Welcome!

Java IoT Authors: Elizabeth White, Pat Romanski, Yeshim Deniz, Liz McMillan, Stackify Blog

Related Topics: @CloudExpo, Microservices Expo, Containers Expo Blog

@CloudExpo: Blog Feed Post

Cloud Is the Gift That Keeps on Giving

Ultimately the CAPEX vs OPEX arguments over public and private cloud computing are irrelevant. Business-value is the only metric

Cloud Expo on Ulitzer

Brenda Michelson, Principal of Elemental Links, writes "elemental cloud computing" recently tweeted: "100k buys way more public, than private, cloud computing power" which started a short but inspiring conversation on the subject centering around the observation that "cloud is the gift that keeps on giving." That's alluding to the fact that the compute power purchased in "the cloud" is an annual expense, unlike private, cloud computing power which requires renewal at longer intervals, usually in the 3-5 year range.

Still, Brenda is right at least in the short term. $100,000 purchases a lot more compute power in a public cloud computing environment than it will/would/does in a private cloud computing environment. The problem is that $100,000 in a private cloud computing environment is likely to provide more business value than would a comparable investment in a public cloud computing environment. And that's really the metric we should be using instead of CAPEX versus OPEX.


THIS IS NOT ABOUT CAPEX vs OPEX


I have read, and re-read, and read some more on the whole "CAPEX vs OPEX" arguments both for and against public cloud computing. I started off by reading JP Morgenthal's "A Better Metric for Analyzing the Value of the Cloud". But that led me to digging deeper as it became apparent that my decision to focus on computer science in graduate school rather than economics and accounting was getting the way of understanding the real debate regarding CAPEX vs OPEX. Bernard Golden, CEO of consulting firm HyperStratus, nearly convinced me that public cloud computing is the only financially responsible option in "Capex vs Opex: Most Miss Point About Cloud Economics". Stratetect argued basically the opposite in "CAPEX vs OPEX. What is the difference?" and thus sent me into a rousing debate with myself (I'm still unsure who won that one). I finished up with a quick read of "CapEx, OpEx and Cloudy Accounting" over at Data Center Knowledge because, well, I'm masochistic, apparently.

I finally came to a few conclusions:

  • I can explain to you why some CAPEX spending can actually lead to a decrease in overall CAPEX spending but not whether it's desirable to do so. For example, an investment in an application delivery controller can result in higher VM density capabilities per physical server, the result of which is less CAPEX required to purchase physical servers to meet annual growth (and a reduction in the associated OPEX, I might add). Whether this reduction in CAPEX is good or bad seems to be somewhat of a subjective opinion and one I am apparently not well-versed enough in accounting to make.
  • Investing in public cloud computing increases OPEX (cost of services) while simultaneously decreasing OPEX (offloads maintenance/management of physical servers, decreases costs associated with datacenter space). Whether the increase is good/bad/desirable is also somewhat of a subjective opinion and open to interpretation. I guess the trick is to try to make sure the decrease in OPEX is greater than the increase, thus resulting in an overall decrease. Bernard Golden insists part of the appeal of public cloud computing is in the ability to just "stop using resources" because it isn't a fixed cost. I disagree that it isn't a fixed cost; it's rare you're suddenly going to not need compute resources, but his argument has merit as a reason why increases in OPEX are more easily dismissed as an argument against public cloud computing.
  • There's no good answer to the CAPEX vs OPEX debate. CEOs, CIOs, CTOs, and financial folks all seem to disagree when it comes to cloud computing and costs. In fact I'm wondering at this point whether cloud computing and its impact on the balance sheet might force a change in the equations financial analysts use to value companies. If it's not as simple as "high OPEX bad and more CAPEX good" then perhaps the "economics" of cloud computing will have broader implications than just for technology, IT, and organizations. But for IT and technology-focused individuals rather than focusing on whether one approach is desirable over another we should - or at least I should - probably just stick to explaining how a given solution decreases/increases CAPEX/OPEX and leave the analysis to someone better suited to the task.

Ultimately I think there's no good answer that can come - at least authoritatively - from an outside source. The only person suited to answering the question of whether increasing OPEX by leveraging cloud computing or investing in the CAPEX necessary to leverage private cloud computing is the one sitting in the CTO/CIO chair. Then I reached another conclusion: we're ignoring the very basic question of the business-value offered by each approach. Focusing in on CAPEX or OPEX or X-EX is not nearly as germane as asking "What's the business value an organization is getting when they write that $100,000 check?"

Read the original blog entry...

More Stories By Lori MacVittie

Lori MacVittie is responsible for education and evangelism of application services available across F5’s entire product suite. Her role includes authorship of technical materials and participation in a number of community-based forums and industry standards organizations, among other efforts. MacVittie has extensive programming experience as an application architect, as well as network and systems development and administration expertise. Prior to joining F5, MacVittie was an award-winning Senior Technology Editor at Network Computing Magazine, where she conducted product research and evaluation focused on integration with application and network architectures, and authored articles on a variety of topics aimed at IT professionals. Her most recent area of focus included SOA-related products and architectures. She holds a B.S. in Information and Computing Science from the University of Wisconsin at Green Bay, and an M.S. in Computer Science from Nova Southeastern University.

@ThingsExpo Stories
Announcing Poland #DigitalTransformation Pavilion
Digital Transformation is much more than a buzzword. The radical shift to digital mechanisms for almost every process is evident across all industries and verticals. This is often especially true in financial services, where the legacy environment is many times unable to keep up with the rapidly shifting demands of the consumer. The constant pressure to provide complete, omnichannel delivery of customer-facing solutions to meet both regulatory and customer demands is putting enormous pressure on...
DXWorldEXPO LLC announced today that All in Mobile, a mobile app development company from Poland, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. All In Mobile is a mobile app development company from Poland. Since 2014, they maintain passion for developing mobile applications for enterprises and startups worldwide.
CloudEXPO | DXWorldEXPO are the world's most influential, independent events where Cloud Computing was coined and where technology buyers and vendors meet to experience and discuss the big picture of Digital Transformation and all of the strategies, tactics, and tools they need to realize their goals. Sponsors of DXWorldEXPO | CloudEXPO benefit from unmatched branding, profile building and lead generation opportunities.
The best way to leverage your CloudEXPO | DXWorldEXPO presence as a sponsor and exhibitor is to plan your news announcements around our events. The press covering CloudEXPO | DXWorldEXPO will have access to these releases and will amplify your news announcements. More than two dozen Cloud companies either set deals at our shows or have announced their mergers and acquisitions at CloudEXPO. Product announcements during our show provide your company with the most reach through our targeted audienc...
@DevOpsSummit at Cloud Expo, taking place November 12-13 in New York City, NY, is co-located with 22nd international CloudEXPO | first international DXWorldEXPO and will feature technical sessions from a rock star conference faculty and the leading industry players in the world.
Everything run by electricity will eventually be connected to the Internet. Get ahead of the Internet of Things revolution. In his session at @ThingsExpo, Akvelon expert and IoT industry leader Sergey Grebnov provided an educational dive into the world of managing your home, workplace and all the devices they contain with the power of machine-based AI and intelligent Bot services for a completely streamlined experience.
DXWorldEXPO | CloudEXPO are the world's most influential, independent events where Cloud Computing was coined and where technology buyers and vendors meet to experience and discuss the big picture of Digital Transformation and all of the strategies, tactics, and tools they need to realize their goals. Sponsors of DXWorldEXPO | CloudEXPO benefit from unmatched branding, profile building and lead generation opportunities.
22nd International Cloud Expo, taking place June 5-7, 2018, at the Javits Center in New York City, NY, and co-located with the 1st DXWorld Expo will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud ...
In his keynote at 19th Cloud Expo, Sheng Liang, co-founder and CEO of Rancher Labs, discussed the technological advances and new business opportunities created by the rapid adoption of containers. With the success of Amazon Web Services (AWS) and various open source technologies used to build private clouds, cloud computing has become an essential component of IT strategy. However, users continue to face challenges in implementing clouds, as older technologies evolve and newer ones like Docker c...
"MobiDev is a software development company and we do complex, custom software development for everybody from entrepreneurs to large enterprises," explained Alan Winters, U.S. Head of Business Development at MobiDev, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
JETRO showcased Japan Digital Transformation Pavilion at SYS-CON's 21st International Cloud Expo® at the Santa Clara Convention Center in Santa Clara, CA. The Japan External Trade Organization (JETRO) is a non-profit organization that provides business support services to companies expanding to Japan. With the support of JETRO's dedicated staff, clients can incorporate their business; receive visa, immigration, and HR support; find dedicated office space; identify local government subsidies; get...
Dion Hinchcliffe is an internationally recognized digital expert, bestselling book author, frequent keynote speaker, analyst, futurist, and transformation expert based in Washington, DC. He is currently Chief Strategy Officer at the industry-leading digital strategy and online community solutions firm, 7Summits.
Bill Schmarzo, author of "Big Data: Understanding How Data Powers Big Business" and "Big Data MBA: Driving Business Strategies with Data Science," is responsible for setting the strategy and defining the Big Data service offerings and capabilities for EMC Global Services Big Data Practice. As the CTO for the Big Data Practice, he is responsible for working with organizations to help them identify where and how to start their big data journeys. He's written several white papers, is an avid blogge...
In past @ThingsExpo presentations, Joseph di Paolantonio has explored how various Internet of Things (IoT) and data management and analytics (DMA) solution spaces will come together as sensor analytics ecosystems. This year, in his session at @ThingsExpo, Joseph di Paolantonio from DataArchon, added the numerous Transportation areas, from autonomous vehicles to “Uber for containers.” While IoT data in any one area of Transportation will have a huge impact in that area, combining sensor analytic...
Bill Schmarzo, author of "Big Data: Understanding How Data Powers Big Business" and "Big Data MBA: Driving Business Strategies with Data Science," is responsible for setting the strategy and defining the Big Data service offerings and capabilities for EMC Global Services Big Data Practice. As the CTO for the Big Data Practice, he is responsible for working with organizations to help them identify where and how to start their big data journeys. He's written several white papers, is an avid blogge...
Charles Araujo is an industry analyst, internationally recognized authority on the Digital Enterprise and author of The Quantum Age of IT: Why Everything You Know About IT is About to Change. As Principal Analyst with Intellyx, he writes, speaks and advises organizations on how to navigate through this time of disruption. He is also the founder of The Institute for Digital Transformation and a sought after keynote speaker. He has been a regular contributor to both InformationWeek and CIO Insight...
Michael Maximilien, better known as max or Dr. Max, is a computer scientist with IBM. At IBM Research Triangle Park, he was a principal engineer for the worldwide industry point-of-sale standard: JavaPOS. At IBM Research, some highlights include pioneering research on semantic Web services, mashups, and cloud computing, and platform-as-a-service. He joined the IBM Cloud Labs in 2014 and works closely with Pivotal Inc., to help make the Cloud Found the best PaaS.
It is of utmost importance for the future success of WebRTC to ensure that interoperability is operational between web browsers and any WebRTC-compliant client. To be guaranteed as operational and effective, interoperability must be tested extensively by establishing WebRTC data and media connections between different web browsers running on different devices and operating systems. In his session at WebRTC Summit at @ThingsExpo, Dr. Alex Gouaillard, CEO and Founder of CoSMo Software, presented ...
I think DevOps is now a rambunctious teenager - it's starting to get a mind of its own, wanting to get its own things but it still needs some adult supervision," explained Thomas Hooker, VP of marketing at CollabNet, in this SYS-CON.tv interview at DevOps Summit at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.