To cloud or not to cloud?: musings on costs and viability

In this paper we aim to understand the types of applications for which cloud computing is economically tenable, i.e., for which the cost savings associated with cloud placement outweigh any associated deployment costs. We discover two scenarios. (i) In an "unified client" scenario, where the cloud-hosted applications are only accessed by a single cloud customer (or small set of associates), it is important to ensure that the cost savings (mainly computation-related) can offset the often significant client-cloud distance (network costs etc). Today, from a technological, cost-centric point of view, this includes only compute-intensive applications with at least 1000 CPU cycles per each 32 bits of client-cloud transferred data. Naturally a number of other considerations may make clouds attractive even for less compute intensive tasks (services, security, pay-as-you-go nature etc). (ii) In a "multi-client" setting on the other hand, when outsourced applications serve numerous different third parties, we show that clouds begin to act similarly in nature to content-distribution networks - their better network integration is simply too good to pass on, when compared to locally hosting the applications (and incurring associated network costs). Thus, in multi-client scenarios, today's compute, energy and general technology costs suggest that outsourcing to clouds is profitable for almost any application. Ultimately, we hope this work will constitute a first step in an objective evaluation of the technological side of costs of outsourcing and computing in general.