The Push and Pull of the Cloud. TPI Cloud Computing Overview. April 5 th 2011

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1 0 The Push and Pull of the Cloud. TPI Cloud Computing Overview April 5 th No part of this document may be reproduced in any form or by any electronic or mechanical Copyright means, 2011 Technology including information Partners International, storage and Inc. retrieval All Rights devices Reserved or systems, without prior written permission from Technology Partners International, Inc.

2 1 The Biggest Opportunity and Threat Since the Internet. Client and Market perspectives Public Cloud External services available on the Internet from a third-party service provider Hybrid Cloud Portions of the public cloud and the private cloud working with each other Private Cloud / Community? A Cloud Computing environment available on a private network. Offers security and enterprise reliability but loses the utilization benefit of the public cloud.

3 2 Promise of Cloud Computing Low or no capital expense Very fast provisioning of services Flexible capacity to quickly adapt to changes in demand Lower operating costs Reduced or no installation of releases, patches and upgrades Pay only for what s used

4 3 Cloud Computing: A Common Definition According to the National Institute of Standards and Technology, Cloud Computing is defined as: A model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. Characteristics Self-service Broad network access Resource pooling Rapid elasticity Measured service Service Models Software as a Service Platform as a Service Infrastructure as a Service Deployment Models Private cloud Community cloud Public cloud Hybrid cloud

5 4 Cloud Strategy Only 1 out of 20 clients have completed a strategy, and only 1 in five have the internal resources to develop their cloud strategies. Completed strategy 5% Will evaluate on a point solution basis 16% 21% Will seek outside assistance, 71% Don't know, 8% Currently developing strategy Haven't formalized discussions 27% Cloud not on company radar Have qualified people internally, 22% 31% n=103 Note: percentages may not sum to 100% due to rounding

6 5 Goals for Cloud Computing Cost management is the primary value driver for clients considering cloud strategies, taking 4 of the top 6 slots. Scale with business demand Drive cost reductions Increase flexibility Pay only for what we use Align cost with value Reduce capex Decrease time to market Increase infra utilization Access to new features Improve customer service Decrease licensing mgmt Standardized platforms Improve competitive advantage Improve reliability Decrease reliance on IT 10% 19% 18% Increase LOB ownership 3% n=73 26% 25% 34% 32% 32% 41% 38% 48% 64% 63% 73% 81%

7 6 Risks in the Cloud Data security is the largest concern as the market has yet to address enterprise security requirements. Clients are responding by focusing on private cloud or service provider hosted services. Data security 78% Failing regulatory requirements Integration risks with legacy systems Unclear who has access to my data Disaster recovery 51% 49% 49% 48% Co-mingling of data Up-time availability Connectivity / bandwidth Service provider viability Unclear where data is stored Response time Migration to different service 34% 33% 29% 27% 26% 25% 25% Ill defined business case 11% n=73

8 7 The Client View Ensuring quality end to end service at a fair price, in a swiftly evolving environment. In other words nothing new, yet everything is new. Needed Agility Capacity on demand Scalability Speed to Market Flexibility Lower Capital Cost savings Social Changes Komatsu signs Telstra for five years Computerworld 29 April, 2010 Komatsu Australia has signed up with Telstra for its communications needs and has migrated to the telco s managed ICT Infrastructure as a Service platform. In addition, Telstra will manage hardware and software. Moving to enterprise utility computing will give Komatsu scalable computing power and storage via a shared environment within the Telstra cloud allowing the company to add new servers or extra storage capacity on demand. Previously it took Komatsu up to two months to deliver the same capability through traditional hardware partners. CBA recruits for shared tech infrastructure 3 May 2010 Australia The bank s chief information officer Michael Harte, in a recent speech to the Committee for Economic Development in Australia (CEDA), said that the bank will never buy another data centre. CBA will never buy another rack or server or storage device or network device again and I will never let any organisation that I work for get locked into proprietary hardware or software again. I'll never tell the bank s teams in the business that it will be weeks to get them hardware provision.

9 8 Drive to the private cloud Get ready for niche, specialized clouds that companies will adopt to pick and choose from based on their individual needs. IDC August per cent will look to private standardization, 45 per cent will look to automation, 26 per cent will adopt private service level management, and 19 per cent will look at private self service models. The swing is expected to continue exponentially, with 95 per cent of companies adopting a virtualized private cloud by Gartner August per cent of those polled in the US said that they would be pursuing a private cloud strategy by 2012, and 75 per cent said that they would invest more in private clouds than in public clouds through 2012.

10 9 Client Challenges Ensuring quality end to end service at a fair price, in a swiftly evolving environment. In other words nothing new, yet everything is new. Connectivity / Reliability / Interoperability Ability to Exit Current Relationships Performance Aggregation and end-to-end Service Delivery Security Maturity Service Consistency, Stability, Leverage Application Portfolio Constraints Metering and Service Cost Management Pricing and TCO Viability of Business Case Financial viability Software Licensing Agreements

11 10 Service Provider Challenges The challenges are almost the same but from a different perspective Connectivity / Reliability / Interoperability Ability to Exit Current Relationships Performance Aggregation and end-to-end Service Delivery Security Maturity Application Portfolio Constraints Service Consistency, Stability, Leverage Metering and Service Cost Management Pricing and TCO Viability of Business Case Cannibalization Financial viability Software Licensing Agreements

12 11 Pre-Cloud Considerations Creating the ability to strategically place technology services where they best meet corporate objectives, or service portability, requires preparation. Consolidation Standardization Simplification Virtualization (of infrastructure) Modernization (of applications)

13 Cloud Adoption Challenges: Pricing Total Cost of Ownership is a more complicated discussion in the cloud computing space. For example, IaaS cloud pricing typically addresses: Unit rates Infrastructure to support the specific unit rate Expenses often not included in a cloud provider s price: Integration of cloud service with retained environment Service desk and technical support resources Migration costs to cloud Additional network bandwidth Remaining book value of stranded assets and software Remaining amortization of applications Cost of fulfilling minimum volume commitments in current contracts Costs of partial termination of existing contracts Staff to manage additional provider contracts 12

14 13 Cloud Adoption Challenges: Security Security concerns focus both on the provider s internal security and issues that arise from client use of cloud services Need to assess traditional security at cloud provider Data center infrastructure, operations and processes Recovery Time Objectives (RTO) and DR-BC practices/policy Security practices, hiring policies, employee non-disclosures Incident response and notification policies Client data security considerations include Access to sensitive data and intellectual property Geographic location requirements ( anchoring ) Access for legal discoverability, compliance, audit

15 14 THANK YOU

16 15 Copyright 2011, Technology Partners International, Inc. All Rights Reserved

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