Clouds combat computing costs

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08-August-2010

Clouds combat computing costs

Linus Lai, IDC associate director, said that the difference in anticipated benefits arose because of the different funding models for private and public clouds. The ROI figure of 1.8 years referred to the return on capital expenses required to build an internal cloud, while the 20 per cent savings figure referred to the drop in operating expenses associated with running IT when an organisation used public clouds.

The IDC survey which was sponsored and released today by VMware found that 72 per cent of Australian organisations now use or plan to use cloud infrastructures. Just 3 per cent of organisations consider cloud a passing fad.

VMware Australia vice president Paul Harapin said that over the last year there had been a fundamental shift in opinion about cloud computing. “A year ago we did a focus group and people pretty much took the mickey out of the whole concept.

“Within a year cloud has gone from being a bit of a joke to the number two priority for CIOs today.” (He claimed virtualisation has been the number one priority for some time.)

Mr Harapin acknowledged that the advent of the global financial crisis, which forced organisations to look for ways to tighten their belts had accelerated the push. However he said that the range of service offerings had also improved.

The research found that while 30 per cent of organisations were keen to use public clouds, a much greater number – 70 per cent were considering private clouds. Of the private cloud adopters, a half of these were also using or looking at public clouds.

As to who is driving the shift Mr Harapin said that CIOs were the primary initiators although he claimed; “The CEO and board have taken a more proactive interest in public cloud than they would in other technology areas.”

VMware’s interest in the area is apparent as Mr Harapin claimed; “Virtualisation is the foundation technology of cloud computing,” adding that it would also help with the portability of cloud based applications from one to another public cloud.

Michael Giusti, the general manager for systems integrator and cloud provider, Harbour IT said that the company used VMware products to build and deliver cloud services in Australia.

Mr Giusti explained that the company had transformed itself from a reseller and systems integrator in response to the burgeoning cloud phenomenon. The company now has a data centre in Sydney and a disaster recovery centre in Melbourne.

It is currently transitioning four organisations to its cloud – including beverage franchise The Coffee Club – with a further five lined up for completion before Christmas. Mr Giusti said that 60 per cent of its pipeline of future business comprised cloud solutions.

“Most organisations we deal with go through an infrastructure refresh every three years. Most CIOs I speak to want to get away from that,” said Mr Giusti.

“The models we are working on, are seeing 10-15 per cent savings over a three year period,” which is slightly down on what IDC forecast.

Both Mr Giusti and Mr Harapin acknowledged that many organisations had lingering concerns about security in the cloud and wanted to know where their data was stored. Neither however believed these issues represented a deal breaker.

In IDC’s survey security was cited by 62.5 per cent of respondents as the top priority. Most also said it was important to have an in-country data centre, with only 14 per cent saying the location was not important.

The cloud is expected to take centre stage next week at VMware’s VMworld 2010 in San Francisco. Mr Harapin said that a lot more would be revealed next week about Project Redwood, which is intended to help organisations develop their own clouds.

The vCloud Service Director which is Redwood’s more prosaic real name, is being beta tested presently and has been tipped for release next week.

He also hinted at the launch of a VM-apps store for enterprise class applications that could be downloaded for virtual machines.

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