State of the Cloud

A perspective on cloud infrastructure services, Neev Technologies July 9, 2012

Most businesses are not ready for the cloud!

1 in 5 customers approach us for a bare-minimum infrastructure setup on the cloud with budgets of less than 10! per annum towards infrastructure " maintenance# $ut, are they really right in going with the cloud% &hat real benefit of the cloud can a business derive from one or two low-cost instances% 'ealistically, can they gain anything at all from trafficbased infrastructure shaping or pay-per-use pricing% (n the contrary, the very nature of the cloud poses a real disadvantage# )aving been built out of low cost, commodity hardware and with no *+A on individual instances, the premise of the cloud is that applications are architected to withstand individual instance failures# ,nless a business has a spend of at least 10! or more per annum, there is no advantage to be gained- putting enormous pressure on support " maintenance that does not .ustify costs# /ypically the businesses with infra re0uirements in line with this budget 12 10!3 are the ones that re0uire additional servers to handle higher traffic during campaigns and those that really ta4e advantage of being able to increase or decrease the si5e of servers dynamically# &ithout minimum e6penditure, the economic efficiency of the cloud does not 4ic4 in# 7ost of our audience today, especially the typical startup is loo4ing at an A&* spend of no more than 5000 per annum# /his prompts for a minimum 0ualifying budget of 10! per annum on infrastructure " maintenance#

'Marketing speak' and real numbers

/he recent ads by 8recision says 9*aving 22 crores9 and 91:;1 server consolidation ratio9 << 97ar4eting spea49% =ither that or we have the wrong mar4et# >or e6ample, how many of our customers have 1: servers to begin with% Also, consider; to save 22 crores 1assuming an average of ?0@ cost savings3, the total cost of infrastructure must be at least 55 crores - that is 11million 1that is around 1#1@ of A&*9 e6pected revenue in >A123# Boes any single company manage that much of A&*% )ere are the customers we have engaged so far with that have big A&* spend 12 25! per annum3 C not including maintenance cost<< Apalya >>/A /ubifi !=) /here are few companies that spend more than DE' 12+ every year on servers 1again not including maintenance cost3# (ne may buy at least : physical servers every year 1FDE' 1#5+ per server including the cost of power " cooling3# >or many large companies, the cost on servers is a very small percentage of the total D/ spend#

And the savings offered by the cloud is a percentage of that small percentage# Dn either case, they will continue to maintain D/ support staff and internal servers and cooling and power bac4ups# >inally, studies suggest that scalability " agility are bigger drivers of the cloud than cost " cape6 savings# *ecurity continues to be the biggest concern# 1:3 &e need to target growing companies< $ut first###

The real size of the market

A. $150 Billion: The size of the Cloud Computing Ma !et "# $01%. &%' *o, how does it sum-up% *aa*, 8aa* " Daa* - all counted under 9cloud9# Daa* being the least of all# eg# *alesforce#com gets counted and is a big percentage $uilding Gcloud appsH is counted under 9cloud9 - nearly everything architected for the cloud# Iirtuali5ed *avvis and Ieri5on data centers are counted as cloud 123 /he shift from 7* apps to Joogle Apps is counted under cloud 1K3 Bropbo6 " Apple9s iLloud 1M3 B. $1 Billion ( The e)pected A*+ evenue in $01$ as pe ,-C. &.' #### and by the way they are still getting there< 0#01@ of this mar4et is 1004 A&* billing a year< And we have those< /o get to 0#1@ of the mar4et is finding who is spending at least 25! per annum on A&* and finding ?0 such customers#

Where lies the money

Ierticals where it maybe useful to target; =ducation sector incl# elearning 'etail sector incl# e-comm 7oving legacy apps to the cloud Ierticals with field force incl# healthcare 7edia companies incl# blogs, sports sites and popular sites Audio N Iideo incl# startups, new bi5 =nterprise apps - structure of some enterprise apps is changing C eg# )' apps and supplychain apps will move to the cloud# Analytics companies incl# $ig data 7obile apps will be a big driver of the cloud# - combining cloud apps " mobile apps into single offerings >or more C 153 /argetting large enterprises will mean getting into N tying up with implementors of *A8, (racle, etc# >inally, $'DL countries are e6pected to lead D/ spending this year by more than half1?3

What we do & whats coming

A. Cloud /eadiness Assessment Are you really ready to ta4e advantage of the cloud% 0o1 you can ta4e advantage of the cloud% &hat is the economic advantage% &hat are the components of the cloud that can be utili5ed% /oday, much of this is pro-bono consultancy but it will evolve into a paid service 1much li4e a $A phase3 as choices get mature and comple6# B. Cloud +e vices B o!e age &C+B' Jrowth of Lloud services bro4erage " the necessity of cloud-centric design are two of the big trends that Jartner predicts for the coming years 193# Lloud services bro4erage becomes a re0uirement for adoption# As cloud computing adoption proliferates, so does the need for consumption assistance# A cloud services bro4erage 1L*$3 is a service provider that plays an intermediary role in cloud computing# says Jartner L*$ is li4e a value added service, where a cloud service bro4er not only mediates between the cloud service provider and the consumer but also customi5es the service by aggregating, integrating, and enhancing the services promising it to be more secure, cost- effective, and trustworthy# Dt helps the customer choose the platforms that best suit its needs, deploy and integrate applications across multiple clouds, andNor enable the customer to move between cloud platforms#

C. Cloud Cent ic -esign /o fully e6ploit the potential of a cloud model, applications need to be designed with the uni0ue characteristics, limitations and opportunities of a cloud model in mind# Jartner advises businesses to loo4 beyond the migration of the organisationOs wor4loads to the creation of cloud-optimised applications that fully e6ploit the potential of the cloud to deliver global-class applications# 193

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