Once again, the day opens with short keynotes. 

Starting us off is James Staten of Forrester.  James gives us two words to think about in respect to cloudonomics: Down & Off.  When the application (resource) isn’t in use, you can turn it off.  When you turn it off, you aren’t paying. 

James says to write applications in  more >>

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Session Abstract: In many ways, Big Data is what clouds were made for. Computing problems that are beyond the grasp of a single computer—no matter how huge—are easy for elastic platforms to handle. In this session, big data processing pioneer Colin Clark will discuss how to discover hidden signals and new knowledge within in huge streams of realtime data, applying event processing design patterns to events in real time.

Speaker – Colin Clark, CTO, Cloud Event Processing

Colin opens talking about high velocity, big data.  more >>

Posted by brenda michelson at 7:29 pm in Big Data, Cloud Watch, data, event processing | Permalink | Comments(1)
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Speaker – Jinesh Varia, Technology Evangelist, Amazon Web Services

Jinesh is doing a nice job describing the evolution of a fictional (dating) website that is live only 3 hours a week.  In telling the story, he is walking through the site’s evolution, the developer’s knowledge of patterns (really good design practices) and the related AWS cloud offerings (patterns of use).

Pattern #1: Design for failure and nothing will fail  more >>

Posted by brenda michelson at 6:30 pm in architecture, Cloud Watch | Permalink | Comments(1)
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Cloudonomics: Private, Public, or Hybrid?

How should one quantify the ROI, costs, and benefits of cloud alternatives? What are the cost drivers of private, public, and hybrid delivery models, and how will they evolve over time? Is pay-per-use good or bad? What are the main cognitive biases in enterprise decision-making?

Speaker – Joe Weinman, Communications, Media, and Entertainment Industry Strategic Programs, HP

I’m starting the tracks with Joe Weinman’s cloudonomics session.  Joe’s session last year was a favorite of mine, so I’m back for more insights.

Joe is talking about some common cloud points/arguments that aren’t so clear.  A few comments:

  • Economies of scale are the key to cloud benefits.  Designing building your own server, is not an economy of scale. Locating near rivers and cheap power is not an economy of scale, it’s an economy of location. 
  • For larger companies, Capex vs. Opex is an accounting decision.  You can reserve cloud instances and then capitalize that expenditure.  Depends on what you need.
  • The end-state is probably going to be a hybrid cloud, some owned, some on-demand.

How to quantify value?

  1. unit cost reduction
  2. total cost reduction
  3. opportunity cost reduction
  4. time & profitability improvement
  5. revenue growth
  6. customer experience enhancement
  7. customer satisfaction / loyalty
  8. risk reduction
  9. competitive vitality
  10. life or death – winner take all dynamics

See Joe’s Meteorology slide, captured & posted by Randy Bias.

Joe referenced his 10 laws of cloudonomics. I also liked his 10 laws of behavioral economics.

Vapor or Cloud: virtualize or defer. Virtualization won’t give you 100% utilization.  Defer, is deferring the workload.  Not possible in consumer, event-driven workloads (tax filing, holiday shopping, sports event).

Hybrid: “Own the base, rent the spike”.

All other things being equal, if cloud services cost less than enterprise IT, then, use them.

If cloud services cost more than enterprise IT, then, don’t jump to conclusions.  Need to consider demand spikes / patterns.  Best to see Joe’s papers that demonstrate the math, decision factors.

Some architecture options for Hybrid Clouds:

  1. Pure Utility Cloud
  2. Mixed-Rate Hosting/Cloud
  3. Cloudbursting
  4. Front-End / Back-end – leave back-end, move front-end to cloud

Caveat: Remember the data.  If it costs more to move (network) the data payload than the resource savings, don’t do it.

Next point: Time is money, the value of on-demand.  Paper (pdf) & Abtract:

"Cloud computing and related services offer resources and services “on demand.” Examples include access to “video on demand” via IPTV or over-the-top streaming; servers and storage allocated on demand in “infrastructure as a service;” or “software as a service” such as customer relationship management or sales force automation. Services delivered “on demand” certainly sound better than ones provided “after an interminable wait,” but how can we quantify the value of on-demand, and the scenarios in which it creates compelling value?

We show that the benefits of on-demand provisioning depend on the interplay of demand with forecasting, monitoring, and resource provisioning and de-provisioning processes and intervals, as well as likely asymmetries between excess capacity and unserved demand…"

Smooth Operator: the value of demand aggregation Paper (pdf) & abstract:

“In industries such as cloud computing, lodging, and car rental services, demand from multiple customers is aggregated and served out of a common pool of resources managed by an operator. This approach can drive economies of scale and learning curve effects, but such benefits are offset by providers‘ needs to recover SG&A and achieve a return on invested capital. Does aggregation create value or are customers‘ costs just swept under a provider‘s rug and then charged back?

Under many circumstances, service providers—which one might call "smooth" operators—can take advantage of statistical effects that reduce variability in aggregate demand, creating true value vs. fixed, partitioned resources serving that demand.”

I think I’ll download some of Joe’s papers for the flight home. 

Posted by brenda michelson at 3:16 pm in Cloud Watch, economics | Permalink | Comments(1)
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I’m at the Information Technology & Logistics Council (ITLC) conference on Amelia Island in Florida.  I was invited here to speak on SOA.  Now, I’m sitting in on a cloud computing session.  The format is three mini-presentations, followed by a panel discussion.

Steve Chaffee opened quoting the Forrester paper by Gene Leganza on Enterprise Architects and Cloud Computing Adoption.  He also mentioned the citizen development aspect of cloud, as familiarized by Gartner.

First up is Chris Rafter, Logicalis is an IT Services Company.  Chris is starting with some Cloud Computing fundamentals.  After some What is Cloud? Chris is talking about how cloud computing isn’t just an IT topic.  more >>

Posted by brenda michelson at 2:31 pm in adoption, Blog | Permalink | Comments(0)
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On Friday, David Linthicum invited me on his cloud computing podcast to chat about what we heard, and didn’t hear, at the Cloud Connect conference.  Naturally, our discussion wound its way to the connections of cloud computing, enterprise architecture, service-oriented architecture and data architecture.

Our podcast is Picking Apart Cloud ConnectCheck it out.

Posted by brenda michelson at 10:11 am in Blog, enterprise architecture, enterprise integration, pundit positions, services architecture, software architecture | Permalink | Comments(0)
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