Wednesday, January 27, 2010

Calculating Cloud Service Provider ROI

Bit of a buzz this morning around the new Cisco IaaS ROI and Configuration Guidance Tool which was launched last week. My comment on twitter was that it was overly complex. Although some interpreted my remark as a slight against Cisco (You know who you are) it was actually a broader remark about the complexities of determining a service providers rate of return (ROI) when deploying your own revenue generating cloud services.

In a nutshell that's the problem facing many data center and hosting providers looking to offer utility style IaaS products & services to their customers. To put it lightly, currently it's an overly complicated endeavor. To be competitive today means competing against Amazon Web Services. They've in a very real sense set the bar and the bar has been set extremely low. Not only does Amazon continue to produce new products and services at an amazing speed and consistency, they also continue to innovate on their cost model with latest improvements including Spot pricing and reserve instances. This means that AWS can offer their IaaS sometimes at less then a cent or two an hour while [mostly likely] continuing to turn a profit. Combined with these economic pressures are the competitive pressures to differentiate your service offering from that of your competitors. For example bundling additional software and services on top.

Cisco's ROI tool does a good job of shedding light on the complexities in defining cloud infrastructure focused business models. It outlines components such as operational costs like Labor, Power, Maintenance as well as capital costs including Data Center Build out (Construction), system integration, storage and compute. For me by far the most interesting part of the calculator is the compute related options. They've broken them down into 3 basic VM categories (Power, Average, and Light)

I also found the proposed scale (number of servers, customers etc) in which the ROI tool was built quite telling about the market Cisco is going after with minimum capital expenditures in the 12 - 15 million dollar range for a Cisco based IaaS deployment with smaller deployments actually returning negative ROI results.

The unfortunate part of the ROI tool is that you can't completely remove all the required fields. The tool forces you to include Cisco based pricing for it's calculations. Which does makes sense, it's a Cisco sales tool after all. Although it would be interesting to be able to insert your own hardware and software costs such as VMware Vs Enomaly ECP or HP servers Vs Cisco. If they add those capabilities, this might very well be the best IaaS calculator I've seen.

Another interesting aspect of this calculator is along with other related Cisco Service provider announcements they have effectively come to the same conclusion we at Enomaly (and others) reached about the current market opportunity for IaaS. Simply that in the short term, the real market, the money to be made within the cloud computing infrastructure enablement sector is with Cloud Service providers (Data Centers, Web Hosts, etc) looking to augment their existing service portfolio in an attempt to remain competitive.

Tuesday, January 26, 2010

Enomaly Named in List of Coolest Cloud Platforms by CRN

Enomaly got a little love today from Channelweb. The magazine named Enomaly in a list of the 20 Coolest Cloud Platform Vendors. The list includes a who's who of the Cloud Space including Amazon EC2, Appistry, AT&T, GoGrid, Google, Microsoft, RackSpace,, Terremark, VMware and others.

ChannelWeb had this to say about the emerging Cloud Space, "Without the platform, there really wouldn't be much in the cloud, now would there? To some, cloud computing platforms have been affectionately called Platform-as-a-Service, or PaaS (not to be confused with that Easter Egg coloring kit of the same name). Cloud computing platforms facilitate and ease the deployment of applications into the cloud, limiting the cost and complexity by cutting the need to buy and manage hardware and software. As cloud computing continues to gather steam and more VARs and their clients are looking to design, develop, test, deploy and host apps in the cloud, a robust, flexible platform has become a must-have. With that in mind, we present the 20 coolest cloud computing platform vendors. See the complete list here.

Thank you!

Wednesday, January 20, 2010

CloudCamp Haiti Recap and Audio / Video Posted

We had a great turnout for CloudCamp Haiti earlier today with great presentations from Dennis Quan of IBM, Sam Ramji of Sonoasystems (Formerly of Microsoft) Simon Wardley of Canonical and Judith Hurwitz, Author of Cloud Computing for Dummies as well great questions from our call in style radio show.

I'd also like to thank all our corporate supporters including our logo sponsors, Cloud-Cast, Cloud Connect, CloudRight, CloudSoft, Curtin University of Technology, Enomaly, Enstratus, OpenQRM, OpsCode, RightScale, Soasta.

To recap, all toll we raised close to $5,000. It's unbelievable to see how the cloud community came together for this important relief effort. I would also like to thank John Willis who took my simple twitter post, "I wish I could do more for Haiti", and ran with it. As well I'd like to thank Dave Nielsen who's tireless efforts were completely amazing. Just to think we went from an idea last Thursday to a complete and well attended CloudCampHaiti in less then a week is astounding. I am honoured and humbled. Thank you from the bottom of my heart!

Just a reminder you can still donate here. or here, or here.

So without further ado here are the links to Video (MOV 400mb) and Audio (MP3) portions of CloudCamp Haiti. The clips run about 4 hours in length. (Audio/Video provided by @cfetter founder of

Monday, January 18, 2010

My TV Debut on BNN

My TV Debut on Business News Network (BNN)

Headline : January 18, 2010 : Cloud Computing - Companies in the Sector

"Cloud computing" is a term that's popping up everywhere. It has its enthusiasts, but some say the recent Google hacking incident could raise questions about the security of cloud computing. So what is cloud computing and why does it matter? BNN speaks to Reuven Cohen, founder and chief technology officer, Enomaly Inc., Mike McDerment, CEO, and Sebastian Ruest, vice president research, IDC Canada.

See Video here > Part 1. Part 2.

Enomaly ECP 3.0.4 Service Provider Edition Released

Enomaly is proud to announce the latest release of ECP Service Provider Edition. This version brings the following improvements and new features:
Cloning: Any powered-off machine can now be cloned, giving end-users the ability to scale out multiple copies of a pre-configured VM. This feature is important for many scenarios, including VM snapshot backups and VDI cloud solutions.

VM Tagging: Any number of tags can be added to a VM which will automatically create VM groups beyond the usual Running, Powered Off, Paused groups. This will allow users to easily organize VMs by function, by type, or in other ways important to them.

HA improvements: We've updated the HA engine to allow for new features, such as cloning and to increase the reliability of failure detection conditions on higher latency networks.

KVM updates: We've integrated additional 3rd party patches into the installer process to increase the functionality of the KVM hypervisor environment.

Contact us to get access to a free evaluation version

Friday, January 15, 2010

Oversubscribing the Cloud

There's been a bit of a debate raging over whether or not Amazon EC2 has been oversubscribed and is suffering from performance problems because it. The discussion started when Alan Williamson wrote a blog post on Tuesday that said he was experiencing growing performance problems while running a large EC2 deployment for one of his customers. The post accused Amazon of oversubscribing their environment which in turn meant he needed to buy larger instances to maintain the same level of performance in turn increasing his client’s costs.

The debate hits at the heart of complexities involved in trying to deploy cost effective, revenue generating, public use infrastructure as a service platforms. I've been saying this for a while -- one of the hardest parts creating a public cloud service is estimating your customers demand while trying to remain competitive, which really means having prices that are on par or better then Amazon EC2.

Amazon was quick to respond saying “We do not have over-capacity issues. -- When customers report a problem they are having, we take it very seriously. Sometimes this means working with customers to tweak their configurations or it could mean making modifications in our services to assure maximum performance.”

The problem with Amazon's vague response is it does very little to address a potentially major issue. In a sense they're saying we'll help you (if you're big enough) while providing no real insight into how their cloud is built, deployed or run. They do imply there are issues, but not relating to over-capacity, it's the fault of how their customers are deploying on EC2, not how their cloud itself is deployed or run. On one hand Amazon has stated they don't have "over-capacity issues", but on the other hand they are far from saying that they don't oversubscribe their environment. Let's be realistic, how else do you expect Amazon to achieve their ridiculously low price points? The very fact they can offer EC2 at such a low cost is to me indirect proof they do oversubscribe their environment. And hell, why not oversubscribe? In fact I'll go as far as to say that it is a good thing.

Amazon isn't alone in using oversubscribing or overbooking techniques for their service. The concept is common within a variety of industries where multiple users share a common resource. These resources can range from hotel rooms, to airline seats to more technical commodities such as bandwidth, storage, shared servers or even energy. The oversubscription model is dependent on the ratio of the allocated commodity which in turn is estimated on a per user / usage basis. The key is to have a well defined model which accounts for a standard deviation (or how much variation there is from the "average" usage). This typically guarantees the quality of a service for a particular user. Underlying the oversubscription model is the fact that statistically few users will attempt to utilize their full allotment of resources simultaneously. This allows you to offer more resources then you actually have available. The concept applies well to public cloud infrastructure environments, and probably is the most important aspect of any competitive pricing model.

But there are problems with the oversubscription model. The problem occurs because there seems to be a non-linear relationship between the amount of capacity versus the amount of customer demand you have. Or to put it another way, just adding more servers as customer demand increases doesn't necessarily automatically guarantee the same level of service across your cloud deployment, something Amazon's recent dramatic growth & performance issues seems to prove.

This brings us to the concept of a quota's. Have you ever wondered why when you sign up for a "unlimited" cloud infrastructure service such as EC2, you are given an initial allotment of servers? For Ec2 it's something like 20 instances. The reason is simple, the hardest part of an oversubscription model is in capacity planning. That is the use of a quota system is an extremely important aspect in any cloud capacity / resource planning you will be doing when launching and running your own public cloud service.

As an example, for the Enomaly ECP our quota system was developed to provide a predetermined level of deviation across a real or hypothetical pool of customers. Yes, it was developed to allow our hosting / cloud service provider customers to oversubscribe their environments. But it also allows for a variety of pricing & costing schemes to be implemented. Models such as tiers of usage, quality of service tiers, and even the ability to provide additional quota increases for "good behavior", like when you receive an automatic increase to your credit limit on your credit card. Without this type of quota functionality, it is practically impossible to adequately run a revenue positive public cloud service.

So the real question we need to ask Amazon is -- are their oversubscription models keeping up with the growth and scale of the underlying platform? Prove it.

PR: Enomaly Launches Cloud Computing Partner Program

Toronto, Ontario – January 15, 2010 – Enomaly, a global leader in Cloud Computing, today announced the launch of the Enomaly Partner Program to enhance the delivery of comprehensive cloud computing solutions to service providers (carriers, hosting companies, and others). The Enomaly partner program encompasses strategic partnerships with leading hardware technology vendors, cloud computing and storage technology companies as well as a global network of systems integrators and service providers who can provide local support and services to the numerous Enomaly customers in Asia, Europe as well as North America.

“The Enomaly Partner Program is a major initiative to attract and support the remarkable number of international technology companies that are recognizing the value of cloud computing and Enomaly’s leadership role in it,” said Justin Groen, vice president of Sales at Enomaly. “As Hosting Companies, Telcos and other service providers deploy our technology in their environments in Asia, Europe, the U.S. and Canada, our partner program will enable technology partners, sales channels and support services to complement Enomaly’s offering and deliver a total solution in all geographic markets.”

A proven cloud computing technology platform, Enomaly’s Service Provider Edition and High Assurance Edition provide a strong platform with which service providers can deliver cloud services to their customers. Simple and easy to use by end-users, Enomaly provides a feature rich, customizable platform that will enable its Service Provider customers to gain competitive advantage in this fast moving market.

Enomaly is a global leader in the fast-growing Cloud Computing space . Enomaly empowers service providers (carriers, hosting companies, and others) to deliver revenue- generating infrastructure on demand (Infrastructure as a Service, or IaaS) services to their customers. Enomaly's Elastic Computing Platform, first released in 2004, was the world's first IaaS platform, and is used today in over 1000 live installations.

Thursday, January 14, 2010

CloudCamp Haiti (Fundraiser) Jan 20, 2010

About CloudCamp Haiti (virtual unconference):

CloudCamp Haiti is a virtual unconference held as a public webinar. CloudCamp-in-the-Cloud builds upon the popular CloudCamp format by providing a free and open place for the introduction and advancement of cloud computing. For this event, we are raising funds to donate to the aid effort in Haiti.

Using an online meeting format attendees can exchange ideas, knowledge and information in a creative and supporting environment, advancing the current state of cloud computing and related technologies.

Please help us spread the word, twitter, facebook, IM, tell your neighbours and friends. Hashtag #CloudCampHaiti or copy and paste this post on to your blog.


- Jan 20th 11:00am - 2:00pm Eastern Standard Time (EST)

- Online (GotoMeeting)

Get involved:
If you are interesting in getting involved as a presenter contact John Willis (john.willis AT If you are interested in sponsoring contact Dave Nielsen (dave AT


11:00am - 11:30am - Sign in and registration (Main Room)
11:30am - 11:45am - Introductions & Overview (Main Room)
11:45am - 12:30pm - Lightning Talks (Main Room)

Lightning Talks - TBD

12:30pm - 1:00pm Unpanel Choosen by attendee’s of CloudCamp Haiti (Main Room)
1:00pm - 2:00pm Break Out Sessions - Round 1

1. Unconference Room #1: main gotomeeting room (TBD)
2. Unconference Room #2: 2nd gotomeeting room (TBD)

2:00pm - 2:30pm CloudCamp Haiti Wrap up (Back in “Main Room”)

- John Willis
- Reuven Cohen
- Dave Nielsen

Interested in sponsoring?

GoogleHack Proves People are Easier to Hack then Networks

By now most of you have probably heard about the GoogleHack in China. Yesterday Google's Chief Legal Officer David Drummond wrote in a blog post that indicated the accounts of dozens of Gmail users in the U.S., Europe and China who are advocates of human rights in China were routinely accessed by third parties. Drummond said that these accounts were compromised through phishing scams or malware, not through holes in Google's computing infrastructure.

And as expected there are headlines saying that this proves that "The Cloud" isn't secure and CAN'T BE TRUSTED. I'm here to tell you it is the opposite. The GoogleHack proves the Cloud is More Secure then Traditional Desktop Software, not less.

First let's look at the actual hack. Although not a lot is known -- what is known is it's probably part of a program known as "GhostNet". The exploit uses emails which are sent to target organizations that contain contextually relevant information. This is more generally referred to as a "Social Engineering hack" which is the act of manipulating people into performing actions or divulging confidential information, rather than by breaking in or using technical hacking techniques. Basically a person opens an email that contains malicious attachments, that when opened, delivers a Trojan horse on to the system's OS. This Trojan connects back to a control server, usually located in China, to receive commands. The infected computer will then execute the command specified by the control server. Occasionally, the command specified by the control server will cause the infected computer to download and install a Trojan known as Gh0st Rat that allows attackers to gain complete, real-time control of computers. Such a computer can be controlled or inspected by attackers, and even has the ability to turn on camera and audio-recording functions, if present, of infected computers, enabling monitors to perform surveillance on windows based machines.

Let's put this hack into perspective. What this hack really proves is that people are easier to hack then networks. The weakest link are the people who are stupid enough to open an attachment they don't recognize, even if it appeared to be from someone they trusted. That's the beauty of social engineering based hacks. The email appears to be from your mother, father, friend or colleague. The lesson we must learn is one of education, don't open attachments you don't recognize. And two, OS based Trojans are still a major treat.

And yes, for the most part the cloud is still safe at least from these sorts of hacks. The real issue with cloud security is the threat from that in which you don't know. Was my infrastructure compromised? Is my hypervisor secure? Has my operating system changed? Those are the real problems that need a technical solution. The rest is just educating the computing public to risks of social engineering related exploits.

Monday, January 11, 2010

Redux: Cloud Computing For a Cause

Originally posted December 2008.
Yesterday I had a great conversation with Romanus Berg of Ashoka, the world's largest network of social entrepreneurs and a long time customer of Enomaly. In the conversation we discussed some of the opportunities that cloud computing may offer as a social empowerment tool in emerging economies.

In case you've never head of Ashoka, founded by Bill Drayton it was one of the first groups to popularize the concept of Social Entrepreneurship. The core foundation of social entrepreneurship is found within businesses that recognizes a social problem and uses entrepreneurial principles to organize, create, and manage a venture to make social change. Whereas a business entrepreneur typically measures performance in profit and return, a social entrepreneur assesses success in terms of the impact s/he has on society.

Ashoka acts as a kind of people aggregator, finding the diamonds in the rough. Those 1 in a million that effect major changes within their local society. Ashoka believes that we are in the midst of a rare, fundamental structural change in society: citizens and citizen groups are beginning to operate with the same entrepreneurial and competitive skill that has driven business ahead over the last three centuries. People all around the world are no longer sitting passively idle; they are beginning to see that change can happen and that they can make it happen.

During the conversation it became clear the both Romanus and I shared a similar vision for cloud computing not just a method of increasing IT productivity but as an empowerment tool for "under-enabled" people. People that up until recently have never had the opportunities that modern information technology has afforded the western world.

This concept of a socially conscience cloud stuck a cord with me. In many emerging economies technology in particular can skip whole generations. For example the move in China to mobile phones, skipping past more traditional forms of telephony. Similarly cloud computing may represent a major opportunity to bring both knowledge as well as modern computing technology through the use of low cost, wireless networks and mobile devices connected to regionalized clouds.

Cloud Computing as a socially conscience enterprise may not just be limited to emerging economies but may also enable the latest eco-trend of green technology. Global cloud computing represents the opportunity to make adjustments based on your carbon footprint. Imaging being able to adjust your computing energy consumption levels based on which provider of electricity is using the best and greenest sources.

Like Ashoka, I believe we are in midst of a rare, fundamental structural change. At the end of the day, cloud computing is about choice, mix in a social consciousness and we start to see one of the bigger socio-technological revolutions of our time, the information revolution.

Sunday, January 10, 2010

Interest in Cloud Computing Up 3,233% Since 2007

Lately it seems that no matter where I go someone is telling me they've heard about cloud computing, from Newspapers to TV, it seems to be everywhere. I'm not talking about techies or the clouderati. I'm talking about your mother, your sister or brother, I'm talking about regular people you meet at dinner parties -- the everyday Joe.

If you are a frequent reader of my blog, you'll know I enjoy looking at trends. A particularly good analytics tool is found at Google's Insights for Search Tool. The site analyzes a portion of worldwide Google web searches from all Google domains to compute how many searches have been done for the terms you've entered, relative to the total number of searches done on Google over time. The site also allows the underlying characteristics of the data sets to be compared, for example against a broader industry. In our case, I compared Cloud Computing and a few other related terms against the broader "Computers & Electronics" industry to how much interest there was for cloud computing. (See Graph Below or original link)

A Few of the more interesting points.
1. The overall interest in Computers & Electronics is down about 46%
2. Interest in Cloud Computing peaked in November up an astounding 3,233% from 0 in October 2007
3. Interest in SaaS and Virtualization also remains very strong.

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