What is cloud computing?

Cloud computing is renting resources, like storage space or CPU cycles, on another company’s computers. You only pay for what you use. The company providing these services is referred to as a cloud provider. Some example providers are Microsoft, Amazon, Google, Oracle and IBM.The cloud provider is responsible for the physical hardware required to execute your work, and for keeping it up-to-date.

Benefits of cloud computing:

Cloud computing isn’t an all-or-nothing service approach. Companies can choose to use the cloud to store their data and execute logic as much, or as little, as necessary to fulfill their business requirements

It’s cost-effective: Cloud computing provides a pay-as-you-go or consumption-based pricing model.
It’s scalable: You can increase or decrease the resources and services used based on the demand or workload at any given time.
It’s elastic: As your workload changes due to a spike or drop in demand, a cloud computing system can compensate by automatically adding or
removing resources.
It’s current: Cloud usage eliminates the burdens of maintaining software patches, hardware setup, upgrades, and other IT management tasks.
It’s reliable: Cloud computing providers offer data backup, disaster recovery, and data replication services to make sure your data is always safe.
It’s global: Cloud providers have fully redundant datacenters located in various regions all over the globe.
It’s secure: Cloud providers offer a broad set of policies, technologies, controls, and expert technical skills that can provide better security than
most organizations can otherwise achieve.

Capital expenditure(Cap Ex) versus operational expenditure (Op Ex) Ex) versus operational expenditure (Op Ex)

Capital Expenditure (Cap Ex): Cap Ex is the spending of money on physical infrastructure up front, and then deducting that expense from your tax bill over time. Cap Ex is an upfront cost, which has a value that reduces over time.

Operational Expenditure (Op Ex): Op Ex is spending money on services or products now and being billed for them now. You can deduct this expense from your tax bill in the same year. There’s no upfront cost. You pay for a service or product as you use it.

Cloud deployment models:

Public cloud: In this case, you have no local hardware to manage or keep up-to-date – everything runs on your cloud provider’s hardware.

Advantages:

High scalability/agility – you don’t have to buy a new server in order to scale

Pay-as-you-go pricing – you pay only for what you use, no Cap Ex costs

You’re not responsible for maintenance or updates of the hardware

Minimal technical knowledge to set up and use – you can leverage the skills and expertise of the cloud provider to ensure workloads are secure, safe, and highly available

Disadvantages:

There may be specific security requirements that cannot be met by using public cloud.

There may be government policies, industry standards, or legal requirements which public clouds cannot meet.

You don’t own the hardware or services and cannot manage them as you may want to.

Unique business requirements, such as having to maintain a legacy application might be hard to meet.

Private cloud:In a private cloud, you create a cloud environment in your own datacenter and provide self-service access to compute resources to users in your organization.

Advantages:

You can ensure the configuration can support any scenario or legacy application.

You have control (and responsibility) over security.

Private clouds can meet strict security, compliance, or legal requirements.

Disadvantages:

You have some initial Cap Ex costs and must purchase the hardware for startup and maintenance.

Owning the equipment limits the agility – to scale you must buy, install, and setup new hardware.

Private clouds require IT skills and expertise that’s hard to come by.

Hybrid cloud:A hybrid cloud combines public and private clouds, allowing you to run your applications in the most appropriate location.

Advantages:

You can keep any systems running and accessible that use out-of-date hardware or an out-of-date operating system.

You have flexibility with what you run locally versus in the cloud.

You can take advantage of economies of scale from public cloud providers for services and resources where it’s cheaper, and then supplement with your own equipment when it’s not.

You can use your own equipment to meet security, compliance, or legacy scenarios where you need to completely control the environment.

Disadvantages:

It can be more expensive than selecting one deployment model since it involves some Cap Ex cost up front.

It can be more complicated to set up and manage.

Types of cloud services:

Infrastructure as a service (IaaS):

Infrastructure as a Service is the most flexible category of cloud services. It aims to give you complete control over the hardware that runs your application (IT infrastructure servers and virtual machines (VMs), storage, and operating systems).

IaaS is commonly used in the following scenarios:

Migrating workloads

Test and development

Storage, backup, and recovery

Platform as a service (PaaS):

PaaS provides an environment for building, testing, and deploying software applications. The goal of PaaS is to help you create an application quickly without managing the underlying infrastructure.

PaaS is commonly used in the following scenarios:

• Development framework.
• Analytics or business intelligence.

Software as a service (SaaS):

SaaS is software that is centrally hosted and managed for the end customer. It is usually based on an architecture where one version of the application is used for all customers and licensed through a monthly or annual subscription. Office 365, Skype, and Dynamics CRM Online are perfect examples of SaaS software.

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