Growing interest in Cloud Services for the enterprise
Enterprises are now looking seriously at the cost and efficiency benefits of using Cloud Computing, as new business models make it an attractive proposition. JMP Securities[1] estimates that the three main Cloud Services market segments will enjoy a 15%, 61% and 27% CAGR over the next 10 years. Those areas are, respectively:
- Software as a Service or SaaS (also known as AaaS — Applications as a Service). Applications are hosted by the communication service provider (CSP), which allows the service to be accessed from anywhere at any time. The service can be any software-based application, including communications, real-time or not.
- Platform as a Service (PaaS): A set of software and product development resources hosted on the CSP’s infrastructure. Developers can create applications on the platform over the Web using APIs, website portals, or gateway software installed on the customer’s computer (for example, Force.com).
- Infrastructure as a Service (IaaS), which provides virtual server instances with unique IP addresses and blocks of storage on demand. This is sometimes referred to as “utility computing.”
Business and technical benefits in one package
Cloud Services offer economies of scale to both the enterprise user and the CSP. The benefits to the user stem from the “off-site” nature of the service proposition:
- Services are available on demand, with no upfront investment or commitment.
- Resources are elastic: consumption can be increased or decreased at any time, as needed.
- The infrastructure and services are fully managed by the cloud provider.
From a technical standpoint, enterprises (and CSPs) benefit from the flexibility of the architecture that underpins the Cloud:
- Services are supported by virtualized/scalable resources.
- Architecture is multi-tenant/multi-instance.
- Based on Internet technologies, Cloud Services are quick and easy to deploy and scale.
Different models for different needs
Even though the notion of the ‘cloud’ originally referred to services available from the Internet, some variants have emerged, offering alternative models for the adoption of cloud-based architecture or services.
- The Public Cloud: A multi-tenant environment, which can be a combination of multiple companies (shared public cloud) or multiple individual users and companies (public and community clouds).
- The Private Cloud: A private network, run by the customer, which often uses a corporate firewall. Both user access and network usage are restricted (for example, only accessible through VPN or on the customer’s premises). When offered by a Cloud Services provider, this is known as a Virtual Private Cloud.
- The Hybrid Cloud: The Hybrid Cloud offers technology to manage complexity and performance, as well as security and privacy concerns. The Hybrid Cloud will deliver some cloud services, while sensitive data will remain on the enterprise’s premises.
Figure 1: Cloud models evolve to satisfy enterprise needs
CIOs see issues, but also benefits
According to the independent research firm Yankee Group,[2] cloud and mobility are converging: the CAGR for cloud computing from 2008-2014 will be around 30%, while smartphone penetration will grow by 19% and tablet computers by 50% CAGR.
As far as enterprise communications are concerned, increasing smartphone penetration, the proliferation of connected devices and increased mobile bandwidth driven by 3G and 4G/LTE are building the case for adopting Cloud Services.
While economic benefits are clear, there are also strategic and time-to-market benefits:
- Users can enjoy IT as a Service.
- Developments and deployments time for new platforms, technologies, services and application are dramatically reduced.
However, barriers to the widespread adoption of Cloud Services by enterprises cannot be ignored – there are still questions about their readiness for enterprise use, such as:
- Security/data privacy and jurisdictional issues
- SLAs, which are in their infancy and vary considerably
- Performance/availability and access control/latency
- Reliability and vendor neutrality
- The ability of Cloud Services to be integrated with business applications
- The relative immaturity — and continuing evolution — of the Cloud Services model
The mandate of CIOs has changed dramatically over the last decade, moving from a technical/expert role to something that relates a lot more to the business. They are being asked to provide services that will help increase customer satisfaction, enable mobile workers and enhance productivity.
The Cloud can offer some significant benefits in these areas. The role of the CIO will increasingly be to decide which services can be made available from the Cloud, and which Cloud model to use.
Their choices will be driven by technical or economic considerations, or both: how best to use Cloud Services to lower costs, accelerate the rollout of new services or applications, increase the efficiency of mobile workforces or in-house collaboration, and so on. The Cloud is also a perfect location for services that require a lot of computing power — and would therefore normally require significant CAPEX investment — because Cloud Services can take advantage of vast resources on demand, when needed, on a pay-as-you-go basis.
A concrete example – Video Infrastructure as a Service
Given the proliferation of personal and enterprise video endpoints, Video Infrastructure as a Service (VIaaS) can be used as a good illustration of the benefits offered by a cloud-based architecture.
The VIaaS solution is set to become the preferred mechanism for supporting soft clients and the dominant form of video infrastructure. It will include emerging video services, as well as alternatives architectures delivered from the Cloud. According to research by Gartner, this market (or rather delivery model) is expected to grow by 45% CAGR[3] by 2015.
Of course, barriers in terms of usability are limiting the adoption of video in the enterprise. New services are required, which deliver:
- High quality without the complexity
- Accessibility from any endpoint
- Do not require any specific expertise or technology platform
- Redefine Quality of Experience standards
This makes Immersive Communications services an ideal candidate to be served by the Cloud. Amongst other things, Immersive Communications enables mixed reality, behavior analysis and virtual director capabilities – features that will require a lot of computing power to render. As an example, scalable personalized video encoding, software frameworks for media processing and video and graphical processing (GPUs – Graphical Processing Units) are some of the capabilities ideally suited for cloud-based delivery.
Moreover, VIaaS can be delivered in a Hybrid Cloud model, where resources and applications are spread across the architecture, enabling the use of Immersive Communications with (on premises) business applications, or social networking services for employee collaboration.
New enterprise services, new revenues
Communication Service Providers are ideally positioned to deliver such cloud-based services, because they can intelligently blend platforms for immersive communications with network-based services (such as prioritization and caching of applications), based on their business criticality. They can build Virtual Private Clouds for enterprise customers, or simply become pure Cloud providers, by syndicating resources to serve many organizations from the same infrastructure.
To contact the authors or request additional information, please send email to techzine.editor@alcatel-lucent.com.