By annie shum | April 28, 2009
CIOs are asked to focus on virtualizing storage, network operations and other critical business infrastructure rather than falling for the pipe dream of “internal clouds.”
By Thomas Claburn InformationWeek April 28, 2009 03:36 PM
The virtues of the cloud have become clouded and Google would like to clear the air. Blame consulting firm McKinsey & Company for the bad weather. It recently published a study on cloud computing that warns companies about falling for cloud computing hype “Clouds already make sense for many small and medium-size businesses, but technical, operational and financial hurdles will need to be overcome before clouds will be used extensively by large public and private enterprises,” the report states.
The report recommends that CIOs focus on virtualizing storage, network operations and other critical business infrastructure rather than falling for the pipe dream of “internal clouds,” which appears to be code for data centers with virtualization.
In a post on Google (NSDQ: GOOG)’s enterprise blog, Rajen Sheth, senior product manager for Google Apps, politely suggests that McKinsey doesn’t get it. He explains that virtualization is not the same thing as cloud computing. Virtualization has benefits, he says, but those benefits are magnified when backed by scalable datacenters operated by the likes of Amazon (NSDQ: AMZN), Google, Salesforce, and soon Microsoft. “In this model, customers can leverage hardware infrastructure, distributed software infrastructure, and applications that are built for the cloud, and let us run it for them,” says Sheth. “This offers them much lower cost applications, and removes the IT maintenance burden that can cripple many organizations today. It also allows customers to deliver innovation to their end users much more rapidly.”
The McKinsey study, Sheth argues, only considers hardware costs. He explains that Google’s cloud not only offers economies of scale most companies can’t match, but also lets companies adapt to service demand and innovate more easily. He points to the White House’s recent use of Google Moderator, a question submission application powered by Google App Engine, as an example of the scaling advantage of Google’s cloud. It was able to handle 100,000 questions and more than 3.5 million votes, a surge of activity many IT operations would have trouble handling without adequate planning and resource allocation. “There is limited value to running an Exchange Server in a virtual machine in the cloud,” Sheth elaborates. “That server was never designed for the cloud, so you don’t get additional scale. You’d also need to continue to maintain and monitor the mail server yourself, so the labor savings are marginal.”
Google’s value proposition — in the context of Gmail — is handling that for you, at about one-third of the cost of running a privately hosted mail server, with 100 times more storage and the frequent addition of new features, he adds.