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Before Jumping All-in on Cloud: Cloud Myths vs. Cloud Realities

If your business isn't leveraging cloud infrastructure already, it's likely the thought has crossed your mind. Long past the ‘early adopter' stage, many seem to be both happy and successful in the cloud ... Should you join them?

hidden costs 

According to a survey by IDG Enterprise, nearly three-quarters of all U.S.-based organizations presently utilize cloud and/or hybrid-cloud tech within their businesses. As you probably guessed, that figure is predicted to increase. Some will move their existing infrastructure to the cloud, while others will indirectly utilize cloud infrastructure by taking advantage of one or more cloud native services.

Though many companies are seeing good results hosting their IT infrastructures in public clouds like AWS, Azure, Google Cloud, and others, some are beginning to re-think their dependence on the cloud and have gone back to hosting certain mission-critical IT functions in house. The cloud isn't a one-size-fits-all solution to every problem IT, and the lessons learned by many over the last decade of production cloud usage should serve as both a useful case study and a clear warning to those debating their move to the cloud.

There's no reason the cloud must be an all-or-nothing proposition. Certain workloads are simply better suited for cloud hosting than others. Careful analysis and planning should be done for each potential workload before committing to a cloud strategy.

Don't get lost in the excitement -- the cloud is not simply a magic bullet of better performance, easier management, and lower costs!

Is the cloud right for my business?

This is exactly the sort of question you should be asking before jumping on the cloud bandwagon!

It's important to begin a digital transformation journey to the cloud by first defining success in terms of your business. Before making any plans to migrate to the cloud, it's imperative you can answer these questions in terms of your business IT:

  • What IT improvements are you looking to make?
  • What are you looking to get out of the cloud?
  • What problems are you looking to solve?
  • Why are you looking to the cloud?
  • What are the limitations of your current infrastructure?
  • And often overlooked and/or under-emphasized: Exactly what does your current infrastructure deployment consist of - including all hardware, software, & services critical to your business?

To answer many of these questions, you must first understand what you have and what you are looking to gain. Only then can any cloud migration strategy have a chance at success. Successful cloud migration strategies require in-depth analysis and planning, and only then will an IT organization (and the business it supports) enjoy the full flexibility of the cloud.

Only after understanding where you are today, the limitations of your current setup and the problems you are trying to solve can you begin to decide if the cloud can offer improvements and/or solutions to those problems; and most importantly, that it won't make any of them worse! Armed with this information, you can then begin to evaluate exactly which of your workloads can, and should (if any!) move to the cloud. There are also tools available that can help you identify the best candidate workloads for cloud migration.

Cloud myth: Going cloud means large "cost savings"

The theory is that by going to the cloud, most if not all upfront capital expenditures will be eliminated (this one of the main reasons the cloud is so attractive to so many). There is a very real risk involved when building out your own infrastructure: under- or over-investing in expensive hardware, data centers, and the ancillaries can cost a lot. In the cloud, businesses need only pay for the computing resources that they use each month.

Indeed, cloud providers will tout savings at every turn: "economies of scale!", they'll say; "Pay only for what you use!", etc. It's best to take heed to what's been learned over the last decade of real-world cloud experience: cloud savings are far from a guarantee! For most, any possible savings when compared with current infrastructure costs should be considered a bonus, should they materialize -- and not a primary motivator for going to the cloud.

It's a good idea to evaluate cloud -- like all technical solutions -- based on the technological advantages, merit, and ultimately competitive advantage that it may be able to provide your business - Don't get caught up in the hype and make the mistake of assuming that cloud automatically means savings!

Cloud reality: Hidden costs abound

The reality with many cloud migrations is that they often result in very little real savings.  Many executives (to the short-term delight of stockholders) take advantage of the fact that a move to the cloud, even without any real "bottom line" savings - results in a large chunk of previously-budgeted cap-ex being wiped from the budget, instead shifting costs to an op-ex model where those large up-front capital expenditures are replaced instead by a regular monthly outlay.

Through the magic of accounting, those monthly expenditures (even if they're larger overall) can show a net cost reduction - on paper! The how isn't the subject of this discussion, but in a nutshell: by eliminating "ownership" and associated capital outlay for large swaths of expensive IT hardware and related equipment (all of which are ‘depreciating assets'), the company's year-over-year expenses are lowered.

At the end of the day, these are less ‘secrets', and more simply good things to keep in mind. Depending on your business and your workloads, a move to the cloud may make sense. Before hopping onto the cloud bandwagon, however, it's a good idea to take the time to really familiarize yourself with what you'll lose by going to the cloud. If you don't have stockholders to please, fancy accounting can only do so much good. To many, giving up control of their IT infrastructure simply isn't worth the tradeoff.

Cloud myth: Only pay for what you use

Capex vs opex aside, it's a widely held belief that cloud infrastructure does save money at the end of the day because it's priced "on demand", a.k.a. You only pay only for what is used. 

In theory, there's truth to this: a mature, well-managed cloud infrastructure can eliminate the risk of over- or under-sizing (and therefore, overspending!) for capacity when compared to a physical infrastructure, which requires the purchase of a fixed, physical amount of computing equipment based on an estimated demand calculation.

By leveraging the on-demand scalability of cloud infrastructure, IT organizations can eliminate situations where a large percentage of idle servers sit consuming electricity while doing no work, and can conversely eliminate risk of coming up short on compute resources should a period of high demand trigger an un-predicted load spike... Cloud infrastructure automation can quickly scale your deployment thus providing the necessary resources to meet the exact compute demand!

...As usual, however, the truth of the matter isn't so simple. Unlike fixed infrastructure costs, when you operate in the cloud, your expenses have no real upper limit, either...!

Cloud reality: No spending limits!

On premise infrastructure has an easily understood ‘max' monthly cost.  Take the price paid for physical servers, add the cost of the data center space (even if it's all leased), add the power bill and any supplemental cooling costs, then add depreciation, etc.

The total costs are easily quantified by any competent accounting department. Whether the servers are at full load or mostly idle, the cost doesn't fluctuate all that much. There's a clear maximum cost per month for your on-prem infrastructure, and very little variance: on the rare occasion you notice that resource utilization for one or more key business applications has surpassed comfortable load limits, order a few more machines at a predictable cost.

The cloud lacks this cost ceiling entirely. There is no real upper limit on the amount of cloud compute resources that can be consumed in a given month!

Take for example how easily developers can conveniently spin up new cloud instances on demand -- let's say, for testing different iterations of their code. Instances are available almost instantly to test as they please; one environment for load testing, another to develop the next version concurrently... Your developers will take advantage of this flexibility, and will quickly automate the generation of hundreds, thousands -- and even tens of thousands of instances (from an effort standpoint, it's all the same in the cloud!) -- each of which generates a new line-item on your monthly bill.

Worse yet, should those thousands of instances be left up and running after the developer finishes his testing and not properly "shut down" -- the bills keep coming!

"Pay as you go" can result in advantages for those who require extreme infrastructure flexibility: most often, it's extremes - the smallest and the largest infrastructures (Amazon, Google, Facebook, etc.) who gain the most benefit from the flexibility the cloud offers. The agility and elasticity of the cloud, along with its automated management features make a good argument for consideration.

 

For many IT organizations (e.g. those that aren't Google/Facebook/etc. sized), this extremely powerful, flexible, and  automated building and scaling can be a real risk factor - that itself must be carefully planned and tested for.

The wrong script - a fat-fingered "infinite loop" - could result in a month's worth of billing that could really, really make someone regret migrating - it could truly cost a startup, and even some more established operations their business!

Make the Cloud Work for You: Instead of all-or-none, consider each workload individually!

If you're serious about the cloud, and the future of your IT organization, take the time to do due diligence on the ins-and-outs of how to best take advantage of what different cloud vendors have to offer. Depending on how data is used and by whom, many will find that a hybrid cloud infrastructure approach will suit their organization best.

Each workload should be carefully evaluated, and its performance requirements understood. Both the advantages and disadvantages of moving each workload to the cloud must be understood. Certain mission-critical and/or sensitive data is often best kept on site, local to employees who need immediate access, while other workloads will be well suited to the cloud.

High-performance compute resources in the cloud are extremely expensive, and for all intents and purposes, however, the cloud (and therefore your cloud workloads) are still ultimately limited by the speed limits of WAN connection backbones, and ultimately the speed of light in terms of latency / round trip time. Because of these limitations and the high cost of performance in the cloud, at least for the foreseeable future, dedicated local servers are still a great option for all the reasons previously discussed. They still excel in performance per dollar, control, and security, and provide a solid argument for keeping key workloads local.

It's a Great Time to go Cloud - Just Tread Carefully.

Now that cloud technology has proven itself, has reached an appropriate level of maturity and has been widely and successfully used for over a decade, it's absolutely a great time to think about what benefits the cloud has to offer your business.

The cloud absolutely excels in things like scaling workload capacity and can't be beat when it comes to the time it takes to set up new infrastructure. Of course, all of this comes with risks. Unlimited compute power and scale at your fingertips can easily translate to unlimited expense, quickly overrunning any potential of cost savings. On the other hand, of course, if your company doesn't care about cost, but needs the flexibility, then the cloud is where you want to be.

Just remember - To successfully transform your IT infrastructure to best serve your business, your IT managers must have a comprehensive understanding of the ins-and-outs of the current infrastructure. Set up your favorite CMDB with comprehensive discovery and ensure all of the hardware, software, service, and interdependencies that makes your business tick are documented and understood. Just as an architect will have no luck adding onto a building without access to current, accurate blueprints, without an accurate map of an IT infrastructure including all hardware, software and services, networks, and most importantly, the interdependencies between it all - an IT manager cannot design their ideal IT infrastructure solution.

After all, figuring out how to get from where you are to where you want to go is only possible if you know exactly where you're starting.

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About the Author

matthew altieri 

Matt Altieri has worn many hats over the course of an exciting 17+ year career in the IT Industry, and is currently Device42's DevOps Evangelist!

Device42 helps you easily maintain an up-to-date inventory of your physical, virtual, and cloud servers and containers, network components, software, services, applications and more - Download free @ www.device42.com 
Published Friday, June 21, 2019 7:33 AM by David Marshall
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