Enterprises Moving from Grids to Clouds

1. Enterprises Moving from Grids to Clouds Robert B. Cohen Fellow, Economic Strategy Institute Area Director, Enterprise Requirements, Open Grid Forum bcohen@bway.net

2. Dion Hinchcliffe, March 26th, 2009 Cloud computing and the return of the platform wars hinchcliffe.org/img/cloud_computing_growth.jpg

3. Top Cloud Firms in 2008 Source: Markus Klems, “Merrill in the Cloud,” Cloudy Times, July 5, 2008. http://markusklems.wordpress.com/2008/07/05/merill-in-the-cloud/

4. Classifying Enterprise Cloud Use

5. Lilly: Reasons for Turning to Clouds • "Amazon EC2 has given us the ability to easily spin up tailored computing environments that can quickly and cost-effectively process tremendous amounts of research data," said Dave Powers, associate information consultant at Eli Lilly. • "This is a huge step forward in maximizing our results relative to IT spend, and now that Amazon EC2 runs Windows and SQL Server, we have even greater flexibility in the kinds of applications we can build in the AWS cloud."

6. Lilly’s Long Term Cloud Plans Lilly Orchestration Layer Google Nirvanix Amazon Rackspace Source: Dave Powers, “Eli Lilly and Cloud Computing,” January 8, 2009. Information Week, “How to Plug into the Cloud” Webcast. https://www.techwebonlineevents.com/ars/eventregistration.do?mode=eventreg&F=1001313&K=4Blog

7. Glaxo: Reasons for Turning to Clouds • Reduce server infrastructure count • Consolidate 4 major compute/data centers with different platforms, different OS that require extra costs to maintain a diverse infrastructure • Want compute/data center in one location, with a uniform hardware platform that is “Carved into different sections based on applications” whose operation could be outsourced • Want new Compute/Data Center to look like Grid/Cloud, with shared SAN storage, 10GB E as high speed fabric, uniform server infrastructure Source: GlaxoSmithKline presentation, OGF 26 Enterprise session.

8. Regulation: Pharmas and Clouds • Pharmas are a Highly Regulated Businesses • FDA regulations • Sarbanes Oxley (SarBox) reporting requirements • May only use clouds for unregulated R&D (target discovery) not product development. • Doesn’t have personal/patient info in this phase, so can be outsourced to public cloud. • For Phase 1 clinical trials pharmas have to prove to FDA this cloud provider is good enough/Certified • Pharmas need to create monitors to oversee their use of SaaS and staff to keep records of all data analyzed and results. Can’t just do a run and forget about it. • Must keep records for 15-20 -> 60 years, certify a cloud. Source: GlaxoSmithKline presentation, OGF 26 Enterprise session.

9. Pharmas may need to provide access to their private clouds behind a boundary “Firewall” in order to maintain security. This may not be possible with an external cloud today. Tunneled VPNs could be used by partners. Dion Hinchcliffe, Enterprise cloud computing gathers steam, August 1st, 2008

10. Wachovia: Profits Drive Banks to Grids • Factors leading to cloud adoption are different from pharmas because individual parts of the bank can pay for access. The result is a very different dynamic • Clouds help parts of a bank make money • With Grids, IT groups showed that could run risk analysis rapidly. Different groups wanted to run risk analysis on additional types of investments and make more money. • One response to SaaS is to build internal “Seed Clouds” and let internal groups use it like SaaS. • Regulations don’t address clouds well. Source: Wachovia presentation, OGF 26 Enterprise session.

11. Clouds push Banks to “All-Inclusive” IT • To respond to SaaS, bank IT groups are exploring models where a range of services are provided for one charge • This is a clear move away from per unit billing and a move to all-inclusive charges • Also, IT only charges for the overhead (extra employee), not the full HW/SW costs! • Economic drivers for bank IT group are really: • Speed to market • Reducing opportunity costs (missed opportunities) or improving ability to find new business chances Source: Wachovia presentation, OGF 26 Enterprise session.

12. Chevron and Collaborative Environments for Oil and Gas • The next generation control room will provide a collaborative work environment for operations to make better decisions based on much enhanced Situational Awareness. • Cloud computing and Virtual Environments are helping to provide a contextual view of the operating plant • Oil and gas firms can derive actionable information from multiple data sources and thereby laying a foundation for a proactive/predictive operating philosophy where “ in the moment” situational awareness impacts safety, reliability and overall performance. Kevyn Renner, Chevron Global Manufacturing, “Next Generation Control Room: “In the Moment” Situational Awareness Drives Better Decisions.” NPRA Plant Automation and Decision Support Session. www.npra.matrixmaxx.com/forms/uploadFiles/15BAA0000000C.filename.padsdescriptions.pdf

13. Chevron Models Well Data using Large Computing Grids Source: Rick Morneau, Talk at WITSML Paris, 16-May-2007. www.witsml.org/images/posc/meetings/may07witpub/may07witpub_06_chevron.ppt

14. Internal vs. External Costs and Clouds • Internal Liability – What if Scientist pushes the wrong button and runs up astronomical costs? • Process controls to "launch" a grid application externally. There need to be controls so a user can’t push the wrong button and end up paying a substantial external charge. • Legal Issues delay decision making when external contracts are required, as do compliance issues. This takes too long. • Setting up external relationships often means internal resources are moving $$$ around between different pockets – very inefficient. • An External Service Provider requires external payments – cold hard cash, when organization wants to restrict external costs. Source: GlaxoSmithKline presentation, OGF 26 Enterprise session.

15. Conclusions • Economic drivers will push clouds internally in pharmas and banks, largely for overflow calculations and short-term calculations. • External clouds can quickly spin up “tailored environments.” • Internal clouds can address regulatory limitations and need to control information (security issue). • Banks can reduce missed opportunities, broaden risk analysis. Result is improved earnings and risk management, faster speed to market. • Legal considerations may push for “all-inclusive” charges for specific types of services.