Public vs. private cloud applications: Two critical differences

When it comes to applications and the cloud, approaches can be broken down into a variety of flavors: Software as a Service (SaaS) business applications, in which a vendor hosts and manages the application in a multitenant environment; a public cloud infrastructure, where a company takes advantage of the economies of commodity hardware and shared infrastructure from a cloud provider; and private cloud applications companies running a virtualized data center architected to scale like a public cloud.

For application professionals considering private clouds and wondering which business applications fit there, the answer is pretty simple, according to Tom Nolle, president of CIMI Corp., a New Jersey-based strategic consulting firm.

"Generally speaking, companies would be considering substantially the same kinds of things as for public cloud," he said. "The distinction would be cost or security."

While that seems a pretty clear delineation, there's still plenty to think about when considering the cloud from an applications perspective -- and it’s not necessarily just about SaaS, Nolle said.

For example, a large organization may have IT spending too much time and effort running and supporting a fairly simple, linear, departmental application. One solution may be to run it in a data center on virtualized servers, perhaps along with other applications. That could be done in a private or public cloud.

Deciding when private or public cloud applications are feasible

However, not all applications are so simple.

"If you had an app that intertwined with a half dozen others, exchanging data in an SOA kind of connection or using a common database with five or six other applications, the management of something like that is totally different," Nolle said.

There are, of course, some applications that simply aren't made for the public cloud. For example, a retail bank's demand deposit account program.

"There is not a bank on the planet that would ever put that in a public cloud," Nolle said. "The security issues would be insurmountable."

It’s not just security that companies need to consider with cloud-based applications, but also cost. Cloud computing's economies of scale and the savings it creates is commonly cited as one of the biggest benefits of the cloud, but it doesn't necessarily work for all scenarios. Larger companies can likely achieve the economies of scale with the public cloud on their own, Nolle said.

"The app would cost two to four times as much as running it in house," Nolle said. "Ninety percent of people who talk about the cloud don't bother to look at how cloud services are priced."

Cloud computing services are mainly priced on a Web-hosting model, which works when a company is storing small amounts of data like webpages, Nolle said. Once a company gets into multiple gigabytes, cloud costs can soar.

"There's a lot of work that's going to have to be done to figure out how apps designed to run in a local data center with servers and storage could be moved to the cloud," Nolle said. "It's unclear whether it would be profitable to do something like that."

Characteristics of a private cloud application

If a private cloud does make sense for an organization, which applications should they put there?

The first private cloud applications that come to mind are those that have fared well in the SaaS markets -- CRM, HR and other disconnected departmental applications that the rest of the company does not need to access. The larger the user base, the more difficult it is for a traditional IT shop to support it in a cloud environment, whether private or public.

"If you look at mainstream IT, once you get to employee users in the 10,000 to 15,000 range, it's unlikely they'd be able to provide that service," Nolle said.

In fact, whether an application is suited for a private cloud is not really application specific.

"You need to determine how much data is involved, how often is it accessed, how large a resource pool does the company have to host the information compared with a cloud provider," Nolle said. "None of those are application specific."

Bill Claybrook, president of New River Marketing Research in Concord, Mass. agrees.

"Anything high performance, high security you don't want to move to the public cloud," he said. "Ones that require special hardware and clustering are starting to edge their way into the public cloud area."

In fact, companies are increasingly turning to hybrid cloud deployments, running most of their applications in house but turning to public clouds when the need for capacity spikes when using cloud bursting techniques . E-commerce websites that need capacity during the holidays are a frequently cited example.

"Web applications are some that are often moved between the two [private or public cloud]," Claybrook said. "You can move just about anything you want, but the ones that are more difficult are those that demand high performance."

However, moving some applications between public and private clouds can be difficult and that's something organizations should consider as they craft their cloud plans.

"Private to public is not all that easy," Claybrook said. "It's simpler if you're using the same hypervisor to build the private cloud. The way to get around it is to build a private cloud using VMware and hook up with a public cloud. Then moving apps back and forth is easier."

And some applications simply aren’t candidates for the cloud. Legacy applications that run on Unix or mainframes are not moving to a cloud environment; they'd need to be rewritten since all the virtualization software is written for x86 machines, Claybrook added.

Again, it depends on what an organization already has invested.

"If I have a private cloud, I could run CRM or all my apps on private cloud, or if I'm only using CRM, I'll probably just get that from someone like Salesforce.com," Claybrook said. "You can run the applications anywhere you want. You just have to see what makes sense."

The cloudy future

As the cloud marketplace and IT's management of cloud environments evolve, most companies larger than about 500 employees are going to employ both private and public cloud principles to some degree or another by the end of the decade, according to Nolle.

"That's going to be the dominant cloud model," he said. "We're moving toward a more componentized, agile deployment method. Instead of a rigid way of one app, one server we're now deploying application components against a general pool of resources that might expand or contract to cloud hosting."

But traditional models aren't going extinct.

"People are going to be running apps on mainframes forever," Claybrook said. "Even though with Unix, the market share for servers out there is dropping off each year, there are a lot of Unix systems running mission critical systems. Unix is not going away. There's still AIX, there's still Solaris."