Cloud is dead. Long live the cloud!

I’ve seen a few articles recently that talking about how organisations are moving workloads out of the cloud and back to their own datacentres. Sometimes they are little more than clickbait. But there is a really important discussion to be had here. So I thought I’d lift the lid on this topic and have a look at what I think is really going on.

The promise of the cloud

Cloud is great for many things. On-demand access to vast amounts of computing and storage resource, on a pay as you go basis. Brilliant. No need to invest in capital. Just pay for what you use.

Except that’s not how all businesses work. At least not for all application workloads and data sets.

Possibly the most famous of these “we found cloud expensive and moved back on-prem” articles is David Heinemeier Hansson (@DHH)’s why we’re leaving the cloud post for 37 Signals, written in 2022. In that post, DHH says that renting someone else’s computers didn’t work for his business. He describes 37 Signals as a “medium-sized business with stable growth”. But, I’m willing to bet that most of the readers of this post are not running SaaS applications in AWS for a global audience of B2B and B2C customers. Some will be, but most of my clients are not.

In fact, in his video on kicking cloud to the curb [sic], David Linthicum (@DavidLinthicum) flags that SaaS providers will scale in a repeated pattern, whereas enterprise [and SME] workloads scale differently. Cloud still has a place for most organisations. DHH’s follow-up post (the Big Cloud Exit FAQ) is worth a read too. Just remember that most business don’t follow the profile of 37 Signals. And that 37 Signals are still using co-lo facilities (because building new datacentres in 2024 is a very brave move, unless you are a hyperscaler).

But you’re not 37 Signals

In 2024, I would seriously question why anyone is running their own office productivity tools (email, IM, intranet, etc.) on-premises. There are many services that can do this for you on a per-person-per-month basis. And they will have better up-time than you ever did, despite what your former email administrator tells you. Those jokes about “Microsoft 364” whenever there’s a blip in the matrix… how much more did you spend on storage to make sure that you got to even 99.5% availability in your Exchange servers?

But let’s move on past the “low hanging fruit” that can relatively easily be replaced by SaaS. Let’s have a look at all those other applications that actually run your business: the finance system; the case management system; the modern data platform; the reporting and analytics; the years and years of accumulated unstructured file data that no-one knows what is needed and what is not. (“The business”* says “that it’s up to IT to sort out”. IT says “we don’t know what you need”. No-one agrees to the blanket retention policies, just in case that file deleted after 3, 7, 10 years is really important.)

What I’ve seen happen, time and time again, is that almost everything is moved to the cloud. I say almost, because the cloud discovery process often turns up evidence of virtual machines that were created, are no longer used, but are left running. This happens because on-premises infrastructure is seen as “paid for”. There is no cost to leaving things running. Except there is – not just in wasted processor cycles and storage, but in the size of the infrastructure that’s required.

Lifting and shifting without transformation

There are many motivations for cloud migrations but the most common I see is because the datacentre is closing. Maybe it’s the end of an outsource, maybe the site is being sold for redevelopment. But it’s nearly always “we must exit by” a particular date. No time to transform – just transition. We’ll sort it out later. Except “later” never comes. The project to move to the cloud is completed. The team is stood down. The partners are disengaged. “Phase 2” to transform the estate doesn’t have a strong enough business case** and things stay the same.

And then the cloud bills come in. They look a bit steep – especially for IaaS. You’re using more storage than you expected, and those VMs are a little pricey. Some “optimisation” is done to adjust VM sizes. Reserved Instances and other benefits are used to reduce the monthly charge.

Watch the costs rise

A year later, the prices rise. Inflation. Exchange rate variance vs. the $ or the € (depending on your provider’s base currency). That’s OK, it was always expected. Wasn’t it? Another round of “optimisation” happens. A couple of applications are no longer used, replaced by SaaS. Some VMs are switched off.

Rinse and repeat. Rinse and repeat.

A few years on, but you’ve still not transformed. Those resources that you “lifted and shifted” to the cloud are, like the old adage, the same computers running in someone else’s data centre.

The CFO looks at the cloud bill and says “how much?!”. It looks astronomical compared with industry norms. They bring in a new Head of IT and tell them that they have to reduce the cloud spend. “We’ll move back on-premises – where it used to cost less”, they agree.

But it’s still the same systems. With the same technical debt. And now it needs power, and water, and expensive servers and storage and… you see where we are going.

Refactor or modernise

Cloud is not a cycle, like in-source/out-source. It’s a business model. And, like all business models you need to tune the way they are used to make best use of them. N-tier applications running on VMs in IaaS will generally not be cost-effective. Look at how to move the presentation tier to web services. Can the application be re-factored? Could the database run in PaaS too? Often the challenge is ISV support. But it’s 2024. If your vendor doesn’t have native support for Azure or AWS, maybe it’s time to find a different vendor.

And if you’re moving to the cloud to save money, maybe it’s time to look again at your business case.

Use the cloud for innovation, not to save money

Cloud can save money. But only after the workloads are transformed. And only then with continual optimisation. The trick is to make the effort you put into transformation cost less than the savings you return through efficiencies. We can do this on-prem too, but it normally involves capital spend. And that’s another major advantage of the cloud. Once you’re there you can use it to try out new products and services, without a major investment. All that AI innovation that’s happening right now. You can try it out in the cloud, for relatively little effort. Now imagine you needed an investment case for the infrastructure to develop new AI models in house? Cloud gave you agility and flexibility.

And don’t forget about efficiency

To borrow a metaphor from David Linthicum, remember that cloud is a utility. If you leave the heating and lights on at home, you can expect a big bill. It’s no different in the cloud, if you run inefficient infrastructure and applications.

Look at the long-term viability and placement for your services, Make right-sizing decisions based on application workload and datasets. The problem isn’t the cloud – it’s that some people are trying to use it for the wrong things.

* I used this term to be deliberately provocative. I could write a whole separate post on the concept of “the business” vs. “IT”.
** It should have. If properly thought through.

Featured image: author’s own

What-as-a-service?

This content is 11 years old. I don't routinely update old blog posts as they are only intended to represent a view at a particular point in time. Please be warned that the information here may be out of date.

I’ve written previously about the “cloud stack” of -as-a-service models but I recently saw Microsoft’s Steve Plank (@plankytronixx) give a great description of the differences between on-premise,  infrastructure as a service (IaaS), platform as a service (PaaS) and software as a service (SaaS).

Of course, this is a Microsoft view of the cloud computing landscape and I’ve had other discussions recently where people have argued the boundaries for IaaS or PaaS and confused things further by adding traditional web hosting services into the mix*.  Even so, I think the Microsoft description is a good starting point and it lines up well with the major cloud services offerings from competitors like Amazon and Google.

Not everyone will be familiar with this so I thought it was worth repeating Steve’s description here:

In an on-premise deployment, the owning organisation is responsible for (and has control over) the entire technology stack.

With infrastructure as a service, the cloud service provider manages the infrastructure elements: network, storage, servers and virtualisation. The consumer of the IaaS service will typically have some control over the configuration (e.g. creation of virtual networks, creating virtual machines and storage) but they are all managed by the cloud service provider.  The consumer does, however, still need to manage everything from the operating system upwards, including applying patches and other software updates.

Platform as a service includes the infrastructure elements, plus operating system, middleware and runtime elements. Consumers provide an application, configuration and data and the cloud service provider will run it, managing all of the IT operations including the creation and removal of resources. The consumer can determine when to scale the application up or out but is not concerned with how those instances are operated.

Software as a service provides a “full-stack” service, delivering application capabilities to the consumer, who only has to be concerned about their data.

Of course, each approach has its advantages and disadvantages:

  • IaaS allows for rapid migrations, as long as the infrastructure being moved to the cloud doesn’t rely on other components that surround it on-premise (even then, there may be opportunities to provide virtual networks and extend the on-premise infrastructure to the cloud). The downside is that many of the management issues persist as a large part of the stack is still managed by the consumer.
  • PaaS allows developers to concentrate on writing and packaging applications, creating a service model and leaving the underlying components to the cloud services provider. The main disadvantage is that the applications are written for a particular platform, so moving an application “between clouds” may require code modification.
  • SaaS can be advantageous because it allows for on-demand subscription-based application use; however consumers need to be sure that their data is not “locked in” and can be migrated to another service if required later.

Some organisations go further – for example, in the White Book of Cloud Adoption, Fujitsu wrote about Data as a Service (DaaS) and Business Process as a Service (BPaaS) – but IaaS, PaaS and SaaS are the commonly used models.  There are also many other considerations around data residency and other issues but they are outside the scope of this post. Hopefully though, it does go some way towards describing clear distinctions between the various -as-a-service models.

* Incidentally, I’d argue that traditional web hosting is not really a cloud service as the application delivery model is only part of the picture. If a web app is just running on a remote server it’s not really conforming with the broadly accepted NIST definition of cloud computing characteristics. There is a fine line though – and many hosting providers only need to make a few changes to their business model to start offering cloud services. I guess that would be an interesting discussion with the likes of Rackspace…

“5 reasons to avoid Office 365?” Are you really sure about that?

This content is 13 years old. I don't routinely update old blog posts as they are only intended to represent a view at a particular point in time. Please be warned that the information here may be out of date.

It’s not often these days that I feel the need to defend Microsoft. After all, they’re big boys and girls who can fight their own battles. And yes, I’m an MVP but if you ask Microsoft’s UK evangelists (past and present), I’m sure they’ll tell you I’m pretty critical of Microsoft at times too…

So I was amazed yesterday to read some of the negative press about Office 365. Sure, some Microsoft-bashing is to be expected. So is some comparison with Google Apps. But when I read Richi Jennings5 reasons to avoid Microsoft Office 365 , I was less than complementary in my reaction.  I did leave a lengthy comment on the blog post, but ComputerWorld thinks I’m a spammer… and it was more than 140 characters so Richi’s Twitter invitation for constructive comments for his next post (5 reasons to embrace Office 365) was not really going to work either.

Picking up Richi’s arguments against Office 365:

  • On mobility. I’ll admit, there are some issues. Microsoft doesn’t seem to understand touch user interfaces for tablets (at least not until they have their own, next year perhaps?) so the web apps are not ideal on many devices. Even so, I’m using Exchange Online with my iOS devices and the ActiveSync support means it’s a breeze. We don’t have blanket WiFi/3G coverage yet (at least not here in the UK) so it is important to think about offline working and I’m not sure Microsoft has that sorted, but neither does anyone else that I’ve found. Ideally, Microsoft would create some iOS Office apps (OneNote for iPhone is not enough – it’s not a universal app and so is next to useless on an iPad) together with an Android solution too…
  • I don’t see what the issue is with MacOS support (except that the option to purchase a subscription to Office Professional Plus is Windows-only). I’m using Office 365 with Office for Mac and SharePoint integration is not as good as on Windows but there seems nothing wrong with document format fidelity or Outlook connecting to Exchange Online. I’ve used some of the web apps on my Mac too, including Lync.
  • Is £4 a month expensive for a reliable mail and collaboration service? I’m not sure that the P1 option for professionals and small businesses (which that price relates to) is “horribly crippled” either. If the “crippling” is about a lack of support, I left Google Apps because of… a lack of support (after they “upgraded” my Google Apps account but wanted me to change the email address on my then-orphaned “personal” account – and you think Microsoft makes it complex?)
  • Forest Federation is a solution that provides clear separation between cloud and on-premise resources. It may be complicated, but so are enterprise requirements for cloud services.  If that’s too complex, then you don’t probably don’t need Active Directory integration: try a lower-level Office 365 subscription…
  • As for  reliability, yes, there have been BPOS Outages. Ditto for Azure. But didn’t Google have some high-profile GMail outages recently? And Amazon? Office 365 (which was a beta until yesterday) has been pretty solid.  Let’s hope that the new infrastructure is an improvement on BPOS, but don’t write it off yet – it’s only just launched! Microsoft is advertising a financially-backed 99.9% uptime agreement

The point of Office 365 is not to move 100% to the cloud but to “bring office to the cloud” and use it in conjunction with existing IT investments (i.e. local PCs/Macs and Office).  If I’m a small business with few IT resources, it lets me concentrate on my business, rather than running mail servers, etc. Actually, that’s the sweet spot. Some enterprises may also move to Office 365 (at least in part) but, for many, they will continue to run their mail and collaboration infrastructure in house.

Richi says that, if he were a Microsoft Shareholder, he’d be “bitterly disappointed with [yesterday’s] news”. The market seems to think otherwise… whilst Microsoft stock is generally not performing well, it’s at least rising in the last couple of days…

Microsoft stock price compared with leading IS indices over the last 12 months

To be fair, Richi wasn’t alone, but he was the one with the headline grabbing post… (would it be rude to call it linkbait?)

Over on Cloud Pro, Dennis Howlett wasn’t too impressed either. He quoted Mary Jo Foley’s Office 365 summary post:

Office 365 is not Office in the cloud, even though it does include Office Web Apps, the Webified versions of Word, Excel, PowerPoint and OneNote. Office 365 is a Microsoft-hosted suite of Exchange Online, SharePoint Online and Lync Online €” plus an optional subscription-based version of Office 2010 Professional Plus that runs locally on PCs. The Microsoft-hosted versions of these cloud apps offer subsets of their on-premises server counterparts (Exchange, SharePoint and Lync servers), in terms of features and functionality.”

Yep, that’s pretty much it. Office 365 is not about competing with Office, it’s about extending Office so that:

  • It’s attractive to small and medium-sized businesses, so that they don’t need to run their own server infrastructure.
  • There are better opportunities for collaboration, using “the cloud” as a transport (and, it has to be said, giving people less reason to move to Google Apps).

Dennis says:

“Microsoft has fallen into the trap that I see increasingly among enterprise vendors attempting to migrate their business models into the cloud: they end up with a half baked solution that does little for the user but gives some bragging rights. All the time, they seek to hang on grimly to the old business model, tinkering with it but not taking the radical steps necessary to understand working in the cloud.”

Hmm… many enterprises are not ready to put the data that is most intimately linked to their internal workings into the cloud. They look at some targeted SaaS opportunities; they might use IaaS and PaaS technologies to provide some flexibility and elasticity; they may implement cloud technologies as a “private cloud”. But Office 365 allows organisations to pick and choose the level of cloud integration that they are comfortable with – it might be all (for example, my wife’s small business) or none (for example me, working for a large enterprise), or somewhere in between.

Office 365 has some issues – I’m hoping we’ll see some more development around mobility and web app functionality – but it’s a huge step forward. After years of being told that Windows and Office are dead and that Microsoft has no future, they’ve launched something that positions the company for both software subscriptions (which they’ve been trying to do for years) and has the ability to host data on premise, in the cloud, or in a hybrid solution. “The cloud” is not for everyone, but there aren’t many organisations that can’t get something out of Office 365.