Private Cloud Computing: A Few Thoughts

We are awash in a world of new and disruptive technology products and services.  One of the most prevalent is Cloud Computing.  The topic of this article is primarily Private Cloud Computing and thoughts on what it will mean for Enterprise IT.  Unfortunately it's a bit of a ramble but I'm not much for spending more hours tweaking and editing this one.

What is private cloud computing?  To make a non-technical analogy, Private Cloud Computing is a little like owning your own car instead of using a rental car that you share with others others and that someone else owns for your automobile and transportation needs.  Rental cars haven't completely replaced personal automobile ownership for many obvious reasons.  Public Cloud Services will not likely replace dedicated private servers either and will likely drive adoption of private cloud computing.

Security is a serious issue with public cloud computing in any form.  Would you be willing to run a critical corporate financial application on a shared cloud computing platform when the terms of service state something like, if we get a court order we'll hand your data over without question or battle and there is nothing you can do about that fact because by using our service you implicitly give us that right as a means of protecting ourselves?  In fact, entire countries are already becoming embroiled in this very debate.   In a recent article in Network World there was discussion about Cloud Storage and international law.  The question was asked, "What does it mean if your data is stored in the cloud and some foreign government entity might have access to it?" That is in fact a really interesting question!

When you have a few minutes and a law degree take a look at seciont 5.4.2 of Amazon Web Services Terms of Service. I am not an attorney but to me it says, you data/information can and will be turned over if we feel like it.  Other parts of that document limit liability and such for Amazon as well.  Now, were I Amazon I'd do exactly the same thing I suppose.  This isn't an article about Amazon though.  It's an article about why private cloud computing is a must.  You can't necessary trust your sensitive data, even in transient states, to public service providers that are required to write Terms of Service agreements like that.

The first stages have already blown right by us in the form of Virtualization technologies like VMWare, Xen, and others that have been commercialized over the last several years and themselves become enablers of the current wave of products and services.  Terms like VM (virtual machine), and Virtualization (which my spell checker still doesn't even recognize) are common now in IT departments and CxO suites everywhere.  Xen is an underlying piece of Amazon Web Services EC2 platform.  VMWare underlies the virtualization and cloud offerings of some newer companies.  Then, there are even companies creating management tools to better manage Xen, VMWare, EC2, and other platforms better than the companies that created the software in the first place.  There are still laggards that haven't effectively used or even explored the earlier rounds of such technologies yet for strategic and tactical business purposes.  We all know what happened to the dinosaurs when things changed.

Today there are very few companies that have the internal knowledge and the resources to create and effectively manage true Cloud Computing infrastructures.  These are well known names like Google, Yahoo, and Amazon.  It is these companies that have dramatically leveraged their internal and originally Private Cloud Computing infrastructures to significant economic benefit.  But, this fact is changing very quickly.

There are many up and coming competitors as well that can make significant contributions in the private cloud computing space over time like Nirvanix, XCalibre, 3Tera, Enomolism, and Joyent.  Then, there are companies like Gigaspaces, 3Tera, and Enomolism that are already rolling out private cloud related services and products that you can use in your own data center.  While some have relatively mature feature sets, the genre as a whole is still very young and deeply segmented.  But, what is happening is a fast and significant shift towards the ubiquitous availability of the technology required to install and manage your own personal cloud computing infrastructures.

As with so many things, this is very much about business economics.  The companies, like Google, that have pioneered and used their private cloud computing platforms effectively today and over the last few years can and do generate staggering economic values.  The economic benefits should, if the project is properly executed,  translate directly to the bottom line in a variety of ways due to increased technology operations effectiveness.

Existing corporations across many industries can benefit similarly to various degrees by leveraging both public cloud computing services and also building private clouds behind the firewall when it's necessary.  The New York Times is a fairly dramatic and recent example of this trend.  They've used modern shared cloud computing to generate economic value from old archived content.

What does all this mean for Corporate IT?  The trend in IT that will materialize more clearly over time is a shift toward internal software and hardware changes that will make the corporate infrastructures resemble current commercial cloud computing infrastructures.  Enterprises need and will want these technologies.  But, the necessary trade-offs regarding security and privacy inherent in public cloud computing will likely cause private clouds will flourish.  Even though the public services themselves are technically secure; it's simply a domestic and international legal matter no matter what country your businesses home office resides.  Just have your attorney read Amazon's terms of service and let us know what they have to say.  So, we'll probably see white label private cloud computing products and services spawn across the industry and settle right in behind the corporate firewall.  Companies will find this economically desirable, managerially pragmatic, cost effective, and very disruptive to their IT Departments.