Initiation au Cloud

Chapter 6
Examining the Value
Proposition of Cloud
4 ArcTIC
Manel Medhioub
manel.madhioub@esprit.tn

Esprit 2016-2017
 Lesson plan

1- The value of Cloud Computing

2- Advantages and obstacles
3-The laws of cloudonomics
4- SLAs
 Introduction

• Every company must decide if cloud

computing will serve its particular needs.
• They must evaluate the potential business
value it offers and the challenges involved.
• What’s most important to them? Is it costs? Is
it control? Is it scale?

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 The value of Cloud Computing

• The Business Value of Cloud Computing (by Joe Weinman)

 address the technology or architecture of the cloud,
 incorporates discussion of quantitative and
behavioral economic factors affecting the adoption
and usage of cloud computing.
• Cloudonomics covers everything you need to
consider for the delivery of business solutions,
opportunities, and customer satisfaction through
the Cloud.
• Cloudonomics: The Business Value of Cloud Computing

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 The value of Cloud Computing
Estimated costs of infrastructure for two application servers, two database servers and a
load balancer across internal and Cloud deployment models
Internal IT Cloud

Capital Investment $40,000 $0

Setup Costs $1,000 $1,000

Monthly Services $0 $2,400

Monthly Labor $3,200 $1,000

Cost over three years $149,000 $106,000

Savings Gained 0% 29%

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Source O’Reilly Media: George Reese
 The value of Cloud Computing

• Traditional IT expenditure has been very capital

intensive:
• Hardware had to be bought outright
• Software licenses were generally an expenditure that appeared
on the balance sheet.
• Cloud computing is particularly valuable because
it shifts capital expenditures into operating
expenditures.
 decouples growth from cash on hand or from
requiring access to capital
 shifts risk away from an organization and onto the
cloud provider
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 The value of Cloud Computing

• A company wishing to grow would normally

be faced with the following options:
 Buy the new equipment, and deploy it in-house
 Lease the equipment for a set period of time
 Outsource the operation to a managed-services
organization
• The conversion of real assets to virtual ones
provides a measure of protection against too
much or too little infrastructure.
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 The value of Cloud Computing

• The infrastructure of a datacenter gain access

to low-cost electricity, high-network
bandwidth, and low-cost commodity
hardware and software
• The ability to access pooled resources on a
pay-as-you-go basis
 completely alter the economics of information
technology infrastructures
 allows new types of access and business models
for user applications.
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 Cloud Computing advantages

• Accelerated deployment of new applications

without consuming the computing resources of
the enterprise.
• Reduced capital requirements for up-front
investments in IT since the enterprise is able to
utilize the resources of CC.
• Flexibility to meet sudden changes in demand
and peaks.
• Capability to provide apps or services that meet
demand and can match future demand
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 Cloud Computing advantages

• Increase security: External cloud service

providers typically have more infrastructure
to handle data security and can also relieve
an IT organization from routine tasks,
including backup and recovery
• Improve end-user productivity: With cloud
computing, users can access systems,
regardless of their location or what device
they are using (e.g., PCs, laptops, etc.).
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 The benefits for providers

Companies become cloud computing providers for several reasons:

• Profit: The economies of scale can make this a profitable business.
• Optimization: The infrastructure already exists and isn’t fully
utilized.
• Strategic: A cloud computing platform extends the company’s
products and defends their franchise.
• Extension: A branded cloud computing platform can extend
customer relationships by offering additional service options.
• Presence: Establish a presence in a market before a large
competitor can emerge.
• Platform: A cloud computing provider can become a hub master at
the center of many ISV’s (Independent Software Vendor) offerings.

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 Obstacles and challenges

• Compliance to laws and policies varies by geographical

area.
• To ensure data privacy, additional security methods is
necessary.
• Most clouds are not interoperable with existing
applications and they limit the addressable market to
those willing to write new applications from scratch.
• The reputation for cloud computing services for the
quality of those services is shared by tenants.
• In cloud computing large data stores are possible but
they have low bandwidth connection.
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 Use case 1: parallel batch processing

• High-performance parallel batch processing

wasn’t available to many organizations before.
• Perform a complex data analysis might take a
server a month to do.
• With cloud computing you might launch 100
virtual machine instances and complete the
analysis in around 8 hours for the same cost.
• Mathematical simulations in Mathematica and
Matlab, graphic rendering in Renderman, and long
encoding/decoding tasks
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 Use Case 2

• The large array of sensors, diagnostic, and

mobile devices, all of which both generate
data and consume data, require the use of
large data sets and on-demand processing.

• The relative ubiquity of cloud computing

systems also enables emerging classes of
interactive mobile applications.

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 The laws of cloudonomics

• The various attributes of cloud computing completely change

how applications are created, priced, and delivered:
 Elasticity: You have the ability to right-size resources as
required.
• This feature allows you to optimize your system and capture all
possible transactions.
 Low barrier to entry: You can gain access to systems for a
small investment.
• This feature offers access to global resources to small ventures and
provides the ability to experiment with little risk.
 Utility: A pay-as-you-go model matches resources to need
on an ongoing basis.
• This eliminates waste and has the added benefit of shifting risk
from the client.
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 The laws of cloudonomics

• Utility services cost less even though they cost

more.
• Utilities charge a premium for their services, but customers
save money by not paying for services that they aren’t using.
• On-demand trumps forecasting.
• The ability to provision and tear down resources (de-
provision) captures revenue and lowers costs.
• The peak of the sum is never greater than the
sum of the peaks.
• A cloud can deploy less capacity because the peaks of
individual tenants in a shared system are averaged over time
by the group of tenants.
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 The laws of cloudonomics

• Aggregate demand is smoother than

individual.
• With a more predictable demand and less variation,
clouds can run at higher utilization rates than captive
systems. This allows cloud systems to operate at higher
efficiencies and lower costs.
• Average unit costs are reduced by
distributing fixed costs over more units of
output.
• Cloud vendors have a size that allows them to purchase
resources at significantly reduced prices.

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 The laws of cloudonomics

• Space-time is a continuum
• The ability of a task to be accomplished in the cloud using
parallel processing accelerates decision making providing a
measurable advantage.
• Dispersion is the inverse square of latency
• Latency, or the delay in getting a response to a request, requires
both large-scale and multi-site deployments that are a
characteristic of cloud providers.
• Don’t put all your eggs in one basket
• Large cloud providers with geographically dispersed sites
worldwide therefore achieve reliability rates that are hard for
private systems to achieve.

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 The laws of cloudonomics

• To assess and exploit the customer value and

revenue potential of the Cloud:
 Quantifies how customers, users, and cloud
providers can collaborate to create win-wins
 Reveals how to use the Laws of Cloudonomics to
define strategy and guide implementation
 Explains the probable evolution of cloud
businesses and ecosystems

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 SLA

• Service-level agreements (SLAs) are a focal

point of negotiations, contract terms, legal
obligations, and runtime metrics and
measurements.

• The SLA is the requirement of the user to

associate business value to the contract in
order to measure against the risk of service
quality degradation or failure, before agreeing
on levels.
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 SLA

• SLAs set cloud consumer expectations and are

integral to how organizations build business
automation around the utilization of cloud-
based IT resources.
• SLAs formalize the guarantees put forth by
cloud providers, and correspondingly influence
or determine the pricing models and payment
terms.

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 SLA

• SLAs issued by cloud providers are human-

readable documents that describe quality-of-
service (QoS) features, guarantees, and
limitations of one or more cloud-based IT
resources.
• SLAs use service quality metrics to express
measurable QoS characteristics: Availability,
Reliability, Performance , Scalability, Resiliency .
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 SLA

• Mapping Business Cases to SLAs

 It can be helpful to identify the necessary QoS
requirements for a given solution and to then
concretely link them to the guarantees expressed
in the SLAs for IT resources responsible.
 This can avoid situations where SLAs are
misaligned or perhaps unreasonably deviate in
their guarantees, subsequent to IT resource usage.
 If a cloud consumer has specific requirements, the
corresponding level of detail should be used to
describe the guarantees.
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 SLA

• Understanding the Scope of SLA Monitoring

 SLAs need to specify where monitoring is
performed and where measurements are
calculated

 For example, monitoring within the cloud firewall

is not always advantageous or relevant to the
cloud consumer’s required QoS guarantees.

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 Specifying SLA

• SLAs usually specify these parameters:

 Availability of the service (uptime)
 Response times or latency
 Reliability of the service components
 Responsibilities of each party
 Warranties
• SLA should like buying insurance, getting the
insurer to pay up when disaster strikes.

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 Windows Azure SLA

“Windows Azure has separate SLA’s for compute

and storage. For compute, we guarantee that
when you deploy two or more role instances in
different fault and upgrade domains, your
Internet facing roles will have external
connectivity at least 99.95% of the time.
Additionally, we will monitor all of your
individual role instances and guarantee that
99.9% of the time we will detect when a role
instance’s process is not running and initiate
corrective action.”
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 Conclusion

• The range of benefits CC can provide have long

been a sought after ideal:
 It reduces costs, allowing capital expenditure to be
converted into more manageable operating expenses
on a “pay as you grow” model
 It is highly automated and therefore more efficient
 It offers unmatched flexibility and agility
 The cloud provides increased storage(resources)
options
 It permits IT to focus on revenue-generating projects
rather than performing endless maintenance on
legacy systems.

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