Future Trends in Cloud Computing All Point to Optimization

Future Trends in Cloud Computing All Point to Optimization

Given our focus on public cloud cost control, we here at ParkMyCloud are always trying to understand more about the future trends in cloud computing, specifically the public cloud infrastructure (IaaS) and platform (PaaS) market. Now that public cloud has become ubiquitous, there’s a common theme. While new services and products continue to develop, more and more of them are focusing on not just creating capabilities that were previously lacking – they’re focused on optimizing what already exists.

Are Cloud Services Still Growing?

Before we dive into optimization, let’s take a look at how the cloud market continues to grow in 2020 and beyond. Gartner estimates that $257.9B will be spent on public cloud services in 2020, up 6.3 from 2019 as outlined in the table below:

And according to IDC, almost half of IT spending is cloud-based, “reaching 60% of all IT infrastructure and 60-70% of all software, services and technology spending in 2020.” These projections come mid-2020, showing that even given the disruption this year,  between Gartner and IDC, no one expects cloud adoption and spending to slow down any time soon. So what’s driving this growth and what are the future trends in cloud computing we should be on the lookout for in 2020 and beyond?

Trends in Cloud Computing You’ve Probably Heard About

There is definitely a lot of hype around Blockchain, Quantum Computing, Machine Learning, and AI, as there should be. But at a more basic level, cloud computing is changing businesses in many ways. Whether it is the way they store their data, improvements to agility and go-to-market for faster release of new products and services, or how they develop and operate services remotely in today’s “locked-down world”, cloud computing is benefitting all businesses in every sector. Smart businesses are always looking for the most innovative ways to improve and accomplish their business objectives, i.e., make money.

When it comes to cloud technology, more and more businesses are realizing the benefits that cloud can provide them and are beginning to seek more cloud solutions to conduct their business activities. And obviously, Amazon, Microsoft, Google, Alibaba, IBM, Cisco, VMWare and Oracle plan to capture this spend by providing a dizzying array of IaaS, PaaS, and DaaS offerings to help enterprises build and run their services.

How These Trends Make Cloud Computing Better

Cloud Automation Tools: as modern IT environments continue to become more diverse and distributed in the pursuit of key business goals, they also bear new challenges for the operation teams responsible for keeping everything running smoothly. The go-to strategy for taming the associated complexity can be summed up in one word – automation.

Automation tools, including some that incorporate AI, are on the rise in 2020. These new automation capabilities, along with comprehensive dashboards that provide a holistic view into multi-cloud operations, will become increasingly important for cloud and IT operations to support the lines of business regardless of where they place their workloads. These tools can help put the right workloads in the right place, manage costs, improve security and governance, and ensure application performance.

Desktop as a service (DaaS): DaaS is expected to have the most significant growth in 2020, increasing 95.4% to $1.2 billion. DaaS offers an inexpensive option for enterprises that are supporting the surge of remote workers due to the global pandemic and their need to securely access enterprise applications from multiple devices and locations.

Multi-Cloud and Hybrid Cloud: Once predicted as the future, the multi- and hybrid cloud world has arrived and will continue to grow. Most enterprises (93 percent) described their strategy as multi-cloud in 2020 according to a Flexera report (up 21% from 2018) and 87% have a hybrid cloud strategy. In addition, 71 percent of public cloud adopters are using 2+ unique cloud environments/platforms. These numbers will only go up in 2021. While this offers plenty of advantages to organizations looking to benefit from different cloud capabilities, using more than one CSP complicates governance, cost optimization, and cloud management further as native CSP tools are not multi-cloud. As cloud computing costs remain a primary concern, it’s crucial for organizations to stay ahead with insight into cloud usage trends to manage spend (and prevent waste) and optimize application performance. 

It’s a complex problem, but we do see many organizations adopting a multi-cloud strategy with cost control and governance in mind, as it avoids vendor lock-in and allows flexibility for deploying workloads in the most cost-efficient manner (and at a high level, keeps the cloud providers competitive against each other to continually lower prices).

Growth of Managed Services: The global cloud managed services market is growing rapidly and is expected to reach $116B billion by 2025, growing from $62.4B in 2020 according to a study conducted by Markets and Markets. Enterprises are focusing on their primary business operations, which results in higher cloud managed services adoption. Business services, security services, network services, data center services, and mobility services are major categories in the cloud managed services market. Implementation of these services will help enterprises reduce IT and operations costs and will also enhance productivity of those enterprises. 

Managed service providers – the good ones, anyway – are experts in their field and some of the most informed consumers of public cloud. By handing cloud operations off to an outside provider, companies are not only optimizing their own time and human resources – they’re also pushing MSPs to become efficient cloud managers so they can remain competitive and keep costs down for themselves and their customers.

Cloud Trends Are Always Evolving

While today, it sometimes seems like we’ve seen the main components of cloud operations and all that’s left to do is optimize them, history tells us that’s not the case. Cloud has been and will continue to be a disruptive force in enterprise IT for years to come as has the Global Pandemic of 2020, and future technology trends in cloud computing will continue to shape the way enterprises leverage public, private and hybrid cloud. Remember: AWS was founded in 2006, the cloud infrastructure revolution is still in early days, and there is plenty more XaaS to be built.

AWS vs. Azure vs. Google Cloud Governance Models

AWS vs. Azure vs. Google Cloud Governance Models

The deliverability of cloud governance models has improved as public cloud usage continues to grow and mature. These models allow large enterprises to tier and scale their AWS Accounts, Azure Subscriptions and Google Projects across hundreds and thousands of cloud users and services. When we first started talking to customers 5+ years ago, mostly AWS users at the time, they often had a single AWS account for their entire organization and required third-party tools to manage usage and costs by project, line of business or application owner. But now, the “Big 3” cloud providers offer an array of ways for even the largest Fortune 500 enterprises to set up, run and manage their use of the dizzying volume of cloud services.

Why Cloud Governance Models are Important

The main way cloud providers allow cloud administrators to manage and grant access to their services is by leveraging Identity and Access Management (IAM) and providing options for roles and policies that govern both access and usage. IAM lets you grant granular access to specific AWS, Azure and/or Google Cloud resources and helps prevent access to other resources. IAM lets you adopt the security principle of least privilege, where you grant only necessary permissions to access specific resources like VM’s, Databases, Storage, Containers, etc.. With IAM, you manage access control by defining who (identity) has what access (role) for which resource. 

In ParkMyCloud, we apply this with Teams and Roles. Admins can create Teams (equivalent to Projects, Applications, or Lines of Business) and can invite a Team Lead to manage that PMC Team, and they can in turn grant users access and set permissions for them, which can then by automated based on policies, usually by leveraging tags but you can use other metadata as well. 

What if you want more flexibility with the cloud providers to both manage user access and to more tightly align your cloud services and usage to your organizational structure, projects and applications? Each of the major providers has designed ways for large enterprises to implement a hierarchical usage of cloud users and services that probably can look very similar to that enterprises organization chart. (If you can understand their jargon.)

How AWS, Azure, and Google Apply Cloud Governance Models

We dug into AWS, Azure and Google and this is what we found:

  • Amazon Web Services (AWS)
    • Tier 1: AWS Organization
      • Tier 2: Organization Unit
        • Tier 3: AWS Accounts
          • Tier 4: Tags

  • Microsoft Azure
    • Tier 1: Azure Enterprise Portal
      • Tier 2: Departments
        • Tier 3: Accounts
          • Tier 4: Subscriptions
            • Tier 5: Resource Groups
              • Tier 6: Tags

  • Google Cloud
    • Tier 1: Organization
      • Tier 2: Folders
        • Tier 3: Projects
          • Tier 4: Resources
            • Tier 6: Tags

Tips for implementing Cloud Governance Models:

  1. Research and attend web sessions on these cloud governance models to ensure you understand the nuance
  2. Implement your cloud provider’s latest hierarchies and governance models prior to mainstream cloud adoption in your organization
  3. Make sure you run the hierarchies you plan to implement by CloudOps, ITOps, DevOps and FinOps to ensure proper organizational mapping and reporting

The cloud providers have done a pretty good job of documenting their roles, policies and hierarchies and creating a graphical representation of their current hierarchical structures cloud governance models. Of course, none of them use the same terminology – I mean, why would you, too easy, right? (And why does Google rank a ‘Folder’ above a ‘Project’? )

With these options available to you, your cloud operations team can make sure to use this to your advantage when planning new resources, accounts, and use cases within your organization. Let us know your thoughts and if you use any of these models to improve your cloud usage.

Where are you on the Cloud Spend Optimization Maturity Curve?

Where are you on the Cloud Spend Optimization Maturity Curve?

Cloud spend optimization is always top of mind for public cloud users. It’s usually up there with Security, Governance, and Compliance – and now in 2020, 73% of respondents to Flexera’s State of the Cloud report said that ‘Optimize existing use of cloud (cost savings)’ was their #1 initiative this year. 

So – what the heck does that mean? There are many ways to spin it, and while “cost optimization” is broadly applicable, the strategies and tactics to get there will vary widely based on your organization and the maturity of your cloud use. 

Having this discussion within enterprises can be challenging, and perspectives change depending on who you talk to within an organization – FinOps? CloudOps? ITOps? DevOps?.  And outside of operations, what about the Line of Business (LoB) or the Application owners? Maybe they don’t care about optimization in terms of cost but in terms of performance, so in reality optimization can mean something different to cloud owners and users based on your role and responsibility.

Ultimately though, there are a number of steps that are common no matter who you are. In order to facilitate this discussion and understand where enterprises are in their cloud cost optimization journey, we created a framework called the Cloud Cost Optimization Maturity Curve to identify these common steps.

Cloud Spend Optimization Maturity Curve

While cloud users could be doing any combination of these actions, this is a representation of actions you can take to control cloud spend in order of complexity. For example, Visibility in and of itself does not necessarily save you money but can help identify areas ripe for optimization based on data. And taking scaling actions on IaaS may or may not save you money, but may help you improve application performance through better resource allocation, scaling either up (more $$$) or down (less $$$). 

Let’s dig into each in a little more detail:

  1. Visibility – visibility of all costs across clouds, accounts, and applications. This is cloud cost management 1.0, the ability to see cost data better through budgeting, chargeback, and showback.
  2. Schedule suspend – turn off idle resources like virtual machines, databases, scale groups, and container services when not being used, such as nights and weekends based on usage data. This is most common for non-production resources but can have a big bang in terms of savings – 65% savings is a good target that many ParkMyCloud customers achieve even during a free trial.
  3. Delete unused resources – this includes identifying orphaned resources and volumes and then deleting them. Even though you may not be using them, your cloud provider is still charging you for them.
  4. Sizing IaaS (non-production) – many enterprises overprovision their non-production resources and are using only 5-10% of the capacity of a given resource, meaning 90% is unused (really!) so by leveraging usage data you can get recommendations to resize those under utilized resources to save 50% or more.
  5. RI / Savings Plan Management – AWS, Azure, and Google provide the ability to pre-buy capacity and get discounts ranging from 20-60% based on your commitments in both spend and terms. While the savings make it worthwhile, this is not a simple process (though it’s improved with AWS’s savings plans)  and requires a very good understanding of the services you will need 12-36 months out.
  6. Scaling IaaS (prod) – this requires collecting data and understanding both the infrastructure and application layers and taking sizing actions up or down to improve both performance and cost. Taking these actions on production resources requires strong communication between Operations and LoB.
  7. Optimizing PaaS – virtual machines, databases, and storage are all physical in nature and can be turned off and resized, but these top the maturity curve since many PaaS services have to be optimized in other ways like scaling the service up/down based on usage or rearchitecting parts of your application.

For more ways to reduce costs, check out the cloud waste checklist for 26 steps to take to eliminate wasted spend at a more granular level.

5 Years in at ParkMyCloud: Simplicity, Self-Service, and Savings Still Win.

5 Years in at ParkMyCloud: Simplicity, Self-Service, and Savings Still Win.

Today, if you can believe it, ParkMyCloud is 5 years old. Our company anniversary is always a good opportunity to take a step back and see where we’ve been and take a look ahead.

A lot has changed in the past 5 years. In 2015, “public cloud” was practically synonymous with “AWS” – and the size of the entire IaaS market was $11 billion. In 2020, we estimate that more than that amount will be spent – and wasted – on idle resources alone, with IaaS revenue of about $50 billion. Azure and Google have become preferred options for many enterprises. While AWS still dominates, it’s at a mere 32% of the market compared with 70% in 2015. Services we use every day, like Fargate and Kubernetes, didn’t exist 5 years ago.

And yet, a lot has stayed the same. Public cloud is still growing. Cost optimization is still a concern – in fact, the top initiative for most cloud users. 

So perhaps it’s not surprising that not too much has changed from the original mission statement we set out to achieve: simplifying cloud cost reduction. In fact, this all still rings true (except, of course, expanding beyond compute): 

“We decided to take on the biggest challenge enterprises of any size face in using cloud services – controlling an ever-growing bill. But we wanted to do it in a simple, elegant, and cost-effective way, so customers could be up and running within 15 minutes, reducing their cloud computing services spending by the next day and achieving payback in less than one month.”

In pursuit of that goal, we’ve hit some exciting milestones this year – from more than $50 million saved on public cloud by our customers to being rated #1 in user satisfaction among cloud cost management platforms. We have been united with Turbonomic for a full year, and continue to onboard new customers, continually finding opportunities to optimize cloud costs through scheduling, rightsizing, and more on compute, databases, storage, and containers.

First and foremost we want to thank our amazing customers. These include a number who joined us a couple of weeks after launching and have been with us throughout. Others came aboard at different times during the last five-years and to all we are truly grateful. We have been provided with constant feedback and whenever we have reached out for support or advice on new feature development we have been provided with wonderful advice.

Of course, anyone who knows me knows we won’t linger on celebration when there’s more to look forward to. We have plenty of news coming down the pipe. We’ll continue to add optimization support for more IaaS and PaaS services across all three of the major cloud providers. We’ll have new integrations to announce to streamline our customers’ end-to-end public cloud optimization journey. And, we’re always striving to improve our user experience and make ParkMyCloud as easy to use for you and your team as possible. If you have suggestions – we’re all ears. It’s all about the ROI! 

So, happy 5th birthday, ParkMyCloud. The journey to cloud optimization continues.

Who Should Manage App Development Costs?

Who Should Manage App Development Costs?

We speak to enterprises large and small about cloud cost optimization, and one of the more dominant themes we have been hearing lately is: who should manage app development costs?  Cloud Operations teams (ITOps, DevOps, FinOps, Cloud Center of Excellence, etc.) that are responsible for the management, governance and optimization of an enterprise’s cloud resources need to get the Application owners or the lines of business owners to be responsible for cost. It can’t simply be the centralized cloud team who cares about cost. Folks using cloud services on a daily basis for engineering, development, QA, testing, etc. need to take actions related to optimizing cloud costs, managing user governance and security operations.

I liken this a bit to the response to the COVID-19 pandemic given this is the event that has defined 2020. The Federal Government can collect data from across the country, provide resources and publish guidelines but ultimately the State Governments need to take the actions to shut down schools and non-essential businesses, and certain counties or jurisdictions within those states can even decide if they will adhere to the state guidelines, there could be very good reasons they don’t based on data or essential businesses. We see the same underlying process in enterprises when it comes to cloud cost optimization and management.

Let’s play this out.

Cloud spend has become the largest single IT cost outside of labor and is growing 10-15% month on month. So, the CloudOps team is given a directive from Finance and/ or IT Management to find tools or solutions to identify cloud waste and control cloud spend primarily in AWS, Azure and Google clouds.

Then, the CloudOps team researches tools, both 3rd party and native cloud provider tools, and finds a couple important things:

  1. If the enterprise is multi-cloud, the native CSP tools are a non-starter
  2. Tools must be data-driven, so the recommendations to reduce the app development cost are believable and actually useful
  3. The tools must be self-service, i.e., the application owners or the lines of business need to be able to take the actions. Otherwise, they will deem CloudOps as being draconian (and push back because they know their app better … sounds like the States).

Next, CloudOps brings in a tool to do a pilot. It starts small with a sandbox account, but as data and trust build, the pilot expands to include many AWS, Azure, and/or GCP accounts that are used by the application owners. Then CloudOps determines a “friendly” line of business where the app development cost owner is keen to identify waste, reduce costs, and increase their cloud efficiency.

CloudOps and the cloud optimization vendor provide a demo to the app owners using their own data and showing them where they have waste, such as idle resources, over-provisioned resources, orphaned resources, resources that could leverage reservations, and so forth. The app owners are intrigued and are keen to understand if they are the master of their own domain.

Common questions:

  • Where is this data coming from? Is it reliable?
  • Can we take our own actions? Is this self-service?
  • What about user governance? My QA team does not need to manage resources that belong to dev or staging. Can we reject a recommendation because the app we are running requires that configuration?
  • Can we group resources into application stacks and manage them as a single entity?
  • Can we override an action?

In order to effectively manage the app development cost, CloudOps needs to involve the owners and users of those applications and provide them with the data and tools to make decisions and take actions. The cloud is self-service, so in order to effectively manage your cloud services, you need the optimization and governance tools to also be self-service and adapt to the needs of each business unit within your organization.