What Your Cloud Vendor May Not Be Telling You

Transcription

1 What Your Cloud Vendor May Not Be Telling You And How It Could Cost You Jordan Jacobs VP of Products, SingleHop

2 Public Cloud Dominates the News! Netflix Shifts All IT to Amazon s Public Cloud (Wall Street Journal, February 11, 2016) How GE is closing datacenters and moving to the public cloud (structureconf.com, September 22, 2015) Shocker! Amazon remains the top dog in cloud by far, but Microsoft, Google make strides (Fortune, May 19, 2015) IT pros should focus on largest public cloud providers (CIO.com, November 17, 2015) Clash of the public cloud Titans: AWS vs Microsoft vs Google vs IBM (TechRadar, November 25, 2015)

3 But, Publicity Does Not Equal Market Share

4 Managed Hosting is 3.5x Larger than Public Cloud Colocation Managed Hosting Bare Metal Public Cloud

5 What is Your Approach to Cloud? Ask yourself: Are your workloads in the right place? Are your people focused on the right things?

6 Economics of Cloud Cloud models can be compared to choosing a car. In Chicago s downtown Loop, I rarely need a car. When I do, I need different cars for different reasons: Running Errands Going on a weekend trip Going to Costco

7 Economics of Cloud Example #2 what if you re a pizza delivery guy? You wouldn t rent your vehicle by the day.

8 Public Cloud May Not Be Your Best Option...there s growing realization that for stable, non-variable workloads, cloud even public cloud may not be the cheapest option at all. Barb Darrow Gigaom Blog Post Sr. Writer at Fortune

9 Breaking Down Cloud Pricing Models There are multiple pricing models for cloud. Being on the wrong one could increase your cost by as much as 70%. Let the economics guide you.

10 Public Cloud Inefficiencies Pricing Model Every time we add an additional application, we add additional cost regardless of the currently available resources. We call this an allocation based cost model. Every year applications use less and less of of the total capacity of a single server. This This means, means, scale scale causes causes huge problems, and massive massive underutilization. + I need to add an application I need to add a server. z z Server Capacity Application Applications use less and less total capacity leading to heavy underutilization of servers and inefficient use of resources

11 Heavy Under Utilization of Servers Gartner report states 12% utilization of servers Accenture report states 7% of AWS resources are being utilized McKinsey reports 6% server usage

12 Reservation Pricing Model Pricing Model No additional cost from adding more VMs until available resources are consumed. The cost is directly tied to the amount of resources reserved or used by each of the VMs. We call this a reservation based model. Pre-virtualization inefficiencies Post-virtualization, server Cluster/Resource pool with lots of VMs. Improved control of data Performance improvements Improved infrastructure manageability Converting customers from an allocation model to a reservation model saves up to 70% over public clouds

13 Are Your People Focused in the Right Place? Almost 50% of the cost of operating a server or virtual machine is personnel.

14 High Cost of Managing IT In House According to the Gartner Linux Server Analysis, an organization on average spends $354 per month in personnel costs. List price for a SingleHop critical management package is $150. Significant economic benefits to SingleHop partnership. Benefits extend regardless of where the infrastructure is located. Category % Annual Monthly Hardware 18% $ 1, $ Software 16% $ 1, $ Personnel 48% $ 4, $ Connectivity 2% $ $ Occupancy 7% $ $ Disaster Recovery 1% $ $ 7.38 Other 8% $ $ Total 100% $ 8, $ Management Items Infastructure Items

15 Analysts say more than 70% of IT budget is spent keeping the lights on.

16 IT Leaders Spend Too Much Time Keeping the Lights On The Average Enterprise IT Budget 73% 27% allocated to capacity management and routine maintenance dedicated to new projects

17 How Much of Your IT Budget Goes to Running vs. Growing Your Business? Gartner: Run, Grow, Transform Framework, 2015

18 Are You Getting the Support You Need? Basic infrastructure support is not included at most public cloud providers.

19 You Pay a Premium for Flexibility Support packages only cover the infrastructure deployment and architecture Questions like: Why is this down? Why is this slow? They may just pass customers off to the Knowledge Base with canned answers

20 The Value of an Managed Service Provider

21 Mapping Your Workload to the Right Cloud Model Workloads with resource spikes Consistent non-variable workloads Managed Private Cloud Public Cloud

22 Five Questions to Align and Refine Your Cloud Approach 1. How variable are your workflows for your cloud apps? Do you have heavy seasonality, cyclical spikes, or more steady workloads? 2. What percentage of server resources are you using on average? 3. Of your complete IT project portfolio, what percentage of those projects are driving new business vs. staying online? 4. Where does your IT staff go for support? How much does that cost? Is your IT staff focused in the right place 5. Do you use just one public cloud provider, or do you have a multi-cloud strategy? Are you selecting the right infrastructure for the workload (e.g. some in Public Cloud, some on Managed Hosting) or lumping all projects into the same type of infrastructure?

23 Jordan Jacobs VP of Products,