Posted by: psilva | September 15, 2010

CloudFucius Confused: Cloud Costing Companies?

Konfuzius-1770 You heard that right.  Yeah, I know – wasn’t cloud computing supposed to save money?  All that economies of scale, pay-as-you-go, shared infrastructure, reduced CapEx and OpEx and so on has gotten real cloudy according to a recent survey.  Research company Vanson Bourne, commissioned by Compuware, found that large European companies are losing £600,000 a year due to poor performance of cloud based applications – that’s close to $1 Million USD!  These are e-commerce sites and Internet based business applications.

They surveyed 300 European IT Directors and found that 57% are slowing down, stopping or even shutting down cloud based applications until they can solve this issue.  They noted that while many organizations have large investments in cloud based systems, cloud performance management may hamper or slow the adoption rate moving forward.  84% said that they expect more accurate SLAs than simple availability especially with business critical apps.  Many respondents have experienced degraded performance to their site when a neighboring customer has a huge surge in demand.  There is finite resources available and when one customer grabs a bunch of it, everyone else can suffer. 

Organizations need to look at end to end performance from an end user perspective and not just what the cloud provider is telling them.  There are many variables when determining availability and sometimes it’s difficult to determine if it’s the cloud provider, the customer’s own infrastructure or the Internet itself.  Compuware’s Richard Stone said, "Security concerns are obviously still important but it’s clear that performance is now becoming the ‘day in, day out’ business inhibitor that has to be solved,"…"The good thing is people are aware of the issue and understand that the end-user experience can’t be compromised."  In another recent survey from Gomez, statistics show that almost one-third of consumers will abandon a slow site within 1 or 5 seconds.  I could relate this to an impatient society but I’d have to include myself.  That same survey found that 39% said speed rather than functionality was more important to a web site.

And one from Confucius: Better a diamond with a flaw than a pebble without.


The CloudFucius Series: Intro, 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21


Technorati Tags: F5, infrastructure 2.0, integration, cloud connect, Pete Silva, security, business, education, technology, application delivery, cloud, context-aware, infrastructure 2.0, automation, web, internet, blog

twitter: @psilvas 

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  1. Peter, great article. No one ever promised that the cloud provider would be efficient in how they manage and deliver their cloud. Many only promised that it would be “cheap.”

    Many recent studies by firms such as Forrester, Gartner, IDC and others are quickly identifying that many companies have some key concerns about cloud computing, and it’s not all about security. While security remains number one, resiliency, availability, and “believe cost savings claims” rank right up there as well. IBM has always taken the position that it’s not simply about cloud computing, it’s about the efficient cloud computing.

    The areas that the providers must begin to prove to their customers that they can address include: Properly matching the compute resources to the needs of the business operation; The ability to provide visibility as to what is happening as the application is running within the cloud infrastructure; The ability to show that applications will not be “fighting” each other for resources which creates a very high volume of the slowdown in the actual running of an application; and then of course that there is an effective security and risk mitigation plan.

    We have deployed hundreds of cloud solutions both building out private clouds, helping companies build and deliver public clouds, and delivering services from the IBM cloud and in all cases the cost savings are dependent on how the end using organization does it today, how efficient is the cloud delivery, and are the resources being used optimized for the application and business function. We have cases where the cost savings have been significant, and we’ve had others where the initial costs have gone up but the motivation was other driving forces like time to market, security, regulatory compliance or accessibility.

    Great article. I like the dialogue.

    • Thanks a lot Bruce! I agree that while many obstructions are related (or at least that’s what they say) to security, availability is key. I’m also of the mindset that a lot of the security responses might have to do with the fear giving up control. They say ‘security’ since that will help them keep control. BTW, I did mention IBM in a recent blog ( referring to your US Open deployment!!

      thanks again,

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