Tue 20 Aug 2013 22:45
Cloud Computing: Everything Old is New Again
There is a great deal of hype about Cloud Computing at the moment, and
it's getting a great deal of
attention. It's no wonder: when firms such as Netflix,
with a market capitalization of over U$15B, use cloud computing to
deliver streaming video services to nearly forty
million customers around the world, and when the US
Central Intelligence Agency spends U$600M for cloud computing services,
people take notice. But what is it all about?
Cloud computing is not really a new thing, it's a variation of a very old idea, with a new name. In the 1960s, when computers were large and expensive, not everyone could afford their own. Techniques for sharing computers were developed, and firms arose whose business was selling time on computers to other firms. This was most commonly described as "timesharing". IBM released its VM virtualization environment in 1972, which allowed a mainframe computer to be divided up into virtual computers, each for a different workload. A timesharing vendor could buy and operate an IBM computer, then rent to their customers "virtual computers" that ran on that machine. From the customer's perspective, it was a way to obtain access to computing without buying one's own computer. From the vendor's perspective, it was a way of "renting out" one's investment in computer infrastructure, as a viable business.
Today, cloud computing, as did timesharing in the past, involves the renting of virtual computers to customers. The name has changed: then, it was called "timesharing"; now, "cloud computing". The type of physical machine has changed: then, a mainframe was used to provide computing services; now, a grid computer. The interconnection has changed: then, leased data lines were typically used; now, the internet. But the basic concept is the same: a vendor rents virtual computers to customers, who then use the virtual computers for their computing, rather than buying their own physical computers.
The advantages and disadvantages of today's cloud computing echo the pros and cons of yesterday's timesharing. Advantages include risk sharing, the ability to pay for just the amount of computing needed, the option to scale up or down quickly, the option to obtain computing resources without having to develop and maintain expertise in operating and maintaining those resources, and the ability to gain access to computing resources in very large or very small quantities very quickly and easily. Moreover, cloud computing vendors can develop economies of scale in running physical computers and data centres, economies that they can leverage to decrease the cost of computing for their customers. Disadvantages of cloud computing include possibly higher unit costs for resources (for example, cloud data storage and data transfer can be very expensive, especially in large quantities), a critical dependance on the cloud computing vendor, variable computing performance, substantial security and privacy issues, greater legal complexity, and so on. These tradeoffs are neither surprising nor particularly new: in fact, many are typical of "buy" vs. "rent" decisions in general.
Then why does cloud computing seem so new? That, I think, is an artifact of history. In the 1970s and early 1980s, computers were expensive and timesharing was popular. In the 1990s and early 2000s, computers became increasingly cheaper, and running one's own became enormously popular. Timesharing faded away as people bought and ran their own computers. Now the pendulum is swinging back, not driven so much by the cost of computers themselves, but the costs of datacentres to house them. A few years ago, Amazon Inc. saw a business opportunity in making virtual machines available for rental: it was building grid computers (and datacentres to house them) for its own operations anyway; why not rent out some of those computing resources to other firms? In so doing, Amazon developed an important new line of business. At the same time, a huge number of new internet firms arose, such as Netflix, whose operations are dominantly or exclusively that of providing various computer-related services over the internet, and it made a great deal of sense for such firms to use Amazon's service. After all, when a company's operations are primarily or exclusively serving customers on the internet, why not make use of computing resources that are already on the internet, rather than build private datacentres (which takes time, money and expertise)? These new internet firms, with lines of business that were not even possible a decade or two ago, and Amazon's service, also only a few years old, have lent their sheen of newness to the notion of "cloud computing" itself, making it appear fresh, inventive, novel. But is it? The name is new, yes. But in truth, the concept is almost as old as commercial computing itself: it has merely been reinvented for the internet.
Of course, the computing field, because of its inventiveness, high rate of change and increasing social profile, is rather at risk of falling into trendiness, and cloud computing certainly has become a significant trend. The danger of trendiness is that some will adopt cloud computing not on its own merits, but solely because it seems to be the latest tech tsunami: they want to ride the wave, not be swamped by it. But cloud computing is complex, with many pros and cons; it is certainly a legitimate choice, as was timesharing before it, but it is not necessarily the best thing for everyone. It's easier to see this, I think, if we look beyond the name, beyond the trend, and see that the "rent or buy" question for computing has been with us for decades, and the decision between renting virtual machines and buying physical ones has often been complex, a balance of risks, opportunities, and resources. For an internet firm whose customers are exclusively on the internet, renting one's computing assets on the internet may make a great deal of sense. For other firms, it may not make sense at all. Deciding which is true for one's own firm takes wisdom and prudence; a healthy dose of historical perspective is unlikely to hurt, and may help cut through the hype.