In a blog posting earlier this week, the Azure team announced that they would be moving all Azure applications out of our “USA – Northwest” datacenter. I was fascinated by this given that the stated reason for this move is a change in local tax law which presumably make it less financially attractive to offer the services from that area. Mike Manos published a great blog post on the topic this morning called “The Cloud Politic – How Regulation, Taxes, and National Borders are shaping the infrastructure of the cloud”. Definitely worth reading and considering the implications.

So where will cloud infrastructure form? Consider the real thing in nature and substitute taxes for atmospheric pressure. Below is a paraphrased description from NOAA:

Wind is simply the air in motion … Pressure gradient is the difference in pressure between high and low pressure areas … What happens to the converging winds near a low? … It has to go somewhere so it is forced to rise. As it rises it cools. When air cools it can hold less water vapor so some of the invisible vapor condenses, forming clouds and precipitation … What about the diverging air near a high? … As air warms it can hold more water vapor, which means that clouds will tend to evaporate.

Bottom line, cloud infrastructure will tend to emerge in low tax, low energy cost, high connectivity areas. This much is obvious and has been a key part of data center site selection methodologies as Manos alluded to. To date these have mostly dealt with “where do we plant these multi-hundred million dollar facilities to exist for at least 10 years”. As the move by the Azure team demonstrates however, what runs in these datacenters can be moved around at will. Is it running internal applications and thus maybe not taxable activity? Or is it running a revenue generating activity that may be taxed? If so, does the datacenter in the next state provide a lower tax environment? If yes, move the workload there, and so on.

With an ever growing percentage of computing likely to migrate toward the large cloud providers, small percent differences in the tax rate, cost of power, etc. can have a large impact on the profitability of providing cloud services. You see this today with certain localities actively shaping public policy around attracting datacenter construction.

Over time I think this will lead to several architectural trends. The first is that an ever increasing number of input parameters (tax rate, power cost, bandwidth, etc) will be utilized by cloud infrastructure software to determine where best to run customer workloads. Where today this occurs mostly during site selection, this will rapidly evolve to the point where it is near real-time and workloads will transparently migrate to follow low cost off-peak power, regions with lower taxes, etc. While workloads are easier to move than entire datacenters, even that is very likely to change given the numbers at stake. Most people have heard of Microsoft’s Chicago datacenter where the first floor is comprised of shipping containers and totals hundreds of thousands of servers. This capacity is obviously mobile but requires supporting facility infrastructure which to date is in fixed locations only. If you look at Microsoft’s Gen4 datacenter vision, you’ll see that eventually even most of the supporting infrastructure will be modular and mobile as well.

These trends will make for some very interesting infrastructure architecture challenges. The clouds will form near low pressure areas…

The Virtual Hard Disk Getting Started Guide is 61 pages of great info outlining all the relevant scenarios, configurations, and options for using VHD files. This was release about 3 weeks ago but I missed it at the time due to training and TechReady9. The guide outlines basic scenarios like booting Windows 7 or Server 2008 R2 from VHD as well as more advanced scenarios like migrating at VHD between physical and virtual environments, etc. If nothing else this is worth a quick read of the table of contents because you will likely see things in there that you didn’t realize you could do with VHDs.

Here is the official description of the doc:

“Windows Server® 2008 R2 and Windows® 7 is the first version of Windows to provide native support for virtual hard disks (VHDs). This guide describes the scenarios that guided the development of this feature, detailed steps about how to employ the functionality (including image creation, deployment, and maintenance), and the associated tools, scripts, and APIs.”

http://www.microsoft.com/downloads/details.aspx?displaylang=en&FamilyID=d2afacbb-5af6-45c2-b275-932116e27b0b

Recently there has been some healthy debate around the validity of “private clouds” and whether such a construct is new or just a different name for virtualization and automated provisioning, i.e. a marketecture. In this corner for the anti-Private Cloud sentiment, we have the 2009 Prediction – Rise and Fall of the Private Cloud which argues there is really no such thing as a private cloud and the concept will die quickly as everyone moves to the public cloud. There are some excellent points in this article, I’ll address several below. Take a quick read and come back, I’ll wait… In the other corner, we have Christofer Hoff from Cisco and his response. Finally, Reuven Cohen hits the nail on the head with his post A Public Cloud by Any Other Name is Private which basically states that this is all basically definitional dancing where people argue about concepts without defining any of the underpinning terms.

People’s opinions on this topic seem to correlate most with whether they believe the defining attributes of cloud computing are financial (only paying for capacity utilized, no capex, etc) or whether they believe the defining attributes are technical (shared infrastructure, scale-out architectures, dynamic provisioning). The folks who focus on the financial side tend to believe either there cannot be private clouds because all costs are still incurred by the organization or that there is no way a single organization will be able to drive costs as low as the large cloud providers can with economies of scale.

The folks who see cloud computing as more of an architecture pattern for applications and an infrastructure/operational model tend to believe that the approach is just as relevant for a public cloud provider as it is for a large internal IT organization.

I am firmly in the camp of those who believe private clouds are going to be an important part of IT for at least the next decade. I come to this view using my definition of a cloud which is: an infrastructure architecture, application development model, and operations management discipline that dynamically provide necessary  services whenever and wherever they are needed while sharing costs between all users.  

Using that definition, all manner of clouds including public, private, hybrid, etc. will exist. Will there be certain economies of scale that a Microsoft or Amazon with hundreds of thousands of servers will be able to achieve that a single business won’t? Of course. But there will also be a degree of customization and agility that private clouds will be able to achieve that large providers won’t.

The reason I believe that private clouds as a concept are something new is that this is the first time that all of IT (infrastructure, development, and operations) are being looked at holistically. This is much more than just being able to sling VMs about the datacenter. This about providing a cost effective infrastructure where code that addresses user needs, be it an app, a VM, or a service can be developed rapidly by using foundational services, deployed near real-time, scale as needed, and then be retired at the end of its useful life.

I’m excited by Microsoft’s opportunities along the full spectrum of the cloud. Azure is a very forward looking vision of the public cloud that I still don’t think most people are grasping yet. Likewise, Microsoft’s traditional on premise solutions are evolving very quickly toward both private cloud and public cloud implementations. To me the most important question that will determine our long term success is how well we are able to provide a seamless continuum between the Azure platform and our Server and Tools solutions as they evolve toward cloud services. I think we are targeting an end game that no one else is really going after from on-premise, through private cloud, to public cloud.