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Scalability

CloudComputingprovidesbusinesseswiththeabilitytoregulatethe
serviceinaccordancewiththeircurrentrequirements:
Scalecapacityupanddownasneeded
Infinitecomputingcapacityondemand
Flexibilitythroughcloudbursting
BusinessAgility

Abilitytohandleexpectedorunexpectedchangesinload
Reducedtimetodeployanapplicationintoproduction
CostEfficiency

Thecustomerpaysjustforwhattheyneed,resultingindirectly
proportionalcosts.
Thecustomeravoidsprovisioning(andpaying)forthepeakasa
permanentfixture
MovefromalargeupfrontCapEx costtoacomparativelysmall
monthlyOpEx cost
ICTcostsaremoretransparenttothebusiness
CostEfficiency(Cont.)

Thecustomerdoesnothavedepreciablehardwareassets
TechnologyrefreshistheresponsibilityoftheCloudProvider
Theproviderpasseshardwaremaintenancecostsontothecustomeras
partofthepredictablemonthlyfee,therearenounexpectedcosts
CompetitiveAdvantage

Organisationscanrespondquicklytoevolvingmarkettrendsandfocus
ongrowingtheircorebusiness
Reducingcapitalspentoninfrastructurereleasesfundstoinvestin
innovationorotherpriorityareas
Productivity

ITstaffcanfocusmoreonstrategicdecisionsanddevelopingand
improvingcoreapplicationsratherthanmaintainingor
troubleshootinginhouseICT
AvailabilityandReliability

AllmajorCloudProvidersfacilitiesarelocatedinhardeneddatacenters
withredundantpower,nosinglepointsoffailureandonsitesecurity
Theservicewillbecertifiedtotherelevantindustrystandardssuchas
ISO9001(Quality)and27001(Security)
Thedatacenter isbuiltbyfacilities,server,networkingandstorage
qualifiedspecialistsaccordingtobestpractice
ChecktheServiceLevelAgreementtoseewhatisguaranteedandthe
compensationiftheSLAisnotmet
Cost

Theadvantagesareallgreattohave,butadecisiontodeployCloud
Computingusuallycomesdowntotheoveralllongtermcost
TheTCOofmaintaininganOnPremisessolutionshouldbecompared
totheTCOofmaintainingaCloudequivalent,andtheadvantagesand
disadvantagesofeachfactoredinwhenmakingthefinaldecision
Itisnotaneither/ordecision.Themajorityofcompanieswhouse
CloudserviceswillhaveamixofOnPremiseandCloudsolutions
DataCenterCosts

CapEx Cost:
Hardwareprocurement

OpEx Cost:
Rackspace
Powerandcooling
Ongoingmanagement
CostingExample

OnPremisesSolution IaaSCloudSolution
Costofeachserver $6,000 Monthly $6,000
Serverrefreshcycle 5Years Yearly $72,000
Costofrunningserversperyear(power,cooling,rackspace,maintenance) $3,000 InstallationFee $0
Numberofservers 12
CostofITsupportperyearforhardwareandbackups $50,000
Tapelibraryandbackupsoftware(oneoffcost) $20,000

CapEx(No.serversxCostperserver+Tapelibraryandbackupsoftware) $92,000
OpEx(No.ofserversxCostofrunningserversx5years+ITsupportx5years) $430,000

TotalCapExplusOpExover5Years $522,000 $360,000

CostSaving $162,000

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