Cloud computing is still a relatively recent technological trend, so each deployment option has its own benefits and drawbacks. But in certain situations, the benefits can outweigh the risks. You just need to identify those situations in which you can apply the cloud to reap the maximum rewards with minimum risk.

To choose which form of cloud computing is appropriate for your company, you’ll need to consider and balance a variety of factors. The charts below weigh a few of the advantages and disadvantages between a public cloud—Amazon EC2, in this case—and a private cloud at at co-located data center. However, this isn't a comprehensive comparison by any means.

• Easily scalable within minutes to accommodate growth
• Storage is scalable as well
• Easy to switch between performance categories

• Higher cost per hour becomes aggregated with additional computing resources
• Scaling up for better performance can multiply cost by a factor of 2 or more
• Fixed level of CPU and RAM per category

• Cost equation is easy and transparent
• OpEx rather than CapEx plus staff costs

• Costs are subject to change at whim of provider
• Costs are per instance – no scalability within an instance
• Data transfer is on a per GB rate ($.10)
• Storage costs are in addition to computing costs, on a per GB rate

• No control over where systems are located or whether redundancy or failover strategy exists (probably doesn’t)
• Public Cloud infrastructures are notoriously unreliable (see History of Cloud Failures)
• No uptime guarantees provided by Amazon

• If virtualized, can scale nearly as quickly as cloud computing.
• No additional cost, within virtualized processor and storage capacity
• CapEx costs can be converted to OpEx through leasing options
• Equipment is owned at end of term
• Performance scaling is incremental – can scale out, up, and within easily
• Environment can easily support mixed higher and lower performance machines
• Easily maintain like environment for development and testing

• For purchase, must amortize costs

• Generally speaking, hardware & software costs generate lower per hour computing costs when calculated over 3 year term
• Can purchase or lease
• Equipment is owned at end of lease term

• Can easily increase level of support if needed
• Systems are designed for high reliability: To maximize uptime, systems include redundant hot-swappable fans and can be configured with redundant hot-swappable power supplies.
• Using a Sun StorageTek™ Host Bus Adapter (HBA),internal SAS disk drives can be configured for RAID 0, 1, 1E, 10, 5, 5EE, 50, 6, and 60.
• Disk drives are also hot-swappable.
• Four integrated Gigabit Ethernet ports enhance network availability and can be installed in failover configurations.
• On-board system management tools encourage proactive remote.
• monitoring and intervention.

*Per hour computing costs for purchased/leased systems are based on a 3 year analysis.

Advanced Systems Group—Stairway to the Cloud