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The Web: Save with Cloud Computing?
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May 3, 2011

The common perception is that Web cloud computing on the Web can save you a bundle, but a Forrester Research note indicates that the calculus is complicated.
By Larry Dignan

In fact, companies that don't manage resource consumption well could get the short end of the stick:

Forrester analyst James Staten makes the following points:

  • Low costs per employee can add up. A $99 per month deal for an on-demand Web CRM system works when you have just five employees. For larger companies, the math gets tricky. Toss in modules and you could be looking at a hefty annual bill.
  • Web infrastructure as a service can add up with usage - especially if you add other services like storage, load balancing, monitoring, content delivery and other items.
  • You still have operational costs. You still have to manage, secure, backup and recover cloud deployments on the Web.

So how do you make Web cloud computing pay off for you? When you manage your consumption tightly by turning off the meter. For instance, a batch report on a Web cloud platform can be completed in a few hours-once a month or week.

Vendor Responsibility

  • Physical support of infrastructure (facilities, rack space, power, cooling, cabling, etc.)
  • Abstracted services (SaaS application, hosted framework, hypervisor, virtual firewall, etc.)
  • Physical infrastructure security and availability (servers, storage, network bandwidth, etc.)
  • Basic monitoring
  • Element management

Business Responsibility

  • Your application
  • Architectural views (e.g., scalability, availability, recovery, data quality, and security)
  • Governance (who has authority/responsibility to make changes and how to make the changes)
  • Life-cycle management (birth, growth, failure, and recovery)
  • Enterprise integration (identity management, access control, etc.)
  • Testing, monitoring, diagnosis, and verification
  • Network of metadata (categories, capabilities, configurations, and dependencies)

Staten notes:

"Understanding the behavior of the applications and services you plan to deploy to the Web cloud is crucial to achieving success with cloud economics. Blindly buying cloud services and expecting substantial savings is a recipe for disaster. Understanding the business model behind the application is how you know whether cloud economics are simply a cost savings tool or a profit-maker for your company. While business buyers may provision certain cloud applications themselves, it still takes developers and IT administrators to activate infrastructure and platform cloud services. Much more importantly, it takes a CIO who can help bridge the understanding between IT and the business to make this a reality."

How many companies are tying applications to the business models that underpin them? Thought so.

In a nutshell, the Web cloud is a no-brainer for:

  • Short-term and cyclical applications.
  • Apps that fluctuate and have variable use cases.
  • Companies that can throttle resources.
  • Enterprises that can use the Web cloud to leverage new businesses and save on capital spending.

The hardest part is that companies need to monitor consumption and turn apps off with systems that sense inactivity. The rub: Many applications aren't built for this level of monitoring and neither are IT workers, who have grown up on ensuring capacity is always available.

In the end, companies need to profile apps, tools, developers and admins to gauge whether they can throttle performance enough to save money on Web cloud computing.

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