cloud" borrows from telephony where telecommunications companies, who primarily offered dedicated point-to-point data circuits till 1990. Later they began offering VIRTUAL PRIVATE NETWORK (VPN) services with similar QOS and lower cost. The first player in the developement of Cloud computing was They discovered that they were using about 10% of the capacity of their data centers. So they came up with the plan of Amazon Web service (AWS) in 2006. In 2011 it is reported that many of the big corporates like Pfizer, Netflix, Foursquare, Quora etc live on Amazon's web services. 4. Types of Cloud Depending on the utility of the Cloud and types of users, Clouds can be classified as follows. 4.1 Community Cloud: A community cloud may be established where several organizations have similar requirements and seek to share infrastructure so as to realize some of the benefits of cloud computing. The cost can be shared by the organisations taking part. This option may offer a higher level of privacy, security, and/or policy compliance. In addition, it can be economic and attractive as the resources (storage, workstations) used and shared in the community have reached their return of investment. Examples of community clouds include Google's Gov Cloud. 4.2 Private Cloud: Douglas Parkhill first described the concept of a "private computer utility" in his 1966 book The Challenge of the Computer Utility. Private cloud somethimes also termed as internal cloud are implementations that

some vendors use these days to describe Cloud computing on private networks. A private cloud is a system or collection of many systems that provide hosted access to all the systems and applications that are internal to an organization. 4.3 Public Cloud Public cloud or external cloud describes cloud computing in the traditional way, where resources are dynamically provided on a fine-grained, self-service basis over the Internet. It is as termed as pay as you go manner and service is sold as Utility computing. 4.4 Combined Cloud Two clouds joined together are more correctly called a "combined cloud". A combined Cloud Comuting Environment consists of multiple internal and/or external providers, that are generally used by Enterprises. 4.5 Hybrid Clouds The main responsibility of the IT department in a non-IT company is to deliver services to the business. With the growing use of cloud computing (both private and public) and the fact that IT departments must also provide services by traditional, in-house methods, this gave rise to the term called hybrid cloud computing. Hybrid cloud is also called hybrid delivery by the major vendors including HP, IBM, Oracle, VMware and Fujitsu who offer technology to manage the complexity in managing the performance, security and privacy concerns that are results of mixed delivery methods. Hybrid delivery is expected to become the norm in data centers 5. Structure of Cloud Computing:

Figure 5: Structure of Cloud

5.1 Hardware Cloud requires huge infrastructure that include hardware and saoftware to manage the hardware. Rick Rashid of Microsoft said that around20% of the worlds's servers are sold to four companies, Micrsoft, Google, Yahoo, and Amazon. Three of the above four companies are cloud sellers. They rent small slices of their computing capacity to businesses all over the world. 5.2 Cloud Stack Cloud providers handle an entire stack of infrastructure required to deliver web applications at scale. A solid cloud computing environment abstracts the basics of a computing environment away from the implementors and lets them focus on adding value with each new application. Managed cloud hosting providers need to offer the following basic layers to stay relevant in a web developers world. 5.3 Efficient OS Web applications rely on a stable, efficient operating system to interface with hardware, manage filesystems, and allocate resources. The cloud server OS is a version of standard installations which does not need a direct hard drive interfaces or other peripherals. 5.4 Programming Language Business Logic Every Cloud computing platform involves use of a dynamic language virtual machine and an appropriate web services gateway. Language functions too closely associated with the parent operating system and its libraries are stripped away, leaving only a pure operating environment for a machine interpreter 5.5 Database storage Databases are the preferred way of persisting structured data powering web applications. Cloud service providers have fine tuned and rewrote database functionality for the cloud and opened new scope for scalable data services across multiple instances of dynamic application. Cloud databases are distributed, replicated, and are transactional. 5.6 Cache Our web applications receive multiple requests for the exact same resource. We should be able to place a pre-assembled version of our web pages, images, and data into a local memory cache for fast serving on multiple requests. The cloud architecture must include a storage cache as its first layer of request processing. 6. Discussions and Recommendations: 6.1 Thoughts of the some giants against the Cloud Computing: Although Cloud computing is considered as a useful emerging utility, but it is not appreciated and encouraged by some of the scholars in the industry. Thoughts of some of those people are listed below.

According to Larry Ellison, The interesting thing about Cloud Computing is that we have redefined Cloud Computing to include ev- erything that we already do. . . . I dont understand what we would do differently in the light of Cloud Computing other than change the wording of some of our ads.

As per Andy Isherwood, A lot of people are jumping on the [cloud] bandwagon, but I have not heard two people say the same thing about it. There are multiple definitions out there of the cloud.
Richard Stallman, known for his advocacy of free software, thinks Cloud Computing is a trap for users. If applications and data are managed in the cloud, users might become dependent on proprietary systems whose costs and service terms may changed unilaterally and adversely.

Richard Stallman used really harsh words for Cloud. He states that, Its stupidity. Its worse than stupidity: its a marketing hype campaign. Somebody is saying this is inevitable and whenever you hear somebody saying that, its very likely to be a set of businesses campaigning to make it true.
6.2 People favouring the concept of Cloud computing: Thought by some of the pioneers of the industry are against the concept of Cloud computing but there are large number of people who still thinks that Cloud computing is one one of the most useful emerging technology and provides a solution not only to SME's and new starters but also to big players.

Brad Jefferson in the favor of Cloud Computing States that, Cloud computing is really a no-brainer for any start-up because it allows you to test your business plan very quickly for little money. Every start-up, or even a division within a company that has an idea for something new, should be figuring out how to use cloud computing in its plan. Mark benoiff, CEO of one of the biggest supporters of Cloud computing said, The cloud services companies of all sizesThe cloud is for everyone. The cloud is a democracy. Vivek Kundra, Federal CIO of United states of America said, There was a time when every household, town, farm or village had its own water well. Today, shared public utilities give us access to clean water by simply turning on the tap; cloud computing works in a similar fashion. Just like water from the tap in your kitchen, cloud computing services can be turned on or off quickly as needed. Like at the water company, there is a team of dedicated professionals making sure the service provided is safe, secure and available on a 24/7 basis. When the tap isn't on, not only are you saving water, but you aren't paying for resources you don't currently need. Small businesses will now have the ability to use the same tools and techniques that larger companies enjoyed for years. They can leverage Web 2.0/ Social Media tools to connect with prospects / customers, build their brand, and use Enterprise 2.0 tools to automate systems within their workplace using free, inexpensive and simple tools.
Sahil Parikh CEO Synage 7. Reports McKinsey, the leader of strategy consultants, published a report on the Cloud computing. The report was prepared for financial services firm which engaged Mckinsey to assess whether they should move all their systems to Cloud (Amazon Web Service).

The outcome of the report has three main basic conclusions are listed below. 7.1 Cloud is more expensive: Amozon is more expensive than in house cost of running computing capacity. Amazon costs $366 per month per server as compared to $150 per month per server internally. 7.2 Companies should not focus on Internal clouds: The big task of internal cloud is server consolidation via virtualization. Therefore companies should avoid usage of Internal Clouds. 7.3 Companies can be almost efficient like Cloud providers: By leveraging server virtualization companies can utilize their servers to 35% which is close to Google's 38%. 7.4 Flaws in the report: The Mckinsey report was not accepted by number of people in the industry due to following reasons. 7.4.1 The Report does not reflect all possible scenariuos. 7.4.2 The Report tells that the maintainence caost of the server is less internally but it doest not put light on the initial cost of the infrastructure and tedious work of managing and updating the systems. 7.4.3 Also report states that the companies save only 10%(which is very small than the actual scenario) of the labour by opting for Cloud. 8. Results The results states that the utility of the Cloud matches the need of the todays Business. Because of the dyanamic changing environments, the workload can shrink or grow very fast which causes a problem for the enterprise to scale up or down immediately. Moreover the features that were used by the Technical giants,and not affordable by small enterprises due to heavy pricing can now be made available to them. Cloud does not suits well to the Financial enterprise that have sensitive data and are not willing to disclose it to the third part vendors. 9. Conclusions: Cloud computing is picking up and there are few early winners who adopted the technology. Companies that used to take 20 years to build up an infrastructure can now be done in merely weeks or months. The most dependable solutions from lnumber of vendors are still in the early stage but will definately pick up in very short time. May be the comming years will let us know whether Cloud computing is the one of the best emerging technologies of all times or just an over hyped phenomenon.

Acknowledgement My deepest thanks to Professor Dr. Charu Shri and Professor Sudipto Chakraborty for their precious guidance in writing this document. They have gone through the article and put lot of efforts to correct document when needed.

References 1. NIST Definition of Cloud Computing v15 2. Larry Ellison, Wall Street Journal, September 26, 2008 3. Andy Isherwood, ZDnet News, December 11, 2008 4. Richard Stallman, The Guardian, September 29, 2008 5. Brad Jefferson CEO Animoto 2009 6. Mark Benoiff CEO 7. Vivek Kundra Federal CIO, United States Government 8. Sys-Con Cloud Computing Journal 9. 10. 11.