Private cloud computing is more than a virtualized environment

Private cloud computing will take hold in 2011, experts say, as enterprises move beyond a virtualized environment to such cloud attributes as metered use and chargeback.

When Thomas Bittman, vice president and distinguished analyst at Gartner Inc. in Stamford, Conn., asked attendees at the recent Gartner Data Center Conference whether they would be pursuing private cloud computing by 2014, 66% answered yes.

Had Bittman asked how many of those private cloud computing environments will include metered usage, showback -- if not chargeback -- and on-demand self-service, the number likely would have been significantly less, according to experts who say implementing a private cloud is a lot more work than one might think.

"There's a lot of ambiguity behind the private cloud definition," said Chris Pray, a senior engineer in the Global Information Services division of Vertex Pharmaceuticals Inc. in Cambridge, Mass. "Having a closet full of servers behind a firewall doesn't meet the definition."

To Pray, a private cloud is an environment that is wholly and solely operated, controlled and managed by a particular company. The public cloud is the reverse: "No control over the computing environment, no [capital expenditure]," he said.

The benefit of a private cloud is control. "When Google has a bad day, you don't have any email," Pray said. "If you were a private cloud, if you had a bad day, you could bring all forces to bear to correct the problem."

The National Institute of Standards and Technology's definition of cloud computing says it includes on-demand self-service, broad network access, resource pooling, rapid elasticity and measured service. A private cloud computing environment should be scalable; a service-oriented architecture that allows you to "turn the knob," Gartner's Bittman said. "If you turn the knob and nothing happens, that's not cloud."

Despite the challenges, CIOs are tuning in to private cloud computing. "It's going to be a big year for private cloud adoption," said Frank Gens, chief analyst at IDC in Framingham, Mass. The research firm's preliminary estimate for the amount that will be spent worldwide this year on private cloud computing services is $13 billion -- less than the $29 billion IDC predicts will be spent on public cloud services in 2011 but "growing much faster," he said. "IT shops should be looking at private clouds as a large part of their next-generation IT service delivery foundation," he added.

A private cloud computing pioneer

Sisters of Mercy Health System, based in St. Louis, built a private cloud in its data center, intending eventually to give other health care organizations access to an installation of Epic Systems Corp.'s clinical health system with integrated software that spans clinical, access and revenue functions. For now, the private cloud is used by internal employees. The ideal external client for an Epic cloud service would be a smaller organization that wants to use the software but can't afford a tier 3 data center with many tier 4 attributes, said Jeff Bell, the health system's chief operating officer.

"We have considered the public cloud, and have a number of systems delivered by an [application service provider], but it's not our strategy," Bell said. "Our strategy is to be the cloud."

Some of Sisters of Mercy's physical servers have as many as 70 virtual machines (VMs) running on them. "We meter [the virtual environment] with software, and can charge back, although we're doing showback at this point," Bell said.

Enterprises are interested in private cloud computing for various reasons including security, experts said. But the biggest driver might be that a private cloud is a potential revenue producer, as in Sisters of Mercy's strategic plan.

"As we potentially take on external customers, we can charge back," Bell said. "Then it will be a hybrid cloud. I would love to be able to host some of the systems that we host for ourselves."

Private cloud in a box?

Most enterprise IT departments lack the experience and maturity to manage such an environment, according to James Staten, vice president and principal analyst at Forrester Research Inc. in Cambridge, Mass. It will take years for most enterprise shops to deliver private cloud computing services, he said.

We have considered the public cloud, and have a number of systems delivered by an application service provider, but it's not our strategy. Our strategy is to be the cloud.

Jeff Bell, COO, Sisters of Mercy Health System

That's one reason why IDC's Gens predicts that in 2011, "several key pure-play public cloud providers like Salesforce.com and Google will partner with infrastructure vendors to create private cloud appliances of their public cloud offerings."

In 2011, a new generation of enterprise software also will emerge, designed for the cloud with built-in support for multi-tenancy, self-service and usage metering, according to Gens. These new versions of email, collaboration and enterprise resource planning will make the implementation of private clouds much more practical.

Other options include Hewlett-Packard Co.'s CloudStart and its cloud-in-a-box POD (for "performance optimized data center"), a customized shipping container with racking, power and cooling systems ready to be plugged into a data center. The POD's price tag is $1.4 million and up, noted Tim Wessels, a systems integrator with Advanced System Integrators LLC, based in Northfield, Mass. IBM, meanwhile, is promoting CloudBurst, a modular system of computers and storage plus the "secret sauce" to make it work like a cloud, he said. CloudBurst starts at about $200,000 per module.

"So I'd say you can get a private cloud … for a price, and it could actually be a lot less than trying to build one yourself," Wessels wrote in his blog. And there's another option for private cloud computing: on the public cloud: "The option to use a private virtual cloud at Amazon.com or Rackspace might start to look pretty good in comparison, and cost a lot less up front," he wrote.

Slow and steady private cloud computing wins the race

If your company decides to take a virtualized environment to the next level for private cloud computing, bear in mind that Rome wasn't built in a day. "We spent several years developing a private cloud," said Sisters of Mercy's Bell, who admits that he was partially hesitant.

"We eased into it, built our policies and procedures, built farms, and partnered with VMware for multi-tenancy -- even though we are single tenancy right now. We're taking it slow, deliberate, making sure we know what we're doing. We want to make sure we can provide quality service to ourselves, and in the future, provide that service to other customers for economies of scale. Scale does matter in a data center."

Most IT departments lack consistent procedures for tracking the deployment, usage and ownership of VMs, which leads to VM sprawl and "will cancel out the economic savings of a private cloud," Forrester's Staten said. An organization is "cloud ready" if it automates the deployment and management of VMs, provides self-service access for end users, and shares access to its infrastructure across business units, he said.

Over the next 12 months, develop an overall cloud strategy and build a dynamic sourcing organization, Gartner's Bittman advised. "Align your data center management with vertical service delivery. Focus on the service catalog, portfolio your services, develop strategies for services and identify new cloud-enabled opportunities. The bottom line: You need to experiment; leadership is critical to gaining buy-in."

Let us know what you think about the story; email Laura Smith, Features Writer.

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