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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.

The Enterprise Hybrid Cloud, Delivered

We’re excited about announcing vCloud Datacenter Services at VMworld 2010 because they're the first examples of a globally consistent enterprise-class hybrid clouds. Let me explain what that means and why it’s important.

In a nutshell, vCloud Datacenter Services — offered globally by leading service providers — marry the dynamic, on-demand nature of public cloud services with the compatibility, security and control that enterprise computing requires. A hybrid cloud is defined as two or more clouds that offer data and application portability.

We did a great deal of research with our customers – talking to those who were considering external clouds into their computing environment. We learned a lot from these conversations and I’ll be writing about them in a series of future posts.

Agility

There was a consistency to what we heard: enterprises of all sizes that loved the promise of the dynamic, on-demand nature of public clouds  – the ability to get computing capacity quickly, with no up-front investment and few restrictions in the types of operating systems and software that could be deployed.

Some of you were finding it a bit uncomfortable, in fact, because there was now an external yardstick for the price of on-demand, commodity computing and storage capacity — which drove focus and learning around the benefits that cloud computing might bring to your organizations. This led to another critical insight: access to on-demand computing as a commodity was not enough by itself.

Portability and compatibility

Why? The first challenge is both economic and technical: we learned that a lot of pilot cloud projects were brand new applications, largely because it was technically difficult to take an existing application and make it work in an external cloud. Existing systems are what an organization depends upon, and in economic terms they represent sunk cost. So the extra cost of re-writing or porting an existing system to work in a shiny new cloud environment is often a non-starter.

At the same time, you were very conscious that the majority of IT dollars go into keeping the lights on for existing systems – so the cloud’s ability to reduce some of those costs or avoid new ones (e.g. a datacenter build out) was attractive.

As a result, a key feature of all vCloud Datacenter services is VMware-certified compatibility and portability: you can take existing virtualized applications and move them to the a public cloud provider of their choice with little or no rework.

Much as I wish there was no rework at all, some systems have assumptions about the operating environment baked into them – such as IP address ranges  – which means there is some work to remove those assumptions. But, with systems that don’t have that kind of restriction – and there are lots of those – there is no need to wait for an internal cloud deployment. You can start getting cloud computing benefits right away using the virtualization technology you’re already familiar with: VMware.

Security

Another important area that we heard about time and again was security. Consequently, security is a key part of vCloud Datacenter services. There are three parts to this: the security of the cloud infrastructure itself, the applications running in the cloud, and the access and authentication rights for cloud users within your organization.

You told us it wasn’t enough that the infrastructure and apps are protected; security teams and auditors need to be able to verify and document it too. To deliver on that, vCloud Datacenter service infrastructure has to meet a strict set of physical and logical security controls, with all logs available for inspection by third party auditors. We developed a control set derived from ISO 27001 and consistent with SAS70 Type II for that purpose, which our service provider partners implement.

We also took advantage of the new vShield Edge and vCloud Director “follow the app” virtual security, which provides a full stateful firewall (again, the logs are available for audit), virtual Layer 2 networking, and full Layer 2 network isolation. As a result, security policy and implementation automatically follow the app, regardless of where it lands physically. (There will be more on this in another blog post.)You also get full role-based access control, authenticated against your own enterprise directory so that you have the kind of access and authorization security you’re used to.

In short, we think the enterprise cloud is about three things: agility for computing services, portability of  existing virtualized applications, and security – not just the protection you expect, but also the transparency required to pass audit.

I’ll be writing more about our experiences working with customers who are building enterprise cloud environments in future blog posts.  In the meantime you’ll find more details on vmware.com