Private Clouds – Not just a Cost and Technology issue, Its all about trust, the family jewels, corporate value, and identity

I recently read a post by my good friend James Hamilton at Amazon regarding Private Clouds.   James and I worked closely together at Microsoft and he was always a good source for out of the box thinking and challenging the status quo.    While James post found here, speaks to the Private Cloud initiative being what amounts to be an evolutionary dead end, I would have to respectfully disagree.

James’ post starts out by correctly pointing out that at scale the large cloud players have the resources and incentive to achieve some pretty incredible cost savings.  From an infrastructure perspective he is dead on.  But I don’t necessarily agree that this innovation will never reach the little guy.  In my role at Digital Realty Trust I think I might have a pretty unique perspective on the infrastructure developments both at the “big” guys along with what most corporate enterprises have available to them from a leasing or commercial perspective.  

Companies like Digital Realty Trust,  Equinix, Terramark, Dupont Fabros, and a host of others in the commercial data center space are making huge advancements in this space as well.   The free market economy has now placed an importance on low PUE highly efficient buildings.   You are starting to see these firms commission buildings with Commission PUEs Sub 1.4.   Compared to most existing data center facilities this is a huge improvement.  Likewise these firms are incented to hire mechanical and electrical experts.  This means that this same expertise is available to the enterprise through leasing arrangements.  Where James is potentially correct is at that next layer of IT specific equipment.

This is an area where there is an amazing amount of innovation happening by Amazon, Google, and Microsoft.   But even here in this space there are firms stepping up to provide solutions to bring extensive virtualization and cloud-like capabilities to bear.    Companies like Hexagrid have software solutions offerings that are being marketed to typical co-location and hosting firms to do the same thing.  Hexagrid and others are focusing on the software and hardware combinations to deliver full service solutions for those companies in this space.    In fact (as some comments on James’ blog mention) there is a lack of standards and a fear of vendor lock-in by choosing one of the big firms.  Its an interesting thought to ponder if a software+hardware solution offered to the hundreds of co-location players and hosting firms might be more of a universal solution without fear of lockdown.  Time will tell.

But this brings up one of the key criticisms that this is not just about cost and technology.   I believe what is really at stake here is much more than that.   James makes great points on greater resource utilization of the big cloud players and how much more efficient they are at utilizing their infrastructure.   To which i will snarkly (and somewhat tongue-in-cheek) say to that, “SO WHAT!”     Do enterprises really care about this?  Do they really optimize for this?  I mean if you pull back that fine veneer of politically correct answers  and “green-suitable” responses is that what their behavior in REAL LIFE is indicative of?    NO.

This was a huge revelation for me when I moved into my role at Digital.  When I was at Microsoft, I optimized for all of the things that James mentions because it made sense to do when you owned the whole pie.   In my role at Digital I have visibility into tens of data centers, across hundreds of customers that span just about every industry.  There is not, nor has there been a massive move (or any move for that matter) to become more efficient in the utilization of their resources.   We have had years of people bantering about how wonderful, cool, and how revolutionary a lot of this stuff is, but world wide Data center utilization levels have remained abysmally low.   Some providers bank on this.  Over subscription of their facilities is part of their business plan.  They know companies will lease and take down what they think they need, and never take it down in REALITY.   

So if this technology issue is not a motivating factor what is?  Well cost is always part of the equation.   The big cloud providers will definitely deliver cost savings, but private clouds could also deliver cost savings as well.   More importantly however, Private clouds will allow companies to retain their identity and uniqueness, and keep what makes them competitively them –Them.

I don’t so much see it as a Private cloud or Public cloud kind of thing but more of a Private Cloud AND Public cloud kind of thing.   To me it looks more an exercise of data abstraction.   The Public offerings will clearly offer infrastructure benefits in terms of cost, but will undoubtedly lock a company into that single solution.  The IT world has been bit before by putting all their eggs in a single basket and the need for flexibility will remain more key.    Therefore you might begin to see Systems Integrators, Co-location and hosting firms, and others build their own platforms, or much more likely, build platforms that umbrella over the big cloud players to give enterprises the best of both worlds. 

Additionally we must keep in mind that  the biggest resistance to the adoption of the cloud is not technology or cost but RISK and TRUST.  Do you, Mr. CIO, trust Google to run all of your infrastructure? your applications?  Do you Mrs. CIO, Trust Microsoft or Amazon to do the same for you?    The answer is not a blind yes or no.   Its a complicated set of minor yes responses and no responses.   They might feel comfortable outsourcing mail operations, but not the data warehouse manifesting decades of customer information.     The Private cloud approach will allow you to spread your risk.   It will allow you to maintain those aspects of the business that are core to the company. 

The cloud is an interesting place, today.  It is dominated by technologists.  Extremely smart engineering people who like to optimize and solve for technological challenges.  The actual business adoption of this technology set has yet to be fully explored.   Just wait until the “Business” side of the companies get their hooks into this technology set and start placing other artificial constraints, or optimizations around other factors.  There are thousands of different motivators out in the world.  Once they starts to happen earnest.  I think what you will find is a solution that looks more like a hybrid solution than the pure plays we dream about today.

Even if you think my ideas and thoughts on this topic is complete BS, I would remind you of something that I have told my teams for a very long time.  “There is no such thing as a temporary data center.”  This same mantra will hold true for the cloud.  If you believe that the Private Cloud will be a passing and temporary thing, just keep in mind that there will be systems and solutions build to this technology approach thus imbuing it with a very very long life.  

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Modular Evolution, Uptime Resolution, and Software Revolution

Its a very little known fact but software developers are costing enterprises millions of dollars and I don’t think in many cases either party realizes it.   I am not referring to the actual cost of purchase for the programs and applications or even the resulting support costs.   Those are easily calculated and can be hard bounded by budgets.   But what of the resulting costs of the facility in which it resides?

The Tier System introduced by the Uptime Institute was an important step in our industry in that it gave us a common language or nomenclature in which to actually begin having a dialog on the characteristics of the facilities that were being built. It created formal definitions and classifications from a technical perspective that grouped up redundancy and resiliency targets, and ultimately defined a hierarchy in which to talk about those facilities that were designed to those targets.   For its time it was revolutionary and to a large degree even today the body of work is still relevant. 

There is a lot of criticism that its relevancy is fading fast due to the model’s greatest weakness which resides in its lack of significant treatment of the application.    The basic premise of the Tier System is essentially to take your most restrictive and constrained application requirements (i.e. the one that’s least robust) and augment that resiliency with infrastructure and what I call big iron.   If only 5% of your applications are this restrictive, then the other 95% of your applications which might be able to live with less resiliency will still reside in the castle built for the minority of needs.  But before you you call out an indictment of the Uptime Institute or this “most restrictive” design approach you must first look at your own organization.   The Uptime Institute was coming at this from a purely facilities perspective.  The mysterious workload and wizardry of the application is a world mostly foreign to them.   Ask yourself this question – ‘In my organization, how often does IT and facilities talk to one another around end to end requirements?’  My guess based on asking this question hundreds of times of customers and colleagues ranges between not often to not at all.  But the winds of change are starting to blow.

In fact, I think the general assault on the Tier System really represents a maturing of the industry to look at our problem space more combined wisdom.   I often laughed at the fact that human nature (or at least management human nature) used to hold a belief that a Tier 4 Data Center was better than a Tier 2 Data Center.  Effectively because the number was higher and it was built with more redundancy.   More Redundancy essentially equaled better facility.    A company might not have had the need for that level of physical systems redundancy (if one were to look at it from an application perspective) but Tier 4 was better than Tier 3, therefore we should build the best.   Its not better, just different. 

By the way, that’s not a myth that the design firms and construction firms were all that interested in dispelling either.   Besides Tier 4 having the higher number, and more redundancy, it also cost more to build, required significantly more engineering and took longer to work out the kinks.   So the myth of Tier 4 being the best has propagated for quite a long time.  Ill say it again.  Its not better, its just different.

One of the benefits of the recent economic downturn (there are not many I know), is that the definition of ‘better’ is starting to change.  With Capital budgets frozen or shrinking the willingness of enterprises to re-define ‘better’ is also changing significantly.   Better today means a smarter more economical approach.   This has given rise to the boom in Modular data center approach and its not surprising that this approach begins with what I call an Application level inventory.   

This application level inventory first specifically looks at the make up and resiliency of the software and applications within the data center environments.  Does this application need the level of physical fault tolerance that my Enterprise CRM needs?  Do servers that support testing or internal labs need the same level of redundancy?  This is the right behavior and the one that I would argue should have been used since the beginning.  The Data Center doesn’t drive the software, its the software that drives the Data Center. 

One interesting and good side effect of this is that the enterprise firms are now pushing harder on the software development firms.    They are beginning to ask some very interesting questions that the software providers have never been asked before.    For example, I sat in one meeting where and end customer asked their Financial Systems Application provider a series of questions on the inter-server latency requirements and transaction timeout lengths for data base access of their solution suite.  The reason behind this line of questioning was a setup for the next series of questions.   Once the numbers were provided it became abundantly clear that this application would only truly work from one location, from one data center and could not be redundant across multiple facilities.  This led to questions around the providers intentions to build more geo-diverse and extra facility capabilities into their product.   I am now even seeing these questions in official Requests for Information (RFI’s) and Requests for Proposal (RFPs).   The market is maturing and is starting to ask an important question – why should your sub-million dollar (euro) software application drive 10s of millions of capital investment by me?  Why aren’t you architecting your software to solve this issue.  The power of software can be brought to bear to easily solve this issue, and my money is on the fact this will be a real battlefield in software development in the coming years.

Blending software expertise with operational and facility knowledge will be at the center of a whole new train of software development in my opinion.  One that really doesn’t exist today and given the dollar amounts involved, I believe it will be a very impactful and fruitful line of development as well.    But it has a long way to go.    Most programmers coming out of universities today rarely question the impact of their code outside of the functions they are providing and the number of colleges and universities that teach a holistic approach can be counted on less than one hands worth of fingers world-wide.   But that’s up a finger or two from last year so I am hopeful. 

Regardless, while there will continue to be work on data center technologies at the physical layer, there is a looming body of work yet to be tackled facing the development community.  Companies like Oracle, Microsoft, SAP, and hosts of others will be thrust into the fray to solve these issues as well.   If they fail to adapt to the changing face and economics of the data center, they may just find themselves as an interesting footnote in data center texts of the future.

 

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