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Global Headquarters: 5 Speen Street Framingham, MA 01701 USA


Opportunities in Private Cloud Computing via a Turnkey Approach

Sponsored by: Microsoft

Michelle Bailey January 2011


The enterprise datacenter is undergoing a reinvention. The previous 10 years of datacenter operations will look nothing like the next 10 years, and much of this change is driven by a combination of new technologies as well as shifting governance and IT automation. To address increasing physical server proliferation, organizations have been aggressively introducing virtualization. While virtualization has helped reduce the number of physical servers in the datacenter, it has led to virtual server sprawl. IDC estimates that the density of virtual machines (VMs) will grow from an average of five VMs per physical server in 2008 to more than eight by 2013 and that management and administration expenses to maintain virtual servers will become the largest single element of server spending by 2013.

In response, datacenters are entering what IDC has identified as the next wave of IT

  • that of "cloud computing." While many think of cloud computing as the services-

based delivery of compute, storage, and/or applications over the public Internet, IDC believes that there is a more important trend in the enterprise datacenter around private cloud computing, or the delivery of IT as a service on IT organizations' own infrastructure.

With cloud computing, organizations now have several options for their application infrastructure, including on-premises servers, public cloud services (which are hosted

at a service provider's site and open to a largely unrestricted universe), or private cloud services (which are built using dedicated hardware and designed for a single enterprise with restricted access and which could be housed on-premises or at a service provider's location). Today, customers can select the approach that works best for them based on the specific requirements of their organization and applications.

Overall benefits of cloud computing include higher levels of responsiveness to business needs, automation, improved orchestration, and faster provisioning. By shifting the management burden to either an outsourced provider or a highly automated layer of infrastructure, organizations can reduce the labor hours required to manage and maintain their servers, whether physical or virtual, and can replace periodic large capital outlays with operational costs on a monthly or an annual basis. IDC expects that enterprises that do not improve their automation capabilities, whether through cloud computing or otherwise, will see their IT costs continue to rise significantly.

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