DISQUS

timwessels · 2 months ago

I think you hit private clouds right on the head...the amount of effort for any IT organization to get this done correctly out of the box is probably pretty high. So the question is how much are they going to "invest" in creating their private cloud and how much better will it really be than using a public cloud? My guess is they will have to invest a lot and it will never be better than using a public cloud as the technological forces affecting public clouds will outstrip the capacity of any private cloud to keep up with them. My conclusion is that for the short to mid term private clouds will be very expensive to build and operate and will constantly lag behind the services and features that public clouds will offer.

John Treadway · 2 months ago

Tim -
There may be deficits in some functionality, and IT is not afraid of making investments when needed. There are just many cases where a private cloud will be preferred over a public cloud for the near future.

John

timwessels · 2 months ago

Hi John,
Saw you at CloudCamp Boston this past July. Enjoyed the event. You and
Dave did a great job.

2009 is turning out to be one of the worst ever years for IT investment.
Maybe large corporations will actually have access to capital and credit to
build their private clouds, but small and medium sized businesses won't. I
doubt that they will be able to borrow or obtain credit for the next round
of server upgrades and licenses for proprietary software upgrades.

Many small businesses I work with rely on credit and credit cards to operate
their businesses. The credit card companies have already reduced the number
of accounts by 15% and they are decreasing credit lines for everyone else
based on their exposure to defaults, which are now running at roughly 10%.
The more unemployment increases the worse it will get for small and medium
sized businesses. IT in small and medium sized businesses is not immune to
these changes.

The economy has entered a deflationary cycle that could last for a decade.
There is way too much private and public debt and not enough income to
service it. I suspect most small and medium sized businesses will finance
their IT operations out of accounts receivable or barter. Cloud-based IT
services are what they will turn to because they are all opex and no capex.

The economy is in much worse shape than most people are willing to admit.
Public cloud computing is one thing that will help many small and medium
sized businesses slash IT costs and hopefully survive.

tim

Ramesh Dharan · 2 months ago

[Disclaimer: I work for VMware.]

I'm curious to hear more about why you think using vCloud leads to any more lock-in versus something else? You also have a throw-away comment about how anyone who chooses VMware is already more "locked in", I'd like to hear a bit more about why you feel that way.

John Treadway · 2 months ago

Ramesh - thanks for the comment. I have been a SW vendor guy on and off since 1991. Lock-in is how you create value for your shareholders, so don't be surprised that this would be the case for VMware. If people just used ESX there would be little lock-in. A VM is a VM (almost). But by wrapping a lot of technology around this that only works with your virtualization layer, you are becoming more and more embedded in the IT process. With each new function you deliver, and customers adopt, the price for switching to Hyper-V, KVM, Xen etc. gets higher. That's lock-in. When you're the 800lb gorilla like VMware, lock-in is bad for the overall market and drives up the cost of ownership for users.

vittorioviarengo · 2 months ago

Hi John,

Great post. What about service definition and service level agreement? Doesn't the internal cloud need a way to define what the services available through the portal are and what is the SLA on them?

Ciao

Vittorio

John Treadway · 2 months ago

Vittorio - sorry for the delayed response. You are quite right on that front. Private clouds - running internally or in someone else's data center - need not only SLAs, but service governance built in (my app is getting slow, automatically scale it... etc.). I have not seen a good instance of this yet - have you?

vittorioviarengo · 2 months ago

I don't have a direct example for you but we recently did a survey of around 100 customers that are planning or building building an internal cloud and 71% of them claim to have a standard service definition in place and 48% said they have standard SLAs as well.