Welcome!

Weblogic Authors: Yeshim Deniz, Elizabeth White, Michael Meiner, Michael Bushong, Avi Rosenthal

Related Topics: @CloudExpo

@CloudExpo: Blog Post

Cloud Computing Infrastructure Capacity Planning

Planning your resources for a public cloud deployment

In the run of a day I get a lot of calls from hosting companies and data centers looking to roll out public cloud infrastructures using Enomaly ECP. In these discussions there are a few questions that everyone seems to ask.

  1. How much is it going to cost?
  2. What is the minimum resources / capacity required to roll out a public cloud service?

Both questions are very much related. But to get to and idea of how much your cloud infrastructure is going to cost, you first need to fully understand what your resource requirements are and how much capacity (minimum resources) will be required to maintain an acceptable level of service and hopefully turn a profit.

In traditional dedicated or shared hosting environment, capacity planning is typically a fairly straight forward endeavor, (a high allotment of bandwidth and a fairly static allotment of resources), a single server (or slice of a server) with a static amount of storage and ram. If you run out of storage, or get too many visitors, well too bad. It is what it is. Some managed hosting providers offer more complex server deployment options but generally rather then one server you're given a static stack of several, but the concept of elasticity is not usually part of the equation.

Wikipedia gives a pretty good overview of concept of capacity planning which is described as process of determining the production capacity needed by an organization to meet changing demands for its products. Although this definition is being applied to a traditional business context, I think it works very well when looking at public cloud infrastructure.

Capacity is defined as the maximum amount of work that an organization is capable of completing in a given period of time with the following calculation, Capacity = (number of machines or workers) × (number of shifts) × (utilization) × (efficiency). A discrepancy between the capacity of an organization and the demands of its customers results in inefficiency, either in under-utilized resources or unfulfilled customers.

The broad classes of capacity planning are lead strategy, lag strategy, and match strategy.

  • Lead strategy is adding capacity in anticipation of an increase in demand. Lead strategy is an aggressive strategy with the goal of luring customers away from the company's competitors. The possible disadvantage to this strategy is that it often results in excess inventory, which is costly and often wasteful.
  • Lag strategy refers to adding capacity only after the organization is running at full capacity or beyond due to increase in demand (North Carolina State University, 2006). This is a more conservative strategy. It decreases the risk of waste, but it may result in the loss of possible customers.
  • Match strategy is adding capacity in small amounts in response to changing demand in the market. This is a more moderate strategy.

Compounding cloud capacity planning is the idea of elasticity. Now not only are you planning for typical usage, you must also try to forecast for sudden increases in demand across many customers using a shared multi-tenant infrastructure. In ECP we use the notion of capacity quota's where new customers are given a maximum amount of server capacity, say 20 VM's or 1TB of storage. For customers who require more, they then make a request to the cloud provider. The problem with this approach is it gives customers a limited amount of elasticity. You can stretch, but only so far. Another strategy we sometimes suggest is a flexible quota system (Match strategy) where after a period of time, you now trust the customer and automatically give them additional capacity or monitor their usage patterns and offer it to them before it becomes a problem. This is similar to how you seem to magically get more credit on your credit cards for being a good customer or get a call when you buy an unexpected big ticket item.

The use of a quota system is an extremely important aspect in any capacity / resource planning you will be doing when either launching or running your cloud service. A quota system gives you a predetermined level of deviation across a real or hypothetical pool of customers. Which out it, you is practically impossible to adequately run a public cloud service.

Next you must think of the notion of overselling your infrastructure. Let's say your default customer quota is 20 virtual servers, what percentage of those customers are going to use 100% of their allotment? 50%, 30%, 10%? Again this differs tremendously depending on the nature of your customers deployments and your comfort level. At the end of the day to stay competitive you're going to need to oversell your capacity. Overselling provides you the capital to continue to grow your infrastructure, hopeful slightly faster then your customers capacity requirements increase. The chances of 100% of your customers using 100% of their quota is probably going to be slim, the question you need to ask is what happens when 40% of your customers are using 60% of their quota? Does this mean 100% of the available capacity is being used? Cloud capacity planning also directly effects things like your SLA's and Q0S. Regardless of your platform, it's never good idea to use 100% of your available capacity nor should you. So determining the optimal capacity and having away to monitor it is going to be a crucial aspect in managing your cloud infrastructure.

I believe to fully answer the capacity question you must first determine your ideal customer. Determine where your sweet spot is, who you're going after (the low end, high end, commodity or niche markets). This will greatly help you determine your customer's capacity requirements. I'm also realistic, there is no one size fits all approach. For the most part, Cloud Computing is a best-guess game, there are no best practices, architectural guidelines or practical references for you to base your deployment on. What it comes down to to is experience. The more of these we do the better we can plan. This is the value that companies such as Enomaly and the new crop of cloud computing consultants bring. What I find interesting is the more cloud computing as a service model is being adopted by hosting firms, the more these hosters are increasingly coming to us not only for our cloud infrastructure platform, but to help them navigate though a scary new world of cloud capacity planning.

More Stories By Reuven Cohen

An instigator, part time provocateur, bootstrapper, amateur cloud lexicographer, and purveyor of random thoughts, 140 characters at a time.

Reuven is an early innovator in the cloud computing space as the founder of Enomaly in 2004 (Acquired by Virtustream in February 2012). Enomaly was among the first to develop a self service infrastructure as a service (IaaS) platform (ECP) circa 2005. As well as SpotCloud (2011) the first commodity style cloud computing Spot Market.

Reuven is also the co-creator of CloudCamp (100+ Cities around the Globe) CloudCamp is an unconference where early adopters of Cloud Computing technologies exchange ideas and is the largest of the ‘barcamp’ style of events.

Comments (0)

Share your thoughts on this story.

Add your comment
You must be signed in to add a comment. Sign-in | Register

In accordance with our Comment Policy, we encourage comments that are on topic, relevant and to-the-point. We will remove comments that include profanity, personal attacks, racial slurs, threats of violence, or other inappropriate material that violates our Terms and Conditions, and will block users who make repeated violations. We ask all readers to expect diversity of opinion and to treat one another with dignity and respect.


@ThingsExpo Stories
IoT is rapidly becoming mainstream as more and more investments are made into the platforms and technology. As this movement continues to expand and gain momentum it creates a massive wall of noise that can be difficult to sift through. Unfortunately, this inevitably makes IoT less approachable for people to get started with and can hamper efforts to integrate this key technology into your own portfolio. There are so many connected products already in place today with many hundreds more on the h...
Here are the Top 20 Twitter Influencers of the month as determined by the Kcore algorithm, in a range of current topics of interest from #IoT to #DeepLearning. To run a real-time search of a given term in our website and see the current top influencers, click on the topic name. Among the top 20 IoT influencers, ThingsEXPO ranked #14 and CloudEXPO ranked #17.
Join IBM November 1 at 21st Cloud Expo at the Santa Clara Convention Center in Santa Clara, CA, and learn how IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Cognitive analysis impacts today’s systems with unparalleled ability that were previously available only to manned, back-end operations. Thanks to cloud processing, IBM Watson can bring cognitive services and AI to intelligent, unmanned systems. Imagine a robot vacuum that becomes your personal assistant tha...
As data explodes in quantity, importance and from new sources, the need for managing and protecting data residing across physical, virtual, and cloud environments grow with it. Managing data includes protecting it, indexing and classifying it for true, long-term management, compliance and E-Discovery. Commvault can ensure this with a single pane of glass solution – whether in a private cloud, a Service Provider delivered public cloud or a hybrid cloud environment – across the heterogeneous enter...
DXWorldEXPO LLC, the producer of the world's most influential technology conferences and trade shows has announced the 22nd International CloudEXPO | DXWorldEXPO "Early Bird Registration" is now open. Register for Full Conference "Gold Pass" ▸ Here (Expo Hall ▸ Here)
The Jevons Paradox suggests that when technological advances increase efficiency of a resource, it results in an overall increase in consumption. Writing on the increased use of coal as a result of technological improvements, 19th-century economist William Stanley Jevons found that these improvements led to the development of new ways to utilize coal. In his session at 19th Cloud Expo, Mark Thiele, Chief Strategy Officer for Apcera, compared the Jevons Paradox to modern-day enterprise IT, examin...
Major trends and emerging technologies – from virtual reality and IoT, to Big Data and algorithms – are helping organizations innovate in the digital era. However, to create real business value, IT must think beyond the ‘what’ of digital transformation to the ‘how’ to harness emerging trends, innovation and disruption. Architecture is the key that underpins and ties all these efforts together. In the digital age, it’s important to invest in architecture, extend the enterprise footprint to the cl...
DXWorldEXPO LLC announced today that All in Mobile, a mobile app development company from Poland, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. All In Mobile is a mobile app development company from Poland. Since 2014, they maintain passion for developing mobile applications for enterprises and startups worldwide.
DXWorldEXPO LLC announced today that ICC-USA, a computer systems integrator and server manufacturing company focused on developing products and product appliances, will exhibit at the 22nd International CloudEXPO | DXWorldEXPO. DXWordEXPO New York 2018, colocated with CloudEXPO New York 2018 will be held November 11-13, 2018, in New York City. ICC is a computer systems integrator and server manufacturing company focused on developing products and product appliances to meet a wide range of ...
In an era of historic innovation fueled by unprecedented access to data and technology, the low cost and risk of entering new markets has leveled the playing field for business. Today, any ambitious innovator can easily introduce a new application or product that can reinvent business models and transform the client experience. In their Day 2 Keynote at 19th Cloud Expo, Mercer Rowe, IBM Vice President of Strategic Alliances, and Raejeanne Skillern, Intel Vice President of Data Center Group and ...
"We are a well-established player in the application life cycle management market and we also have a very strong version control product," stated Flint Brenton, CEO of CollabNet,, in this SYS-CON.tv interview at 18th Cloud Expo at the Javits Center in New York City, NY.
In his session at @ThingsExpo, Arvind Radhakrishnen discussed how IoT offers new business models in banking and financial services organizations with the capability to revolutionize products, payments, channels, business processes and asset management built on strong architectural foundation. The following topics were covered: How IoT stands to impact various business parameters including customer experience, cost and risk management within BFS organizations.
While the focus and objectives of IoT initiatives are many and diverse, they all share a few common attributes, and one of those is the network. Commonly, that network includes the Internet, over which there isn't any real control for performance and availability. Or is there? The current state of the art for Big Data analytics, as applied to network telemetry, offers new opportunities for improving and assuring operational integrity. In his session at @ThingsExpo, Jim Frey, Vice President of S...
With the introduction of IoT and Smart Living in every aspect of our lives, one question has become relevant: What are the security implications? To answer this, first we have to look and explore the security models of the technologies that IoT is founded upon. In his session at @ThingsExpo, Nevi Kaja, a Research Engineer at Ford Motor Company, discussed some of the security challenges of the IoT infrastructure and related how these aspects impact Smart Living. The material was delivered interac...
Andrew Keys is Co-Founder of ConsenSys Enterprise. He comes to ConsenSys Enterprise with capital markets, technology and entrepreneurial experience. Previously, he worked for UBS investment bank in equities analysis. Later, he was responsible for the creation and distribution of life settlement products to hedge funds and investment banks. After, he co-founded a revenue cycle management company where he learned about Bitcoin and eventually Ethereal. Andrew's role at ConsenSys Enterprise is a mul...
Amazon started as an online bookseller 20 years ago. Since then, it has evolved into a technology juggernaut that has disrupted multiple markets and industries and touches many aspects of our lives. It is a relentless technology and business model innovator driving disruption throughout numerous ecosystems. Amazon’s AWS revenues alone are approaching $16B a year making it one of the largest IT companies in the world. With dominant offerings in Cloud, IoT, eCommerce, Big Data, AI, Digital Assista...
The Founder of NostaLab and a member of the Google Health Advisory Board, John is a unique combination of strategic thinker, marketer and entrepreneur. His career was built on the "science of advertising" combining strategy, creativity and marketing for industry-leading results. Combined with his ability to communicate complicated scientific concepts in a way that consumers and scientists alike can appreciate, John is a sought-after speaker for conferences on the forefront of healthcare science,...
In his session at Cloud Expo, Alan Winters, U.S. Head of Business Development at MobiDev, presented a success story of an entrepreneur who has both suffered through and benefited from offshore development across multiple businesses: The smart choice, or how to select the right offshore development partner Warning signs, or how to minimize chances of making the wrong choice Collaboration, or how to establish the most effective work processes Budget control, or how to maximize project result...
In his keynote at 19th Cloud Expo, Sheng Liang, co-founder and CEO of Rancher Labs, discussed the technological advances and new business opportunities created by the rapid adoption of containers. With the success of Amazon Web Services (AWS) and various open source technologies used to build private clouds, cloud computing has become an essential component of IT strategy. However, users continue to face challenges in implementing clouds, as older technologies evolve and newer ones like Docker c...
When shopping for a new data processing platform for IoT solutions, many development teams want to be able to test-drive options before making a choice. Yet when evaluating an IoT solution, it’s simply not feasible to do so at scale with physical devices. Building a sensor simulator is the next best choice; however, generating a realistic simulation at very high TPS with ease of configurability is a formidable challenge. When dealing with multiple application or transport protocols, you would be...