Is the Private Cloud Really Worth It?

Arthur Cole

Is the so-called "private cloud" truly a worthwhile endeavor?

That's the question many IT professionals are asking themselves as more and more vendors pitch the concept as a way to add cloud-like functionality to existing data center infrastructures.

But aside from the complaints from purists who argue that by its nature cloud computing requires the use of external, third-party resources, there are some legitimate concerns that internal clouds may not be as useful as some proponents argue.

The primary criticism is the cost factor. The main appeal of the public cloud is that it provides a full set of IT resources without the expense, mostly on the hardware side, of building it from scratch. If you already have that infrastructure in place, or are planning to build it anyway, what exactly are you saving by turning it into a cloud?

It's a good question, but as Stephen Foskett points out in his Cloudonomics blog, the private cloud still has value even without the Capex calculation. You get a tremendous amount of flexibility when it comes to deploying new applications or shifting data loads, for example, and you also have a controlled test environment to determine what works and what doesn't before heading out to the public cloud.

That's part of the reason many traditional IT firms are looking to branch into both private and public cloud services. Microsoft, for one, has been wrestling with the delivery of its Azure service for private use. While the company has said it won't provide the service on local servers, it will add many of its features to the Dynamic Data Center Toolkit for Enterprises. That way, clients can dip their toes into the cloud at their own pace, and have an Azure-compatible infrastructure in place once they decide to go public.

And then there are companies like Rackspace, which just announced a private cloud service that is nevertheless hosted on their own architecture. Say again? How can a third-party deliver a private cloud from servers not owned by the client? By offering a single-tenant architecture for each customer rather than sharing resources among multiple customers, CTO John Engates told me.

"Private clouds are always done on dedicated infrastructure behind the private firewall," Engates said. "Ours is the same because it is still behind the customer firewall that we have dedicated to them in our datacenter. It's no different from a customer having a co-located datacenter because we are not sharing any hardware resources at all."

In this way, he said. enterprises avoid the upfront capital costs of traditional data center infrastructure, but still gain the security and availability of a private cloud. The company has also taken steps to open up its cloud architecture by issuing its Cloud Servers and Cloud File APIs under the Creative Commons 3.0 Attribution license. Developers can now copy, implement and even modify any of these specs, while ensuring that their applications are compatible across public, private or hybrid clouds.

Despite these developments, the future of the cloud is still, well, cloudy. There simply is not enough real-world experience yet to determine whether any of these approaches is truly cost-effective or provide the functionality needed by today's enterprise.

In theory, it looks good, but until the early adopters are ready to place significant data loads onto the cloud, all we have to go on is conjecture.

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Jul 30, 2009 5:12 PM Tom Bradicich Tom Bradicich  says:

Arthur, very good post on the developing topic of Private vs Public Clouds. From my experience in developing and spec'ing infrastructure for clouds, I've gained the following insights from many client/end user engagements:

1) The definition of Private Cloud varies and is developing, but I personally like to use a four-fold terminology: "Internal Cloud", "External Cloud", "Private Cloud", and "Public Cloud". A Private Cloud, in which the end user/client is the sole user, can be manifested either as an Internal Cloud or an External Cloud. I refer to it "Internal", if the end users hosts/manages it in their own data centers. The cloud can also be "Private" when hosted "External" by a third party. We have this very situation with Computing On Demand services in IBM. That is, we have clients with Internal and External Clouds, which are both "Private", in that the client has sole use of the cloud and ultimate authority. Hence all four combinations of Internal, External, Private, Public exists --- although the Internal/Public Cloud combo is rarer, but could exist in a situation where the cloud owner subs out excess capacity to a third party.

2) Private Clouds continue to have great benefit to end users who need: special security requirement, low level control of the data/apps, or the need to tweak the infrastructure in real-time (during development, peaks, etc.). I see this in the health care, government, banking, and insurance sectors, and some others. While I see some clients seeking to use a mix of both Public and Private models, many of IBM's large enterprise and government clients focusing on private clouds. Financial benefit seems to be there too, as one client in the financial services industry has seen a several hundred percent ROI from a Private development & test cloud.

What I find most intriguing and has captured some of my focus, is the emerging scenario where both an Internal and External Cloud is used. And, workloads are placed based on a variety of parameters such as cost, response time, capacity/availability, security, policy, etc. --- a "Cloud Workload Broker"...

Tom Bradicich, Ph.D.

IBM Fellow, and VP, Systems Technology, IBM


Jul 31, 2009 8:53 AM Dan Brow Dan Brow  says:

The private cloud will eventually become a part of the enviroment.   I see this especially for cloud storage, which is where I spend most of my time.  Organizations are looking to find the most effective and cost-efficient solutions for storing significant volume of existing and new data.  A lot of this data is unstructured or file-based and it needs to remain available and accessible across the organization, which has become increasingly distributed and mobile.  A private cloud storage infrastructure gives them the ability to meet the demands of the business for file storage while keeping their IP protected and secure.  One of the big changes that the cloud phenomenon has brought is the interest in having the type of infrastructure provided by companies like S3 or Google with a similar cost structure, i.e. low, and on commodity hardware.  Essentially, this is driving toward new storage technologies that are object-based, run on clusters of standard servers and has a low management overhead.  Traditional file and NAS storage doesn't meet the requirements for cloud storage, which is why we've seen product entries that are object-based like EMC Atmos and DDN WOS.  I believe this is great news for customers allowing them to take advantage of new storage technology.  It is also great to see these two storage vedors enter this market.  There are some smaller companies out there already as well and the one I'm most familiar with is Caringo, I tested their free 4TB offering.  It has been delivering object-based storage to the market for several years.  From a technology perspective, there is a lot of exciting things happening in storage these days.


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