White. Paper. Dell and Microsoft: An Efficient and Optimized Path to Hybrid Cloud Computing. December 2015

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1 White Paper Dell and Microsoft: An Efficient and Optimized Path to Hybrid Cloud Computing By Colm Keegan, Senior Analyst December 2015 This ESG White Paper was commissioned by Microsoft and is distributed under license from ESG.

2 White Paper: Dell and Microsoft: An Efficient and Optimized Path to Hybrid Cloud Computing 2 Contents Overview... 3 Software-as-a-service (SaaS)... 3 Development and Test (Dev/Test)... 4 Cloud Backup and DR... 4 Deploying a Scalable Hybrid Cloud Architecture... 4 Additional Challenges... 5 Dell s Hybrid Cloud Platform System for Microsoft... 6 Delivering Enterprise-class Hybrid Cloud... 6 IT Transformation Enablement... 6 Independent Resource Scaling... 6 Software-defined Storage Management... 7 Automated Patch and Updates... 7 Out-of-the-box Support for Key Cloud Use Cases... 7 Dell Cloud Services and Financial Programs... 8 Enabling Rapid and Affordable Hybrid Cloud Deployment... 8 The Bigger Truth... 9 All trademark names are property of their respective companies. Information contained in this publication has been obtained by sources The Enterprise Strategy Group (ESG) considers to be reliable but is not warranted by ESG. This publication may contain opinions of ESG, which are subject to change from time to time. This publication is copyrighted by The Enterprise Strategy Group, Inc. Any reproduction or redistribution of this publication, in whole or in part, whether in hard-copy format, electronically, or otherwise to persons not authorized to receive it, without the express consent of The Enterprise Strategy Group, Inc., is in violation of U.S. copyright law and will be subject to an action for civil damages and, if applicable, criminal prosecution. Should you have any questions, please contact ESG Client Relations at

3 Overview White Paper: Dell and Microsoft: An Efficient and Optimized Path to Hybrid Cloud Computing 3 Many organizations are looking at hybrid cloud computing capabilities as a way to increase business competitiveness, enable greater business agility, and reduce the total cost of ownership (TCO) of IT. In fact, according to recent ESG research, surveyed IT decision makers regard the increased use of cloud computing services as a top cost containment strategy (see Figure 1). 1 Indeed, public cloud computing services can provide IT organizations with a way to lower costs, improve services to end-users, and help IT focus more on business innovation by offloading certain operational functions to the cloud. However, businesses need the flexibility to run application workloads in the public cloud while retaining the ability to easily repatriate these workloads back onpremises as the business demands; hence the need for hybrid cloud solutions. But if a hybrid cloud environment is difficult for end-users to use and complex for IT administrators to cohesively manage, it can result in higher costs and elevated risk to the business. For these reasons, it is critical for IT organizations to consider hybrid cloud solutions, which create a consistent experience for both end-users and administrators, whether applications are run locally or in the cloud. As importantly, to keep costs and business risk to a minimum, IT organizations need complete visibility into workloads running in their private cloud and across multiple public cloud environments. Let s take a look at some popular cloud use cases and how they can be integrated into a hybrid cloud framework to attain maximum business benefits. Figure 1. Top Five IT Cost Containment Strategies Which of the following measures if any is your organization taking to reduce or otherwise contain IT expenditures? (Percent of respondents, N=601, multiple responses accepted) Renegotiate contracts 35% Increase use of cloud computing services as alternative to in-house applications and/or infrastructure 33% Purchase new technologies with improved ROI 33% Postpone projects 25% Increase IT outsourcing 24% 0% 10% 20% 30% 40% Source: Enterprise Strategy Group, Software-as-a-service (SaaS) Cloud-based file sharing, CRM, HR and applications, for example, are often leveraged by businesses as a way to offload non-core business applications to the cloud. Since the SaaS provider is exclusively focused on maintaining and running these applications in its cloud environment, the provider can often provide better quality of service (QoS) and a more enhanced end-user experience than traditional, on-premises applications. Another potential SaaS 1 Source: ESG Research Report, 2015 IT Spending Intentions Survey, February 2015.

4 White Paper: Dell and Microsoft: An Efficient and Optimized Path to Hybrid Cloud Computing 4 benefit is that it can help IT organizations focus more on servicing revenue-generating applications rather than spending time maintaining non-core business applications. One potential downside, however, is that in the event that there is a business reason to repatriate these workloads back into a private data center environment, it can be extremely difficult to migrate that data back onpremises. Therefore, it would be ideal if businesses could utilize SaaS in a hybrid cloud context, whereby they retain the flexibility of either using these applications in the cloud or running them in a private cloud environment based on the needs of the business. Development and Test (Dev/Test) The cloud infrastructure-as-a-service (IaaS) market has largely been driven by application developers who needed an on-demand way to rapidly spin up virtualized computing resources to enable faster application development and innovation. While public cloud IaaS solutions can help improve business speed and agility, these workloads are often not visible to IT administrators and management personnel. Referred to as shadow IT or an operating environment that is not under the purview or direction of the IT organization, this situation can leave businesses vulnerable to higher costs and possibly lead to violation of corporate data governance or regulatory compliance policies. Consequently, businesses need solutions that empower their developers and end-users to consume public cloud resources, while enabling IT to maintain visibility and control over sensitive business data and cloud resource costs. Cloud Backup and DR Cloud-based backup and disaster recovery (DR) are two very popular cloud use cases. By leveraging the data center facilities of a cloud service provider, businesses can modernize their backup and DR processes by replacing onpremises tape based backup and archival solutions with cloud disk-based archival solutions. This can potentially improve recovery service levels while making IT more efficient. In addition, by replicating backup/archival and critical business information offsite to the cloud provider s facility, businesses can avoid the substantial costs associated with building out a dedicated backup and DR data center environment. Ideally, a hybrid cloud solution that utilizes the same underlying backup and DR technologies on-premises and in the cloud would greatly simplify IT operations while making local and remote data recovery processes consistent and seamless. Deploying a Scalable Hybrid Cloud Architecture In order for businesses to fully leverage the cloud, and attain all of the aforementioned benefits, they need a way to seamlessly integrate their existing on-premises application infrastructure with cloud-based computing resources. The challenge is designing and implementing a hybrid cloud architecture that can scale out to meet the ever growing demand for virtualized compute, storage, and networking resources on-premises, while enabling application workloads to fluidly migrate to and from the public cloud as the business demands. As importantly, businesses need the ability to dynamically grow and shrink application resources across their private cloud environments to maximize efficiencies and to ensure there is an adequate supply of resources at all times. According to ESG research, 34% of IT planners cite rapid elasticity as the most important capability of a private cloud infrastructure (see Figure 2). 2 Likewise, businesses need to ensure that they will be able to maintain consistent application performance and meet service level agreements (SLAs) whether workloads reside onpremises or are running in the cloud. 2 Source: ESG Research Report, Trends in Private Cloud Infrastructure, April 2014.

5 White Paper: Dell and Microsoft: An Efficient and Optimized Path to Hybrid Cloud Computing 5 Figure 2. Most Important Attribute of a Private Cloud Infrastructure Which of the five essential characteristics of cloud computing do you believe is the most important attribute of a private cloud infrastructure? (Percent of respondents, N=260) Measured service (i.e., usage-based tracking/billing), 10% On-demand selfservice, 15% Rapid elasticity (i.e., ability to add or remove IT resources as needed), 34% Resource pooling, 20% Universal network access with seamless connectivity to public cloud resources, 20% Source: Enterprise Strategy Group, Perhaps even more critical is the need to drive user adoption of the hybrid cloud solution. End-users tend to gravitate toward operating environments that are intuitive and simple to use. This calls for a solution that provides a consistent end-user experience whether applications are running in a private cloud or public cloud environment. This is especially true for application developers who want to devote more time to coding and finding innovative ways to solve business problems, and less time wrestling with piecemeal cloud componentry. Similarly, overburdened IT administrators need a consistent set of management tools across the hybrid cloud infrastructure. Ideally, there would be a single administrative portal that provides visibility and control into application workloads on-premises and across multiple public clouds. Some key questions for IT decision makers include: Are applications in compliance? Is there data in the cloud that should be secured on-premises (e.g., HIPAA, SEC-14, etc.)? How efficient are cloud workloads? Are there orphaned VMs running in the public cloud that we are being charged for? Are there opportunities to repatriate workloads that can be more cost-effectively run onpremises? With greater visibility across the hybrid cloud, IT can ensure that application SLAs are being met, costs are effectively being managed, and end-users are in compliance with corporate data governance and regulatory mandates. Ultimately, organizations need the flexibility and the choice to run workloads in a hybrid fashion, across multiple clouds, to best meet the needs of the business. And this all needs to come without sacrificing end-user simplicity and administrative control and oversight. Additional Challenges Once a business has made the decision that a hybrid cloud approach is the best way to meet its needs, there are several other critically important matters to consider prior to embarking on a deployment. First, there is the question of where to place application workloads. Approximately 20% of applications today, for example, are cloud-

6 White Paper: Dell and Microsoft: An Efficient and Optimized Path to Hybrid Cloud Computing 6 native. These may be good candidates for placement in the public cloud, but what would be the best strategy for the remaining 80% of the application environment? Likewise, should existing cloud-based SaaS applications be repatriated on-premises? Or should more non-core business applications be migrated to the cloud? Some applications might need to be completely rewritten to become cloudified, while others could simply be updated with application programming interface (API) extensions to make them compatible with cloud environments. The bottom line is that application migrations are complex and fraught with risk. In addition to potential API modifications, IT planners also need to consider how virtualized infrastructure, like server hypervisors, will interact with virtualized resources in the cloud. There could also be inconsistencies between on-premises security and network services in terms of how the cloud provider configures and provisions these services. There could also be inconsistencies in the application middleware layers. In short, all of these disparate elements can combine to make application migrations, to and from the cloud, very challenging. To address all of these seemingly intractable issues with deploying a hybrid cloud environment, Dell and Microsoft have partnered to help to streamline hybrid cloud architecture deployments. The Dell Hybrid Cloud System for Microsoft offering, provides a consistent hybrid cloud experience for end-users and IT administrators, while delivering a hybrid cloud architecture that delivers a consistent stack of virtualized infrastructure resources, cloud services, APIs, templates, and service catalogues across private and public cloud environments. Dell s Hybrid Cloud Platform System for Microsoft Delivering Enterprise-class Hybrid Cloud Dell s Hybrid Cloud Platform System for Microsoft (DHCS) is a pre-integrated and pre-validated, enterprise-class hybrid cloud solution that combines a consistent private and public cloud experience based on Microsoft Cloud Platform System Standard which includes Microsoft Azure Pack, Windows Server, System Center, and Microsoft Azure services (public cloud). The DHCS solution is a pre-integrated rack enclosure equipped with all the virtualized compute, storage, and networking resources required to support the rapid deployment of a private cloud environment. The system arrives at a customer s location with software components deployed and pre-configured to accelerate the initial setup process. And through seamless integration between Dell s DHCS solution and the Microsoft Azure public cloud, businesses can attain end-to-end hybrid cloud workload capabilities. IT Transformation Enablement As a pre-integrated solution, IT has to spend less time integrating, configuring, and deploying private cloud infrastructure, which translates into faster time-to-value and a faster path to transitioning to a hybrid cloud environment. Moreover, by combining the management of all the virtualized application resources through a single administrative interface, IT organizations can spend less time on day-to-day infrastructure management and more time on business service delivery. Independent Resource Scaling One of the most important attributes of DHCS is that it offers a highly scalable private cloud platform. Powered by Dell computing, storage, and networking technology, DHCS provides for the independent scaling of compute and storage resources. This configuration flexibility allows businesses to configure resources based on the underlying needs of mixed application workloads. For example, if the environment is more compute-intensive, then additional CPU resources can be added to DHCS. Likewise, if there is a need for faster storage I/O, additional SSD can be independently added to the platform. DHCS compute nodes consist of 2U Dell 6300 chassis configured with Power-edge C6320 servers. Each node supports four servers, and each DHCS rack enclosure can support up to 16 nodes. DHCS provides for high CPU core density up to 320 cores and 4 TBs of system memory can be configured in a DHCS rack.

7 White Paper: Dell and Microsoft: An Efficient and Optimized Path to Hybrid Cloud Computing 7 Software-defined Storage Management Similarly, DHCS provides for flexible and highly scalable storage configurations. A single DHCS enclosure, for example, can house up to 128 TBs of storage capacity. To satisfy the need for high performance and efficient storage capacity, DHCS supports a mix of high-speed SSD and highly dense HDD. DHCS integrates Microsoft s Storage Spaces, a software-defined storage solution. IT administrators have the flexibility to dynamically configure and provision storage across VMs to meet the real-time needs of application workloads. And from a networking connectivity perspective, CPS utilizes two Dell S GbE switches to provide a robust, high-speed networking infrastructure. Automated Patch and Updates Perhaps one of the most vexing and time-consuming administrative activities is performing infrastructure patching and updating. Microsoft estimates that up to 70% of valuable administrator time can be spent solely on managing patch and update processes. Dell and Microsoft have created a new integrated seamless update framework for DHCS. With this new update framework, patching and updates are delivered in a unified manner, with no disruption to operations. The actual patching process is powered with intelligent automation and dependency awareness that makes the update process simple and fast. Patches and updates are triaged, tested, and packaged prior to being made available, and the process delivers system-wide updates to firmware, BIOS, hardware drivers, and software in a unified system. By utilizing a common hybrid cloud management portal for managing and using Windows Azure Pack on DHCS for local private cloud and MS Azure public cloud services, DHCS enables businesses to provide a consistent end-to-end hybrid cloud experience for both end-users and IT administrators by providing seamless access to private cloud Azure Pack services and public cloud Azure services. And through Dell s Cloud Manager platform, businesses can integrate the management of their private cloud environment with Microsoft Azure, and other public cloud services like AWS, Google, Rackspace, etc., to control and track end-user usage and spending across multiple public clouds. By enabling IT organizations to set end-user access policies to cloud-based resources, Dell Cloud Manager helps businesses rein in shadow IT to better manage ongoing cloud costs, enhance security, and ensure adherence to corporate data governance and regulatory compliance statutes. In addition, IT organizations can drive end-user service automation using application service catalogues and customized service templates available within Dell Cloud Manager. This can enable faster application deployment times and help businesses be more agile. In effect, Dell Cloud Manager seamlessly supports MS Azure Pack and MS Azure public cloud while extending support for all public cloud services within a consistent and intuitive cloud management framework. Out-of-the-box Support for Key Cloud Use Cases Backup/DR to the Cloud Dell s DHCS is integrated with MS Azure services for backup, site recovery, and operational insights. These tools provide IT administrators with a common backup platform to protect local business data assets and applications onpremises with built-in support for moving backup and archive data offsite to the Azure public cloud. This gives businesses a way to leverage low-cost cloud storage to support long-term data retention requirements to reduce costs while meeting corporate data governance and compliance mandates. MS site recovery technology can also be utilized to replicate critical business application data to the cloud to support stringent recovery point and recovery time objectives (RPO/RTO). Furthermore, recovering in the Azure public cloud provides a consistent architectural stack to ensure the timely recovery of key business applications during a DR event, while also giving end-users a consistent experience. As importantly, by leveraging Azure public cloud facilities, businesses can attain a low-cost way to acquire DR capabilities, helping to further reduce ongoing IT costs.

8 Hybrid Cloud Dev/Test White Paper: Dell and Microsoft: An Efficient and Optimized Path to Hybrid Cloud Computing 8 Application developers can utilize Dell s DHCS hybrid cloud services to rapidly provision and deploy application development and test beds on-premises or in the Azure public cloud. This helps ensure resource availability regardless of resource constraints in the local data center. Additionally, IT administrators can monitor hybrid cloud workloads to ensure that they are running at optimal efficiency and are adhering to regulatory (e.g., HIPAA or SEC- 14) mandates. With Dell Cloud Manager you can build custom service catalogues of approved applications, stacks, and services to deploy across your user base, streamlining provisioning and eliminating the need for workflow approval. Deploy servers and applications with the click of a button while adhering to governance policies and providing a consistent user experience. Additional Dell Cloud Manager capabilities include:. Deliver multi-tier apps from the right cloud at the right time without sacrificing compliance Capture the efficiencies, scalability, and elasticity of the public cloud, and the control and security of private cloud it s your choice, you are in control Create single or multi-tier application services Consistent self-service experience across clouds through a single end-user portal Deploy services on one or across multiple clouds Dell Cloud Services and Financial Programs Enabling Rapid and Affordable Hybrid Cloud Deployment End-to-end Professional Services From cloud assessment and design to integration and managed services, Dell s professional cloud services organization can enable organizations to rapidly implement and customize their hybrid cloud environments. Businesses can opt to have Dell cloud services remotely manage any and all aspects of their hybrid cloud. This includes anything from cloud infrastructure to application performance management. Creative Financing Dell Financial Services offers a flexible way to acquire private cloud solutions through a portfolio of Scale Ready Payment Solutions. Cloud service providers and businesses can opt for any of the following financial options to affordably acquire a private cloud solution: 1. Cloud Flex Pay. Through this unique financing vehicle, Dell provides a simple way to evaluate DHCS for Microsoft for an initial six-month term. At the end of the initial six-month evaluation, you can choose to extend the evaluation for an additional 6 months, continue using the system with a customized payment plan, purchase the system outright, or return the system back to Dell. 2. Pay as you grow. Through this program, organizations can finance the deployment of a fully configured DHCS platform, but only remit payment to Dell as the actual resources are consumed by end-users. This eliminates the need to make a large, up-front capital outlay and helps businesses to reduce risk. 3. Scale on Demand. With this program, a business can acquire the entire solution up front with payments that increase as your business grows. 4. Provision and pay. Grow your DHCS private cloud over time with a cyclical plan that provides the flexibility to remit payments as resources are provisioned to cloud tenants. DHCS and Dell Financial Services provide a powerful way to enable IT transformation by enabling businesses of all sizes to affordably implement a utility-based, private cloud environment. These flexible financing vehicles can

9 White Paper: Dell and Microsoft: An Efficient and Optimized Path to Hybrid Cloud Computing 9 enable IT organizations to transform how they deliver computing services to their end-users while minimizing business risk. The Bigger Truth Affecting IT transformation requires people change and adopting new technologies that help ease the transition to new ways of consuming IT services. Hybrid cloud computing has emerged as the desired framework for many organizations to empower their end-users, business partners, and customers to obtain the information and services they require to be successful. But the challenge is that legacy application environments are typically very difficult to integrate with public cloud computing environments. As a result, IT organizations could end up spending a lot of time, energy, and money on retrofitting their application infrastructure to make them cloud ready. This can result in needless delays in attaining the business speed needed to remain competitive, and perhaps more ominously, can subject businesses to undue risk if there is a lack of visibility into the performance, efficiency, and compliance of cloud-based application workloads. While there is increasing demand across businesses of all sizes for hybrid cloud computing capabilities, many IT decision makers are emphatic about the need for simplicity in these environments. This is especially critical given the fact that ESG has been tracking a critical shortfall in IT skill sets over the last several years. 3 DHCS enables IT transformation by allowing businesses to quickly deploy a highly scalable, private cloud solution based on Windows Azure Pack that seamlessly integrates with Microsoft Azure public cloud services. As a pre-integrated solution that minimizes deployment time, complexity, and day-to-day infrastructure management, the DHCS solution provides a consistent administrator and end-user experience, whether applications are running locally in the data center or in the Azure public cloud; helping to ensure end-user adoption of IT-sponsored hybrid cloud services. And by simplifying the management of hybrid cloud environments, DHCS can help time-crunched IT administrators find more time to focus on revenue-generating activities rather than operational management. Built with powerful Dell compute, storage, and networking components, DHCS provides out-of-the box support for key cloud use cases like backup/dr and dev/test to enable IT organizations to lower costs while providing key endusers, like application developers, ready access to hybrid cloud infrastructure resources. And through Dell s Cloud Manager framework, businesses can maintain full visibility into workloads across the hybrid cloud to help ensure peak efficiencies, compliance, and critical application performance SLAs. Lastly, organizations can flexibly migrate applications to the cloud and repatriate these workloads as needed to meet business objectives. In short, the DHCS offering provides a fast track to hybrid cloud computing capabilities that eliminates the complexity, risk, and uncontrolled costs often associated with running diverse application workloads across multiple cloud environments. 3 Source: ESG Research Report, 2015 IT Spending Intentions Survey, February 2015.

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