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Life After the Public Cloud:

Keys to Understanding
Private Cloud Technologies
By Dave Ohara
This research was underwritten by Equinix

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Table of contents
ABOUT DAVE OHARA...........................................................................................3
ABOUT GIGAOM PRO...........................................................................................3
LIFE AFTER PUBLIC CLOUD................................................................................4
Growing pains&99999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999999.5
Using cloud metrics 999999999999999999999999999999999999999999999999999999999999999999999....................10

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
GigaOM Pro
Enabling technologies&999999999999999999999999999999999999999999999999999999999999999999999999999999999999911
A new way of thinking about data center design 99.9999999999999999999999999999999..............12
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(@(3(@ December 2011
About Dave Ohara
Dave Ohara holds a degree in Industrial Engineering and Operations from the
University of California, Berkeley. He joined HP after graduation, working in process
engineeringtype of jobs in PC manufacturing, quality and reliability, and distribution
logistics. After five years, he joined Apple to redesign its distribution logistics system
and quickly moved through a variety of HW and SW product development positions.
He has also worked at Microsoft, on Windows 3.1 Far East versions.
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Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
GigaOM Pro

- 4 - December 2011

Life after the public cloud
In less than a decade, cloud computing has come to dominate how media and web
applications are delivered, and there are good reasons for this success. Cloud
computing, roughly speaking, can be said to have four main benefits:

The cloud provides on-demand allocation of resources, which gives system
developers the perception of infinite resources for data storage, computation and
network bandwidth. With cloud computing, capacity planning becomes a
nonissue for developers, who never need to worry about their application
outgrowing the fixed capabilities of any particular data center. The on-demand
allocation of resources greatly shortens the time needed for deployment of a new
application. Theres no ramp-up time for the data center itself.
The cloud provides a self-service approach for administrators to manage
resources. For example, there might be a web portal for requesting additional
compute instances. Resources can also be managed automatically by software.
Self-service management reduces labor costs and is operationally efficient.
The cloud provides scalable resource usage. Applications can run on a single
virtual server instance or thousands of servers that are distributed across the
globe. Scaling from a few servers to thousands can be accomplished in minutes
or hours, not weeks or months. The ability to scale up quickly is one of the most
important cloud benefits for new applications.

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
GigaOM Pro
Life After the Public Cloud: Keys to
Understanding Private Cloud Technologies
By Dave Ohara
The following is an excerpt from the GigaOM Pro report,"Migrating Interactive Media
and Web Applications to the Private Cloud"


- 5 - December 2011
The cloud provides measurable resource utilization. For the public cloud, this
means that you pay as you go based on what you use. The pay-as-you-go model
helps conserve valuable startup capital, and it gives visibility to operational costs.
(For private clouds, resource measurement may take the form of
interdepartmental accounting chargebacks or monthly reports.)

It is therefore no surprise that many startups use the public cloud services offered by
companies such as Amazon, Rackspace and SoftLayer to present their initial product
offerings. Letting someone else take responsibility for networking, storage and
computing resources allows a product team to concentrate on tasks that make its
business grow. This is the promise of Infrastructure-as-a-Service offerings, and it

Growing pains
It is also true, however, that as products stabilize and audiences grow, the value
proposition of the public cloud can become less attractive for an application. Questions
of performance, control and cost come to the fore. What worked for the startup phase
of a company may not be ideal as it matures, as is the case with Zynga, whom we
profile later in this report.

These issues tend to come into play once an application has reached the point that its
operational expenditures for cloud services exceed $25,000 per month. By the time
cloud services are costing $100,000 per month, these issues may become pressing.

To understand this, it is helpful to look at an example.

Web-based applications that deliver static content such as video and software
downloads often use commercial content delivery networks. CDNs employ hierarchical
replication and distribution to reduce the distance that data must travel when a user of
the service requests a file. Files can be served from the networks edge locations, which

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
GigaOM Pro

- 6 - December 2011
are in proximity to end users. Akamai and Limelight Networks are well-known CDN
providers, although public cloud providers like Amazon and Microsoft, as well as
transit providers like Level 3, are also entering the CDN business. Even telcos have
started to develop CDN offerings for their networks. The following diagram shows the
operation of a traditional CDN.

Figure 1: media distributed to edge networks by a traditional CDN

Source: Dave Ohara/ GreenM3
The role of a CDN is being impacted by a trend toward more-interactive media-based
applications, such as the web-based game FarmVille, which attracts more users when
latency is low.

Traditional CDN design is intended for static media such as large video files.
Interactive and dynamically produced or personalized media reduce the usefulness of
the original hierarchical CDN distribution approach. An alternative to this approach is
to move some of the application logic to the edge network in addition to media files.
For example, you might build a tiered application structure where some processing is

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
GigaOM Pro

- 7 - December 2011
performed on edge servers that forward certain requests to a more centralized data
center, as seen below in Figure 2.

Figure 2: media and application logic distributed to edge networks

Source: Dave Ohara/ GreenM3
This example shows that network design and application design are often
interconnected for applications that are large enough to merit the additional
investment in this kind of customization. In other words, when an application reaches
some level of maturity, the organization is likely to have the resources to invest in a
network and application structure that is optimized for particular attributes of that
application. Different applications compete with one another based on the users
perception of performance; studies have shown that web applications for retail sales
produce progressively less revenue as latency increases. For mature applications that
have numerous competitors and predictable capacity requirements, the one-size-fits-
all approach of a public cloud provider (even with the additional support of a
traditional CDN) may fail to produce an interactive application with competitive

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
GigaOM Pro


- 8 - December 2011
Reducing network latency by integrating application and network design is one of the
reasons you might want to consider migrating to a private or hybrid cloud. In the case
described above, the application and the network need to be modified to remedy the
performance bottleneck. Its a case where system architects need more control over the
environment than what would be offered by a public cloud provider. Such a
modification would not be possible for an application that is hosted by a cloud service
provider, since the cloud service provider handles all details of the network design.

Not e: Although this paper compares public and private clouds, it is also useful to
briefly compare the private cloud approach to traditional IT. One of the interesting
consequences of building applications in the cloud is that the development and
operations teams work together more closely than in traditional IT. There are a
number of benefits to the integration of development and operations, including
timely feedback on the efficacy of decisions. With a private or hybrid cloud, changes
to the application and network structure will quickly be visible, as there will be an
increase or decrease in performance, revenue and traffic. In traditional IT,
efficiencies provided by changes to the code or the IT configuration are difficult to
identify, because they are executed by different teams and do not occur
simultaneously. For example, the deployment of additional data center capacity may
happen months after an application change is made. As a result of this lack of agility,
servers in traditional IT centers often are over-provisioned and are not configured
for the specific needs of the applications they run. Traditional IT focuses on a
centralized data center and tends to neglect the distributed nature of large-scale
Internet applications. Private and hybrid clouds, in contrast, are fully distributed
computing platforms that include network design as an integral component.

Also, it is still unclear how the existing CDN players will adapt to the trend to move
applications to edge networks. In general, the more interactive or personalized your
media distribution is for users, the less value a traditional CDN will offer. New
service providers, such as Contendo, have entered the market to focus on the problem
of content distribution in an age of highly interactive applications.

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
GigaOM Pro

- 9 - December 2011
Relying on an out-of-the-box data center and network isnt always what an application
needs. Examples of such a scenario include:
Your system architects realize that the public cloud is generic. A retail business
and a gaming business use the same public cloud even though they have very
different networking requirements. An architect can create a data center that is
tailored to your specific needs. You may even benefit from using different servers
and storage devices than are supplied by your public cloud provider.
Your websites arent as responsive as you would like. Slow response times
translate into lost revenue, because customers become frustrated and go to a
competitors site.
You rely on your cloud service provider for continuous service, but you have
experienced downtime when your sites arent available. This is an obvious source
of lost revenue.
You can improve performance to important markets by being geographically
closer to those markets.
You feel that it is risky to be completely dependent on an outside provider. From
a business perspective, you are uncomfortable with being vulnerable to changes
in price as well as to any problems with the network.
You want to control network security to decrease the risk of hacking, computer
viruses and other forms of attack.
You want to be sure that you can comply with changing regulatory standards,
such as practices for the storage and transmission of personal information.
You have realized that public clouds lower your up-front capital costs but that a
mature application may incur sizable recurring costs. Your operating expense
grows as your business grows. At a certain point the higher operating expense
outweighs the benefits of lower capital investment in infrastructure.

If any of these reasons are compelling, you will want to evaluate your situation in more
detail. Metrics and a migration strategy can help you.

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
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- 10 - December 2011

Not e: It is true that some of the largest web applications such as Netflix, Yelp,
Newsweek, IMDb, Foursquare and Zynga rely on a public cloud provider such as
Amazon. Very large organizations have the influence to negotiate custom
agreements with cloud services providers that alleviate some or all of the issues
mentioned above. For example, the largest organizations can demand custom
engineering of the network, and they can even specify where data centers are
located. There are only a handful of applications, such as Zynga and Netflix, that can
demand a custom infrastructure.

Using cloud metrics
Metrics give you a way to quantify your business objectives and to measure them over
time. Metrics and business goals should always align. Clearly uptime and cost are
concerns, but they are only two factors among many.

Network performance metrics can also be useful to help you evaluate how well the
public cloud is working for you. You may want to collect data on bandwidth, latency,
the number of hops a packet must traverse before it reaches its destination, the
amount of time it takes to establish a connection with a server, the amount of time it
takes for downloads and how often your application is unavailable because of
downtime. How metrics affect the decision is dependent on an organizations business
model. A financial institution cannot tolerate seconds of downtime, but a startup
search service could survive for minutes.

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
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Understanding private cloud technologies
From the service-oriented point of view of the cloud, the application stack can be
divided into three layers.

- 11 - December 2011
The Infrastructure-as-a-Service (IaaS) layer corresponds to physical facilities, network,
power and computing hardware. The Platform-as-a-Service (PaaS) layer includes
instances of a computer operating system that are hosted in partitions managed by
virtualization software. The Software-as-a-Service (SaaS) layer is the application,
which provides services to users who connect using the Internet. There are
opportunities for a service-oriented approach at each layer of the technology stack.
Cloud services generally operate at the IaaS layer. They provide the virtualized
resources for computing hardware and networking.

Enabling technologies
There are several technologies that enable public and private cloud computing. The
first is virtualization, which uses binary files (or images) that represent a servers
configuration and data state. With virtualization, a single server can run multiple
operating system instances at the same time, and the configuration state of a particular
virtual server ("a compute instance") can easily be replicated. For example, an image
can be loaded on many servers quickly as a way to scale up the number of compute
instances in response to higher-than-expected demand.

The second enabling technology is software that allows for automated operation of the
data center. Open-source software such as OpenStack makes it possible for you to
build a private cloud without the investment in custom management software that was
previously required. Facebook has launched the Open Compute Project, an open-
source initiative that provides cost-efficient and energy-efficient designs for data
centers and servers. The Open Data Center Alliance is another organization that offers
open-source software to create cloud infrastructures.

You can also use commercial tools to build, manage and operate cloud-based
infrastructure. Nimbula has tools to create a cloud operating system that supports IaaS
in both public and private clouds in a manner that is similar to Amazon EC2. Another
commercial tool for managing cloud environments is RightScale. (For more about

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
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- 12 - December 2011
RightScale, see the Zynga case study later in this paper.) Commercial cloud-
management software that enables enterprises to integrate the management of the
cloud with their existing IT systems is produced by all the enterprise IT software

Choosing cloud management software is daunting. It can be difficult to evaluate the
tools provided by each vendor or open-source community. Your technical team can
evaluate the different options and, in concert with the executive leadership, choose the
cloud-management software that best serves your business goals.

A new way of thinking about data center design
The service-oriented approach to cloud computing has inspired some significant
changes in the way that data centers are designed. In cloud-based designs, there is a
focus on system-level reliability rather than on redundant hardware at each layer of
the system. For example, a cloud-oriented data center would not use expensive,
redundant power supplies in an attempt to make individual servers more reliable.
Instead, the application would be written in a way that lets it continue on a new
virtualized server after a hardware failure, which may be located within the data center
or in another geographic location. Applications that are resilient to hardware failures
maintain the overall robustness of the system, even when individual components fail.
This allows a cloud-based data center to be created from inexpensive, commodity
hardware. The traditional IT data center that invests in reliability at each level of the
stack is a dying breed.

Cloud-based data center designs include the adoption of software engineering
principles by non-software disciplines. The principles of componentization and the
standardization of interfaces are used to reduce the need for each component to have
customized configuration. It is quite common now for developers to spend time in
operations, which is where the new term DevOps comes from.

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
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- 13 - December 2011
Also, note that a cloud-based approach to data center and network design requires
cooperation from all layers of the system, including the application. A private cloud
provides the same kinds of virtualized execution environments and other services as a
public cloud. In this sense, it is quite different from traditional enterprise data centers,
which generally do not provide on-demand, self-service access to virtualized
computing resources.

If you use a public cloud today, your application will generally be easier to migrate to a
private cloud than applications that run on legacy IT data centers. This represents an
opportunity to bring cloud-oriented efficiencies into the corporate data center and to
take advantage of the best practices developed in public clouds and apply them to a
private cloud.

As you consider the possibility of migrating from the public cloud to a private cloud,
you must keep in mind that the system you are building is significantly different from a
traditional data center and that creating a new team to build the private cloud may be
easier than asking existing teams to support both it and the traditional data center.

Life After the Public Cloud:
Keys to Understanding Private Cloud Technologies
GigaOM Pro
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