UC Berkeley

Above the Clouds

UC Berkeley RAD Lab

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 Outline
• What is it?
• Why now?
• Cloud killer apps
• Economics for users
• Economics for providers
• Challenges and opportunities
• Implications

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 What is Cloud Computing?
• Old idea: Software as a Service (SaaS)
– Def: delivering applications over the Internet
• Recently: “[Hardware, Infrastrucuture,
Platform] as a service”
– Poorly defined so we avoid all “X as a service”
• Utility Computing: pay-as-you-go computing
– Illusion of infinite resources
– No up-front cost
– Fine-grained billing (e.g. hourly)
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 Why Now?
• Experience with very large datacenters
– Unprecedented economies of scale
• Other factors
– Pervasive broadband Internet
– Fast x86 virtualization
– Pay-as-you-go billing model
– Standard software stack

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 Spectrum of Clouds
• Instruction Set VM (Amazon EC2, 3Tera)
• Bytecode VM (Microsoft Azure)
• Framework VM
– Google AppEngine, Force.com

Lower-level, Higher-level,
Less management More management

EC2 Azure AppEngine Force.com

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 Economics of Cloud Users
• Pay by use instead of provisioning for peak

Capacity

Demand Capacity

Demand
Time Time

Static data center Data center in the cloud

Unused resources
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 Economics of Cloud Users
• Risk of over-provisioning: underutilization

Capacity
Unused resources

Demand

Time

Static data center

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 Economics of Cloud Users
• Heavy penalty for under-provisioning

Capacity

Demand

Capacity 1 2 3
Time (days)
Demand Lost revenue
1 2 3
Time (days)
Capacity

Demand
1 2 3
Time (days)
Lost users
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 Economics of Cloud Providers
• 5-7x economies of scale [Hamilton 2008]
Cost in Cost in
Resource Ratio
Medium DC Very Large DC
Network $95 / Mbps / month $13 / Mbps / month 7.1x
Storage $2.20 / GB / month $0.40 / GB / month 5.7x
Administration ≈140 servers/admin >1000 servers/admin 7.1x

• Extra benefits
– Amazon: utilize off-peak capacity
– Microsoft: sell .NET tools
– Google: reuse existing infrastructure
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 Adoption Challenges
Challenge Opportunity
Availability Multiple providers & DCs
Data lock-in Standardization
Data Confidentiality and Encryption, VLANs,
Auditability Firewalls; Geographical
Data Storage

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 Growth Challenges
Challenge Opportunity
Data transfer FedEx-ing disks, Data
bottlenecks Backup/Archival
Performance Improved VM support, flash
unpredictability memory, scheduling VMs
Scalable storage Invent scalable store
Bugs in large distributed Invent Debugger that relies
systems on Distributed VMs
Scaling quickly Invent Auto-Scaler that
relies on ML; Snapshots
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 Policy and Business
Challenges
Challenge Opportunity
Reputation Fate Sharing Offer reputation-guarding
services like those for email
Software Licensing Pay-for-use licenses; Bulk
use sales

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 Short Term Implications
• Startups and prototyping
• One-off tasks
– Washington post, NY Times
• Cost associativity for scientific applications
• Research at scale

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 Long Term Implications
• Application software:
– Cloud & client parts, disconnection tolerance
• Infrastructure software:
– Resource accounting, VM awareness
• Hardware systems:
– Containers, energy proportionality

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