Kyle Casper - Welcome to the Cloud!

Welcome to the Cloud!

Cloud computing is the next phase in the Internet's evolution. With tremendous capabilities of providing the means through which everything, from computing power to computing infrastructure, applications, business processes to personal collaboration, can be delivered to you as a service via the internet (Hurwitz). What makes it so attractive one may ask? Being able to access one’s information wherever and whenever need be. Cloud computing is on the verge of becoming the most impactful and fundamental shifts in how computing is applied. The government will play a lead role in utilizing cloud computing for data storage, applications, and processing power (Wyld). Despite overwhelming advantages, cloud computing does have disadvantages. Being strictly internet based technology; it shares the same vulnerabilities as any other application or system dealing with the World Wide Web. One issue that becomes a major concern of cloud computing is the security of the data. Possible solutions and precautions have been and are continuing to be researched. Cloud computing is going to have a huge impact on the way companies do business and the world’s economy as a whole.

There are many people confused about the concept of cloud computing. It is relatively new and will become well known amongst our American businesses over the next few years. The “cloud” in cloud computing is the set of hardware, networks, storage, services, and interfaces that combine to distribute features of computing as a service. Cloud services include the delivery of software, infrastructure, and online storage. These services can be delivered as separate individual components or as an entire platform. All of this is at the user’s demand via the internet (Hurwitz).

Cloud computing is offered in three different forms and it consists of essential characteristics. There are public clouds, private clouds, and hybrid clouds, which are combinations of public and private (Hurwitz).
Cloud computing has a high cost of computing which exceeds the costs of the physical system itself. It also requires highly specialized labor to keep it running well. These issues are addressed by the essential characteristics of cloud computing (Durkee). On-demand access offers quick completion of demand for computing and has the on-going ability to achieve that demand as required. Elasticity allows computing to be provided in the amount required and disposed of when no longer needed. Cloud resource costs are based on the quantity used which makes it amazingly flexible. This tremendous flexibility is what is attracting individuals and businesses to move to the cloud (Hurwitz). All of the servers are connected to a high-speed network that allows data to flow to the Internet and also between computing and storage elements. Cloud computing allows for huge resource pooling. The cloud provider's infrastructure is shared across a number of end customers which provides economies of varying range at the computing and services levels. Cloud computing requires little or no commitment which also attracts customers (Durkee).

Not all businesses have the same needs. To apply to a much wider market the cloud is divided into three basic service models, each addressing a specific business need. The first model is the most basic of the cloud service models. In an IaaS (Infrastructure as a Service) model, the end customer is purchasing raw compute, storage, and network transfer. This service type is delivered as an operating system on a server with some amount of storage and network transfer. IaaS can be delivered as a single server or as part of a group of servers integrated into a VPDC (virtual private data center). The second model is PaaS (Platform as a Service) which is the next layer up on the cloud stack. The end customer purchases an application environment on top of the core infrastructure. Some examples of this model would be application stacks: Ruby on Rails, Java, or LAMP (Durkee). PaaS has quite an advantage; it allows the developer to buy a fully functional development and/or production environment. The final model is SaaS (Software as a Service). This currently is the highest layer in the cloud stack. The end customer purchases the use of a working application. Some examples of SaaS are NetSuite and SalesForce.com (Durkee).

There are many tasks that are done in computing. Whether the consumer is on an individual personal computer or in a corporate data center, they can perform tasks such as storing data to communicating via email to collaborating on documents or calculating numbers on large data sets (Wyld). The basic idea behind cloud computing is that any of these tasks can be shifted to the cloud. One of the major advantages of cloud computing is that it enables users to interact with systems, data, and each other in a time efficient manner. This decreases the need to be concerned about the core technology. According to the Cloud Computing Manifesto: “The key characteristics of the cloud are the ability to scale and provision computing power dynamically in a cost efficient way and the ability of the consumer (end user, organization or IT staff) to make the most of that power without having to manage the underlying complexity of the technology” (Wyld).

The increase in growth of cloud computing is one worth noting. Global IT spending hit $3.4 trillion in 2008. Nearly ten percent of the $64 billion spent on business applications worldwide in 2008 was spent on cloud computing applications. Growth rates for cloud computing is expected to grow in excess of 20-30% or more for years to come. It is estimated that the global market for cloud computing services could reach $42 billion by 2012. It is also predicted that it will grow to over $150 billion annually by 2013 (Wyld). Over 500 IT decision-makers were surveyed in the 2009 Cloud Computing Survey. According to the results, the shift to cloud computing can be easily seen because organizations are increasingly relying on new technologies to cut their IT performance costs, but not their IT organization’s stability (Wyld).

The real question many IT departments have been asking is whether the transition cost to cloud computing will be low enough to benefit from. Recent evidence suggests that leading cloud computing vendors, like Amazon, are realizing that the current cost motivation may not be enough. Pricing models are expected to get even more competitive as Microsoft gets ready to launch Azure and Google App Engine gets ready to open up to cloud computing (Hinchcliffe). To get a better understanding of cloud computing costs refer to the following tables:

* - The Effective Hourly Rate is computed based on full-time (24x7) usage.

These prices reflect computing power and some scratch storage. Dedicated long-term storage requires a separate cloud computing service and other features as well. This comparison is of raw core compute power only. It is estimated that a cloud data center of 100 servers could be operated around the clock on EC2 for well under $5 an hour, or just under $38,000 a year in servers, power, cooling, facilities, basic operations (Hinchcliffe). Compare this with the pricing recently announced for Microsoft Azure:

According to the table, Microsoft is slightly cheaper than Amazon for Windows instances by $0.005/hour than for the time being. Microsoft announced that when Azure launches, it will offer subscriptions that “provide payment predictability and price discounts that reflect levels of usage commitment” (Hinchcliffe). The downfall to Microsoft’s cloud, which will most likely remain unchanged, is that Unix/Linux is unable to run on it at all. Amazon and Microsoft both offer three and a half nines of service level availability (99.95%). That means about 4 hours of expected but unscheduled downtime a year for a business (Hinchcliffe).

The last of the major three cloud service providers is Google App Engine (GAE). It shares the same price of $0.10/CPU hour as Amazon's EC2 for on-demand instances (Hinchcliffe). GAE has restrictions in terms of what it will run in its cloud. It supports only Java and Python appications at this time. An advantage of GAE’s cloud is that it’s free for production use to a limit of 6.5 CPU hours per day and one daily gigabyte of transfer (Hinchfliffe).

In order to analyze cloud computing the advantages and disadvantages must be compared. There are many advantages of joining the cloud (Miller). Cloud computing significantly helps increase savings for a company. Since it is only required to purchase the necessary infrastructure, support equipment and communication costs only once, the expenses on the investment are reduced tremendously. Another way cloud computing saves a lot of money and energy for a company is because replacing the equipment that is under contract and expanding it is easily done. Everything is attached to the cloud, including all applications and infrastructure. A simple connection to the cloud will allow access to any of the items stored. Cloud computing is very time efficient because all of the programs do not have to be installed on every computer. Another advantage of cloud computing is that it’s virtual. A company can easily change the amount of bandwidth, the number of users connected to the cloud, and the number of applications available to them at any time at their own convenience (Pros).

Despite the many advantages, cloud computing does have its share of disadvantages. The SLA Agreements are the contracts that you make with your service provider. It is very important to verify all the services being defined in the contract. It is also important to understand the amount being paid for the quality of services received. Performance guarantees are almost always listed in the SLA Agreements. Make sure the performance expected is guaranteed by the contract and the cloud is able to deliver that same performance. Another major disadvantage of cloud computing is the possibility of leaking out confidential data and information through the cloud computing system. This creates a huge risk to the company and could result in an even bigger loss. Security issues are another major disadvantage of cloud computing. Every cloud computing service provider will promise to deliver demanded services. In reality, they provide different levels of quality and services when it comes to actually installing them. Finding a reliable service provider has become a tiring and time-consuming job (Pros).

Many analysts believe that with the current economic situation, and the huge financial strain placed on governments, the only viable option would be to adopt cloud computing in the public sector. The benefits of cloud computing are so large that IT organizations have been willing to withstand the challenges facing the technology. A July 2009 Computerworld reported, the larger the entity, the greater its chances would be in engaging in cloud computing (Wyld).
The impact cloud computing is expected to have on the U.S. federal government’s IT spending is one worth noting. The public sector market analyst firm, INPUT recently predicted that over the next five years, overall federal IT spending will increase at a compound annual rate of 3.5% (Wyld). This means that it will reach $90 billion by 2014. INPUT also predicts that federal cloud computing-related spending will increase almost eight times as fast, with a growth rate of approximately 30% by 2014. According to INPUT’s estimations, federal spending on cloud computing services will triple over the next five years, growing from $277 million in 2008 to $792 million annually by 2013. This shows that by 2014, over $1 billion of the federal IT budget would be specifically for cloud computing (Wyld).

The General Services Administration has recently decided to transfer its e-mail program to a Web-based system represented on Google's popular Gmail program. It reports that this transfer is part of a major government plan to increase federal use of cloud computing. The Obama administration has stated that cloud computing will permit more people to share a common infrastructure. This would cut down on technology and support costs. Federal officials hope that GSA's transfer will encourage more federal entities to adopt cloud computing for e-mail and other applications. Cloud service providers are also hoping the same (Censer).

Despite the overwhelming benefits of cloud computing, the transfer into it raises many security concerns. Security is a significant problem facing IT executives as they consider shifting data and processing to cloud providers. The main concern of cloud computing is reliability. Many of the most popular public cloud services have been known to have outages and dropped services. Some included are Gmail’s GoogleApps, Apple’s MobileMe service, and Amazon’s S3 cloud service. When service disruptions occur, it hurts the reputation of all cloud services. The security of cloud computing is a problem that will undoubtedly come up in the media each time a data breach occurs. When cloud service outages occur, most of the risk falls on the IT executives and not on the cloud computing service providers (Wyld).

One of the most obvious issues with cloud computing is the need to trust a third-party company with business-critical information and applications. A risk of losing data control is experienced anytime a business must depend on an outside source to handle any of its services (Centerbeam). In many current cloud computing contracts, it is the company purchasing the cloud’s sole responsibility to maintain the security and confidentiality of data. Many judges and other law enforcement officials believe it is fair to offer less protection to data provided through cloud computing because it is voluntarily put on a third-party server. The Electronic Communications Privacy Act dictates law officers only require a subpoena to gain access to data on a cloud, but require a warrant to search personal computers (Centerbeam). Other legislation-related difficulties also occur outside of the U.S. Information amongst cloud’s are frequently spread out in multiple data centers. Data security can become an issue because cloud providers construct their data centers in diverse international locations. Different countries have laws that vary widely regarding data security and protection versus here in the United States (Centerbeam).

Solutions to these possible issues facing cloud computing are continually being researched. There are several groups specialized in developing standards and security for clouds.. The Cloud Security Alliance (CSA) is a team created to discuss the current and future best practices for information security in the cloud. The CSA web site is also compiling information about cloud-related standards under development by other groups. The Open Web Application Security Project (OWASP) manages a “top 10” list of vulnerabilities to cloud-based or Software as a Service deployment models. The list is updated as the threat landscape changes. The Open Grid Forum publishes documents to containing security and infrastructural specifications and information for grid computing developers and researchers (Wolf). Further solutions and precautions may require Governments to step in and create new legislation to support cloud computing trends. This will allow the technology to become much more secure (Centerbeam).

The cloud is growing exponentially fast and being adopted in a wide variety of industries. Cloud computing is on the verge of becoming the most impactful and fundamental shifts in how computing is applied. The government has been increasingly utilizing clouds. The advantages overpower the disadvantages. The possible solutions to the issues amongst clouds seem viable and will continue to be researched and developed. From an economic stand point, companies should jump on the bandwagon and adopt cloud computing. It is going to have a huge impact on the way companies do business and it will improve the world’s economy as a whole.

Works Cited

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"CenterBeam, Inc News: Cloud Computing Facing Inherent Structural Problems." CenterBeam, Inc. - Managed IT Services & Helpdesk. 27 Oct. 2010. Web. 05 Dec. 2010. .
Durkee, Dave. "Why Cloud Computing Will Never Be Free - ACM Queue." ACMQ Site - ACM Queue. 16 Apr. 2010. Web. 05 Dec. 2010. .
Hinchcliffe, Dion. "What Does Cloud Computing Actually Cost? An Analysis of the Top Vendors - Dion Hinchcliffe's Next-Generation Enterprises." An SOA, BPM, Decision Management and Cloud Computing Guide for the Enterprise Community. 22 Aug. 2009. Web. 05 Dec. 2010. .
Hurwitz, Judith, Robin Bloor, Marcia Kaufman, and Fern Halper. "What Is Cloud Computing? - For Dummies." How-To Help and Videos - For Dummies. Web. 05 Dec. 2010. .
Miller, Michael. "Are You Ready for Computing in the Cloud?" Inform IT. Pearson Education, 3 Sept. 2008. Web. 5 Dec. 2010. .
"Pros And Cons Of Cloud Computing - Cloud Computing Advantages And Disadvantages." Lifestyle Lounge - Online Lifestyle Magazine - Lifestyle Management Tips. Web. 05 Dec. 2010. .
Wolf, Jake. "Security Issues and Solutions in Cloud Computing: Literature Review." Network Security News. 25 June 2010. Web. 05 Dec. 2010. .
Wyld, David. "Risk in The Clouds?: Security Issues Facing Government Use of Cloud Computing." Bukisa - Share Your Knowledge. 13 Oct. 2010. Web. 05 Dec. 2010. .