Welcome!

Cloud, Big Data, and the Internet of Things

Automic Blog

Subscribe to Automic Blog: eMailAlertsEmail Alerts
Get Automic Blog via: homepageHomepage mobileMobile rssRSS facebookFacebook twitterTwitter linkedinLinkedIn


Related Topics: Cloud Computing, DevOps Journal

Blog Feed Post

Stand By Data Center, IaaS Is Heading Your Way By @Automic | @CloudExpo [#Cloud]

Exploring the impact of infrastructure-as-a-service on the data center and the key trends expected to emerge

Stand By Data Center.... IaaS Is Heading Your Way
By Michael Schmidt

My first blog, Infrastructure service clouds: re-defining the data center, introduced the concept of infrastructure-as-a-service (IaaS), its benefits and why the cloud technology is proving so disruptive. With IaaS making waves in the data center market, it's time to look at the ripples IaaS is making on the industry value chain. And shine a light on emerging IaaS trends.

Three data center players are feeling the ripples of IaaS: hosting providers, data center software/hardware vendors and data center customers.

Impact on Data Center Players

Impact on data center outsourcers and hosting providers
IaaS will drive further consolidation among data center outsourcers and hosting providers. Why? Because the flexibility and cost advantage of IaaS cloud providers requires data center outsourcers and hosting providers to either adopt IaaS or move into niches.

With standards driving down IaaS licenses and implementation costs, data center outsourcers and hosting providers could move into IaaS either on their own (which requires sufficient scale) or through partnerships. It's easy to imagine a net of partnering providers offering IaaS under a virtual umbrella as a standardized offering to customers.

Impact on data center software and hardware vendors
Threat. That's the impact of IaaS on this community. Firstly because consolidation and scale shift purchasing power towards the large IaaS providers. And secondly because IaaS treats all workloads as equal, placing commoditization pressure onto the industries.

To prosper, data center software and hardware vendors must enable their technologies for use in IaaS environments. Optionally, they could move upstream into the infrastructure service cloud business by using economies of scope or provide differentiated products on top of evolving standards.

Impact on consumers of data center services
IaaS is good news for customers, owing to decreasing costs and increased flexibility for dynamic workloads. However, the real winners are small and medium-size businesses, which don't need to allocate precious capital to dedicated hardware/software.

The relative losers are large enterprises, particularly those in regulated industries which may be restricted from move away from an on-premise infrastructure. Conversely, enterprises with sufficient internal scale to offset IaaS implementation costs will gains through increased resource utilization-commonly referred to as ‘private cloud'.

Current Trends and Their Impact

Standards are on the horizon
The most important difference between proprietary IaaS solutions, like Amazon AWS, and IaaS stacks that use a combination of commercial licensed products (OpenStack and the Citrix CloudPlatform, for example) is the breadth of data center hardware and software they support. IaaS stacks are likely to win through here: their popularity is an incentive for vendors to integrate with a platform, conversely better platform support increases the number of adopters.

OpenStack has the best potential to become this standard: it has a broad open source developer community and significant shared R&D investments from firms including HP, IBM and CISCO.

A standard will probably drive commoditization pressure among IaaS providers and at the same time strengthen the vendors, who can build differentiating offerings on top.

Regulatory changes
Strict government regulations and compliance rules could fragment the IaaS market into regional providers, potentially reducing scale effects and driving prices up. Germany, for example, has strict data security regulations that prohibit sensitive data being stored outside of the country.

Commoditization pressure and responses
The emergence of standards and feature parity between IaaS solutions diminishes the opportunity for differentiation. In this climate, price reigns supreme. Commoditization will also be exacerbated by another key characteristic of IaaS: the low switching costs for consumers.

For this reason, IaaS providers are moving into the platform-as-a-service (PaaS) space, whereby application platform or environment cloud services are offered on top of the infrastructure. These services are more complex and fragmented by applications, thereby promoting differentiation. They also make customers more ‘sticky', since the customer switching costs are high.

Drawing it all together
Make no mistake, IaaS will have a significant disruptive and transformational impact on all the data center players. However, the complex nature of enterprise IT architectures, coupled with the critical role they play in corporate success, will create inertia. The appetite among enterprise IT for agility and cost reduction needs to be balanced against compliance enforcement and risk mitigation strategies. Since enterprise IT is the largest customer of a data center infrastructure, it might take longer than anticipated for IaaS technology to reach its full potential.

Read the original blog entry...

More Stories By Automic Blog

Automic, a leader in business automation, helps enterprises drive competitive advantage by automating their IT factory - from on-premise to the Cloud, Big Data and the Internet of Things.

With offices across North America, Europe and Asia-Pacific, Automic powers over 2,600 customers including Bosch, PSA, BT, Carphone Warehouse, Deutsche Post, Societe Generale, TUI and Swisscom. The company is privately held by EQT. More information can be found at www.automic.com.