Economics of the cloud
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The cloud is not just a change in technology but also a change in the economics of technology solutions. This session will dive deep into different models highlighting how leveraging cloud solutions not only shifts costs from capital to operational but also impacts time to market.
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Economics of the cloud
- 1. Economics of the Cloud Tom Moen Director of Strategy and Innovation @Cloudmovr Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012 Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 2. Gartner (yesterday) Top 10 Trends 1. Mobile Devices 2. Shift from Native Apps to Web Apps 3. Personal Cloud Replaces Personal Computer 4. The Internet of Things 5. Cloud 6. Strategic Big Data 7. Actionable Analytics 8. In-memory Computing 9. Virtual Appliances Integrated Ecosystems 10. Enterprise App Stores Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 3. Cloud Momentum Building Fast of all data will live in or pass 30% through the cloud $150 Billion market for cloud computing 80% of Fortune 1000 will use cloud computing 2 Billion 4 billion searches 663 million users 369 million users Internet users monthly worldwide Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 4. IT Cloud Spend (as a %) Increasing www.ami-partners.com Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 5. Total Cloud Revenue Worldwide Billions $400 $350 $300 $250 $200 $150 $100 $50 $0 2005 2010 2015 2020 Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 6. Total Mobile Units Worldwide Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 7. Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 8. Reasons They Migrated to Cloud 0 10 20 30 40 50 60 70 80 Reduce Upfront Costs Flexibility Agility Focus on Core Business Competitive Advantage Don't Know Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 9. What I Hear⌠What Business is saying: What IT is saying: ⢠Email/Collab is Too Expensive ⢠We Hate Upgrading ⢠CapEx to OpEx ⢠We Lack Skills/Retention ⢠Need Capability/Feature NOW! ⢠Projects Require High ROI ⢠Consolidation of BUs ⢠Need Predictable Spend ⢠Upgrades/Updates Kill Us ⢠Need Enhanced Reliability ⢠New Sheriff in Town ⢠Need Enhanced Security ⢠Merger or Acquisition ⢠Deliver New Capabilities ⢠Applications Too Costly ⢠We Like to Sleep ⢠Scale/Performance/Capacity ⢠Better Up-time ⢠Regulatory/Compliance Issue Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 10. Why I Believe in Cloud Cloud Helps Accelerate Your Journey Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 11. There are Benefits of Cloud Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 12. There are many Clouds Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 13. Private Clouds ⢠Faster, simpler deployments of VMs in your own data centers ⢠Faster, simpler deployments of applications with fewer errors ⢠Automated discovery and remediation of problems. Private Clouds are a facet of improved systems management. Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 14. Public Clouds ⢠Faster, simpler deployment of VMs in external datacenters ⢠Deployment of packaged and custom applications using pay-as-you-go compute resources ⢠Faster , simpler application development and enhanced management ⢠Lower-cost storage with blobs Public Clouds allow you to scale your IT environment on demand Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 15. Think AND Not OR Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 16. Think of it as an IT Continuum⌠Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 17. Cloud Services You Manage You Manage Vendor Manages Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 18. Microsoftâs Enterprise Cloud Offerings AND happens HERE Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 19. Letâs Get Economical! Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 20. Do You Consider Investment In Technology as a Means to Cut Costs? â˘A majority of CFOs considered investment in technology as a means of cutting costs. â˘Those who thought otherwise considered investment in technology as a means to improve processes. Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 21. Normal Project Cost Benefit/Reduction ⢠Reduction in Storage ⢠Improvement in Server Consolidation ⢠Problem Resolution Savings ⢠End User Savings ⢠Application Development Savings ⢠Space and Utilities Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 22. Cloud Economics Supply Demand Side Side Multi Tenant Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 23. Estimated Annual Costs Data Center* ⢠Sioux Falls, S.D. $9,684,282 ⢠Winston-Salem, N.C. $9,799,928 ⢠San Antonio, Texas $10,314,249 ⢠Birmingham, Ala. $10,340,534 ⢠Ames, Iowa $10,378,916 ⢠Charlotte, N.C. $10,440,123 ⢠Indianapolis, Ind. $10,451,796 ⢠Tulsa, Okla. $10,452,228 ⢠Des Moines, Iowa $10,480,298 ⢠Columbus, Ohio $10,499,091 *125,000 sq feet, employing 75 people Source: Boyd Company, Princeton, NJ Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 24. IT Costs Over 85% Staffing Downtime IT Staff Training Server Hardware Server Software Services Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 25. Worldwide Spending On Servers Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 26. Time Effect On Servers Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 27. Electricity âIf a CIO has not had to build a new data center recently, electricity is likely to be a huge surpriseâ Ken Brill Founder and Executive Director Uptime Institute Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 28. Electricity Costs ⢠.6% in 2000 $42,000,000 ⢠1.5% in 2010 $135,000,000 ⢠3% in 2012 $330,000,000 40% of this bill is for cooling! Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 29. On-Prem Email/User/Month â SaaS Model Hardware $0.60 1.37% Client Software $3.49 7.98% Server Software $3.61 8.26% Storage $2.40 5.49% Email & Hygiene/Filter $2.99 6.84% Archiving & Compliance $8.99 20.57% Staffing $5.16 11.81% Mobility $8.88 20.32% Financing $1.08 2.47% Real estate $0.84 1.92% Utilities $0.63 1.44% HA/DR Avtex Customer Conference 2012 $5.04 11.53% The Intersection of Technology and Customer Experience Total Costs /User /Mo Hyatt Regency | Minneapolis |10.25.2012 $43.71 100.00%
- 30. Cloud Email/User/Month â SaaS Model Hardware $0.60 1.37% Client Software $3.49 31.47% Server Software $3.61 8.26% Storage $2.40 5.49% Email & Hygiene/Filter $3.92 35.35% Archiving & Compliance $3.68 33.18% Staffing $5.16 11.81% Mobility $8.88 20.32% Financing $1.08 2.47% Real estate $0.84 1.92% Utilities $0.63 1.44% HA/DR Avtex Customer Conference 2012 $5.04 11.53% The Intersection of Technology and Customer Experience Total Costs /User /Mo Hyatt Regency | Minneapolis |10.25.2012 $11.09 100.00%
- 31. Forrester Research Inc Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 32. TEI Exchange 2010 - Forrester $237,797 per Year 1,500 Users $158 /yr/user $13.21/mo/user Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 33. GroupWise Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 34. Total Cost Comparison On-premises cost Microsoft Online cost Savings General costs Hardware and maintenance $174,814 Included $174,814 For 2,500 total users: Software $1,496,893 $1,196,726 $300,167 ⢠2,250 using e-mail, Operations $2,668,100 $741,960 $1,926,140 Deployment and migration $212,663 $107,931 $104,732 collaboration, Running total $4,552,470 $2,046,617 $2,505,853 IM/presence ⢠250 using Kiosk e-mail High availability Hardware and maintenance $104,150 Included $104,150 & collaboration Software $101,985 Included $101,985 ⢠275 E3 Plan Operations $8,800 Included $8,800 ⢠600 using web Deployment and migration $14,209 Included $14,209 conferencing Running total $4,781,614 $2,046,617 $2,734,997 25% over-allocation for future growth 45% savings Hardware and maintenance $34,301 n/a $34,301 Software $168,901 n/a $168,901 over 3 years Running total $4,984,816 $2,046,617 $2,938,199 TOTAL $4,984,816 $2,046,617 $2,938,199 Per user per month $55.39 $22.74 $32.65 Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 35. Windows Azure Comparison â PaaS Model The first scenario included initial one time costs. In this scenario, we determined that CUSTOMER could realize a cost savings of 91.7% with adoption of the proposed Windows Azure Platform architecture. Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 36. Azure Savings â IaaS Model 1,400,000 Azure On-Premise 1,200,000 $867,889 $2,282,072 1,000,000 800,000 Azure 600,000 On-premise 400,000 200,000 0 Ideas Imaging Insight PAS Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 37. Cloud Economics Supply Demand Side Side Multi Tenant Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 38. Demand Side â Workloads Ideal Cloud On and Off Compute Inactivity On & off workloads (e.g. batch job) Period Over provisioned capacity is wasted t Time to market can be cumbersome Growing Fast Compute Successful services needs to grow/scale Keeping up w/ growth is big IT challenge t Cannot provision hardware fast enough Unpredictable Bursting Comput e Unexpected/unplanned peak in demand Sudden spike impacts performance t Canât over provision for extreme cases Predictable Bursting Compute Services with micro seasonality trends Peaks due to periodic increased demand t IT complexity and wasted capacity Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 39. Demand Side Economics Randomness Multi-Source Uncertain Growth Time of Day Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 40. Cloud Economics Supply Demand Side Side Multi Tenant Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 41. Top Data Centers in 2006 ⢠Disney ⢠Shell Oil ⢠P&G ⢠Others names and logos youâd recognize Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 42. Multi Tenancy -Top 10 DCs 2011 1. 350 East Cermak / Lakeside Technology Center (Digital Realty) 2. Metro Technology Center, Atlanta (Quality Technology) 3. The NAP of the Americas, Miami (Terremark) 4. NGD Europe, Newport Wales (Next Generation Data) 5. Container Data Center, Chicago (Microsoft) 6. Microsoft Dublin (Microsoft) 7. Phoenix ONE, Phoenix (i/o Data Centers) 8. CH1, Elk Grove Village, Ill. (DuPont Fabros) 9. Microsoft Data Centers in San Antonio (Microsoft) 10. Microsoft Data Centers in Quincy (Microsoft) Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 43. Multi Tenancy ⢠Fixed labor costs shared ⢠Server utilization shared Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 44. WHY HASNâT EVERYBODY MOVED TO Cloud?? Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 45. Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 46. Impediments to Cloud Adoption Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 47. Gartner â Impediments to Cloud Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 48. Impediment - Disbelief of Savings Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 49. Impediment Who Takes the Lead??? CEO CFO CIO Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 50. Impediment â Big Questions That I Get Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 51. SERVER SERVICE GAP Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 52. Compliance Adherence in Business Productivity Online Suite SAS-70 Type I EU Safe Harbor (SSAE SOC 1 Type I) Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 53. Compliance Adherence in Office 365 FISMA EU Model Clauses SAS-70 Type II (SSAE SOC 1 Type II) ISO 270001 Access to our âTrust Centerâ SAS-70 Type I EU Safe Harbor (SSAE SOC 1 Type I) Data Processing Agreement HIPAA/BAA Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 54. SharePoint Online 2007 â Customerâs Requirements ⢠Infrastructure ⢠GB Limits ⢠Maintenance Costs ⢠Document management ⢠⢠Dev/Test/Training Environments Intranet Roadmap ⢠Search ⢠Internal/External Access ⢠Login(s) ⢠Legal ⢠EU Privacy ⢠3rd Party Tools Holds/Retention/eDiscovery ⢠BI ⢠Upgrade Roadmap ⢠Social Collaboration ⢠Platform ⢠Resource Needs ⢠Bandwidth / Network ⢠Dashboards ⢠Language Packs ⢠People Search ⢠Workflows ⢠Security ⢠Records Center Management ⢠Upgrades ⢠ISO ⢠Architecture Flexibility ⢠Anywhere access ⢠Up Front Costs ⢠AD Integration ⢠Support Costs ⢠OSC Presence Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 55. SharePoint Online 2010 â Customerâs Requirements ⢠3rd Party Tools ⢠BI ⢠Bandwidth / Network Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 56. Exchange Online 2007 Concerns Outlook 2003 support Custom mobile device policies POP/IMAP Unified Messaging Messaging Records Management Customize OWA login page On-premise OCS voice/UM integration Transport rules Server-side auto-forwarding Journal to on-premise archive Allow SMTP relay Application connectivity via older APIs OWA multi-factor authentication Post-processing of outbound mail Free/busy calendar sharing Cross-mailbox search PowerShell access Exchange Management Console access âSend asâ capabilities Public folders Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 57. Exchange 2010 Online Outlook 2003 support Application connectivity via older APIs Public folders Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 58. Where Can I Find More? Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 59. Silver Lining Planning Services! ďź Understand your current environment ďź Gain a thorough understanding of your requirements. ⢠Deliver a SAW and SAW Report ⢠Deployment Planning Tools and Report ⢠Other tools to uncover potential hurdles ďź Generate a very accurate SOW ďź Artifacts include ⢠Complete project plan ⢠SOW, ⢠ROI/TCO for your project. This is work includes up to four days on site and two days of documentation depending on your requirements. Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
- 60. Avtex Customer Conference 2012 The Intersection of Technology and Customer Experience Hyatt Regency | Minneapolis |10.25.2012
Hinweis der Redaktion
- Was trying to think how economics of Cloud help customer interactions but your customer may be somebody with a budget, the CFO, CEO, somebody you are trying to serve better, cheaper faster. In this vain, the content I am about to reveal to you makes perfect sense.So how many of you are looking at the Cloud as a means of saving hard and soft dollars? Show of hands please. How many of you have done some type of analysis of Cloud offering to see if it would save you money?How many of you have done some TCO/ROI analysis?How many of you are interested or looking at Cloud based solutions?How many of you are tired of me asking questions?
- One: Mobile devices.By next year, mobile phones will overtake PCs as the most common Web access device worldwide. Does this mean mobile devices will replace PCs? Yes and no, says Gartner. Some IT departments may only need to support mobile devices for specific workers whose jobs require them while the rest continue to use PCs. But, Gartner adds, the rise of mobile devices does signal the end of Windows as the single corporate platform.Two: A long-term shift from native apps to Web apps as HTML5 becomes more capable.Gartner did note that native apps won't disappear and "will always offer the best user experience and most sophisticated features."Three: The personal cloud replaces the notion of personal computer.The cloud will house all aspects of one's life, Gartner said.Because it's so vast, and capable of marshaling infinite resources, "no one platform, form factor, technology or vendor will dominate" it, Gartner says. It also means that IT will have to support almost everything.Four: The Internet of Things.Everything will connect to the Internet, including cameras, microphones, augmented reality, buildings and embedded sensors everywhere. In many cases, it's here already.The Internet of Things will lead to new products, such as usage-based insurance or tax policies. It will also raise new questions, such as whether a robot interacting with an ERP system is a named user for the purposes of software licenses."We are at a point where it is no longer a stretch to imagine that much of what and who we interact with will be connected to the Internet," said Cearley.Five: Cloud computing.As cloud adoption expands, IT departments will have to create "cloud services brokerages" to serve as a central focus for managing access to external services.Six: Strategic Big Data.It's becoming more economical, thanks in part to low cost servers and CPUs, for organizations to tackle big data projects. By strategic big data, Gartner believes that users will be moving beyond isolated projects and incorporating big data analysis in more and more of what they do.Seven: Actionable Analytics.Actionable Analytics is, in some respects, a distinct subset of its sixth trend, Strategic Big Data. Low cost processing is making it possible "to perform analytics and simulation for each and every action taken in a business." Most analytics today focus on looking at historical analysis; the next step is predicting what might happen.Eight: In-memory Computing.In-memory Computing, says Gartner, can be transformational. It allows hours-long batch processes to be squeezed into processes that only take minutes or seconds. In-memory Computing will become a mainstream platform over the next year or two, as users seek more real-time analytical queries.Nine: Virtual appliances integrated ecosystems.They won't kill off physical appliances and their security advantages, but virtual appliances will gain an increased place in IT operations.Ten: Enterprise App Stores.Enterprise App Stores will turn IT departments into market managers, providing governance and even support to "apptrepreneurs." App store markets will become the "anchor point" for users to get everything they need.
- Research shows companies are now allocating and planning on allocating more of their IT budgets to cloud services to help them meet demands. By 2015, AMI reports that companies will spend 12.2 percent of their IT budgets on cloud services.This is a 50 percent increase over the percentage they spent in 2010.
- Cloud is actually so good it is driving other technologies like Mobility â this is like bacon being so good it makes other things like chestnuts taste good. Cloud is so good that it is driving mobility and maybe a little the other way. Where my bacon analogy breaks down.
- The majority of respondents considered reduced upfront costs, increased flexibility, and competitive advantage as key benefits of implementing a cloud computing solution. The savings from cloud computing are enticing. Like equipment leasing before it, cloud computing turns what once was a big-ticket capital expenditure into an operating expense for companies â one that can be tuned up or down, depending on business conditions.The savings come in infrastructure, your company would require less IT infrastructure, and less people to manage this infrastructure.Surprisingly, however, most did not consider its ability to enable a company to react quickly to changes in market conditions as a key advantage.Michael Schrage, Research Fellow, MIT Sloan Schoolâs Center for Digital Business explains that the cloud can accelerate and compress both the development and the test times for innovation and change.Reduced time to impact is one of the key advantages of cloud computing
- Key points to land:No other company can offer the depth and breadth of solutionsCloud on your terms â hybrid between on-prem and in the cloud solutionsSegmented!With that as a baseline⌠lets get ready to be economicalâŚ
- It is not surprising that a majority of CFOs considered investment in technology as a means of cutting costs. Those who thought otherwise consider investment in technology as a means to improve systems and processes, with cost reduction being very important but a by-product.
- Benefits Year 1 Year 2 Year 3 Total PresentvalueReduction of storage costs 310,320 159,888 170,755 640,963 542,539Server consolidation 108,000 108,000 108,000 324,000 268,580Problem-resolution savings 94,320 94,320 94,320 282,960 234,560End user security savings 50,400 50,400 50,400 151,200 125,337Application developmentsavings11,520 11,520 11,520 34,560 28,649Total benefit 574,560 424,128 434,995 1,433,683 1,199,665
- Supply-side savings. Large-scale data centers (DCs) lower costs per server. ďˇ Demand-side aggregation. Aggregating demand for computing smooths overall variability, allowing server utilization rates to increase. ďˇ Multi-tenancy efficiency. When changing to a multitenant application model, increasing the number of tenants (i.e., customers or users) lowers the application management and server cost per tenant.
- "If a CIO has not had to build a new data center recently, this [electricity] is likely to be a huge surprise,âKen Brill, founder and executive director of the Uptime Institute, which provides consulting services to more than 100 data center operators.
- $42,000,000.00$135,000,000.00$330,000,000.00
- Presenter ScriptBut first, letâs cut right to the chase and look at a sample cost comparison. For an organization of 2,500 users, this table shows what it might cost to run e-mail, collaboration, and IM/presence for all of them; and web conferencing for 1,000 of them. This is a 3-year total.<click>Now if we assume that this company also deployed those workloads in a highly available fashion, there are some additional costs that would add up â not just for licensing, but also for ops and deployment<click>And if we assume that the company is over-sizing the solution a bit for future expected growth by purchasing additional hardware and licenses, here are the additional costs that would be associated with that.Now letâs look at the cost of enabling those same 2,500 users to have e-mail, collaboration, and IM/presence.<click> This table also brings a twist with it â in the online services world, there is a âdeskless workerâ option that allows the company to purchase limited e-mail and collaboration licenses for its 250 factory floor workers. So weâve factored in the savings associated with that. Youâll also notice that there are no additional costs for high availability â thatâs built into the service â and no need to over-allocate hardware or licenses to plan for future growth because the service allows you to add users on demand as your business grows. <click>All told, the savings add up to about 45% over the 3 years. The per-user, per-year cost is reduced from $55 to $30.
- Supply-side savings. Large-scale data centers (DCs) lower costs per server. ďˇ Demand-side aggregation. Aggregating demand for computing smooths overall variability, allowing server utilization rates to increase. ďˇ Multi-tenancy efficiency. When changing to a multitenant application model, increasing the number of tenants (i.e., customers or users) lowers the application management and server cost per tenant.
- Supply-side savings. Large-scale data centers (DCs) lower costs per server. ďˇ Demand-side aggregation. Aggregating demand for computing smooths overall variability, allowing server utilization rates to increase. ďˇ Multi-tenancy efficiency. When changing to a multitenant application model, increasing the number of tenants (i.e., customers or users) lowers the application management and server cost per tenant.
- Fixed application labor amortized over a large number of customers. In a single-tenant instance, each customer has to pay for its own application management (that is, the labor associated with update and upgrade management and incident resolution). Weâve examined data from customers, as well as Office 365-D and Office 365-S to assess the impact. In dedicated instances, the same activities, such as applying software patches, are performed multiple times â once for each instance. In a multi-tenant instance such as Office 365-S, that cost is shared across a large set of customers, driving application labor costs per customer towards zero. This can result in a meaningful reduction in overall cost, especially for complex applications. ďˇ Fixed component of server utilization amortized over large number of customers. For each application instance, there is a certain amount of server overhead. Fig. 14 shows an example from Microsoftâs IT department in which intraday variability appears muted (only a 16 percent increase between peak and trough) compared to actual variability in user access. This is caused by application and runtime overhead, which is constant throughout the day. By moving to a multitenant model with a single instance, this resource overhead can be amortized across all customers. We have examined Office 365-D, Office 365-S, and Microsoft Live@edu data to estimate this overhead, but so far it has proven technically challenging to isolate this effect from other variability in the data (for example, user counts and server utilization) and architectural differ
- Over 30% of CFOs surveyed are already using or are considering using a cloud computing solution, indicating a keen interest in cloud technology.Concerns regarding security and compliance was the number one impediment in adopting a cloud computing solution, followed by loss of control and compatibility. Mr SN Mukherjee, COO, IL&FS put it very eloquently when he explained that âwhen we send an email, we don't know where it goes⌠it goes into a cloud. In the case of cloud computing, instead of an email, weâre sending our IT infrastructure into the cloud, which can be unsettling.âAn interesting fact is that CISOs, on the other hand, do not take the position that security suggests that the cloud be treated with caution.They recognize the benefits and are working towards a safe and secure migration to the cloud.
- One third of CFOs consider themselves responsible for taking the lead in implementing a functional and cost effective cloud computing solution. Most others felt it is the CIO who should be held responsible.Even today, despite distributed decision making, close to 20% still think the CEO should take the lead.