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Successfully Adopting the Cloud

Sponsored by:

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Executive Summary.......................................................... 03

The Changing Role of the CIO.......................................... 04

The Global Rise of Cloud Computing............................... 05

The Cloud Computing Potential....................................... 06

Market Awareness and Adoption Drivers........................ 07

Adoption Trends.............................................................. 08

Implementation Process.................................................. 09

The Road Ahead............................................................... 10

Appendix.......................................................................... 12

Table of Contents

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What you will learn:

o Major technology trends in mature European markets

and their impact on the CIO role.

o Cloud computing current adoption and potential.

o How to choose your cloud provider.

Executive Summary

Western Europe hosts a mature IT market, where companies invest

heavily in both services and software. In such markets, conventional

data center services are already well established and experiencing

moderate growth rates.

Cloud computing is forecasted to present the fastest growth rate

within data center services in mature economies, as technology

investments are now being employed in “front office” activities

such as mobility, social networks and communication.

This shift from back office to front office investments is directly

impacting IT leaders and positioning them as strategic decision

makers within the company. In this context, CIOs must act as

enablers of innovation, but they still have to deal with challenges

such as capital budget constraints, high maintenance costs and

growth of storage requirements.

Cloud computing can be an IT department’s ally in mitigating these

challenges, as the main drivers for cloud adoption are all business

focused: cost savings, business continuity, scalability and avoiding

data center expansion.

In order to develop a consistent cloud strategy, a company must

bear in mind that cloud implementation is complex and involves

strategic areas of the business. As a result, it is important that

companies venturing into the cloud have a well-defined long term

Cloud strategy as well as a strategic partner that will not only

provide cloud services, but will help the company find the best fit

according to its unique needs.

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The Changing Role of the CIO

Technology Trends in Mature European Markets

Technology leaders are increasingly facing two types of business challenges. On the one hand, the competitive global landscape requires greater efficiency and budget constraints, requiring the business to rein in spending and focus on margins. At the same time, new technologies create unprecedented opportunities to grow revenue, expand services, and enter new markets. It is left to IT to determine how to balance these two types of challenges: to simultaneously contract and expand operations, to build resources in some areas while cutting back in others.

In addition, IT leaders still have to deal with operating issues, such as the need to support storage growth, strengthen business continuity and disaster recovery plans, meet IT governance requirements and ensure high levels of security in the IT environment.

Globalization

Consumerization of IT

Innovation

Anywhere, anytime, any

device

The new IT department must create and deliver applications and business tools quickly, securely, cost-effectively, and with high levels of performance and availability.

IT is no longer a supplier, but a strategic enabler of business

growth

Social Business

Data-driven decisions

We have seen an enormous potential for the CIO to bring innovation and breaking competitive edges to our company.

CIO – Retailer

Over the last decade, businesses have made major investments in “back office” functionality. In the future, we will see a strong focus on the “front office” driving by trends such as mobility, social networks and communication.

In this context, the concept of information technology is moving to business technology. IT leaders are taking strategic roles within the company, enabling business growth, providing better interaction with customers and helping to create competitive advantages.

Source: Frost & Sullivan

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The Global Rise of Cloud Computing

Among data center services, cloud computing is the service that will experience the fastest growth rate, since enterprises will increasingly turn to cloud providers to avoid expanding or replacing their on-premises data center infrastructure, especially in a volatile economy. By utilizing the shared facilities of commercial data center providers, enterprises can limit their capital expenditures, while expanding their overall server resources.

The burgeoning opportunities in the cloud have led providers of traditional data center services to add this business model to their portfolios. However, cloud economics are different from other data center services, such as co-location or managed hosting

Managing an in-house data center brings several challenges for IT leaders. According to Frost & Sullivan research, 40 percent of IT executives consider capital budget constraint as one of the most important challenge they face when managing a data center. High maintenance costs and growth of storage requirements were also considered constraints by 35 percent and 30 percent of the sample respectively.

These and other challenges such as technology updates and slow performance of applications position IT infrastructure outsourcing as an alternative to mitigate the aforementioned problems and to enable IT leaders to focus on more strategic activities.

Data center services are developing fast to meet the requirements of the new IT environment, and cloud computing has emerged as a game changer.

Dedicated Hosting

Disaster Recovery

Storage

Maturity Introduction Growth Decline

Time

Colocation

IaaS

SaaS

PaaS

Data Center Services Evolution

Source: Frost & Sullivan

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The Cloud Computing Potential

More than a technological revolution, Cloud Computing is the ultimate evolution of a

series of environments and technologies, using pay per use characteristics of Utility

Computing, distributed computing of Grid Computing, the scalability and efficiency of

virtualization technologies and the browser-based client of a series of environments

such as Software as a Service.

There are three different models to deploy the Cloud:

Public cloud: the infrastructure is hosted by a third-party provider and is shared

among multiple customers. Each customer is charged for computing resources on a

metered or pay-as-you-go basis.

Private Cloud: computing resources are dedicated to a single enterprise, these

resources are shared and allocated exclusively among the enterprise’s own

applications. Private clouds can be either hosted by a third-party cloud provider, or be

constructed in the enterprises’ own data center.

Hybrid Cloud: relates to the combination of public and private cloud, in which, for

example, the highly scalable and cost-effective shared environment of the public

cloud can be used to run less mission critical workloads while the extremely vital and

confidential information is run and stored in secure and individual private clouds.

Cloud Computing Characteristics

Distributed computing

Pay per Use Browser-based

client

√

IT Architectures

√ √

√

√

√

√

√

Cloud Computing

Utility Computing

Grid Computing

Virtualization Tecnologies

Software as a Service

Platform as a Service

√ Web Services

Cloud can be defined as a flexible and scalable shared environment that uses

virtualization technologies to create and distribute computing resources to users

on an as-needed basis, accessed via the Internet browser and delivered over a

network.

Source: Frost & Sullivan

The question is no longer whether to enter the cloud. If your company is serious about competing in the marketplace, the cloud represents your best way to transform IT to support your company’s most urgent business needs.

Frost & Sullivan

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Market Awareness and Adoption Drivers

When thinking about adopting infrastructure services, the main driver is cost savings,

followed by the need to ensure business continuity and creating a scalable

environment. Other drivers include disaster recovery plans and avoiding data center

expansion.

As opposed to popular wisdom, which holds that security and compliance are hurdles

to cloud adoption, Frost & Sullivan research shows that 25 percent of the companies

believe that adopting cloud computing can increase security levels and compliance.

Therefore, while security and compliance are still concerns when it comes to

information and workloads hosted in the cloud, they do not always restrain IaaS

adoption.

11%

15%

19%

20%

21%

23%

25%

35%

35%

38%

55%

-10% 0% 10% 20% 30% 40% 50% 60%

Striving to "go green"

Decreasing IT staff

Earning a high ROI

Deferring server purchases or upgrades

Shifting costs from capital to operating …

Deferring/avoiding data center expansion

Improving security/compliance

Preparing for disaster recovery

Scalability

Strengthening business continuity plans

Decreasing costs

% of Respondents

Top Drivers for Choosing Cloud Infrastructure Services

The market awareness of IaaS solutions is increasing. According to Frost & Sullivan

research, from 2011 to 2012 the percentage of companies not familiar with the IaaS

concept was reduced from 40 percent to 25 percent. Despite the increasing market

awareness, 40 percent of the companies are still studying the benefits of IaaS

adoption.

While only 15 percent of mature market companies currently use IaaS, that adoption

level is expected to grow within the next two years, given the stated intention of 20

percent of the companies to implement IaaS during this period.

Source: Frost & Sullivan Sample size: 108

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22%

23%

23%

25%

28%

31%

31%

31%

32%

32%

36%

36%

39%

40%

44%

32%

32%

33%

43%

40%

27%

32%

42%

32%

40%

34%

43%

38%

31%

29%

11%

6%

6%

6%

5%

7%

6%

9%

6%

5%

6%

10%

7%

10%

11%

0% 10% 20% 30% 40% 50% 60% 70% 80% 90%

Short-term marketing programs

ERP applications

Seasonal or adhoc bursts

Tier 1 storage (high availability)

Desktop management

HR management

Proprietary or custom apps

Archival storage

Collaboration or UC

CRM applications

Test and development

Backup recovery

Backup storage

Email

Website hosting

Currently Use and Plan to Continue Using

Plan to Implement Within 2 Years

Currently Use but Plan to Stop Using Within 2 Years

Adoption Trends

Companies are increasing the number of applications they have placed in the cloud.

In 2012 the average number of applications was five, while in 2011 it was only three

and in the next two years that number is expected to double.

Website hosting and email are still the main applications placed in the cloud.

However, this scenario is expected to change in the next two years when backup

storage and backup recovery become the most adopted applications.

Tier 1 storage will receive significant investments within the next two years. Other

applications such as CRM and Unified Communications are also likely to represent

new, built-for-the-cloud software solutions. Nevertheless, so far enterprises have

shown reluctance to tackle the challenge of migrating complex legacy systems to the

cloud.

We started to test IaaS in 2012 and we are very satisfied with the business agility we now have.

CIO – Healthcare Industry

Applications Deployed in IaaS

Source: Frost & Sullivan Sample size: 108

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Implementation Process

Fifty-three percent of the companies prefer cloud and network services from a single provider. On average companies currently use two cloud service providers and plan to add a third provider within the next two years. This may be due to a lack of perceived value associated with centralizing cloud activity with a single provider or problems in finding the right provider match.

When respondents were asked to name their top three criteria for selecting a cloud provider, fourteen different attributes emerged. This shows that there is still lack of consistency in what the market is looking for in a cloud provider.

The most important aspect selected by respondents was ease of migration. This relates to IT managers’ concerns about the risks of cloud migration. Other most important factors, including availability, price and scalability, highlight companies’ intentions to partner with providers who help them to mitigate business challenges, such as cost structure, security and compliance.

6%

7%

7%

8%

8%

10%

11%

12%

12%

13%

15%

15%

16%

18%

19%

25%

28%

30%

38%

0% 5% 10% 15% 20% 25% 30% 35% 40%

Managed service options

Integrated platform for all Cloud models

Bursting from private data center to Cloud

Integrated Platform as a Service

Separate services for storage and computing

Billing options

Open source platform

SLAs for unauthorized access data

Escalating tiers of security options

SLAs for data loss or leakage

Ability to change Cloud providers easily

Consistent pricing

Easy to use management system

Application performance SLAs

Compliance assurance

Scalability

Low price

Availability (uptime) SLAs

Ease of migration to Cloud environment

% of Respondents

Most important Features or Attributes in Selecting a Cloud Provider

Source: Frost & Sullivan Sample size: 108

Creating a consistent cloud strategy is not an easy task. To ensure your company gains full value from the cloud, you must develop, implement, and manage a cohesive plan that covers not only current needs, but also future requirements

Choosing a strategic partner that helps you in your journey into the cloud is a key factor for success.

Cloud is complex and touches strategic parts of your business. As such, make sure you have cloud partners that will invest time in developing cloud processes that fit the unique needs of your company.

Frost & Sullivan

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The Road Ahead

Cloud computing can be a powerful tool to help companies mitigate

business challenges. These include the need for availability and security

while increasing flexibility and scalability, as well as demand for less

complex and easy to manage environments.

Despite its benefits, cloud implementation is complex and involves strategic

areas of the business. When defining its cloud requirements, a company

should bear in mind that the cloud is not an one-time initiative, but an ever

evolving journey. Therefore in order to ensure a successful and consistent

cloud strategy it is important to develop a plan that encompasses both

current and future needs and adopt a strategy that enables the company to

move into the cloud at its own pace .

Furthermore, companies should carefully select a cloud partner and not

merely a provider. A cloud partner can help to develop the roadmap that

will cut through the complexity of cloud decisions, while understanding the

company’s specific needs in order to deliver the right level of service

required.

Assemble a team. Focus on Business benefits of Cloud Computing. Don’t forget Cloud will have a positive effect on both CFO and CEO’s business objectives.

Don’t forget: Cloud is a Business Enabler

Security & Networking are King in the Cloud Era.

Partner with Security & Networking Experts

Cloud Computing is not a “one size fits all” technology. Clients will have different uses for Cloud Computing, so start small.

Start Small – you need quick wins to grain traction

Key Recommendations for CIOs regarding Cloud

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© 2012 Frost & Sullivan, Todos os direitos reservados

Este documento contém informações altamente confidenciais e de propriedade exclusiva da Frost & Sullivan. Nenhuma parte pode ser divulgado, citado, copiado ou reproduzido sem a autorização por escrito da Frost & Sullivan.

Appendix

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The Power of Terremark, Cisco and EMC

Enterprise Cloud combines the power and flexibility of infrastructure-as-a-service with the agility, security and availability that large, SMB and government organizations with mission-critical computing needs demand of their infrastructure.

An easy-to-use, Web-based, management interface provides command and control over a cloud-based resource pool of compute, storage and network built on a fully clustered enterprise-class computing architecture featuring virtualization technology from VMware, computing from Cisco, storage from EMC and housed in Verizon Terremark’s secure, top-tier datacenters.

Additionally, Enterprise Cloud provides a highly secure foundation for managing business applications with an architecture designed to help meet today's critical compliance and certification requirements, including SAS-70 Type II Audits, PCI-DSS and Safe Harbor. For customers requiring more comprehensive security services on the cloud, Verizon Terremark has a team of information security experts to determine the security posture that is appropriate for specific cloud environments.

Verizon Terremark’s Enterprise Cloud™(IaaS) relies on best-in-class technology from renowned partners like EMC and Cisco. Connectivity is provided by more than 160 carriers and supported by its global data center footprint.

Unified Computing: Cisco’s next-generation Unified Computing System (UCS), unites computing, network, storage access, and virtualization into a single integrated architecture designed to reduce total cost of ownership (TCO) and increase business agility. Cisco UCS servers and racks were created to be virtualized and to support cloud computing. Cisco UCS servers are based on x86 architecture and use the processing power of Intel Xeon processors. The UCS servers deliver extremely high performance, ideal to support mission-critical activities, and combined with its simplified and unified architecture, promote increased IT productivity and reliability as well as an excellent cost-performance ratio. Cisco USC servers enable automatic deployment and configuration of the infrastructure.

Unified Fabric: Cisco Unified Fabric solutions provide an open evolutionary approach and architectural flexibility to meet the needs of dynamic virtualized and cloud-based environments. Unified Fabric delivers network services to servers, storage, and applications, providing transparent convergence, scalability, and sophisticated intelligence. Solutions include: Cisco multilayer data center switches, Cisco Nexus® and Catalyst® switches, Cisco Fabric Manager, and Cisco NX-OS Software

Unified Management: Cisco Unified Management simplifies and automates IT provisioning with policy-based management delivering physical and virtual resources on-demand for greater flexibility and agility. It provides improved productivity of IT staff and reduces the risk of failure due to inconsistent configurations.

Today’s leaders are looking for Cloud solutions to help them create and expand new markets. Cisco Unified Computing —along with Unified Fabric and Unified Management solutions—form the Unified Data Center, Cisco’s platform for changing the economics of the data center. Cisco Unified Data Center provides an agile, efficient and simple platform designed for deploying IT as a service and cloud computing securely and cost effectively. Cisco is connecting the world of many clouds.

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Infrastructure: A cloud infrastructure built on a software-defined data center foundation can help customers achieve efficiency and agility benefits. To transform infrastructure, customers need to start building a virtualized infrastructure that can not only store their data, but also provide protection in the form of more efficient and effective backup and disaster recovery, better security, as well as disaster avoidance and protection.

Operating model: As IT transforms its operations to run IT-as-a-Service, its role will also transform – from an exclusive provider of IT services to a broker of IT services – both internal and from service providers. IT will need to acquire new skills as new roles emerge within the organization. In addition, new processes need to be established to maximize the efficiency and adoption of the new operating model.

Applications: With a transformed infrastructure, IT can virtualize mission-critical applications, move existing applications onto virtual infrastructures without disruption, and deliver greater efficiency and agility. Modernizing existing applications and building new applications using software lifecycle automation techniques, customers become proactive and can rapidly take advantage of new opportunities.

EMC is a global leader enabling businesses and service providers to transform their operations and deliver IT-as-a-Service. Through innovative products and services, EMC accelerates the journey to cloud computing, helping IT departments to store, manage, protect and analyze their most valuable asset – information – in a more agile, trusted and cost-efficient way. An important step on the journey is to leverage service providers to gain the most of what IT does best and what service providers do better.

Verizon Terremark, Cisco and EMC have developed tailored cloud computing solutions which leverage Verizon Terremark's data center infrastructure, Cisco’s high performance UCS servers and EMC's best-of-breed storage, back up, and replication technologies.

This strategic alliance utilizes Verizon Terremark, Cisco and EMC’s world wide presence enabling global reach in terms of supply chain, support and product innovation. Partnering with enterprise-class vendors like EMC and Cisco who have a well established technological roadmap as well as a focus on product innovation allows Verizon Terremark to continuously enhance its services with new and cutting edge technologies.

The partnership between Verizon Terremark, EMC and Cisco has resulted in a platform based on the best-of-breed technology from each company, creating a combined value proposition second to none.

The Combined Value Proposition

The combined value proposition of the Verizon Terremark, Cisco and EMC partnership puts together cutting-edge technologies to provide clients with improved business agility, greater efficiency and cost control, while supporting their journey to the cloud.

Frost & Sullivan

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About Verizon Terremark

A subsidiary of Verizon Communications Inc. (NYSE, NASDAQ:VZ), Verizon Terremark sets the standard

for IT deployments with advanced infrastructure and managed service offerings that deliver the scale,

security, and reliability necessary to meet the demanding requirements of enterprises and governments

around the world. With a global network of data centers and a comprehensive portfolio of secure

solutions, Terremark is helping enterprise and government executives realize the power and promise of

the cloud today.

About Frost & Sullivan

Frost & Sullivan, the Growth Partnership Company, partners with clients to accelerate

their growth. The company's TEAM Research, Growth Consulting, and Growth Team

Membership™ empower clients to create a growth-focused culture that generates,

evaluates, and implements effective growth strategies. Frost & Sullivan employs over 50

years of experience in partnering with Global 1000 companies, emerging businesses, and

the investment community from more than 40 offices on six continents.

For more information about Frost & Sullivan’s Growth Partnership Services, visit

http://www.frost.com

About Cisco

Cisco (NASDAQ: CSCO) is the worldwide leader in IT that helps companies seize the opportunities of

tomorrow by proving that amazing things can happen when you connect the previously unconnected.

One of Cisco's key differentiators has been our ability to capture market transitions which drive

innovation that enables our customers' long-term success. At the heart of these transitions - cloud,

mobility, video, any device and social - is the network. Cisco’s vision is to become our customers' most

strategic business partner by delivering intelligent networks and technology and business architectures

built on integrated products, services, and software platforms which enable our customers' success. Cisco

has shaped the future of the Internet by creating unprecedented value and opportunity for our customers

and ecosystem partners and has become the worldwide leader in networking - transforming how people

connect, communicate and collaborate.

About EMC

EMC employs approximately 53,500 people worldwide. We are represented by approximately 400 sales

offices and scores of partners in more than 85 countries around the world. We have the world's largest

sales and service force focused on information infrastructure, and we work closely with a global network

of technology, outsourcing, systems integration, service, and distribution partners. We are a publicly

traded company, listed on the New York Stock Exchange under the symbol EMC, and are a component of

the S&P 500 Index. In 2011, EMC was included in the Dow Jones Sustainability Index (DJSI) for North

America, which tracks the financial performance of leading sustainability-driven companies. We are

committed to acting in a socially and environmentally responsible manner and to being an attentive and

thoughtful neighbor in our local and global communities. We score at the top, or near the top, of regional

rankings of the best places to work.