IT's Evolutionary Transition

Cloud computing significantly changes the strategic playing field. Core to this change is both a philosophical and physical change to how infrastructure is managed. One doesn’t have to look far to see similarities in other industries where this transformation has taken place. Paramount among them is the electric industry. In the late 1800’s, companies built their own power generation facilities. By the turn of the century, companies were leveraging central facilities to provide power. This afforded companies several advantages. First, economies of scale provided economic benefit. Companies could acquire power cheaper than they could produce it themselves. Second, it allowed companies flexibility to move their companies further from the power sources themselves. Centralized power generation lead to additional power transmission possibilities. Third, it allowed companies to focus on strategic priorities and avoid becoming masters at power generation. Lastly, the economic model changed for the companies. Instead of making capital investments in power generation, they moved to a pay-as-you-go service based model. This provided further flexibility for the company

Turning back to present day…

In the short term, there are a number of questions that come up when considering cloud computing and specifically IaaS. Many enterprise and SMB companies are already starting to consider pay-per-use services to replace their existing systems. Some estimates peg this number at ~40% of companies use some form of cloud computing service (2009). But this story is not all positive. There are a number of challenges that come with these opportunities. The first challenge is in IT portfolio management. As an organization evaluates their existing (and projected) portfolio offering, consideration needs to be given on which services are strategic to the company. Similar to power generation, is compute/ storage capacity strategic? Or is it simply a requirement? Second, providers need evaluations that consider internal operations. Asking the right questions and probing into sensitive areas will provide confidence in the provider’s ability…and risks. One cannot absolve themselves of risk assessments simply by leveraging a third-party provider.

Similarly, is one provider enough to meet the requirements? As we have already seen, infrastructure providers will have failures too. How do you ensure that you’re protecting the interests of the company through your arrangements?

What is a data center fabric? Can this be related to how electric generation started? What about the electric grid? Can we expect to see a compute grid develop? Where do classical operating systems come in? If there is a migration process for companies from IaaS to PaaS (and to SaaS), will the significance of operating systems diminish? As we see the market mature, the answer is certain to be yes. That is not to say that operating systems will go away. But for most applications, the priority will be on the platforms.

In order to look forward, we have to first look back and ask ourselves the purpose of the operating system. In the most basic sense, we needed a common way for applications to interface with the physical hardware resources they were consuming. Fast forward to the cloud era. What do applications need to interface with? Depending on the level they’re working at (SaaS or PaaS), they’re only concerned with the platform they are developed for…not the hardware resources they are consuming.

One could ask where the concern about hardware resources comes in. That is where we will start to see a type of cloud operating system develop. However, unlike stand-alone operating systems of today, cloud operating systems will adopt a mesh-like integration. They can run as easily as a single resource as they can a combined (and shared) resource. This cloud resource provides the abstraction layer between hardware resources and the applications/ platforms that consume them. Hence, a cloud computing fabric starts to develop.

The fabric becomes a common resource pool that can dynamically allocate resources to the services and applications as needed. As the market matures, so will the adoption of cloud-based operating systems. And eventually the size and number of private systems (and those operating systems) will decrease. This is not unlike the changes to the power generation facilities moving into the 1900’s.

Is there an advantage for early adopters to this migration? Yes. Early adopters will drive the architectures that develop. Sure, there are risks to consider, but those can be mitigated.

I’m in the process of setting up this blog. Expect more information along with presentations, links and thoughts on IT strategic issues including:

Cloud Computing

Death of the Data Center