can’t solve. However, there will be new things that you may choose to spend money on that in the past were not a problem, such as doing live migration between servers. But if you just want to run a shop that has up to around 20 servers, unless you’re doing something really weird, you should do it. It is easy and readily available from any of the major vendors. This addresses the relatively easy problem of “Can I put three things on one server?”

If you then realize you have new problems, meaning “Now that I have three things on one server, I want that server to be more available or I want to migrate stuff if that server fails,” this is a level of sophistication that the market is only beginning to address. Different vendors have different definitions.

simon cRosBY: Once you achieve basic virtualization, the next big issue is increasing overall availability. If I can get higher availability for some key workloads, that transforms the business.

steVe heRRoD: I agree. In fact, we currently have a large number of customers that buy one VM per box first and foremost for availability and second for provisioning.

tom BishoP: About two years ago, the best session at a conference I attended was “Tales from the Front, Disaster Recovery Lessons Learned from Hurricane Katrina.” A large aerospace company had two data centers, one just south of New Orleans and another one about 60 miles away in Mississippi. Each center backed the other up and both ended up under 20 feet of water.

The lesson they learned was to virtualize their data center. In response to that experience they built a complete specification of their data center where it could be instantiated instantaneously and physically anywhere in the world.

mache cReeGeR: Our target IT manager is trying to squeeze a lot out of his budget, to walk the line between what’s over the edge and what’s realistic. Are you saying that all this load balancing, dynamic migration, that the marketing literature from Citrix, VMware, and Microsoft defines as the next big hurdle and the vision for where virtualization is going are not what folks should be focusing on?

simon cRosBY: Organizations today build organizational structures around current implementations of technology, but virtualization changes all of it. The biggest problem we have right now is that we have to change the architecture of the IT organization. That’s people’s invested learning and their organizational structure. They’re worried about their jobs. That’s much harder than moving a VM between two servers.

mache cReeGeR: A while back I did a consulting job for a well-known data-center automation company and they brought up this issue as well. When you change the architecture of the data center you blow up all the traditional boundaries that define what people do for a living—how they develop their careers, how they got promoted, and everything else. It’s a big impediment for technology adoption.

simon cRosBY: One of the reasons I think that cloud-based IT is very interesting is none of the cloud vendors have invested in the disaster of today’s typical enterprise IT infrastructure. It is horrendously expensive because none of it works together; it’s unmanageable except with a lot of people. Many enterprise IT shops have bought one or more expensive proprietary subsystems that impose significant labor-intensive requirements to make it all work.

Clouds are way cheaper to operate because they build large, flat architectures that are automated from the get-go, making the cost for their infrastructure much lower than most companies’ enterprise IT. If I’m Amazon Web Services and I want to offer a disaster recovery service, the numbers are in my favor. I need only provide enough additional capacity to address the expected failure rate of my combined customer set, plus a few spares and, just like an actuary, determine the risks and cost. A very simple and compelling business model.

aLLen ste WaRt: The thing that challenges the cloud environment and most enterprise data centers is the heterogeneity of the shop and the types of applications they run. To take advantage of the cloud, you have to develop an application model that suits disconnected state and applications. I think that challenges enterprise IT

shops, because they look out and see a completely dissimilar range of applications without a common development framework.

GustaV: I just built two data centers and fully populated them. If I look at the stereotypical cloud case right now, EC2 ( www.amazon.com/ec2) is about $0.80 per hour per eight-CPU box. My cost, having bought the entire data center, is between $0.04 and $0.08.

Having bought the entire data center, I have the budget and scale to blow away that $0.80 EC2 pricing. SMBs (small- and medium-size businesses) probably do not have that option. The cloud guys can produce tremendous margin for themselves by producing the scale of an entire data center and selling parts of it to SMBs.

tom BishoP: The model that’s going to prevail is exactly the way the power companies work today. Every company that builds power-generation capacity has a certain model for their demand.

They build a certain amount of capac-
ity for some base level demand and
then they have a whole set of very so-
phisticated provisioning contracts.
mache cReeGeR: Or reinsurance.
tom BishoP: Reinsurance to basically
go get electricity off the grid when they
need it. So the power we get is a com-
bination of locally generated capacity
and capacity bought off the grid.
simon cRosBY: As a graduate student,
I read a really interesting book on con-
trol theory that showed mathematical-
ly that arbitrage is fundamental to the
stability of a market and the determi-
nation of true market price. Based on
that statement, virtualization is just an
enabler of a relatively efficient market
for data center capacity; it’s a provi-
sioning unit of resource.
Virtualization allows for late bind-
ing, which is generally considered to
be a good thing. Late binding means
I can lazily (that is, just-in-time) com-
pose my workload (a VM) from the OS,
the applications, and the other rele-
vant infrastructural components. I can
bind them together at the last possible
moment on the virtualized infrastruc-
ture, delaying the resource commit-
ment decision as long as possible to
gain flexibility and dynamism. Virtu-
alization provides an abstraction that
allows us to late bind on resources.
steVe heRRoD: The opportunity to