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September 10, 2010 • Vol.32 Issue 19
Page(s) 1 in print issue

Setting Up A Private Cloud
How To Bring Your Cloud Computing Strategy In-House

Key Points

• An enterprise should determine whether to set up a private cloud based on such factors as business need, service access, ownership costs, and risk management.

• Like any major IT project, private cloud setup requires working with key man-agement personnel, setting up testing, ensuring hardware compatibility, and training users.

• The new system should have intelligent governance to deal with issues related to resources, systems, and changing business conditions.

As a way to exercise greater control over security and application availability, some enterprises are moving toward building private clouds. With the right approach and expertise in place, this type of setup can offer the best of both worlds: the cost-effectiveness of cloud computing and the assurance that comes with the ability to manage data and applications more closely. Here are some insights into determining if a private cloud is right for your enterprise and what’s involved in setting one up.

Making The Choice

The benefits of cloud computing promise to be so compelling that it makes sense for enterprises to consider a private cloud approach, according to Peter ffoulkes, vice president of marketing at Adaptive Com-puting ( He notes that private clouds don’t have to be a wholesale redesign of an entire infrastructure, but can instead start as small as a single project, perhaps a development and test cloud for new IT services.

“If public cloud is being considered as a future option, a small private cloud can be a safe way to develop the necessary skills and understand the cultural aspects of cloud computing as they relate to your own specific organization before boldly going outside the firewall,” he says. (For a closer look at public vs. private clouds, turn to “The Public vs. Private Cloud Debate” on page 8.)

An enterprise can also consider a private cloud as a way to get more dynamic IT service delivery, notes Dana Spector, senior services architect at Dimension Data (

“The IT manager should assess both the level of control they need and the proprietary nature of their data/services to determine whether a private cloud is the best approach,” Spector notes. Jeremy Duckett, Dimension’s vice president of strategic services, adds that key considerations in building the business case for private cloud adoption include whether the cloud offers the ability to optimize the cost of implementation and ongoing management while managing risks, whether physical asset ownership costs can be met

while meeting regulatory and corporate compliance requirements, and how the services will be accessed (automated self-service or high-touch).

In general, the IT manager should align the sources for cloud computing with the enterprise’s business characteristics and appetite for savings and risk mitigation, Duckett notes.

Setting Up The Cloud

Once an enterprise has determined that a private cloud is the best choice, the next step is to look at implementation.

In the simplest definition of implementation, some organizations just use virtualization as a proxy for a cloud environment and run their own infrastructures, says Rob Juncker, vice president of technology operations at Shavlik Technologies ( “I have issues with this definition and consider a true ‘private cloud experience’ being one where the software being implemented is residing truly in the cloud,” he says. “That definition being the case, the setup of this environment really depends on the vendor you choose and how turnkey the implementation is as far as the application goes.”

On one hand, there are vendors offering a click-and-run approach, which allows an SME to determine the systems it wants and be up and running with very little effort. In other cases, large data center vendors offer a truly private cloud experience where the enterprise is providing host machines, setting up the infrastructure, and dealing with applications.

“Similar to any IT project, foresight and experienced project management is a must,” says Christopher Sousa, manager of managed services at Dataprise ( “Prior to beginning the project, the IT manager must work with key management personnel to establish timelines, milestones, sub-goals, test phases, implementation, and documentation. Effective communication is critical to the success of any major IT project.”

He adds that in designing the cloud infrastructure, IT managers must verify application compatibility, determine security protocols and encryption, design physical and logical infrastructure, and establish representative test groups to confirm viability for operations. Also crucial is verifying connectivity, ensuring local hardware compatibility, training users, and creating documentation.

Going Forward

According to Sousa, a private cloud infrastructure provides centralized network resources at a remote location. Users are able to securely connect to the network resources from anywhere via the Internet, and applications and data are processed remotely by the network resources and delivered locally to user workstations. “This reduces local processing requirements, enabling less expensive local hardware and longer hardware refresh cycles,” Sousa says. “The remote network resources are backed up and/or replicated to protect critical data, and all modification to network resources are managed at the remote site.”

Once the IT department has done all the heavy lifting of putting in an agile, automated, and adaptive infrastructure, users will get access to dependable IT services through a self-service portal, ffoulkes notes.

How well it works depends on the quality of implementation, he adds: “The underlying resources must have the characteristics required to make the services being offered run as advertised. Some applications don’t run well on virtualized systems. Some applications require high-bandwidth, low-latency networks. Some require large memory.”

Also, the new system should have intelligent governance, says ffoulkes, who believes that there will always be contention for resources, systems will fail, and business conditions will change, so service reservations and even resource configurations will have to be adjusted accordingly, and IT managers should anticipate this type of governance structure.

Despite the effort that it takes to implement a private cloud, ffoulkes is convinced that it can have far-reaching benefits. “Cloud computing increases utilization levels of existing resources and reduces IT costs,” he says. “How many IT organizations cannot benefit in some way from such a wide range of possible advantages?”

by Elizabeth Millard

Common Misconceptions

According to Christopher Sousa, manager of managed services at Dataprise (, there are some major misconceptions when it comes to private clouds. Here are a few of the more common ones:

Private clouds reduce network speed and responsiveness. Often, cloud-based infrastructures employ greater processing power than most onsite networks.

Private clouds are less secure than local networks. Many organizations are concerned about transmitting proprietary data over the Internet to a private cloud. The truth is that private clouds can be provisioned with the same security protocols as local networks, and virtually all private clouds utilize some form of encryption for communications between local users and the cloud.

Any application can be hosted in a private cloud. Many applications are not compatible with a cloud-based network or require an updated version to function in cloud environments.

Private clouds are less customizable or scalable than local networks. Private clouds can be customized in many of the same configurations as local networks. Whether an enterprise utilizes clustering, remote backups, customized applications, or other elements, private clouds can support many configurations and can be scaled to meet the requirements of the organization.

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