Application Development:
Fly to the Clouds or Stay in-House?
Stamatia Bibi1, Dimitris Katsaros2,
Panayiotis Bozanis2
1Department
of Informatics
Aristotle University of Thessaloniki, Greece
2 Department of Computer & Communication
Engineering, University of Thessaly
1http://sweng.csd.auth.gr
2http://www.inf.uth.gr/
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Presentation outline
 Introduction
 Cloud Computing Costs
 Traditional Software and Systems Costs
 Decision Model
 Conclusions and Future work
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Introduction
IT managers are recently faced with the problem of making a
selection between cloud computing and on-premise development
 2 questions
– Quality?
– Costs?
 Cloud computing costs
– software-as-a-service
– platform-as-a-service
– infrastructure-as-a-service
 On-premise assets
– IT infrastructure
– Software development
– Operation expenses
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Scope
 A framework for decision making
– Costs
– Quality
– Demand level
 Example
– A popular SaaS application is used as an
example: CRM (Customer Relationship
Management)
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Cloud computing utilities
 Software-as- aService (SaaS), Platform-as-a-Service (PaaS)
and Infrastructure-as-a-Service (IaaS).
 Horizontal
– subscription management software, mail servers, search engines
and office suites
 Vertical applications
– Accounting software, Management Information systems and
Customer Relationship Management systems
 Subscription fees recorded in Service Level Agreements
– licensing fees, maintenance and upgrade costs
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Cloud computing utilities
 Platform as a Service (PaaS)
– Developer studios, tools to build a web application, runtime environment
and management and monitoring tools
 Infrastructure as a Service
– physical storage space and processing capabilities that enable the use
of SaaS and PaaS
– Hardware, servers and networking components are typical examples of
IaaS
 PaaS and IaaS costs are usually interrelated
– PaaS costs: usage of operating systems, database management
systems, web hosting server software, batch processing software and
application development environments
– Usually costs of IaaS are calculated as on-demand instances per hour.
 number of servers, the operating systems and middleware applications loaded to them.
 based on CPU, memory and hard disk usage
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
On premise software development
 Infrastructure Costs
– Hardware
– Networking
 Operational Costs
– Floor
– Electricity
– Administration
 Development Costs
–
–
–
–
Personnel
Product
Environment
Process
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Decision Model
 3 step decision model
– Assess software and infrastructure development costs
– Define quality characteristics
– Estimate user demand
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Assess software and infrastructure
development costs.
 CRM (Customer Relationship Management application)
 Cloud
– Zoho, Salesforce
– prices range from 12$ per month to 75$ per month, per user
– 5 potential users that use a sublist of features charged 50$ per
month the annual costs are calculated to be 3000$
 On- premise
– ISBSG (find mean values)





1867 total effort
181.5 function points
233 workdays
11,65 months
48242$
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Define quality characteristics.
Attribute
Cloud
On premise
Reliability
Continuity, better equipment
Back- ups, disaster recovery
Availability
Instant, universal internet access
Only on the company’s office
Customization
Limited
Full control and flexibility
Confidentiality
Encryption, firewalls, VLANs.
Data privacy, local in-house access
to critical business data
Interoperability
Device independence
Dependence on local systems and
devices
Maintenance
Better and quickly addressed
Intensive, time and cost consuming
task
Usability
Require from users to possess Incorporates
functionality
and
knowledge and experience
features that the users are
familiar with
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Estimate user demand.
 Seasonal demand
– refers to sales and retails periods that usually present
increased demand volume. (for the CRM)
 Temporary effect
– may refer to clearance period or possible relocation that
are seldom events that may cause extra demands
 Expected demands:
– Batch processing may involve for the CRM a period that
massive advertisements are shifted
 Unexpected demands
– for the CRM may occur when a new product of the
company becomes very popular unexpectedly
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Conclusions
 A first step towards:
– identifying all relevant costs of cloud computing
– on-premises infrastructure and software
 Proposed a three step decision model for evaluating
the two alternatives.
– Assess software and infrastructure development costs
– Define quality characteristics
– Estimate user demand
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)
Future Work
 Evaluate the proposed model on real world
applications deployment and compare the three
alternatives (cloud, on–premise, a combination of
the two) based on data coming from both in-house
development and cloud hosting
 In particular for the hybrid of the two worlds, we plan
to elaborate on the cases where it is more profitable
and derive appropriate “rules-of-thumb”, since we
argue that this model will be the one that will finally
dominate the market
WETICE 2010, June 28 - June 30, 2010, TEI of Larissa (Greece)