Post on 23-Dec-2015
How Cloudy is the Future?
HostingCon KeyNote19 July 2010
Lydia Leong
Research Director
Internet Infrastructure and Emerging Enterprise Services
What is the Future of Hosting?
• What is cloud computing, really?
• What will the cloud mean, not just for the future of infrastructure but for the future of IT and the way that businesses and consumers use IT?
• How will different segments of the hosting market evolve over the next five years?
1980 1990 2000 2010 2020
Cloud Computing:Multiple Perspectives, Multiple Origins
VirtualizationSubsidized Applications
Web 2.0 and Mashups
Global-Class Consumer Applications
Management Discipline
Internet
Web
Cloud
Connectivity
Information and Browser UI
Services and WebAPI/Arch.
Googleplex
SaaS
From the EnterpriseFrom the Web
Real-Time Infrastructure
Utility Models
Data Center Pressures
Grid
Web Platforms
Focus on "Computing"Focus on "the Cloud"
The Changing Seller / Buyer Relationship
"All that matters is results. I don't care
how it's done."
"I don't want to own assets; I want to pay for elastic use, like a
utility."
"It's about economies of scale
with effective and dynamic sharing."
Acquisition ModelService
Business Model Pay for use
Technical Model Scalable, elastic, sharable
Access Model Internet
"I want accessibility from anywhere,
from any device."
Vendors UsersSell tech to:
Implement tech bought from:
The Seller The Buyer
Providers ConsumersSell service to:
Consume service from:
Cloud computing promotes a provider-consumer
relationship over a vendor-
user relationship.
Gartner defines cloud computing as "a style of computing where scalable and elastic IT-related capabilities are provided 'as a service' to customers using
Internet Technologies“.
What is Cloud Computing?
Internet TechnologiesServices are delivered through use of Internet Identifiers, Formats, and Protocols.5
Metered By UseServices are tracked with usage metrics to enable multiple payment models.4
SharedServices share a pool of resources to build economies of scale. 3
Scalable & ElasticServices scale on-demand to add or remove resources as needed.2
Service BasedConsumer concerns are abstracted from provider concerns through service interfaces1
5 A
ttri
bu
tes
that
su
pp
ort
ou
tco
mes
Private Cloud
Public Cloud
Outsourced Private Cloud
Cloud Provider
The Spectrum of Private to PublicCloud Services
Anyone
Exclusive
ACCESS
Users Third PartyOWNERSHIP/
CONTROL
Private Cloud Services
Public Cloud
ServicesShared
data/grid service
Web search
Internal dev/test service
Targeted industry service
Consortia-owned service
Dedicated SaaS
instances
Business partner cloud
services
Virtual private cloud
Exclusive provider (IT
spinoff)
Slicing the Cloud
System Infrastructure Services
Business Services
Information Services
Application Services
App. Infrastructure Services
CloudEnablers M
gmt.
and
Sec
urityV-Cloud
SaaS
IaaS
PaaS
Same Old IT…New Abstractions, Delivered as a Service
Application Infrastructure
Application
Information / Data
Process
System Infrastructure
Middleware
Application
Information / Data
Process
Operating System
Hardware
Data Center Facilities
Business Wants the Promise of Cloud
• Hype leads to unrealistic expectations
• Internal IT is often slow to respond
• The real cost of IT is often poorly understood
• The problem is often process, not technology!
The Cloud Challenges IT Organizations
Vendor ManagementContracts (or lack thereof), service-level agreements, vendor relationships.5
InteroperabilityStandards, portability, interoperability, vendor lock-in, public/private hybrids.4
Suitability for NeedsWhat workloads and applications are suitable to cloud environments?3
Security / ComplianceCloud services introduce new security issues. Perception (and reality) of risk.2
Ownership / ControlTypical outsourcing concerns apply to external cloud services.1
Th
e C
on
cern
s o
f IT
Man
ager
s
Adoption of the cloud computing model, and associated services, whether public or private, requires a culture shift within IT organizations.
11
What Does the Cloud Do To Hosting?
• Alters the way that IT is consumed, and therefore buyer needs, desires, and expectations
• Transforms all segments of the market
• Creates new use cases and new opportunities
• Destroys legacy models
Hosters Change or Die
Hosting Market Segmentation
• Shared (Mass-Market) Hosting- Virtual hosting, traditional VPS
• Colocation- Small and large-footprint
• Self-Managed Hosting- “Server rental”
• Simple Managed Hosting- Managed through the OS layer; typically 1 or 2 servers
• Complex Managed Hosting- Managed up to the application; typically 4+ servers
• Segmentation is delivery-platform agnostic (don’t care whether it’s dedicated or virtualized)
Middleware
Application
Operating System
Hardware
Data Center Facilities
Mass-Market Hosting: Buying Trends
• Focus on the business value of the technology- SOHOs will increasingly adopt SaaS
- Local integrators developing for the SOHO market will increasingly move to PaaS
- Specific platform hosting (such as Wordpress) will remain popular, but this borders on being SaaS / PaaS, not IaaS
• Social media will continue to be increasingly influential in tech-savvy buyer decisions
• Market share will continue towards shift to hosters who have brands and “pull through”
What Happens to Mass-Market Hosting?
• Users desire ease of use, control panels, and other things – no need for technical knowledge
• Relatively minimal impact in shared hosting, from the “typical” cloud IaaS products
• Cloud IaaS destroys the traditional VPS market
• Moderate impact from PaaS, increasing rapidly over time, and affected by market alliances
• Users buy SaaS and implicitly buy into SaaS ecosystems
Colocation: Buying Trends
• Capital-constrained businesses are favoring colocation and leasing over data center builds- Large-footprint colocation and data center leasing are
the drivers of the most growth – not retail colocation
• Increasingly a local / regional business
• No supply/demand imbalance in the largest metropolitan markets
• The broader trend is towards lower-quality, less expensive space (more Tier II than Tier III)
• Power densities are continuing to increase
What Happens to Colocation?
• The colocation business is not destroyed by…- More powerful servers
- Virtualization
- The cloud
• But…- Footprints will become denser
- Servers will be more efficiently utilized
- A greater percentage of the IT infrastructure will be owned by service providers, not end-user customers
Self-Managed Hosting: Buying Trends
• SMBs: Developers / the DevOps movement
• Enterprises: Virtual data centers
• New use cases- “High-performance” computing
- Batch computing
- General IT infrastructure
• Fastest-growing segment of the market
What Happens to Self-Managed Hosting?
• Dedicated servers don’t go away
• But virtualized servers predominate
• Significant broadening of the market
• Commoditization- Strong price-sensitivity from buyers
- Margin compression
• Automation of management features
Simple Managed Hosting: Buying Trends
• Significant negative impact from the economy- SMB segment is harder hit by the downturn
- Save money through self-management
- Pricing pressure
• Shift to cloud IaaS
• Management services are still important
• Larger deals are becoming more commonplace
What Happens to Simple Managed Hosting?
• Automation becomes king- Many basic management tasks can be automated
- Drives down costs, improves service quality
- Blurs the line between self- and simple managed
- Potential collision with PaaS
• Market consolidation?- Leverage scale for cost-efficiency
- Build more powerful brands
• People still matter
Complex Managed Hosting: Buying Trends
• Has held up well despite the economy
• Virtualization is part of most deals
• Less price-sensitive- Most deal wins based on “comfort level”
• Buyer is increasingly savvy- Does research online
- Business decision-maker
- Technical evaluator
• People-centric business
What Happens to Complex Managed Hosting?
• Convergence with data center outsourcing- Driven by the universality of cloud-style IaaS
- More tactical than DCO
• Hybrid environments are and will be the norm
• Universal flexible, on-demand provisioning
• Automation will take place at the lower levels- Customers will be pushed towards standardized
solutions in order to obtain cost savings
• Customization will still require people
Who are You?
• The classic hosting business dilemma: assets, technology, or people?
• Are you a software company?- Hosters are traditionally integrators of technology, not
developers of technology- The lack of true turnkey cloud solutions is pushing
hosters into doing more development
- But turnkey solutions will emerge
• How are you going to compete with software companies?- Microsoft, Google, VMware…
Gartner Research
Lydia Leong, Research Director
Internet Infrastructure and Emerging Enterprise Services
lydia.leong@gartner.com