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Cloud bursting: How will it affect your billing requirements?

Time and again, customers identify agility and scalability as key benefits of using public cloud services. The core value of cloud computing is the ability to provision resources

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on-demand, as required by the business, and then return those resources once they are no longer needed. While this provides value and business agility, providers are finding that cost accounting and billing can be a bit of a challenge.

The concept of cloud bursting appeals to enterprises that have fluctuating capacity needs. The idea behind it is that enterprises can use their internal systems or perhaps private clouds for normal needs, and when additional capacity is required, they may allocate the extra resources they need within a public cloud.

Customers who use cloud bursting may allocate and de-allocate resources several times a day -- and thousands of times a month. Providers can't track that manually.

This allows customers to use public clouds only when required and therefore only use public cloud resources sporadically. While this benefits the cloud users -- and is perhaps the core selling point of public cloud computing for them -- the ability to track and manage these resources becomes problematic for the providers.

Defining the problem

Cloud providers face three main billing challenges, and cloud bursting further complicates each one. These issues include:

The complexity of cloud services makes usage -- and ultimately cost -- difficult to track. Cloud services are complex. A single "cloud service" is the sum of many highly specific services and functions, and providers must be able to account for how any of these services interact with each other, including any service dependencies. In the case of cloud bursting, the core issue is that the number of resources that come into play may differ greatly, depending on how the consumer uses those services and for what duration.

In some cases, cloud providers will find that resources remain allocated, even after the service consumer has de-provisioned the resources. Providers need to know when these "zombie resources" are likely to be created so that you can create services that find and remove them.

There are too many resources to track manually. The number of services providers offer cloud consumers with has reached a point where manual accounting processes to measure usage are no longer realistic. Customers who use cloud bursting may allocate and de-allocate resources several times a day -- and thousands of times a month. Providers can't track that manually, and chances are that if they do, they're likely to overcharge or undercharge customers.

There are also too many consumers to track resource usage manually. Just as we hit the tipping point for services, we also hit the threshold for service consumers. At some point, there are just too many users and organizations using cloud services for providers to manually track.

Although cloud bursting typically involves a single on-premises system or private cloud provisioning services, there could be thousands of systems or humans provisioning services for short periods of time, as needed, at any moment.

Defining the solution

Considering the requirements of cloud bursting, as well as the general requirements of tracking usage, cloud providers are seeking key capabilities. While a provider's requirements may vary depending upon the types of cloud services it supports, most providers should look for cloud billing systems to achieve the following goals:

  1. Automated, multi-tenant cloud billing that can eliminate the time-consuming preparation of invoices that reflect the use of cloud services, including bursting. Usage-based billing is complex, as it requires that a great deal of information be tracked during operations.
  2. Self-service customer cost reporting that allows the provider to gain a competitive advantage and increase customer trust by giving them anytime access to their downstream cloud costs. That way, even with the erratic cost patterns that emerge around cloud bursting, consumers can still predict future usage for both budgeting and governance purposes.
  3. Granular, time-stamped and auditable information about costs, tracked through all operations of a cloud service. This can quickly resolve billing disputes and eliminate costly discounts with accurate and auditable customer cloud usage and cost data. Everything is tracked, and everything is available.

After understanding the requirements, as listed above, it's a good idea to list the features and functions that meet your needs as a cloud provider. This will form the foundational requirements to seek a cloud financial management system to provide the right tools for usage-based cost accounting. These include the ability to track and manage those consumers who use cloud bursting. More specifically, cloud providers need billing systems that offer cost visibility, cost analysis, cost accounting and cost governance.

Cost visibility. This refers to the ability to have near real-time access to the costs within a cloud computing provider's environment, including costs of the resources used, costs of any services provided to the cloud provider (such as external management and security systems), cost of the services provided to the cloud service consumer and other costs that may be germane to the provider.

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Cost analysis. This is the process of taking the cost data that we're making visible to both the cloud service provider and consumer.

Cost accounting. This refers to the process of collecting, analyzing, summarizing and evaluating various alternative courses of action to determine if there were better, more cost-effective ways of leveraging the cloud service, based on the cost data gathered.

Cost governance. This is the ability for the cloud provider or cloud services consumer to institute cost-related processes and policies.

For those who want the ability to track the use of resources, and allocate that usage to the right consumer in the right ways to track steady or occasional usage, it's just a matter of understanding the requirements and mapping them to the right technology.

Make sure you select and deploy the proper cloud financial management system that's right for your ability requirements to provide and track cloud computing services. This means proof-of-concept projects and many days of testing to be sure you have the right solution in place.

About the author:
David "Dave" S. Linthicum is a senior vice president at Cloud Technology Partners, a Boston-based cloud consultancy. He is an internationally recognized cloud industry expert, and he is the author and co-author of 13 books on computing, including the best-selling Enterprise Application Integration. Linthicum speaks at many leading technology conferences on cloud computing, service-oriented architecture, enterprise application integration and enterprise architecture.

His latest book is Cloud Computing and SOA Convergence in Your Enterprise: A Step-by-Step Guide. His industry experience includes tenures as chief technology officer and CEO of several successful software companies and upper-level management positions in Fortune 100 companies. In addition, he was an associate professor of computer science for eight years and continues to lecture at major technical colleges and universities, including the University of Virginia, Arizona State University and the University of Wisconsin.

This was first published in July 2013

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