Deconstructing Cloud

Foreword

In the winter of 2012, I created a short-lived daily blog entitled Tinder Stratus. While the blog doesn’t exist in it’s daily format today, in 100 posts I was lucky enough to create some ripples in Canada’s cloud economy. Cloud was a word surrounded by hype; it was on the lips of every senior level executive of every company around the world. The problem was, no one really knew what it meant.

Explaining cloud has always been tricky. Marketers have attempted to balance the technical aspects of cloud with its business benefits but have effectively accomplished little more than promoting confusion between cloud, virtualization, and business transformation.

When I set out to write this book, and even when I wrote the blog, my goal was to figure out how to explain clearly the relevant information, without adding to the existing marketing hype. It’s a challenge because, even with this book, many readers are likely to ask: Do we really need another cloud book? The answer is yes, and I sincerely hope this is the one.

This book was written for one purpose. Much like the old Tinder Stratus blog, this book was written to deliver as much information as possible about cloud, so we can minimize the preexisting learning curve. Let’s face it: no one has time to read a stack of books and articles on cloud to gather the fundamentals they need. Instead, we need a comprehensive guide that addresses all the key issues, a guide that organizations can use so they can begin adopting these amazing new processes. The only way to do this is by addressing both the positive and negative aspects of cloud in a way that our leaders can understand. That is why this book exists.

I hope that after reading this book, organizations will begin leveraging these next-generation business practices, and we will start seeing higher adoption rates for cloud services as a result. Furthermore, I am optimistic that these ideas will help inspire the creation of more cloud services: services that will not only make organizations more efficient, but will also drive overall social change.

Cloud, Virtualization and the Rest of the Jargon

Where do we start? Cloud, virtualization: these words are commonplace today. Virtually every business magazine has run some kind of feature on cloud, and technology publications are also jumping on the bandwagon. However, many readers lack the knowledge background to fully understand these terms. Due to the speed at which technology is advancing, the learning curve for cloud and virtualization remains steep, and it’s causing headaches for organizations that must now navigate a terminology minefield if they want to begin offering cloud-related services.

Cloud is not technology; it is not a trend. Cloud is the evolution of a group of different technologies and business approaches into a single, new service delivery model. Cloud cannot exist without its technology roots, which stem from IT optimization practices mainly found in virtualization and service delivery.

What is cloud? How will it change your organization? Let’s find out.

Cloud, Without the Jargon

The term cloud is said to have originated circa 1994, when we started using the cloud as a metaphor to explain the Internet. As a symbol, the cloud was a great way to represent the resources we located offsite, content floating somewhere in the ether. In a similar fashion, the term cloud was used to describe the abstraction of resources from on-premises infrastructure. While the term itself has become somewhat of a buzzword, the origin of what we now refer to as the cloud (i.e., cloud computing) offers some perspective on our understanding of this new business model.

According to Wikipedia, the cloud’s beginnings go back much further:

"The underlying concept of cloud computing dates back to the 1950s, when large-scale mainframe became available in academia and corporations, accessible via thin clients / terminal computers, often referred to as dumb terminals, because they were used for communications but had no internal computational capacities. To make more efficient use of costly mainframes, a practice evolved that allowed multiple users to share both the physical access to the computer from multiple terminals as well as to share the CPU time. This eliminated periods of inactivity on the mainframe and allowed for a greater return on the investment. The practice of sharing CPU time on a mainframe became known in the industry as time-sharing.¹"

Many argue that Amazon was another key motivating force behind cloud computing. In 2006 Amazon launched its Amazon Web Service (AWS), as a means to leverage the extra computing power it had created in order to drive its website. Because Amazon required an inordinate amount of computing power during peaks such as holiday seasons, the company tried to figure out a way to offer its extra resources as a service to other organizations during off-peak periods. This led to the introduction of AWS, and the first form of traditional cloud computing, as we know it today.

Cloud computing leverages computing resources (such as hardware and software) delivered as a service over a network (typically the Internet). Generally located offsite, cloud computing can optimize use of low-cost resources (such as processors and storage), new efficient computing platforms, and high-capacity networks in order to deliver business services more efficiently and at a lower cost.

Cloud’s flexibility comes from enabling end users to gain access to remote resources from a wealth of devices, by use of a web browser or application as the main point of access. Due to the flexibility of the cloud platform being rooted in virtualization, cloud computing enables organizations to apply new hardware and software approaches to business applications, resulting in improved manageability and less maintenance while scaling resources to manage computing requirements and minimizing costs.

Cloud, however, isn’t just about how you can build new service delivery models through the application of hardware and software designs; it is about transforming your organization to capitalize on new business processes that previously weren’t easily accessible. Cloud is truly about business transformation. It is about doing more with less.

The real benefit of the cloud model comes from new service models that are being offered by service providers. Traditionally, organizations had to build their own IT environments, and the innovation of the organization was tied to the IT department’s ability to enable the business to leverage those innovations. If your IT team could provide the latest applications and resources to enable a business transformation project, there was a higher chance for overall business innovation. Sadly, unless you were a multi-million-dollar startup, the skillsets and funding required for these projects were scarce, and the ability to thrive on the innovational edge wasn’t entirely realistic.

This is where the traditional cloud model came from. Organizations that had the luxury of building large data centers to manage innovation projects were often hampered by underutilized resources that sat dormant only until periodic demand (such as holiday seasons) required them. These organizations realized that other businesses could benefit from subscribing to their underutilized resources, and this, in turn, created a new potential revenue stream for the larger hosting organization. This is where we started to see models such as Software as a Service (SaaS), whereby users are provided access to application software and databases, and the cloud provider manages the infrastructure and platforms that run these applications. This model allows organizations to reduce IT operating costs by outsourcing hardware and software maintenance, as well as support, to the cloud provider. Outsourcing these responsibilities enables the business to redirect funds previously budgeted for their management, which allows increased spending on more critical projects. As more organizations begin capitalizing on these outsourcing models, they do so knowing it will lead to greater adoption and standardization, while lowering overall costs for the entire subscriber base.

For the sake of this book, I use the term cloud as a means of describing the methodology of leveraging cloud-computing technologies. Cloud is a movement.

http://en.wikipedia.org/wiki/Cloud_computing

Virtualization: A Computer in a Computer

I can’t talk about cloud without discussing the key component that makes all things cloud possible: virtualization. Virtualization isn’t necessarily a new technology, but its pervasiveness today is why cloud is now such a hot issue. Cloud is the use of virtualization to transform the way organizations manage their IT processes through either enabling on-site virtualization of resources, or through subscribing to hosted off-site services found in cloud offerings from infrastructures as Service to Software as a Service (SaaS).

So, what is virtualization?

Virtualization is the ability to create a virtual machine (VM) that acts like a physical computer. Just as you have a computer with an operating system, storage, and processor, virtualization allows you to create the same environment, albeit virtually instead of physically. The benefit of virtualization comes from the ability to put more than one of these VMs on a server. Depending on the size of the server (host), theoretically you could have several VMs sharing that server’s resources, and in doing so, reduce the number of independent servers you actually need. You can also mix and match operating systems on the same server, so if your application needs a Linux Host, you can run it alongside another active VM or on a physical server running Windows OS.

In hardware virtualization, the host machine is the actual machine on which the virtualization takes place, with a guest machine or VM running on it. The words host and guest are used to distinguish the software that runs on the physical machine from the software that runs on the virtual machine. The software or firmware that creates a virtual machine on the host hardware is called a hypervisor, or Virtual Machine Manager. Depending on the platform, the hypervisor may have a specific name, as in the case of Microsoft’s Hyper-V.

To show what virtualization looks like, the diagrams below offer visual representations of several common builds.

Figure A shows a typical server configuration. This is how almost every server is built, with system resources (storage, processors and network functionality), an operating system, and the end applications. Keep in mind: if you create a server for every major application (databases, CRM, email, etc.), you require a veritable legion of these servers. Hence, this type of model is growing obsolete. The real limitation to traditional architecture however, is that these servers are designed to run a single operating system and a single application. This often results in an inefficient 5-20% average capacity usage per server, not to mention the maintenance required to keep this environment up and running. When one considers the expenses associated with building these servers and the capital costs required to power and cool these machines (especially if your organization has a data-center full of them), you can imagine how much money is spent by IT just to keep the lights on.

With virtualization, the goal is to take these inefficient servers and share their resources. You are no longer dedicating a server for a single application; rather, you are now running many of these applications on a single server. The beauty of virtualization is that the underlying platform allows for the hosting of multiple types of operating systems on the same host server.

Figure B illustrates how, by leveraging virtualization, you can run several of these virtual VMs, each with their own OS and application, within a single host server. Virtualization software solves the problem of one-server-one-application by enabling several operating systems and applications to run on one physical host. Each self-contained VM is isolated from the others, and uses as much of the host’s computing resources as it requires. These VMs act as independent entities, containing their own operating system and applications. They are surrounded by internal logical barriers which give them separation and independence from one another, allowing several VMs to be run at the same time on a single host.

The VMs sit on a thin software layer called a hypervisor (the software or firmware that creates the VM), and are assigned individual quotas of system resources depending on their needs, such as RAM, storage and the type of network service required. The only real limitation to how many guest VMs can run on a single host is the amount of resources available to support the functions of the VMs.

There are several key types of virtualization. Full virtualization takes the entire hardware environment and transitions it to a virtual format to run the same way as it would normally. In some other cases, organizations may wish to leave some applications unmodified, and