As anyone who has been around technology knows, buzz words are the lifeblood of the industry.   So when the word “Cloud” started being used, it sounded much like any other buzzword-worthy moment. I thought, isn’t this just a fancy way to say hosting much as SaaS is just a rehash of ASP from 15 years ago?  The answer is no.  This is different, very different, and IT departments need to invest the time to understand and grasp the concepts.

Within our industry, the vendors that supply slot systems, property management and point of sale or any of the other dozen applications we use daily, all offer cloud-based versions of their software. But instead of saying Cloud, let’s instead distinguish systems as being either on-premise or off-premise. The benefits of most off-premise solutions are reduced capital investments and expending less resources for managing equipment, patching operating systems or backing up data. 

To really start understanding the Cloud, take a look at Amazon Web Services or AWS. It launched in 2006 with a handful of services, mostly virtual servers and storage offerings. That has now grown into a massive collection of services that are extremely easy to provision, very inexpensive (really, I mean cheap) to operate and are incredibly robust and secure.  

See if this sounds familiar: every night you need to update the analytics in the data warehouse.    You have a database server and another server that performs the ETLs (Extract, Transform and Load). The ETLs take six hours to complete and sometime during the afternoon the reports start churning out. Generally this is done serially, meaning one ETL is processed at a time because doing more means you would need to purchase another servers. There is a capital cost to the equipment, maintenance and every few years you need to either add capacity or perform a major uplift in technology. 

Here is the same scenario under AWS and its entirely automated:  when it’s time to start performing the ETLs, you mount the database which is normally running on a smaller database server onto a very large, memory optimized instance. Now, instead of a single server performing ETLs, your script launches six virtual servers, each loading an image with the scripts that need to be performed. As the work finishes, the server instances are terminated and the billing for that instance stops. Once all the scripts have finished, the heavyweight database server also terminates (no more billing) and the smaller database server picks back up where it left off before this process began.

What is the difference between running one server for six hours or six servers for one hour?   Besides getting your information in one-sixth the time, the costs are the same. The key to the savings is that you only pay for time and space that you consume. Start the server from an image, do the work, then throw away (terminate) the server. AWS servers that are comparable to the ones in your data center only cost a dollar or so an hour to operate; even the beefiest servers AWS offers are less than $5/hour. 

Prior to thinking about the Cloud, the solution would be to use virtualization technologies such as VMWare to perform most of the same functions as described above. But again, I would be bounded by having sufficient physical nodes in a virtual cluster and licensing for the nodes and operating systems for those new instances. And those physical servers still need power, cooling, space and maintenance.

Moving data between on-premise and off is seamless with Virtual Private Cloud which allows for a VPN connection between your data center and cloud.  Additionally, Cloud storage can be treated as an iSCSI device and seen as a virtual tape library storing data for as little as one cent per gigabyte per month. Yep, a penny.  Haven’t you ever put a tape into a drive and wondered if it will read? Amazon storage durability is a staggering 99.999999999 percent.  I was told that if you had 10,000 files in S3, statistically, it would lose one file every 10 million years. 

How many web servers do you have?  How does this compare to the Cloud solution, considering that all this automation costs almost nothing while the demand isn’t there?  This is the power of the Cloud.

 My first impression of the Cloud was wrong; I highly recommend spending the time to understand this game changing, paradigm shifting, out of the box, buzzword of the day technology.