Appreciating the Fundamentals of Cloud Computing Economics

Michael Vizard

Perhaps the biggest problem with cloud computing today is not the technologies involved, but rather the way IT organizations approach it.

In a new “Hybrid Cloud for Dummies” book, Judith Hurwitz, president of the IT consulting firm Hurwitz & Associates, and other well-known industry analysts make the case that IT organizations are not taking enough of a holistic approach to managing the cloud. The economics of cloud computing, says Hurwitz, are far from simple. IT organizations, she says, need to pay particularly close attention to the characteristics of the application workloads that are being put into the cloud and, given network bandwidth fees, how much and how often data is going to need to be moved.

Without a concerted plan, Hurwitz says IT organizations are going to wind up recreating the same mess that many of them have inside their data center in the cloud, which will be even harder to manage across multiple cloud service providers. The discipline needed to manage cloud computing, adds Hurwitz, begins with an emphasis on service-oriented architecture (SOA) fundamentals because at the end of the day, cloud computing is really all about the delivery of IT as a service.

As cloud computing evolves, Hurwitz says we’re about to witness the tuning of data centers for specific classes of application workloads. Today there is a tendency to throw the same types of processors at every application. But it’s becoming apparent that analytics applications, for example, have different processing characteristics than transaction applications. How IT organizations manage the transition to a more application-workload-centric view of managing IT will ultimately define who succeeds and fails in the era of the cloud.

In the meantime, Hurwitz says IT organizations should take a giant step back from creating silos in the cloud. Without clearly defined application programming interfaces that in the future will allow cloud services to be managed as part of a larger IT strategy, cloud computing sprawl will create high management costs that will simply dwarf any of the short-term gains derived from cloud computing today.

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