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Cloud, meet Enterprise

This week we, along with our partners, announced the service availability of vCloud Datacenter Services. We think this is a major milestone because these are the first production enterprise hybrid clouds. There are already several “swipe your credit card get a developer VM” clouds out there, so why do we need three more? Precisely because these are not “swipe your credit card” developer clouds. These are clouds designed and architected to run existing enterprise applications with flexibility, performance and security.

I can imagine some reaching for their Twitter clients to lambast me for failing to acknowledge there are some enterprise apps running in those developer clouds today. Of course there are – but that misses the point. These are either new or re-architected applications, not the 99% of existing applications upon which IT departments spend 70+ percent of their budgets (according to Gartner).

I see a market for both types of cloud – developer and enterprise – but the enterprise cloud market is just getting started. Here are three reasons why this is important:

Reality check one: cloud is not just about raw infrastructure 

We’ve done a couple of enterprise cloud surveys recently, and in one of them IDG Research, partner to CIO magazine, asked 636 enterprise IT executives in the US, Europe and APJ about their cloud plans – and what was holding them back. Top of the list were performance, security, availability and portability. 88% said they’d be happy to move to a cloud that offered them the same or better security as they had inside their own four walls. This aligns with many conversations we’ve had with VMware customers, who haven’t made significant moves to use public clouds because of these barriers. 

Gartner’s Lydia Leong blogged on this topic recently, saying “provisioning raw infrastructure is the easy and cheap part, in the grand scheme of things.” What we’ve heard from VMware customers aligns with that. Enterprise IT folk need is the flexibility and agility of public cloud, coupled with the security, performance, availability and services they get in their own data center today. Oh, and help to deploy and manage all of this stuff would be helpful too. As would local presence and delivery capabilities in countries with strict data privacy laws (think Switzerland, Germany or France).

Reality check two: converting VM files isn’t hybrid cloud

Portability is another issue that is top of mind for enterprises. It gets back to the 99% of applications they run – enterprises want to know how those puppies are getting to the cloud. Several cloud providers offer tools to convert virtual machine file formats so that they can run on their cloud infrastructure. VMware is a keen supporter of open VM file formats (and open cloud APIs, too), which today means the industry-wide OVF file format. Most of these converters translate to a cloud-specific proprietary VM format. This has led some to proclaim that they can now offer a hybrid cloud, or indeed some sort of cloud portability. Translating the file is the easy part – but what about the application inside the VM? Is it going to get the same layer 2 network configuration it expects, for example? There are a host of dependencies and in developer clouds the assumption is that the app gets re-coded to use the new APIs of the host cloud. This is not portability — it's porting, the proverbial check in to the Hotel Calfornia of apps.

Portability really means that the app behaves the same way without modification (new code) – because modification means more expense, not lower costs. It also requires the same kind of security in the cloud that the customer can get in their own datacenter. vCloud Datacenter services provide both for VMware customers: the same VMware vSphere infrastructure foundation they use today, and auditable security for the cloud infrastructure, individual app and user level.

Reality check three: businesses don’t budget using credit cards 

Some have suggested that contracting with a cloud provider for a specific service level isn’t cloud, as if there were some “cloud purity law” that says credit cards are the only way to go. The only kind of purity law I enjoy is the German one concerning beer.  Let’s get real: businesses plan and budget their expenditures in advance. Staying within budget (i.e. predictable spend) is a very important concept for businesses. It may also be advantageous to strike a contract rather than paying instantaneous or “spot” rates, because it also allows the provider to plan ahead and get greater efficiency.

vCloud Datacenter provides a way to guarantee resource allocation to apps, and therefore guarantee predictable performance and predictable billing. The other fact of life at most businesses is that if something is going well and there’s lots of customer demand, budget can rapidly be reallocated to capture that demand. So even in this situation, the customer can scale up or scale down quickly. 

Cloud, meet Enterprise

One of the more enjoyable things about the cloud is its rapid evolution. We’re seeing the emergence of different flavors of cloud, and my guess is this will only continue as enterprises begin to really embrace this new model of computing. As we’ve worked with thousands of enterprises to virtualize and embark on the journey to the cloud, our customers have spoken.  They’ve told us what they need from a cloud service, and we are committed to delivering. Today we and our partners introduce the enterprise  hybrid cloud, designed to deliver IT agility and self-service, while maintaining security, performance and control.