Seeing the Future of IT Infrastructure

Global services predicts that the IT Infrastructure space will come to outsource more and more to offshore players.

Traditionally, infrastructure outsourcing carried with it the burden of “transfer of assets” with the provider taking on the assets and people of the customer company. However, going forward, customers are more likely to be lured by offshore players who are leveraging enhancements in communications infrastructure, remote-management tools and labor-cost arbitrage.

Offshore IT-infrastructure service providers are creating a new business model to tap into the $80 billion opportunity. By 2010, offshore providers are expected to have a market share of 20 percent, up from 3 percent in 2005. According to Everest Research Institute, these companies are growing at a 61 percent CAGR, while the traditional players are growing at 7 percent CAGR.

Click Here to know more about some considerations while offshoring your IT Infrastructure.

Though Global Services also predicts that:

The managed-services model will drive the market, and fewer and fewer companies will opt for the staff-augmentation model.

Companies that have so far outsourced only application development and maintenance will be the prime contenders for sourcing infrastructure services

Companies will look to source services such as server management, security and network monitoring and data-center management.

With MDS round the corner with the advent of outsourcing, smaller players will get more of the pie.

The Cloud Visage

The term cloud is used as a metaphor for the Internet, based on how the Internet is depicted in computer network diagrams and is an abstraction of the underlying infrastructure it conceals. Typical cloud computing providers deliver common business applications online which are accessed from a web browser, while the software and data are stored on the servers.

These applications are broadly divided into the following categories: Software as a Service (SaaS), Utility Computing, Web Services, Platform as a Service (PaaS), Managed Service Providers (MSP), Service Commerce, and Internet Integration. The name cloud computing was inspired by the cloud symbol that is often used to represent the Internet in flow charts and diagrams.

What do they own?

In general, cloud computing customers do not own the physical infrastructure, instead avoiding capital expenditure by renting usage from a third-party provider. They consume resources as a service and pay only for resources that they use. Many cloud-computing offerings employ the utility computing model, which is analogous to how traditional utility services (such as electricity) are consumed, whereas others bill on a subscription basis. Sharing "perishable and intangible" computing power among multiple tenants can improve utilization rates, as servers are not unnecessarily left idle (which can reduce costs significantly while increasing the speed of application development). A side-effect of this approach is that overall computer usage rises dramatically, as customers do not have to engineer for peak load limits.In addition,"increased high-speed bandwidth" makes it possible to receive the same response times from centralized infrastructure at other sites.

What does the Shift Mean?

The shift would affect companies a few different sub-industries including software companies, internet service providers and hardware manufacturers. Companies in each of these industries will face significant change if cloud computing is to be the next step for the industry. While it is relatively easy to see how the main software and internet companies will be affected by such a shift, how companies in the internet and hardware industries will be affected is slightly more difficult.

So, its a mixed bag. Good for some providers whereas it makes life a little difficult for others.The term cloud coined a couple of years back, is basically the outsourcing of all IT.

London to Boast Energy Giving Datacenter

As energy costs seesaw wildly and public concern over the environment grows, data centres have landed in the corporate cross hairs.

How ironical is it, that landed under pressure governments and enterprises are realigning their priorities to give back what they had been using to the people.East London will now seea green data center by next year that will use energy/heat given off by racks of servers to power residential and business properties in the surrounding area.

This construction will also be capturing waste heat for re-use. With carbon dioxide levels increasing at an alarming rate, this endeavour will start off what is called as" giving back to the environment". To read more of the report click here.

With the Copenhagen summit in full flow and countries playing hard on their visions to reduce global warmimg, the U.K. Government will see this card as a feather to the crown.

Firms to Pump in More Money in the Cloud

The coming years will see corporate majors pumping in more money in the private cloud computing space than in public offerings. Such a scenario is expected owing to the fact that private cloud computing have the capacity to let firms access scalable and elastic IT services over the internet, without banking on a public service provider.

A Gartner report says the existing IT architectures and processes can be simply replaced by the cloud and more companies will jump on to the bandwagon. It has been pointed out that larger companies will maintain private clouds within the organization and use outsourced services when they want to access additional resources.

Adding, Gartner has said that continued investment in private cloud computing will allow public providers to learn from associated technological, cultural and business interface changes. It has been earlier pointed out that cloud computing could take a position as one of the most important strategic technologies for 2010, alongside green IT.

- RIM Desk

UK drives Green Outsourcing

Green IT just got a shot in the arm with UK government's decision to make its IT operations carbon neutral. Here's what a report says:

The guidelines have created a new level of expectations for outsourcing providers, with environmental concerns entering the formal selection process for suppliers.

The report also points out that organizations may opt for outsourcing to help them cope:

At the same time technology outsourcing is expected to rise significantly if organisations are to deal with the financial burden of compliance with environmental regulation in-house.

We definitely see this as the beginning of a movement within many governments in the days to come. Outsourcing becomes a key strategy for organizations to help them comply faster, better and cost-effectively.

- RIM Desk

Time to demonstrate value of IT services

Here is a report which demonstrates why Remote Infrastructure Management (RIM) is being viewed more seriously by organizations across the spectrum. Apptio, the provider of on-demand IT Financial Management software, says:

CEOs will Require IT to Demonstrate Value of Services. IT organizations that cannot explain the total cost of an IT Service to business leaders will begin losing credibility. Like any service provider, IT must track the cost of delivering goods and services. They must have systems in place to analyze, allocate and reduce costs, and communicate to the CEO and other business leaders the value IT is providing.

- RIM Desk

Transition to industrialized IT is not a mean feat

We have begun to witness the industrialization of IT, writes Chuck Hollis, :

How we build, operate and consume IT will likely be forever changed in a handful of years.  Everyone will be affected.

However, very few of these newer large-scale players have a way to reach IT organizations effectively.  Most enterprise IT organizations want a “high touch” relationship with their vendors, especially when considering something relatively new.

For a service provider that’s focused on being cost-advantaged, that’s a business model problem, since building such an organization is an expensive proposition.  Better to sell your cost-advantaged service through someone else who already has a customer relationship, e.g. a big enterprise IT vendor or their partners.

You can read more of blog here.

- RIM Desk

5 Key Parametres for Cloud Based Providers

Forrester's James Staten states that clients are getting "cloud weary." Therefore the biggest challenge for service providers is to set themselves apart in the eyes of the customer. This is only possible by developing ones core competence in the service area as well as meeting the commodity needs.

James Urquhart suggests 5 different parametres that will help service providers stay alive in the era of competition.

1.Ease of operations/use: The biggest question is "How does a company with hundreds of applications in the cloud strewn across a dozen or more vendors monitor and manage those applications to manageable service levels"?

Phenomenal user interfaces that will set some providers apart from others is one of the answers, but the real answer to the question lies in "behind the scenes" interfaces;such as APIs, publish and subscribe event streams, transparency and auditability systems, etc. This will set apart service providers.

2.Configurability: One of the things about today's best-known cloud computing environments is that they are essentially infrastructure and software architecture frameworks that dictate a lot about the application architectures that can be built on them.

Today application architects are forced to consider how they would build and operate their application in the infrastructure architecture given them. The answer for IaaS vendors are things like network architectures, data storage options and server options. Also useful here are services that enhance the infrastructure, like security systems, message queueing, and storage tiering.

3.Performance: Processing speed, memory speed, storage access, read and write speeds, latency, bandwidth are the things that are tunable by the cloud provider, either through technology acquisition, or through superior engineering and operations expertise. And, as with servers and storage, the fastest speeds will give you the edge.

4.Reliability and security: The core concept that every user looks for is risk mitigation.There is also a lot of debate over whether public cloud services are better than private data centers, that companies will need time to demonstrate differentiation in both of these categories.

Features have to be introduced to increase the transparency of both operations and security in any provider. Redundant distributed data stores, "early warning" DDoS detection events, auditability APIs;are all features that would increase customer's ability to trust that their provider has made the protection and availability of their data and functionality a core competency.

5.Customer service: Here vendor relationship management with the user will be a key differentiator. Customer service representatives should be very prompt in responding to customer queries.

Cloud computing is one of those market opportunities that makes or breaks companies. The winners will find ways to differntiate. Those that don't almost certainly can't win.