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Flexible services instead of rigid server clusters: hosting in the cloud

In the hosting area, cloud computing offers à la Amazon EC2 with almost unlimited flexibility, scalability and on-demand billing. But the topic is complex and also advertise many providers purely for marketing reasons with the label “Cloud Hosting”. We show what distinguishes real cloud hosting and show the potential.

Cloud hosting is particularly attractive for small and medium-sized enterprises (SMEs): instead of having to run a small to medium-sized server cluster, they can move applications and services “to the cloud” and move from there. This relieves the burden on the IT department and allows it to focus on managing IT applications and services rather than managing the underlying infrastructure. When deciding whether outsourcing “to the cloud” really makes sense, not only technical aspects but also business valuation models such as Total Cost of Ownership (TCO) and Discounted Cash Flow (DCF) can help.

Careful analysis of other non-business aspects does not replace these methods. In addition, project requirements, legal conditions and the technical feasibility of a project should be thoroughly assessed before deciding on or against cloud hosting.

Technically, there are big differences between traditional hosting and cloud hosting. But how exactly do you know if a provider offers real cloud hosting? Essential are the features “provisioning”, “scalability” and “payment model”. Based on this, the various offers can be well separated.

Fast and automated provisioning, which provides server performance, is an important feature of cloud hosting offerings that sets it clearly apart from conventional offerings. While traditional hosting often requires time spans ranging from several hours to days for deploying new resources, cloud hosting takes only a few seconds to minutes (“on-demand”). This short-term supply of resources results in business models that would not be possible without cloud computing. In addition, the flexibility increases, because you can respond to an increased demand for resources in the short term.

In terms of scalability, cloud hosters are taking the approach of providing resources in a potentially unlimited amount. For a cloud hosting provider, it does not pose a problem to provide customers with large amounts of resources in a short time. Traditional hosting providers, however, rely on dedicated servers. Through this approach, resources are always limited.

Due to the fine-grained provisioning and the scalability, cloud payment offers completely new payment models. While classic providers have contract terms ranging from months to years, cloud hosters offer consumption-based billing. Customers only pay for what they really consume, similar to a prepaid mobile phone contract. Examples include the number of hours that a virtual server operates or the gigabytes of traffic that are transmitted from the server.

Practical example of media hosting

Providers of cloud hosting solutions such as Amazon or Rackspace have made completely new business models possible, which would not be possible with traditional hosting concepts or only with disproportionately large amounts of money. Amazon provides a nice overview of startups from various areas that rely on cloud services on a special case study page.

For example, startup companies such as SmugMug and Jamglue use Amazon EC2 and S3 to provide innovative file sharing services to their users. The following scenario shows advantages and disadvantages of 
different hosting approaches based on four possible IT architectures that could be used to implement a similar file exchange service .

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