Three market signs that a cloud revolution is brewing

A cloud revolution is coming, changing the user landscape. Major IaaS price cuts and other provider moves give hints on where cloud is heading.

Any new technology presents users -- and early adopters in particular -- with an uneasy combination of extravagant claims and immature execution. In many cases, the users with the most compelling business cases will take the risks and blaze a trail for others. When they do, they leave signposts along the way in the form of the impact of their adoption on the nature and prices of services. That's the way it has always been, and that's the way it is with the cloud. It's time we read three of those signs to see where the cloud revolution is heading.

1. IaaS price cuts. The most important market signal of the last six months is the continued decline in pricing for infrastructure as a service (IaaS). This decline is an indication that cloud providers are seeking more business by cutting prices. That's good news for the cloud consumer. However, price commoditization will make it much harder for new innovative companies to enter or survive in the IaaS marketHow will the constant reductions in IaaS pricing be viewed -- as good or as bad news?

2. IBM's server move. Another critical sign is IBM's decision to sell its x86 server business to Lenovo. It's not that IBM thinks that x86 systems have no future, but that the prices and profit margins for x86swill be under continual pressure -- not the sort of thing a big technology company wants to see. From a cloud perspective, commodity servers are a good thing because they'd cut the costs for cloud providers, and they'd also cut the costs for users who are comparing cloud costs with those of internal IT.

How will this critical development be viewed from a cloud perspective?

3. PaaS and SaaS growth. Finally, we're seeing more platform as a service (PaaS) and software as a service (SaaS) growth, as well as a growing market for "platform services," or Web services to enhance basic IaaS offerings.Why are users moving up the cloud stack? And why are providers encouraging it by focusing more on higher-layer services, those above IaaS?

These three market signs have seemingly little in common. But taken together, they signal a radical shift in the paradigm driving cloud adoption, and that's a signal of a different future for the cloud.

IaaS price cuts are a signal that the cloud giants recognize adoption will depend entirely on cloud price. The case for hosting a current app in the cloud is created by the difference between its in-house and cloud costs. Cloud cost reductions are aimed at getting more qualifying applications. This means that the adoption rate of the cloud would likely decelerate, at least in the near term, without a boost in cloud savings. The simple "virtual hosting" model of the cloud is probably already running out of steam.It's also running out of profits. The cloud providers lose revenue on every existing customer when they drop prices. Contrary to what's been written, the major cloud providers have little further economies of scale to gain.

IBM's decision to leave the x86 server market shows that the hardware there is already commoditized, so few more cost reductions in basic cloud infrastructure can be expected. All this means that cloud providers won't become better businesses because lower prices create more users; they'll become better businesses by selling basic IaaS users other cloud services on top of IaaS. The lower prices are a signal that IaaS might actually become a loss leader to get users into the cloud store to buy virtual "milk," then buy virtual "cookies" while they're there.

Moving above basic IaaS

Two things happen when you move "above" basic IaaS services in the cloud. First, your new services displace more hardware and software cost on the user side. Second, users can then justify higher prices from a cloud provider without killing cloud's incentive. IaaS displaces only hardware cost; PaaS displaces hardware, OS and middleware costs; and SaaS displaces all application costs.

The most important impact of a move from IaaS is allowing cloud providers to begin to support native cloud application development. Amazon's new Web services are clearly not designed to induce people to migrate their existing content-caching or Web-accelerating applications to the cloud; they have no such applications. It's these applications, things that can be done well only on the cloud. They will evolve from the limited "hosted server consolidation" applications of today and drive the cloud's future.

Amazon, Google, Microsoft and other cloud providers need a customer base so they can sell their cloud-specific services. Price reductions for IaaS will keep that base, and opportunities to upsell into the emerging cloud-specific service market will grow.

The more higher-layer components there are to cloud services and the more cloud-specific that applications become, the less the cloud of the future will look like the cloud of today. The notion of a "hybrid cloud" will almost disappear as agile components move freely across hosting options using these advanced orchestration concepts. Every cloud will be potentially a hybrid, so users and providers will rely on deployment and management tools that converge on a common model.

The signs are clear: The cloud is not a different hosting option for existing applications; it's a different architecture for application development. Adding the cloud hosting dimension to the tools available to developers will change forever how we write business and even entertainment applications and services. For those who relish revolution, the best news of all is that the price wars and service trends we see today are a clear sign that the cloud providers themselves think a cloud revolution is just around the corner.

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Piecing together the hybrid cloud management puzzle

Piecing together the hybrid cloud management puzzle

Managing the hybrid cloud means covering all of your bases from having a solid cloud management strategy to security. Having a plan helps to ensure high performance from the best of both cloud worlds.

Hybrid cloud gives users the ability to reap the benefits of public cloud -- including elasticity, on-demand resources and a pay-as-you-go model -- while still maintaining control over critical applications through private cloud. You could say hybrid clouds are little bit country and a little bit rock n' roll. However, that doesn't mean that hybrid cloud management is a walk in the park.

Yes, a hybrid cloud allows users to cash in on the low costs and scalability of public cloud, as well as limit the dangers of third-party exposure. But, there are many questions to answer before diving deep into the waters of hybrid cloud.

What is the true definition of a hybrid cloud?

Don't be fooled into thinking you have a hybrid cloud when, in reality, you're using separate public and private clouds. It's all about orchestration when it comes to separating the hybrids from the wannabes. Automated orchestration acts as the bridge between the public and private clouds to help move data between the two. For a true hybrid cloud model, build both cloud types on clustered COTS-based architecture rather than legacy gear. Otherwise, automated orchestration is not possible between the cloud types.

What are the keys to a solid hybrid cloud management strategy?

Fitting the hybrid cloud puzzle together is difficult when some pieces come from a public cloud and others from a private cloud. A solid management strategy is paramount for using a hybrid cloud. Managing hybrid cloud requires consistency, so configurations should be able to run on both cloud types.

No one wants billing surprises at the end of the month, so admins need tostay on top of cloud spending. Hybrid cloud users can keep costs under control with alerts for when infrastructure as a service or platform as a service expenses reach their limits.

Security concerns are always attached to the cloud, and the hybrid model is no different. Security follows the same cloud consistency rules as configurations. Admins should be proactive in planning for security breaches with data encryption and firewalls.

How can I avoid hybrid cloud security hurdles?

Data security is a benefit of private cloud, but that doesn't mean hybrid cloud is without issues. However, many of these concerns are manageable. A lack of data redundancy is a significant cause for concern -- especially when it comes to outages. Using multiple data centers creates a failover option that can limit the damage and inconvenience of an outage.

Negotiating a weak service-level agreement (SLA) can be another cause for concern around hybrid cloud security. Because a hybrid cloud is a combination of public and private, make sure the SLA takes into account both cloud environments. Your cloud SLA should cover the needs for each cloud, and not just focus on one or the other. The same goes for security tools. Authentication and other controls need to be cohesive for public and private clouds.

Compliance, or a lack thereof, is more fuel to the security concern fire. Teamwork is vital to keeping any hybrid cloud compliant, and both clouds need to maintain compliance for the entire platform to succeed.

What if my public cloud provider isn't meeting my expectations?

If your public cloud provider is letting you down, then it's time to part ways. Your hybrid cloud strategy should include a backup provider so you don't have to deal with unexpected costs, poor service or providers dropping the ball on the SLA. But, don't go from one bad provider experience into the arms of another. Make sure your backup provider won't expose you to vendor lock-in. Also, ensure your backup provider is compatible for current and future cloud workloads so you don't have to rearchitect applications. 

How can I combat hybrid cloud deployment issues and manage applications properly?

Even though hybrid cloud is the best of both worlds, you still need to work out some deployment kinks. Each cloud has unique needs and if those needs aren't met, problems will arise -- such as latency and dependency. Planning ahead for these issues when migrating apps from private to public clouds and having a strong understanding of your cloud SLA keeps your hybrid cloud running smoothly.

To get the best hybrid cloud application performance, carefully map out your cloud architecture to determine where the application best fits. An app with poor performance slows down the entire enterprise and frustrates end users and consumers.

About the author:
Nicholas Rando is assistant site editor for SearchCloudComputing. You can reach him at nrando@techtarget.com.

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