When The New York Times wanted to convert a century and a half worth of its newspaper archives into PDFs for online distribution, it needed considerable computing power from its data center. But, because it was a one time job, a capital investment in equipment for its data center hardly made sense. Instead, the newspaper simply bought as much computing power as it needed from Amazon’s computing cloud for the one time job at hand.
Welcome, to the world of virtualization, a software technology that is rapidly transforming the IT landscape and fundamentally changing the way that people compute, regardless of whether they fall into the category of IT professional or Mac user.
Virtualization can be described as the separation of an apparent function (or capability) from the physical means through which it is produced. Hardware virtualization technology enables a data center to pool its physical computing, storage and bandwidth resources and dole it out as virtual machines with just the right capacity for each application. Once an application has terminated, the capacity is returned to the pool and repurposed. This enables organizations to provision, on the fly, precisely the amount of computing power to an application that needs it, as opposed to permanently allocating computer resources that may never be used. In fact, some industry benchmarks have estimated that only 10 percent of the servers in typical data centers ever reach 90 percent or more utilization rate.
Technology is emerging to apportion processor cycles, storage and network bandwidth dynamically to different applications. This “virtualized” infrastructure frees applications from a single piece of hardware so they can use resources efficiently. Amazon.com’s Elastic Computing Cloud (EC2) is one example, allowing users to buy a “data centre” over the Internet, run applications remotely, and pay by transaction volume.
Perhaps within a decade IT departments at most companies will no longer have dominion over what we now think of as corporate information technology. And savvy CIOs are starting to rethink their roles not as managers of infrastructure and systems, but as guardians of the single most important corporate jewel--data. So what might the new IT environment look like a decade from now?
In all likelihood, there will be far fewer boxes in the data center--and fewer corporate data centers to begin with – because virtualization makes it more practical for data to be hosted securely and efficiently offsite. For each type of software that remains on premise, there is a comparable variety available over the “cloud” that is accessible on multiple devices. And business applications are delivered as modular, standard services, with groups of users assembling them into customized applications (known as service-oriented architecture for corporate-grade applications and mashups for consumer-grade applications).
Rapid advances in hardware virtualization, server architecture, intelligent networks, utility computing, software-as-a-service (SaaS), and Rich Internet Applications (RIA) are beginning to make the location of computing less relevant and visible, leading to the new paradigm that has been labeled “cloud computing.” Cloud computing refers to the sourcing of some capability—hardware, software, execution of a business process—from somewhere “out there.” The users of the capability don’t know and don’t care exactly where it comes from or how it’s put together, much the same way a grateful farmer in a drought doesn’t know or care which cloud a given raindrop comes from.
Cloud computing promises these major benefits: sourcing flexibility for hardware and software, variable (as opposed to fixed) costs for IT, continuous (as opposed to step) upgrades for mission-critical enterprise software, centralized management of user software, and arguably better security against malicious attacks and data theft.
There are at least three discernible categories of cloud computing.
Hardware cloud
This is a very large and very sophisticated datacenter that lets you use its hardware—servers, storage, network—for a use-based charge. You can, among other things, run your enterprise applications, store your data or execute e-commerce transactions.
Need more processing power, storage or bandwidth during crunch time? No problem. The hardware cloud infrastructure expands or contracts to accommodate your need, and you pay only for what you use. Exactly how the provider does this or precisely where the computing takes place, you don’t know and, theoretically, you don’t care.
The growing availability of this option will help IT groups respond more rapidly to changing business needs. We see this frequently with organizations, such as The New York Times, that have one time needs, as well as with financial service companies, including banks and credit card companies, that have increased demands at a certain time of the year. When Nasdaq, for example, wanted to generate additional revenue selling historic data for stocks and funds, it needed to optimize its databases and servers to handle the increased load. It went to the cloud to create a lightweight reader application that allowed users to capture the required data. Amazon’s Elastic Computer Cloud is an example of a hardware cloud.
Software cloud
Software as a Service is specialized software (say, for customer relationship management) that runs on a hardware cloud somewhere, typically (although not always) someplace other than your own data center. Your employees use a web browser to access it; typically, you pay by the number of users, or seats.
The provider manages the hardware and software capacity needed to support the required number of seats and the service level you want. Exactly where the hardware resides or how the software is configured, the users don’t know and again, theoretically, don’t care.
SaaS continues to evolve into full-fledged platforms for which independent software vendors (ISVs) develop and deploy business applications, just as they have done for the client-server environment. As a result, businesses can opt to access the bulk of their IT capabilities (from infrastructure to software and services) directly from third parties via the Internet. Salesforce.com is an example of a software cloud.
Desktop cloud
This runs the desktop applications you’d normally install on your home or office computer (such as word processing or spreadsheets) from a hardware cloud via the Internet, yet provides you the same experience as if the application ran locally. A complex caching mechanism distributes the computation across your computer, the Internet itself and remote data centers so that you literally cannot know exactly what computation takes place where. Google Docs, Yahoo’s Zimbra and Microsoft Live are examples of desktop clouds.
Although each of these categories is mature enough for early adopters--for example, Amazon boasts more than 10 billion objects on its storage cloud; Salesforce.com reported more than $740 million in revenues for its 2008 fiscal year; and Google counts General Electric and Procter & Gamble among its users--there are some important enterprise-grade issues that are yet to be addressed.
Three issues--where data resides, the security of software and data against malicious attacks, and performance requirements--may well determine the direction in which cloud computing evolves and its very success.
Virtualization is rapidly changing the rules of the game. While certain aspects of cloud computing are relatively mature and viable today, it remains an evolving process. CIOs who understand the changing landscape and can take advantage of the opportunities stand to benefit greatly by converting fixed capital costs to variable costs and being more agile in their abilities to respond to dynamic business needs.
Kishore S. Swaminathan is the chief scientist for Accenture.
