Cloudscaling Cloud Connect 2011 Keynote Randybias Final4 110325165551 Phpapp02
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Transcript of Cloudscaling Cloud Connect 2011 Keynote Randybias Final4 110325165551 Phpapp02
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Enterprise Cloud MythsRandy Bias @randybiasMarch 8th @cloudscalingCloud Connect 2011
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Are Enterprise (IaaS) Clouds a Mistake?
Public or Private Clouds Built in the ‘Enterprise’ style
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The Myth
“We need Enterprise Clouds because ...”
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The Myth Continued
Enterprises need more ... FUD??
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The Fundamental Assumption in the Myth
vs.
Greenfield AppsLegacy Apps
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Enterprises Love Commodity Clouds
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There Are Two Battles Waging
Enterprise Clouds
Commodity Clouds
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The Battle Lines
Public Privatevs.
vs.Public Public
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The Error in Cloud as “Outsourcing”
Public Private
vs.
vs.
Where are the cost savings? “multi-tenancy?”
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The Enterprise ‘No Clothes’ Moment ...
Where is the enterprise cloud business model equivalent of Amazon Web Services?
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$0B
$0.5B
$1.0B
2007 2008 2009 2010 2011
The Amazon Model is Winning
$0M
$150M
$300M
2007 2008 2009 2010 2011
Source: Public estimates from Cloudscaling/UBS & RAX earnings statements
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AWS 5-year Projected Revenue at 100-50% CAGR
$0B
$3B
$6B
$8B
$11B
2009 2010 2011 20122013
20142015
2016
Source: Public estimates from Cloudscaling & UBS + Cloudscaling estimates
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AWS Growth & Momentum is Staggering
0B
175B
350B
525B
700B
3 14 40102
262
655
Q4’06 Q4’07Q4’08
Q4’09Q4’10
Q4’11
Source: Public AWS blog & PR announcements
S3 Published Growth Numbers
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The Starkest Example Possible(‘Private’ Hosting vs. Public Cloud)
-10%
0%
10%
20%
30%
40%
Q4’08 Q1’09 Q2’09 Q3’09 Q4’09 Q1’10 Q2’10 Q3’10 Q4’10
RAX Cloud RAX Hosting
Q/Q % growth rates
Source: Public RAX earnings statements
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Commodity Cloud as % RAX Total Revenue
0%
7%
13%
20%
2007 2008 2009 2010 2011
Source: Public RAX earnings statements
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The Punchline?Enterprise Clouds Have Greatest Investment
$0B
$8B
$15B
$23B
$30B
2009 2010 2011 2012 2013Commodity Cloud Enterprise Cloud
Source: Cloudscaling estimates based on public data (conservative)
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What’s Different About Commodity?
Attribute Commodity Enterprise
H/W Cost OptimizationHomogeneous & standardizedDesign-for-Failure
Self-service, low friction
Scale Engineering
Open Source
Cloud-oriented Biz Model
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Initial Capital Expense:Enterprise vs. Commodity Cloud
$0
$500
$1,000
$1,500
$2,000
$225
$1,892
H/W Cost per Sellable ‘VMU’ (1GB RAM, 1 vCore)
CommodityEnterprise
Source: Cloudscaling confidential financial models for IaaS clouds
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Labor Operational ExpenseEnterprise (300:1) vs. Commodity Cloud
(1500:1)
$0M
$38M
$75M
$113M
$150M
Year 1 Year 2 Year 3 Year 4 Year 5
Commodity Enterprise
Servers : IT Headcount
Source: Cloudscaling estimates based on known IaaS deployments
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The Evidence Suggests ...
Go CommodityServe Greenfield
“Cloud-ready” appsEmbrace the Change