Cloud Computing Thesis

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Introduction

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August 6, 2010 0

Over the years many organizations have invested in massive in-house computing capacities and
specialized Information Technology (IT) staff around the world in order to support their primary
business processes or to achieve a competitive advantage. According to Porter and Millar IT creates
competitive advantage by giving companies new ways to outperform their rivals. To gain competitive
advantage over its rivals, a company must either perform these activities at al lower cost or perform
them in a way that leads to differentiation and premium price (Porter & Millar, 1999). Nowadays
organizations are looking for IT to operate more efficiently and help to reduce the overall costs. The
concept of outsourcing has contributed to this development by transferring entire business functions to
an external service provider.

A recent phenomenon in the domain of outsourcing is called Cloud Computing. “Clouds are a large
pool of easily usable and accessible virtualized resources (such as hardware, development platforms
and/or services). These resources can be dynamically re-configured to adjust to a variable load (scale),
allowing also for an optimum resource utilization. This pool of resources is typically exploited by a
pay-per-use model in which guarantees are offered by the Infrastructure Provider by means of
customized SLAs” (Vaquero, 2009).
This means actually that more and more IT services – applications and technology – are outsourced to
external vendors over the Web, which eventually will lead to a change in the traditional business model
– where IT is in-house organized – to a virtual enterprise. This virtual enterprise, based on mainly
Cloud services, could be the future perspective. Meanwhile organizations are looking into business
process outsourcing (BPO), which involves the delegation of an entire business process to a third party
provider, including its supporting services (Gewald & Dibbern, 2009).

There are generally three types of IT services which an organization can outsource, namely: PaaS
(platform as a service), SaaS (software as a service) and IaaS (Infrastructure as a service) (Feuerlicht &
Govardhan, 2009). This research will address the most significant differences between them and
provide the basic architecture and layers of the Cloud Computing model. In fact the distinction between
those types of services may not be that important, the focus of the model is on the supplement,
consumption and delivery for IT services based on the Internet (e.g. the Web) in a dynamically scalable
way.

The process of outsourcing IT services and renting ‘computing’ usage from a third party service
provider means a flexible solution to the constantly changing demand of an organization. Therefore
many third party service providers, also called the Cloud providers, are using the concept of “Utility
Computing”. This means, just like the principle of electricity, that you pay for the resources you
actually use. This could have major consequences for the way we look at IT/IS in the future, when IT is
transforming into a utility and becomes standardized, the strategic advantage for the Cloud service user
might disappears as well (Radhakrishnan, Zu, & Grover, 2006).

Scalability, agility, flexibility and its service/ utility cost model can be theoretically seen as the main
benefits of the Cloud Computing model. Of course there are more benefits which should be taken into
account. However, from a business IT demand perspective there are some ‘uncertainties’ regarding
security, reliability and control for instance (Viega, 2009). SLA’s normally provide certainty
concerning these matters, like they currently do in outsourcing agreements. However, are they
sufficient regarding the Cloud Computing model to provide quality of service (QoS)? Moreover, what
happens if a service provider suddenly goes out of business or changes its business model. There might
be several other potential downsides regarding the Cloud Computing model which organizations are
struggling with. However, as Cloud Computing moves beyond the pure hype stage and into the
beginning of mainstream adoption, it is important to dig beyond the main Cloud term to the actual
ideas and technologies to dodge the hype and take advantage of the benefits that exist (Smith, et al.,
2009). This thesis will not give an answer to all of the questions mentioned above, but hopefully it will
provide some assistance in the decision making process of implementing the Cloud Computing model
in an organization.

In the modern world, Information and Communication Technologies are very closely integrated to
form total solutions for businesses. Hence, many academic
topics for dissertation and thesis research projects can comprise of problem areas addressing both these
technologies when investigated in the context of
corporate business solutions, solutions for government organisations and public infrastructure services.
Some of the solutions in IT are widely debated
because they are being claimed to be the future of computing infrastructures for IT enabled businesses.
I have come across numerous white papers that
attempt to establish the feasibility of these technology solutions. These white papers, mostly sponsored
by original equipment manufacturers, solution
providers and service providers, have been very effective in outlining the benefits of these new
solutions and their high level design details such that
corporate business owners have started taking interest in them. Virtualization, Cloud Computing,
Green Data Centres and Unified Threat Management
Solutions are four such areas for which the global vendors and service providers are actively pursuing
their customers. Many customers are already running
pilots in their IT infrastructure systems but the mechanism of learning from the pilots is not clearly
defined and implemented. Such large scale changes in the
world of IT systems and networking cannot be implemented based on ad-hoc learning from pilots
given that unstructured learning approaches can lead to
incorrect and biased conclusions thus causing major setbacks to the businesses. The focus should not
be only on saving capital expenditure and operating
costs but also on IT services, IT governance, Information Security, Compliance, Reliability, Business
Continuity, etc. In fact, the ground level implementation
plans and their challenges are yet to be analysed, tested and ratified. The academic community can find
numerous opportunities in establishing the validity
of these new solutions. The students should focus on studying the realisation of business benefits
claimed by the OEMs and Solution Providers such that the
other side of picture evolves clearly. I hereby present an outline of these solutions for the benefit of
students undertaking higher studies in IT systems.

(a) Green Data Centres: This is also referred to as sustainable data centres by many analysts. The
detailed specifications for designing and deploying green
data centres have been released by many companies and independent technology analysts. The primary
target of green data centres is to achieve
"conservation as much as possible" - energy conservation, space conservation, cost conservation,
resource conservation, etc. The designers try to implement
systems that are as lean as possible. But Gartner reports have warned about threats of crossing
conservation thresholds that can result in reduced
performance, reduced productivity, reduced disaster recovery capability and above all, reduced
capacity and flexibility to take on the business growth
challenges. Unfortunately, the consulting world is closely affiliated to the OEMs and Suppliers and
hence all designs and solutions are normally biased to
achieve sales targets. Hence, I suggest that students should come forward and undertake dissertations
and thesis research projects to study the designs,
implementation plans and maintenance/running/upgrading challenges of green data centres. A number
of topics can evolve especially if the studies are
focussed at the local geographies where the students are residing. The reader will appreciate the fact
that medium to large scale data centres require
enormous power capacities that the buildings meant for office spaces cannot build to host them even if
they have the requisite space for hosting the racks for
network devices and servers. In my consulting assignments, I have struggled significantly to fit the
equipment power ratings into the power budget provided
by the building administrators. A medium to large scale data centre may require anywhere between 500
KVA to 1200 KVA (or may be more) of power capacity
which is not provided by even large scale builders offering office spaces of the order of 100000 square
feet per floor or more; and yes, please keep in mind that
I am only talking about the data centre and not the desktops, laptops, lights, airconditioning, heating,
etc. of the employee areas. With the rapid growth of
businesses in the modern world of globalization, data centres can no longer be squeezed and made a
bottleneck for business growth. This is, probably, the
last thing upon which a business may like to compromise. Hence, Green Data Centres appear to be the
solution for the future. Also, it will be well integrated
with the philosophy of the Green Building revolution across the world. Every original equipment
manufacturer is working towards reducing the power
consumption ratings of its products. They have already done well in reducing the form factor and hence
the heat dissipation of servers and network
equipment, but energy conservation is still not addressed adequately. Overall, the total solutions should
be a combination of energy efficient solutions and
products. In this context, virtualization is gaining significant popularity across the world. The students
may like to conduct separate researches on
implementation of green data centres and virtualization or else combine both of them to conduct
integrated researches.

(b) Virtualization Solutions: Virtualization has become the buzz word when future solutions for IT
enabling of businesses are discussed. This refers to the
technology in which multiple virtual machines can run on a single hardware as if they are independent
computers used by independent users. Some
strategists argue that virtualization is one of the key deliverables in deployment of green data centres.
The products from Microsoft, VMware, and Red Hat
can enable end to end implementation of virtualization solutions. Many companies have already started
implementing virtual servers in their data centres
hosted on blade server hardware. With all the buzz around, very few have employed structured
research procedures to determine whether the self hosted
virtualization solutions are able to deliver to the business as per the claims made. I suggest that the
students should come forward and employ empirical
techniques like Phenomenography to investigate the actual business benefits achieved by corporations
by implementing in-house virtualization. A large
number of topics can evolve in this problem area. The focus should be on cost reduction as well as
improvement in productivity and performance of the
business. Gartner reports have warned about many negative effects of virtualization if the corporate
strategies, performance objectives and corporate
governance/information security objectives are not included in the architectures designed by the
solution providers. In the consulting assignments of ETCO
India, I have observed that the business stake holders are very reluctant to accept virtualization to host
their business critical solutions due to absence of
proven track records and absence of empirical generalizations in the academic world. This is a very
vast area for academic research. The students can create
multiple virtual hosting scenarios on OPNET Modeler or similar tools and simulate the models to
generate results. Additionally, the students may like to
conduct case studies on Corporations, SMEs and Entrepreneurs that have already hosted their IT
systems on virtual servers. The attributes to be investigated
are: performance of servers after hosting multiple operating systems and applications, network traffic,
user experience, possibility of virtualising IP
multimedia solutions, fail over, data organization and management, information security, software
delivery and licensing, auditing, IT governance, IT
services, competitive advantages gained by businesses, etc.

(c) Cloud Computing: This is evolving as a service facilitating IT resources on demand by virtue of
applications and business services hosted on Virtual IT
Infrastructures. Many OEMs have already launched cloud computing services to corporations across
the world - like IBM Blue Cloud, Google Apps Cloud,
Amazon Elastic Compute Cloud (EC2), Microsoft Cloud, etc. These service providers claim that the
customers can get any IT resource on demand - storage
capacity, memory, network bandwidth, application license, etc. The market is developed to such an
extent that millions of customers are already availing
these services. The students have mammoth opportunities to study the benefits of cloud computing to
businesses across the world. A large number of case
studies is possible because the concept has gained popularity across the globe. It needs to be
investigated if the current virtualisation service providers on IT
infrastructure clouds are fully ready to undertake the responsibility of running mission critical
businesses (like banks, financial services, trading and
investments, etc.) the way they have been running reliably in traditional data centres. It will be quite
interesting for the students to conduct interviews with
professionals that have already hosted their services on virtual servers. The attributes to be investigated
are: Reliability, Uptime, Speed and Performance,
Elasticity (resources on demand), Billing, Information Systems Strategy, IT Strategy, Information
Security, IT Governance, IT Services (to end users), etc.

(d) Unified Threat Management (UTM) Solutions: Unified Threat Management services framework is
a new innovation in the world of Internet Service
Providers using network and host based security products operating on cloud computing platforms.
This framework is expected to create new waves of user
expectations, service offerings, revenue models and client engagements that have not been tapped till
date due to lack of empirical models. The SMEs and
Corporations looking forward to transitioning their IT systems to Cloud Computing platforms can hire
UTM solutions from an ISP connecting them to the
Cloud Computing vendor. One can imagine AOL, AT&T or British Telecom connecting a large client
with globally dispersed users to Google Apps through
UTM protected networked links from client desktops/laptops to Google servers whereby all the
security controls are taken care of by UTM devices
implemented by these ISPs. This is an emerging area that requires enormous research efforts,
especially from students. Consolidating security solutions with
one service provider has many implications in terms of reliability, dependability, rate of attacks and
breaches, third party (service provider) compliance to the
information security policies of the customers, ownership of damages to the businesses if things go
wrong, strategies to switch service providers, etc. I suggest
that students should undertake studies on comparison of UTM solutions with traditional in-house
security implementation of corporations from business as
well as technological perspectives.

Problem statement

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August 5, 2010 2
The history of IT in business has been a history of increased interconnectivity and interoperability,
from mainframe timesharing to minicomputer-based local area networks to broader-Ethernet networks
and on to the Internet. Each stage in that progression has involved greater standardization of the
technology and, at least recently, greater homogenization of its functionality. For most business
applications today, the benefits of customization would be overwhelmed by the costs of isolation (Carr,
2003). In the pre-Internet era organizations wrote their own applications for each process they want to
automate. Soon it became clear that it would save costs when you bought a standard application form a
third party supplier, like word process or e-mail applications. Later on the globalization reached its
optimum, when the world became one marketplace and boundaries disappeared, organizations
discovered the principle of outsourcing business functions to the other side of the word. Main drivers
behind this process would be operational efficiency and cost reduction. The arrival of the Internet has
accelerated the commoditization of IT by providing a perfect delivery channel for generic applications.
More and more, companies will fulfill their IT requirements simply by applying pay-as-go utility
models, infrastructure services with value added platform services or fee-based infrastructure services
with value-added application services (Zhang & Zhou, 2009). In essence, users of Cloud Computing
“outsource” their data processing needs to a third-party (Jaeger, Lin, & Grimes, 2008). Thus, the
computing world is rapidly transforming towards developing software for millions to consume as a
service, rather than to run on their individual computers (Buyya, 2008). According to Gartner Cloud
services will lead to the use of new business models (service aggregators, integrators, brokers,
franchisee) and favor the growth of sourcing models based on multiple service providers, like selective
sourcing and prime contractor/ service integrators (Gartner(c), 2009). So Cloud Computing is going to
change the way IT is organized and will definitely have an effect on every organization that is using IT.
The principle of Cloud Computing is perhaps clear in theory; the question is how this phenomenon can
be adopted in practice.