Cloud Computing: Hybrid, Private and

Public Clouds
By Pravin Ganore | August 1, 2014
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Know the three types of Cloud Computing and the main characteristics of each one.

Currently, the importance of Cloud Computing around the world is undeniable. The attention
that the topic has received at conventions, fairs technology, among others, shows that this
business model is here to stay.

In cloud computing, there are three types of organization for service delivery, infrastructure, data
storage, and software platforms: Private Cloud, Public Cloud and Hybrid Cloud. They all follow
a basic principle which is to promote the virtual work environment based on the collaborative
aspect of technology.

PUBLIC CLOUD

The model of Public Cloud is a service provided by a supplier to ordinary users or businesses via
the Internet. This service provider is responsible for protecting, hosting, maintenance and data
management in a company or for client, charging only for the resources used, whether
application infrastructure, physical infrastructure or software.

This service is shared with other companies or users. With this, the company has full control
over what does and records in the cloud, but not on the actions of others in the environment. You
can use this service effectively, however, your company may face potential safety problems due
to the public nature of this Cloud.

It is a model that has as one of its benefits to reduce costs and thus is a good alternative for
companies with a limited budget or other priorities. However, if your company works with a
large volume of confidential data, this may not be the best solution. The Public Cloud is
suitable for small and medium-sized businesses working with less sensitive data.

PRIVATE CLOUD

Private clouds are cloud services provided within a company and they offer all the basic
functions of Cloud Computing such as increased productivity, flexibility and scalability, remote
access, among others, but with restricted access to only one company or a specific group without
IT resource sharing with other companies or users outside the corporate environment. In this
format, the very company that integrates all departments and areas with the Cloud Computing
model, with the installation and maintenance of infrastructure and the platform for the company
that provides the Private Cloud system.
With this, the private cloud using an intelligent and flexible network that provides an experience
of reliable use, enabling storage and access to information and corporate data safely. Companies
that operate in highly regulated sectors or working with sensitive information, such concerns
have that need to be met. Choosing a private cloud can be the right option in this case because
its main purpose is just to provide more stability for the storage of corporate data in the cloud,
ensuring total control over the environment with less risk of threats from third parties, and
providing access wherever the employee is.

Another advantage of a private cloud is high customization capabilities, it is possible to increase

the efficiency of servers and data centers, reducing deployment costs and increasing the
company’s productivity and streamlining operations and infrastructure. However, the price of
deploying an internal cloud can be a hindrance for some small and medium businesses.

HYBRID CLOUD

The hybrid cloud model allows keeping systems in private and other public cloud
simultaneously. For example, critical systems that handle sensitive information or can be hosted
internally while other systems that do not deal with sensitive data, can be used on a public
network.

A well-built hybrid cloud can meet safe processes that need more care because the private cloud
ensures safety through an exclusive network installed in the company. A hybrid cloud can also
meet the demands of scalability, for example, when a company needs the extra capacity of a
server only during a busy period in particular, and soon after to no longer use most. Hybrid cloud
can more easily meet its irregular demand, due to its dynamic scalability.

This format of cloud allows a company to establish the best training for the business model as it
enhances the internal control of applications for the business needs, analyzing what is the best
option. Due to new technological and economic realities, the hybrid cloud model has been the
most used in the corporate market.

- See more at: http://www.esds.co.in/blog/cloud-computing-hybrid-private-and-public-

clouds/#sthash.yg0Kdvwy.dpuf

Understanding the Cloud Computing Stack: SaaS, PaaS,

IaaS
 https://support.rackspace.com/white-paper/understanding-the-cloud-computing-stack-saas-paas-
iaas/

Cloud Computing is a broad term that describes a broad range of services. As with other
significant developments in technology, many vendors have seized the term “Cloud” and are
using it for products that sit outside of the common definition. In order to truly understand how
the Cloud can be of value to an organization, it is first important to understand what the Cloud
really is and its different components. Since the Cloud is a broad collection of services,
organizations can choose where, when, and how they use Cloud Computing. In this report we
will explain the different types of Cloud Computing services commonly referred to as Software
as a Service (SaaS), Platform as a Service (PaaS) and Infrastructure as a Service (IaaS) and give
some examples and case studies to illustrate how they all work. We will also provide some
guidance on situations where particular flavors of Cloud Computing are not the best option for
an organization.

The Cloud Computing Stack

 

Cloud Computing is often described as a stack, as a response to the broad range of services built
on top of one another under the moniker “Cloud”. The generally accepted definition of Cloud
Computing comes from the National Institute of Standards and Technology (NIST) [1]. The
NIST definition runs to several hundred words [2] but essentially says that; 
Cloud computing is a model for enabling convenient, on-demand network access to a shared
pool of configurable computing resources (e.g., networks, servers, storage, applications, and
services) that can be rapidly provisioned and released with minimal management effort or
service provider interaction.

What this means in plain terms is the ability for end users to utilize parts of bulk resources and
that these resources can be acquired quickly and easily.

NIST also offers up several characteristics that it sees as essential for a service to be considered
“Cloud”. These characteristics include;

• On-demand self-service. The ability for an end user to sign up and receive services without the
long delays that have characterized traditional IT 
• Broad network access. Ability to access the service via standard platforms (desktop, laptop,
mobile etc) 
• Resource pooling. Resources are pooled across multiple customers [3] 
• Rapid elasticity. Capability can scale to cope with demand peaks [4] 
• Measured Service. Billing is metered and delivered as a utility service [5]

More than a semantic argument around categorization, we believe that in order to maximize the
benefits that Cloud Computing brings, a solution needs to demonstrate these particular
characteristics. This is especially true since in recent years there has been a move by traditional
software vendors to market solutions as “Cloud Computing” which are generally accepted to not
fall within the definition of true Cloud Computing, a practice known as “cloud-washing.”

The diagram below depicts the Cloud Computing stack – it shows three distinct categories within
Cloud Computing: Software as a Service, Platform as a Service and Infrastructure as a Service.
In this report we look at all three categories in detail however a very simplified way of
differentiating these flavors of Cloud Computing is as follows;

• SaaS applications are designed for end-users, delivered over the web 
• PaaS is the set of tools and services designed to make coding and deploying those applications
quick and efficient 
• IaaS is the hardware and software that powers it all – servers, storage, networks, operating
systems

To help understand how these 3 components are related, some have used a transportation
analogy;

By itself, infrastructure isn’t useful - it just sits there waiting for someone to make it productive
in solving a particular problem. Imagine the Interstate transportation system in the U.S. Even
with all these roads built, they wouldn’t be useful without cars and trucks to transport people
and goods. In this analogy, the roads are the infrastructure and the cars and trucks are the
platform that sits on top of the infrastructure and transports the people and goods. These goods
and people might be considered the software and information in the technical realm. [6]

It is important to note that while for illustration purposes this whitepaper draws a clear
distinction between SaaS, PaaS and IaaS, the differences between these categories of cloud
computing, especially PaaS and IaaS, have blurred in recent months and will continue to do so.
[7] Nevertheless, with a general understanding of how these components interact with each
other, we will turn our attention in more detail to the top layer of the stack, SaaS.

Software as a Service
 

Software as a Service (SaaS) is defined as [8];

…software that is deployed over the internet… With SaaS, a provider licenses an application to
customers either as a service on demand, through a subscription, in a “pay-as-you-go” model, or
(increasingly) at no charge when there is opportunity to generate revenue from streams other
than the user, such as from advertisement or user list sales 
SaaS is a rapidly growing market as indicated in recent reports that predict ongoing double digit
growth [9]. This rapid growth indicates that SaaS will soon become commonplace within every
organization and hence it is important that buyers and users of technology understand what SaaS
is and where it is suitable.

Characteristics of SaaS

Like other forms of Cloud Computing, it is important to ensure that solutions sold as SaaS in fact
comply with generally accepted definitions of Cloud Computing. Some defining characteristics
of SaaS include;

• Web access to commercial software 

• Software is managed from a central location 
• Software delivered in a “one to many” model 
• Users not required to handle software upgrades and patches 
• Application Programming Interfaces (APIs) allow for integration between different pieces of
software

Where SaaS Makes Sense

Cloud Computing generally, and SaaS in particular, is a rapidly growing method of delivering
technology. That said, organizations considering a move to the cloud will want to consider which
applications they move to SaaS. As such there are particular solutions we consider prime
candidate for an initial move to SaaS;

• “Vanilla” offerings where the solution is largely undifferentiated. A good example of a vanilla
offering would include email where many times competitors use the same software precisely
because this fundamental technology is a requirement for doing business, but does not itself
confer an competitive advantage
• Applications where there is significant interplay between the organization and the outside
world. For example, email newsletter campaign software 
• Applications that have a significant need for web or mobile access. An example would be
mobile sales management software 
• Software that is only to be used for a short term need. An example would be collaboration
software for a specific project 
• Software where demand spikes significantly, for example tax or billing software used once a
month

SaaS is widely accepted to have been introduced to the business world by the Salesforce [10]
Customer Relationship Management (CRM) product. As one of the earliest entrants it is not
surprising that CRM is the most popular SaaS application area [11], however e-mail, financial
management, customer service and expense management have also gotten good uptake via SaaS.
Where SaaS May Not be the Best Option

While SaaS is a very valuable tool, there are certain situations where we believe it is not the best
option for software delivery. Examples where SaaS may not be appropriate include;

• Applications where extremely fast processing of real time data is required 

• Applications where legislation or other regulation does not permit data being hosted externally 
• Applications where an existing on-premise solution fulfills all of the organization’s needs

Software as a Service may be the best known aspect of Cloud Computing, but developers and
organizations all around the world are leveraging Platform as a Service, which mixes the
simplicity of SaaS with the power of IaaS, to great effect.

Case Study: SaaS Allows Groupon to Scale Customer

Service[12]
 

Launched in November 2008, Groupon [13] features a daily deal on the best stuff to do, see, eat
and buy in more than 500 markets and 40 countries. The company has thousands of employees
spread across its Chicago and Palo Alto offices, regional offices in Europe, Latin America, Asia
and Africa with local account executives stationed in many cities. Groupon seeks to sell only
quality products and services, be honest and direct with customers, and provide exceptional
customer service.

“Within a few months of our founding, our customer base exploded,” says Joe Harrow, Director
of Customer Service, Groupon. “At first, I was spending 10 percent of my time responding to
customer requests. It gradually became a job for several agents. We realized we simply couldn’t
go on without a real ticketing solution.”

Convinced that Groupon’s rapid growth would continue, Harrow researched several enterprise-
level support solutions. But he didn’t find a good fit.

“The enterprise-level solutions seemed complicated and difficult to set up,” Harrow recalls.
“They would have increased our efficiency, but at the cost of hampering the customer
experience.” Harrow then searched the web for online support software and found Zendesk [14].
After a quick evaluation of Zendesk, Harrow knew he had the right solution. 
“Right off the bat, Zendesk was intuitive to use,” Harrow says. “It seemed more powerful and
robust than other online support solutions, and it had been rated very highly in reviews we’d
read. Plus, we knew that because it was a web-based solution, it could easily scale to support our
increasing volume.”
Groupon now employs more than 150 customer support agents, who handle nearly 15,000 tickets
per day. Zendesk’s macros, which are predefined answers to FAQs, are Groupon’s favorite
Zendesk feature. These macros help Groupon train its agents to deliver one of the company’s
customer service hallmarks: one-touch resolution.

Groupon has also found it easy to integrate Zendesk with other solutions. By integrating Zendesk
with GoodData, Groupon has extended and enhanced its reporting – going well beyond the limits
of its old spreadsheets. As an example of the sort of scalability that SaaS brings, Groupon
recently processed its millionth customer ticket [15].

Platform as a Service
 

Platform as a Service (PaaS) brings the benefits that SaaS bought for applications, but over to the
software development world. PaaS can be defined as a computing platform that allows the
creation of web applications quickly and easily and without the complexity of buying and
maintaining the software and infrastructure underneath it.

PaaS is analogous to SaaS except that, rather than being software delivered over the web, it is a
platform for the creation of software, delivered over the web.

Characteristics of PaaS

There are a number of different takes on what constitutes PaaS but some basic characteristics
include [16];

• Services to develop, test, deploy, host and maintain applications in the same integrated
development environment. All the varying services needed to fulfil the application development
process 
• Web based user interface creation tools help to create, modify, test and deploy different UI
scenarios 
• Multi-tenant architecture where multiple concurrent users utilize the same development
application 
• Built in scalability of deployed software including load balancing and failover 
• Integration with web services and databases via common standards 
• Support for development team collaboration – some PaaS solutions include project planning
and communication tools 
• Tools to handle billing and subscription management

PaaS, which is similar in many ways to Infrastructure as a Service that will be discussed below,
is differentiated from IaaS by the addition of value added services and comes in two distinct
flavours;
1. A collaborative platform for software development, focused on workflow management
regardless of the data source being used for the application. An example of this approach would
be Heroku, a PaaS that utilizes the Ruby on Rails development language. 
2. A platform that allows for the creation of software utilizing proprietary data from an
application. This sort of PaaS can be seen as a method to create applications with a common data
form or type. An example of this sort of platform would be the Force.com PaaS from
Salesforce.com which is used almost exclusively to develop applications that work with the
Salesforce.com CRM

Where PaaS Makes Sense

PaaS is especially useful in any situation where multiple developers will be working on a
development project or where other external parties need to interact with the development
process. As the case study below illustrates, it is proving invaluable for those who have an
existing data source – for example sales information from a customer relationship management
tool, and want to create applications which leverage that data. Finally PaaS is useful where
developers wish to automate testing and deployment services.

The popularity of agile software development, a group of software development methodologies

based on iterative and incremental development, will also increase the uptake of PaaS as it eases
the difficulties around rapid development and iteration of software.

Some examples of PaaS include Google App Engine [17], Microsoft Azure Services [18], and
the Force.com [19] platform.

Where PaaS May Not be the Best Option

We contend that PaaS will become the predominant approach towards software development.
The ability to automate processes, use pre-defined components and building blocks and deploy
automatically to production will provide sufficient value to be highly persuasive. That said, there
are certain situations where PaaS may not be ideal, examples include;

• Where the application needs to be highly portable in terms of where it is hosted 

• Where proprietary languages or approaches would impact on the development process 
• Where a proprietary language would hinder later moves to another provider – concerns are
raised about vendor lock-in [20] 
• Where application performance requires customization of the underlying hardware and
software

Case Study: Menumate Uses PaaS to Serve Tasty

Applications
 
Menumate [21] is a provider of point of sale hardware and software for the hospitality industry
across Australasia. Menumate has taken advantage of the Force.com PaaS to migrate over time a
series of legacy applications used in the business.

Daniel Fowlie and Abhinav Keswani are Directors of development house Trineo [22] the
company responsible for boutique development for Menumate. Fowlie explains that the use of
the Force.com platform has allowed Menumate to centralise, modernise and integrate an
otherwise disparate in-house software toolkit.

Keswani feels that a more conventional development approach would require significant
infrastructure, connectivity, security and would introduce uptime considerations - whereas the
Force.com platform inherently provides these non-functional requirements - allowing Menumate
and Trineo to focus purely on developing the needed functionality. Additionally, utilizing a PaaS
approach has meant Trineo could take advantage of both existing integrations and automated
deployment tools - another example of PaaS easing the development process.

Using PaaS, Trineo have been able to migrate over time a series of legacy applications used in
the business. Some of these applications are:

License Key Generation - The Menumate software uses license keys to activate the features that
the customer has paid for. The power of the PaaS programming language allowed Menumate to
quickly port this code to Force.com where the license keys are linked to the customer record in
the Salesforce.com CRM. This allows Sales and Support staff to quickly see the status of
licenses.

Enhanced Case Management - A lot of the support cases Menumate were dealing with were
orders for consumables. To handle this they had a separate DOS based application that would
allow the user to build up an order and create an invoice. Menumate now can add products to a
support case and automatically send an invoice to their accounting software using an existing
integration product.

Label Printing - Another legacy application was for creating freight labels for sending
consumables and hardware to customers. Utilising the PaaS technology, these can now be
printed directly from the customer record.

Utilizing a PaaS development environment has resulted in the creation of these applications
being significantly faster than would otherwise be the case. In some examples, in the absence of
PaaS, the cost of developing the application would have been prohibitive.

PaaS is undoubtedly an exciting and powerful form of Cloud Computing however in terms of
market awareness it’s hard to look past Infrastructure as a Service and the rapid growth it’s
seeing in the marketplace.

Infrastructure as a Service
 

Infrastructure as a Service (IaaS) is a way of delivering Cloud Computing infrastructure –

servers, storage, network and operating systems – as an on-demand service. Rather than
purchasing servers, software, datacenter space or network equipment, clients instead buy those
resources as a fully outsourced service on demand [23].

As we detailed in a previous whitepaper [24], within IaaS, there are some sub-categories that are
worth noting. Generally IaaS can be obtained as public or private infrastructure or a combination
of the two. “Public cloud” is considered infrastructure that consists of shared resources, deployed
on a self-service basis over the Internet.

By contrast, “private cloud” is infrastructure that emulates some of Cloud Computing features,
like virtualization, but does so on a private network. Additionally, some hosting providers are
beginning to offer a combination of traditional dedicated hosting alongside public and/ or private
cloud networks. This combination approach is generally called “Hybrid Cloud”.

Characteristics of IaaS

As with the two previous sections, SaaS and PaaS, IaaS is a rapidly developing field. That said
there are some core characteristics which describe what IaaS is. IaaS is generally accepted to
comply with the following;

• Resources are distributed as a service 

• Allows for dynamic scaling 
• Has a variable cost, utility pricing model 
• Generally includes multiple users on a single piece of hardware

There are a plethora of IaaS providers out there from the largest Cloud players like Amazon Web
Services [25] and Rackspace [26] to more boutique regional players.

As mentioned previously, the line between PaaS and IaaS is becoming more blurred as vendors
introduce tools as part of IaaS that help with deployment including the ability to deploy multiple
types of clouds [27].

Where IaaS Makes Sense

IaaS makes sense in a number of situations and these are closely related to the benefits that
Cloud Computing bring. Situations that are particularly suitable for Cloud infrastructure include;

• Where demand is very volatile – any time there are significant spikes and troughs in terms of
demand on the infrastructure 
• For new organizations without the capital to invest in hardware 
• Where the organization is growing rapidly and scaling hardware would be problematic 
• Where there is pressure on the organization to limit capital expenditure and to move to
operating expenditure 
• For specific line of business, trial or temporary infrastructural needs

Where IaaS May Not be the Best Option

While IaaS provides massive advantages for situations where scalability and quick provisioning
are beneficial, there are situations where its limitations may be problematic. Examples of
situations where we would advise caution with regards IaaS include;

• Where regulatory compliance makes the offshoring or outsourcing of data storage and
processing difficult 
• Where the highest levels of performance are required, and on-premise or dedicated hosted
infrastructure has the capacity to meet the organization’s needs

Case Study: Live Smart Helps Dieters by Taking an

Infrastructure Diet
 

Live Smart Solutions is the parent company behind The Diet Solution Program, (insert endnote -
http://www.thedietsolutionprogram.com) a company producing books and online diet programs.
Beyond Diet [28] is an interactive community site for individuals on their diet program.

Started in 2008, the company has seen rapid growth including a 50x revenue jump in 2010. This
translates to average daily site visits of 300,000 with spikes up to one million unique viewers.
When deciding on a strategy for their infrastructure, Beyond Diet needed something that was
both low-touch and highly scalable. It is important that Beyond Diet have the ability to both
scale up and down as their marketing strategy sees large traffic spikes on a regular basis.

Rob Volk, CTO of Live Smart, reports that moving to Cloud infrastructure has given him more
peace of mind. Formerly Live Smart had a part-time systems administrator working on their
sites, and as Volk says,

It was not the best option for us. Now with Managed Cloud [an IaaS service offered by cloud
computing provider Rackspace], Rackspace is basically acting as our Linux and Windows
administrator. They’ll make our changes as we need them, and respond to any downtime, 24
hours a day. Within minutes, an engineer will log on to fix the problem.

The main drivers for Volk moving to Cloud were the ability to focus on core business and leave
day-to-day management of infrastructure to the experts. The fact that Cloud providers offer
multiple levels of redundancy, fast configuring and high degrees of flexibility were deciding
factors. Interestingly, Volk never even considered running his own physical servers; rather the
decision was one of either hosted servers or the Cloud.
The decision was made to go with Cloud because it provided reduced cost and higher flexibility
than corresponding dedicated server options.

Volk is using multiple Cloud providers: he has three web servers, multiple database servers and a
load balancer with Rackspace, while also using Amazon’s S3 service.

The biggest benefit Volk sees with Cloud infrastructure is scalability. As he explains,

After New Year’s, everyone goes on a diet. Our peak time is right after New Year’s: we might
get three times the traffic from January to March. With Cloud Servers, we’re able to spin up new
web front ends within a matter of minutes, then take them back down once traffic goes down.
We have this elasticity in our farm that is only possible in a virtualized environment.

Conclusion
 

Cloud Computing is a term that doesn’t describe a single thing – rather it is a general term that
sits over a variety of services from Infrastructure as a Service at the base, through Platform as a
Service as a development tool and through to Software as a Service replacing on-premise
applications.

For organizations looking to move to Cloud Computing, it is important to understand the

different aspects of Cloud Computing and to assess their own situation and decide which types of
solutions are appropriate for their unique needs.

Cloud Computing is a rapidly accelerating revolution within IT and will become the default
method of IT delivery moving into the future – organizations would be advised to consider their
approach towards beginning a move to the clouds sooner, rather than later.

About the Author 

Ben Kepes 
Ben is the founder and managing director of Diversity Limited, a consultancy specializing in
Cloud Computing/SaaS, Collaboration, Business strategy and user-centric design. More
information on Ben and Diversity Limited can be found at http:// diversity.net.nz