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Enterprise’s Journey to the Clouds – Adventures in IT Wonderland

In Lewis Carroll’s novel, Alice’s Adventures in Wonderland, Alice asks the Cheshire cat which way she ought to go, to which the fictional cat responds, “That depends a good deal on where you want to get to”.

When Alice responds - “I don’t much care where” the wily old cat says, “Then it doesn’t matter which way you go”. With apologies to Mr. Carroll, the right cloud strategy very much depends on where you want to get to.

The Pros of Cloud Adoption – The Tea Party

Cloud technologies have enabled enterprises to lower operating costs and capital expenditures, accelerate the development and introduction of new products and services and dynamically adjust IT infrastructure to meet changing computing demands. As a result, the network has increasingly become the lifeblood of business and cloud computing is driving a new focus on network quality and bandwidth.

Enterprises companies in in all industries have been moving more and more of their computing workloads out of corporately owned data centers and into cloud facilities. The promise of agility, on-demand scalability, and lower operating costs contribute significantly to improved margins and maximizing returns on IT investments.

Many of these organizations are also using cloud infrastructure to support and/or accelerate the digital transformation of their organizations. Cloud and other online services are eliminating data silos and providing powerful engines to process Big Data, power analytics and drive artificial intelligence which in turn improves business performance and supports new lines of business.

The Pandemic has Accelerated Corporate Digital Transformation by as much as 10 years.

The foregoing migration to the Cloud has been accelerated in the era of COVID-19 by at least 5 years and some would argue that it is closer to 10 years.

Cloud types and configurations “Curiouser and curiouser!"

In Wonderland, Alice was so surprised by the strange circumstances she found herself in that she made up the word “curioser”; the expression is still used lightheartedly to mean that something is getting increasingly confounding.

While people talk about moving compute capabilities to the cloud – cloud itself means many things. There are several different types of cloud configurations and platforms.

  • Public cloud - many users access compute resources through the internet or dedicated network connections using platforms provided by AWS, Google Cloud, Microsoft Azure and a growing group of others.

  • Private cloud – compute resources are kept within a data center, usually owned by colocation providers such as Equinix, Digital Realty, NTT GDC, CyrusOne and many others. Here the Enterprise client will usually deploy their own hardware and proprietary architecture.

  • Hybrid cloud - mixes public and private cloud models and transfers data between the two.

  • Multi-cloud scenario - business uses Infrastructure as a Service (IaaS) options from more than one public cloud provider.

Rather than settling on a single provider, many enterprises use a combination of platforms, software-as-a-service (SaaS) providers, colocation facilities and managed services. SaaS, which at $85 billion is by far the largest segment of the overall cloud market, is emblematic of this trend.

In this day and age, many of the enterprise custom applications are increasingly collections of SaaS services woven together in unique ways.

As cloud usage continues to grow, it's important that IT professionals understand where different types of applications are best suited to be deployed. Today, it is estimated that approximately 20% of enterprise applications are deployed in the clouds. Cloud deployments are estimated to grow to as much as 80% in the next three to five years.

More and more enterprise organizations will be deploying applications in public and private cloud environments. At the same time, the distributed processing phenomenon called edge computing is creating new network demands at the corners of the organization. Accordingly, enterprise will be increasingly operating in hybrid and/or multi cloud environments.

In some industries, like financial services, latency (or more specifically – the reduction thereof) is a competitive advantage and can be the difference between success and failure. In a never-ending quest for speed, businesses today need to employ a distributed network model where data is processed as close as possible to the origin or use of the data.

Colocation facilities can be a valuable component of the overall enterprise network by creating robust, highly available infrastructure that connects seamlessly to multiple clouds. Colocation provides a central meeting place for networks, clouds and enterprises to host their physical infrastructure and interconnection enables them to efficiently exchange traffic with one another. It is no wonder that interconnect is the fastest growing component of the colocation industry.

Customers own the equipment they place in a colocation center and have access to it 24 hours a day. The provider is responsible for providing power, network and cooling infrastructure and often offers availability service level agreements for customers who value that peace of mind. The provider doesn’t manage customer workloads and has zero visibility into the programs they run.

While the responsibility is on the customer to maintain software and balance workloads, the same would be true in an on-premises data center. Customers in regulated industries, in particular, value having that level of security and control. In the meantime, sharing the costs of power, floor space and common infrastructure such as backup provides economies of scale that save customers money. Small companies can enjoy the same robust data center features as giant enterprises.

All cloud and many SaaS providers use “on-ramps” such as Amazon Web Services’ Direct Connect or Microsoft Azure ExpressRoute to enable customers to establish dedicated connections between their networks and the cloud provider’s. Most of these on-ramps are actually routed through colocation facilities in order to reach the largest number of customers. Colocation providers partner with the big cloud platform providers to enable customers to establish private, low-latency network links between their dedicated infrastructure and cloud infrastructure providers for optimal performance of a hybrid IT environment.

The Cons of Cloud Adoption – Down the Rabbit Hole

Every company has a different reason to move compute capacity to the cloud, and goals for each organization will vary. Many cloud projects deliver subpar results not because of poor selection of cloud configurations or platforms but by selecting the wrong workloads to migrate to the cloud. Decisions made will have a long-term impact on business agility, efficiency, risk profile and Total Cost of Ownership (TCO).

As a rule, most Enterprise Organizations have opted to keep legacy, business-critical, high throughput, low latency applications on-premises. Also, any applications or data which is under strict regulatory and/or geographic restrictions have tended to remain on-prem.

However, as bandwidth increases, and edge computing capabilities expand, the issues with respect to latency are relaxing. Also, given the increasing robustness and strengthening security of cloud offerings, regulatory frameworks are becoming more tolerant of cloud solutions.

The Right Strategy Depends a good deal on where you want to get to

At the end of Alice’s Adventures in Wonderland, Alice comes to learn that life is a puzzle, and although she tries to find purpose and answers, all the riddles and games lead to more confusion, frustration, and nonsense.

The journey to the Clouds is a puzzle where the pieces may look similar from case to case but will ultimately be different given the circumstances and requirements for each organization. Public cloud provides scalability through a pay-per-usage model. Private cloud or on-premises provides extra control and security. A hybrid cloud model provides the best of both, although performance and connectivity may suffer.

At Cushman & Wakefield, we partner with best-in-class IT professional to provide companies with an integrated approach to help wade through the various options associated with cloud migration and cloud accommodation and the associated real estate decisions.

For more information on PTS and Cushman & Wakefield’s Global Data Center Advisory Group: Our Services. 

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