Cloud Computing – The IT Solution for the 21st Century


“With an internal private cloud, we expect to reduce costs in terms of total cost of ownership (TCO) by 40-50%. 10- 15% of that saving will come from better usage of hardware and the rest from improved operations basically introducing a self-provisioning portal that requires minimal human intervention.”


Novartis, Juergen Basse-Welke


“We are experiencing significant reuse, and hence carbon reduction, in our internal private cloud environment. Fully 1/3 of all of the virtual servers requested in the internal private cloud are recycled each month.”


Citigroup, Paul Stemmler


large-scale adopters of private cloud solutions since they wish to demonstrate confidence in their own cloud services to their customers.


The financial and business case for cloud computing


The complexity of the term ‘cloud computing’ was outlined in the initial section with its variations in delivery methods and deployment models. Added to this, each organization has a unique IT estate (the entire suite of information technology which supports the business) and will seek to leverage cloud services in different ways. The amount paid for a particular software license or cloud service subscription will also vary by firm. As a result, the business case for cloud computing is typically a company specific exercise, and in this report a business case has been generated for a hypothetical food & beverage firm.


The environmental case for cloud computing


Cloud computing has the potential to reduce firms’ carbon emissions. Through virtualization and running servers at higher utilization rates, the total energy required to support a given service is reduced, which results in lower carbon emissions. Added to this is the fact that for public clouds in particular, providers focus on the efficiency of the data center as a whole (data center PUE) and generally run data centers at lower PUEs.


The critical inputs into our analysis to calculate carbon reductions from cloud computing are9


:


• Number of servers • Server utilization rate • Maximum and idle server power ratings


• Network and storage utilization rate • Data center PUEs • Embedded server energy • Energy for data transmission • Size of firm (by revenue)


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9. The model schematic and key assumptions used in the model can be found in the appendix


10. http://www.thegreengrid.org/~/media/WhitePapers/ Data%20Center%20Metrics%20Task%20Force%20 Recommendations%20V2%205-17-2011.ashx?lang=en


Data center PUE Power usage effectiveness (PUE) is a data center efficiency measure and calculates the ratio of total power consumed by a data center against the total power consumed by the IT equipment. This measure has attracted a certain level of criticism due to variations in interpretation over what should be included in the total data center power consumption calculation as well as questions around temporal variations in the measure. Attempts to provide greater standardization around this measure have been made by the Green Grid in a May 2011 publication10


this report, average PUE values were applied to public cloud, private cloud and dedicated IT deployment environments and were based on data obtained through the study interviews and extensive additional research.


. For the purposes of


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