Empirical Findings
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Empirical Findings
Höllwarth (2013) compares cloud services with the decision between using the car
or the plane to go on a business trip. Assuming a client from Milan places an order
with us and asks for an appointment on site. We now have to decide to take our car
or travel by plane. Driving the car is stressful and takes long. Hence we decide to
go by plane and use our car only for the drive to the airport. This solution is more
comfortable and we arrive much sooner at our final destination. The parallels to
cloud services are the following ones: If somebody drives a car, he uses his own
hardware to go to the airport. Car driving costs a lot of money, comprising high initial
investments and high follow-up costs like for example taxes, insurance, as well as
a loss of value. As soon as we turn the key and start the car, operating costs for gas
and maintenance costs emerge. Analogous to a car, a datacenter occasions costs:
Internet connection, electricity, air conditioning, rent, licenses etc. The costs thereby
incurred are continuous costs, even if no work is done in the datacenter. As soon as
employees start to work with the system, additional operating costs emerge: IT staff,
system maintenance, and so on. The bottom line is that the initial balance drawn for
the usage of the car is nearly as negative as the usage of on-premise datacenters.
As measured by the required employment of capital, energy and resources, both
solutions are not very efficient. For the above mentioned business trip, we chose to
use an airline (a public service provider). An airline’s core competency is the
transportation of passengers. Compared to the travel expenses for a trip by car, the
carrier has to deal with much higher expenses. Due to the fact that the costs are
shared among many persons (passengers), the airline is able to offer its customers
tickets for a fixed price. While you need to pay for all expenses when using your car,
you only pay for your booked flight when travelling by plane. In return you are able
to partially use the whole infrastructure of the airport and the airplane. When buying
a ticket, you waive for the individuality of a self-determined trip by car. Instead you
chose to accept the carrier’s standard service. In cloud computing terms this means:
Cloud service providers assume full responsibility for all costs associated with initial
investments in cloud datacenters and server farms, Internet connection, software
and hardware. Their core competency mostly involves the provision of standardized
services through the Internet. If the demand for flights increases, the carrier
