Cloud Hosting

The advantages of hosting in the cloud are very well documented, indeed on this site there are numerous articles explaining why the whole world and its dog should consider migrating to the cloud. This is the devil's advocate article that describes some of the dangers that you may be taking on if you do choose to make the switch.

What is going on behind the scenes?

A new Software as a Service (SaaS) startup company (we'll call it SaaSware) has decided to leverage the infrastructure of a major cloud hosting provider upon which it can build its proprietary software. It's fantastic because SaaSware doesn't have to fork out thousands of dollars on servers, storage and other expensive network equipment, and it also doesn't need to understand much of what happens at the technical level - the cloud simply takes care of that.

The added layer of abstraction, whilst hugely beneficial in many ways, is also a double edged sword, especially when things start to go pear shaped.

As a cloud hosting customer, I don't know how my data is being held, where it is being stored, how it traverses the network - I am simply at the mercy of the provider. Whilst I understand that the cloud is theoretically much more resilient and stable than a dedicated server, it's also more complicated and in the event of an epic failure there may be no route to recovery, or at least a more difficult route than simply restoring a RAID5 array.

Vendor Lock-in

SaaSware have spent a year or two customising their CRM software for clients on a specific cloud platform and are beginning to reap the rewards. All of a sudden the cloud vendor realises it's profit margins are too small and takes its consumers on a price hike of catastrophic proportions. It soon becomes clear that SaaSware can't afford to pay the new prices and needs to look for another provider.

If SaaSware had its own dedicated server, it would be easy to replicate the environment through another provider. Another server with the same OS and configurations could be provisioned quickly and subsequently the files and data could be transferred across. The DNS settings would be updated and everything would work. Still an arduous task, but it doesn't require any development changes.

In the cloud, whilst there are incentives to ensure inter-operability between providers (see the Open Cloud Manifesto) , we aren't there yet making a provider transfer an extremely difficult task to undertake.

Vendor lock-in has already been mentioned as a possible danger by gurus in the web industry such as Richard Stallman (GNU Founder) - Read More.

Pricing Sting

SaaSware modified their CRM software and migrated to another cloud hosting provider, one with a more competitive RAM/Hour rate. During the testing phase of their eagerly anticipated product release, the team of developers left their machines connected to the test server running test scripts that require significant processing power to complete. Overnight processing was the standard protocol when SaaSware had their own dedicated servers.

Unfortunately, the new cloud host charges per CPU clock cycle and the extensive testing performed each night for a period of one month resulted in a huge bill at a time when cashflow for the new startup is very tight.

Traditionally when you buy hosting, you pay in arrears and you renew after each year thereafter. In the cloud you are susceptible to rise and falls in server charges on a monthly basis and maybe stung with a freak bill that wasn't foreseen.

Generally speaking, for the larger sites on the web, the cloud is proving cost effective. However, the service is still in its infancy and therefore pricing is not as competitive as it will be in the years to come.