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The Economics of Cloud Computing: An Overview For Decision Makers

Chapter Description

In this chapter, Bill Williams explores the standard definition of cloud computing to establish a baseline of common terminology. Understanding the essential characteristics of cloud computing platforms, as well as cloud deployment and service models, is critical for making informed decisions and for choosing the appropriate platform for your business needs.

Cloud Deployment Models

To close out our discussion of what cloud computing is and is not, we should review one more element highlighted in the NIST definition of cloud computing: deployment models.

Our gold standard of cloud computing definitions calls out the following deployment models:

  • Private cloud
  • Community cloud
  • Public cloud
  • Hybrid cloud

Let us briefly walk through each of these models.

Private Cloud

Using the notion of “siloed infrastructures,” many corporate IT environments today could be considered private clouds in that they are designed and built by and for a single customer to support specific functions critical for the success of a single line of business.

In today’s parlance, however, a private cloud might or might not be hosted on the customer’s premises. Correspondingly, a customer implementing his own private cloud on-premise might not achieve the financial benefits of a private cloud offered by a service provider that has built a highly scalable cloud solution. An in-depth analysis of costs associated with legacy platforms should highlight the differences between today’s private clouds and yesterday’s legacy silos.

It should also go without saying that legacy silos are not true private clouds because they do not embody the five essential characteristics we outlined earlier.

Community Cloud

In a community cloud model, more than one group with common and specific needs shares the cloud infrastructure. This can include environments such as a U.S. federal agency cloud with stringent security requirements, or a health and medical cloud with regulatory and policy requirements for privacy matters. There is no mandate for the infrastructure to be either on-site or off-site to qualify as a community cloud.

Public Cloud

The public cloud deployment model is what is most often thought of as a cloud, in that it is multitenant capable and is shared by a number of customers/consumers who likely have nothing in common. Amazon, Apple, Microsoft, and Google, to name but a few, all offer public cloud services.

Hybrid Cloud

A hybrid cloud deployment is simply a combination of two or more of the previous deployment models with a management framework in place so that the environments appear as a single cloud, typically for the purposes of “cloud peering” or “bursting.” Expect demand for hybrid cloud solutions in environments where strong requirements for security or regulatory compliance exist alongside requirements for price and performance.

Note that major cloud providers typically offer one or more of these types of deployment and service models. For example, Amazon AWS offers both PaaS and public cloud services. Terremark offers private and community clouds with specialized hybrid cloud offerings, colocation and exchange point services, and cost-efficient public cloud services through vCloud Express.12

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