More and more enterprises are recognizing the advantages of using a cloud service and subscribing to cloud computing systems for carrying out their business. IDC has reported that enterprise cloud application revenues reached $22.9B in 2011 and is projected reach $67.3B by 2016, attaining a CAGR of 24%. A forecast by Cisco shows that cloud traffic as a percentage of total center traffic will increase from 39% in 2011 to 64% in 2016. The company also predicts that by the year 2015, three out of five data center workloads will be processed in the cloud.
A 2011 survey by IBM also revealed that the number of enterprises adopting cloud computing is expected to double by 2015 as they realize the ease of doing tedious and time consuming tasks quickly by using cloud based applications. Amazon AWS which is a key player in the cloud computing segment reported a stupendous increase in the number of objects stored in its S3. The company reported that the number of objects stored in S3 increased from 2.9 billion in Q4 2006 to 566 billion in Q3 2011.
More and more enterprises are realizing that working on an AWS cloud involves several benefits such as:
In a presentation, Amazon revealed that companies are using AWS for enterprise applications such as Oracle, SAP, Microsoft, IBM, web applications such as digital media distribution, gaming, media sharing, High performance computing and disaster recovery applications. AWS recommends to its customers that they spread their assets across multiple availability zones in a region. The system is designed in such a way that even though two availability zones may fail concurrently, the customer’s data will be protected.
Customers deploying business application on AWS have the choice of installing and configuring their own applications or launching entire software stacks from organizations like Oracle, SAP, Microsoft and IBM by choosing from a list or pre configured virtual machine images. Customers also have the option of subscribing to business applications that run on the AWS and are offered as a service by software vendors such as Adobe, ESRI, Consona and many others. AWS offers a global cloud infrastructure that helps customers achieve lower latency and better performance.
According to an IDC whitepaper which studied the long term economic implications for enterprises moving their workloads to a cloud, the average five year ROK from using AWS is 626%. Not only this, the returns grow over time. IDC interviewed 11 organizations including Samsung, BankInter, Fox, Netflix, Tomlinson Real Estate Group and others and found that these companies witnessed cumulative savings averaging over $2.5 million per application. This included savings in development and deployment costs, application management costs and infrastructure support costs. The five year TCO of developing, deploying and managing critical applications on AWS represented a 70% savings over the deployment of same resources on premises. The use of cloud also enhanced the business agility by allowing to bring their applications to market quickly, the IDC whitepaper revealed.
While there are several benefits of using a cloud computing system like AWS, challenges such as the dependency on the infrastructure of someone else and the security of data stored in it remain. An organization choosing to outsource personal data for processing or other services to a cloud service provider, it has to take the responsibility of protecting that data from any kind of potential misuse. Security of information on a cloud is of paramount importance and enterprises using it need to take preventive steps like limiting access to the information to only a few relevant people, ensuring that the cloud provider has proper authentication systems in place, carry out periodic audits and ensure about the level and type of encryption methods used by the cloud provider to keep the personal data safe and secure.
Organizations should inform their clients or customers that their personal information may be processed by a third party or a cloud service provider. Enterprises also have obligations under privacy laws that include enabling customers to access their personal information, request corrections and resolve complaints. Enterprises should ensure that their contracts with the cloud provider clearly states that data ownership lies with the former and that the cloud provider does not keep a record of the personal information in its systems after the completion of the contract.
Another risk involved in using a cloud service is that these services are not governed by any standards. Consequently applications have to be changed to adapt to the services offered by different vendors. Moreover bigger enterprises that have already invested a lot in building their infrastructure would like to reap the advantages of that. These challenges can be handled by looking at the concept of enterprise private cloud offerings.
These enterprise private cloud solutions help organizations leverage their existing IT infrastructure and environment and create a cloud computing platform in that private internal network. This option offers enterprises advantages like self service, automation and charge back over the other option of using virtualized infrastructure. Private clouds do help overcome some of the challenges associated with public clouds but are not as cost effective as they do involve buying and managing infrastructure. Also such clouds do not offer benefits like scalability, lower up front capital costs and less management overheads as are available in the case of public clouds. The ideal solution is to adopt a hybrid approach where both public and private clouds are used for different category of applications. Also, several cloud computing solutions like AWS provide abstractions over internally available infrastructure by using virtualization software like VMware, ESXi, etc.
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