Can the Cloud Handle Enterprise IT?

Cloud computing is the latest buzz phrase in the enterprise, as management seeks to cut IT costs.

 By Richard Adhikari
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Up to now, enterprises have been cautious about putting data- and transaction-intensive applications such as stock trading on the cloud because managing them has been difficult. Solutions are beginning to appear, however.

It's faster to set up a Web site on the cloud than to go through corporate IT. All users need is a credit card. It's also cheaper because companies pay only for the resources they actually consume.

Amazon.com's Elastic Compute Cloud (EC2) service, for example, with 1.7 gigabytes (GB) of memory, one EC2 compute unit, 160GB of storage and a 32-bit platform, costs 10 cents per hour.

Most enterprises, however, use the cloud for relatively minor tasks because they believe no tools let them manage applications such as trading or data streaming applications, which are heavy on transactions.

Solutions to that problem do exist, from computer behemoth IBM (NYSE: IBM) and smaller players such as Red Hat (NYSE: RHT) as well as new companies like 3Tera, RightScale and GigaSpaces.

Cloud computing at IBM

IBM has proven that cloud computing can meet the demands of an enterprise with 255,000 employees. Launched two and a half years ago, the IBM Innovation Portal runs many applications on a platform that's flexible and similar to that of Amazon (NASDAQ: AMZN), Dennis Quan, IBM's software group director of Tivoli development, told InternetNews.com.

Developers go to a self-service Web 2.0 portal and request the computing infrastructure they need and get it rapidly. About 100 projects ranging from developer tools to productivity tools to a game project are running on this cloud, and "about 20 percent of them" turn into products IBM ships to customers.

This portal is managed by a cloud management stack based on IBM's Tivoli products, which are also applied to clouds it built for its partnership with Google (NASDAQ: GOOG), Quan said.

IBM sees enterprises using cloud computing both internally, like it does, and externally. "Cloud computing isn't just about virtual machines and acquiring resources over the Web from Amazon with a credit card; it's about how you can get those efficiencies within the corporate walls and outside," Quan explained.

Right now, IBM is working on the New Enterprise Data Center platform, which will evolve from its Blue Cloud initiative.

The New Enterprise Data Center platform is a fusion of two concepts: the Webcentric cloud approach used by Google (NASDAQ: GOOG) and MySpace, in which companies scale and manage large infrastructures and support large user volumes, and the IT enterprise datacenter approach, incorporating mission-critical transaction processing systems as well as high levels of uptime, security and data integrity.

IBM is developing products in the Tivoli suite and in the IBM Global Services Portfolio that will provide cloud computing-based services and products, Quan said.

Next page: Red Hat's JBoss on EC2

This article was originally published on Jul 8, 2008
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