Private clouds showing up on IT’s agenda

One in 10 companies deploying internal clouds

Enterprise IT shops are starting to embrace the notion of building private clouds, modeling their own networks after public service providers such as Amazon and Google.

Enterprise IT shops are starting to embrace the notion of building private clouds, modeling their infrastructure after public service providers such as Amazon and Google. But while virtualization and other technologies exist to create computing pools that can allocate processing power, storage and applications on demand, the technology to manage those distributed resources as a whole is still in the early stages.

The corporations building their own private clouds include such notable names as Bechtel, Deutsche Bank, Morgan Stanley, Merrill Lynch and BT, according to The 451 Group. The research firm found in a survey of 1,300 corporate software buyers that about 11% of companies are deploying internal clouds or planning to do so. That may not seem like a huge proportion, but it's a sign that private clouds are moving beyond the hype cycle and into reality.

"It's definitely not hype," says Vivek Kundra, CTO for the District of Columbia government, which plans to blend IT services provided from its own data center with external cloud platforms like Google Apps. "Any technology leader who thinks it's hype is coming at it from the same place where technology leaders said the Internet is hype."

At the center of cloud computing is a services-oriented interface between a provider and user, enabled by virtualization, says Gartner analyst Thomas Bittman. "When I move away from physical to virtual machines for every requirement, I'm drawing a layer of abstraction," Bittman says. "What virtualization is doing is you [the customers] don't tell us what server to get, you just tell us what service you need."

Chart defining cloud computing

While virtualization technologies for servers, desktops and storage are readily available, Gartner says to get all the benefits of cloud-computing enterprises will need a new meta operating system that controls and allocates all of an enterprise's distributed computing resources.

It's not clear exactly how fast this technology will advance. VMware plans to release what might be considered a meta operating system with its forthcoming Virtual Datacenter Operating System, but in terms of timing the vendor will say only that will be released at some point in 2009.

But cloud computing is less a new technology than it is a way of using technology to achieve economies of scale and offer self-service resources that are available on demand, The 451 Group says. Numerous enterprises are taking on this challenge of building more flexible, service-oriented networks using existing products and methodologies.

Thin clients and virtualization is the key for Lenny Goodman, director of the desktop management group at Baptist Memorial Health Care in Memphis, Tenn.

Baptist uses 1,200 Wyse Technology thin clients, largely at patients' bedsides, and delivers applications to them using Citrix XenApp application virtualization tools. Baptist also is rolling out virtual, customizable desktops to those thin clients using Citrix XenDesktop.

Just as Internet users can access Amazon, Google, Barnes & Noble or any Web site they wish to use from anywhere, Goodman wants hospital workers to be able to move among different devices and have the same experience.

"You get the advantage of taking that entire experience and making it roam without the nurse having to carry or push anything," he says. "They can move from device to device."

Goodman also says a cloud-based model where applications and desktops are delivered from a central data center will make data more secure, because it's not being stored on individual client devices.

"If we relocate that data to the data center by virtualizing the desktop, we can back it up, we can secure it, and we can provide that data to the user wherever they are," he says.

In the Washington, D.C., government, Kundra came on board in March 2007 with the goal of establishing a DC.gov cloud that would blend services provided from his own data center with external cloud platforms like Google Apps. Washington moved aggressively toward server virtualization with VMware, and made sure it had enough network bandwidth to support applications hosted on DC.gov.

The move toward acting as an internal hosting provider as well as accessing applications outside the firewall required an increased focus on security and user credentials, Kundra says. But that was a necessary part of giving users the same kind of anytime, anywhere access to data and applications they enjoy as consumers of services in their personal lives.

"The line is blurred," he says. "It used to be you would come to work and only work. The blurring started with mobile technologies, BlackBerries, people doing work anytime, anywhere."

While Kundra and Goodman have begun thinking of themselves as internal cloud providers, many other IT shops view cloud computing solely as it relates to acquiring software-as-a-service and on-demand computing resources from external providers such as Salesforce.

"Cloud computing is definitely the hot buzzword," says Thomas Catalini, a member of the Society for Information Management and vice president of technology at insurance brokerage William Gallagher Associates in Boston. "To me it means outsourcing to a hosted provider. I would not think of it in terms of cloud computing to my own company. [Outsourcing] relieves me of having to buy hardware, software and staff to support a particular solution."

Analyst Theresa Lanowitz of Voke, a strong proponent of using external clouds to reduce management costs, says building internal clouds is too difficult for most IT shops.

"That is a cumbersome task," she says. "One of the big benefits of cloud computing is the fact that you have companies out there who can offer up things in a cloud. To build it on your own is quite an ambitious project. Where I see more enterprises going is down the path of renting clouds that have already been built out by some service provider."

There is room for both internal and external cloud computing within the same enterprise, though. In Gartner's view, corporations that build their own private clouds will also access extra capacity from public providers when needed. During times of increased demand, the meta operating system as described by Gartner will automatically procure additional capacity from outside sources, and users won't necessarily know whether they are using computing capacity from inside or outside the firewall.

While "cloud" might strike some as an overused buzzword, Kundra views cloud computing as a necessary transition toward more flexible and adaptable computing architectures.

"I believe it's the future," Kundra says. "It's moving technology leaders away from just owning assets, deploying assets and maintaining assets to fundamentally changing the way services are delivered."

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