The True Value of Cloud Computing
Two weeks ago I had the honor to be invited to participate at a small panel at Structure09 in San Francisco CA next to Matt Mullenberg founder of WordPress, Robert Miggins VP of Business Development at Peer1 and Geir Magnusson Jr. consulting architect at the Gilt Groupe.
The topic of the panel was about the effects of running Cloud Computing on commodity hardware, but somewhere along the conversation, somebody asked a question that prompted a bit more explanation of the general effects of cloud computing.
See, most people are confused about the true benefits of cloud computing; often citing the cost of running a server from a cloud provider as being less than a traditional dedicated server from a traditional hosting company like Server Beach or alike. The fact of the matter is that running a server image from a cloud provider like EC2 is almost twice as expensive as it would be if you had a comparable dedicated server from a traditional hosting vendor. The reason is because the true value of Cloud Computing, is not in the cost of running a particular server in comparison to its traditional counterpart, but in the flexibility and elasticity that one gets to instantly scale up or down an application at times of high or low demands. For these capabilities, we gladly pay a premium.
The problem is that 95% of web applications (my personal estimate) are not designed to be able to take advantage of these properties and for a good reason. IT IS NOT TRIVIAL. Having the power to instantly scale up or down an application to only consume and pay for the resources that are required at that point in time is an amazing capability and if done correctly it WILL be less expensive than running on regular hardware from a traditional hosting vendor since you don’t have to run at over capacity all the time only of those peak times, but taking advantage of that power is harder than most people think.
Careful design and planning is required when building the application to facilitate this elastic scaling, but that is why companies like my own exist. In my opinion (and thankfully I’m not alone on this one), the future of software is on the web, but this new breed of web applications or SaaS Applications have many particular requirements that are key for their success that truly complicate the requirements to building the applications. Things like a true multi-tenant application, customer provisioning, application metering and billing only to mention a few are a must in order to succeed and are not trivial to design.
Cloud Computing is extremely powerful on its own because when done right, it can provide great financial rewards as well as operational rewards but understand that the hardware layer alone is merely a tiny piece of the puzzle. The true value of Cloud Computing will be much more appreciated when it is coupled with a platform layer like SaaSGrid that abstracts away the hardware layer and provides a unified foundation to enable the elastic properties at the application layer without the explicit interaction of the application developer.
What are your thoughts? Are you using Cloud Computing strictly for hosting or are you taking advantage of its elastic properties? What do you think about SaaS Application Servers like SaaSGrid?
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