Sending Computers into the Cloud
Since the modern electronic computer was invented in the 1940s, the trend has been toward reducing the size of the computer while increasing its capability. The logical end of this trend is to remove the physical computer altogether. While that isn't likely to happen in business, companies have found ways to make their central computers disappear.

Central computers still exist, of course, but if you look around business offices, follow the cables from a desktop or wireless router through walls and down halls, you may not find a central computer. What you'll find instead in more and more organizations are signals going "into the cloud." That saying refers to cloud computing, which provides computing services and database access over the Internet that are accessible from anywhere in the world rather than from a specific computer in a specific location.

Deutsche Bank (DB), the German financial services firm, made a decision to send its computers into the cloud. As Alistair McLaurin of its Global Technology Engineering group put it, the bank "wanted to create something radically different," to "challenge assumptions around what centrally provided IT services could be and how much they must cost." DB created a system in which computing is done by virtual machines (VMs): software-managed "slices" of real computers that behave in every respect like a full computer but that share the hardware of one real computer with many other VMs.

A virtual machine is an extension of the familiar concept of running more than one program at a time. In a VM, you run more than one operating system at a time, with each completely isolated from the others. The result is substantial savings in hardware cost and everything that goes with it, such as space and electricity. By putting the computers that host their virtual machines in the cloud, DB freed themselves from the constraints of being at a particular physical location. DB can thus optimize the use of these virtual computers across the entire company.

Another advantage of the virtual approach is that someone who needs a new computer doesn't have to purchase one. Instead, they can use a virtual computer inside a real computer that the company already has; such a VM is easier to set up than a new system. In fact, "a user who is a permanent employee, who wants a new Virtual Machine for their own use only, can do it by visiting one Web site, selecting an operating system [Windows, Solaris, or Linux] and clicking three buttons. The new VM will be ready and available for them within an hour."
The Open Data Center Alliance recently chose DB as the grand prize winner of its Conquering the Cloud Challenge. The specific basis for the award was the way DB's cloud-based system manages user identities.

When a user requests a virtual machine, the system already knows who has to approve the request (if anyone), where its cost should be billed, and who should be allowed to administer the machine. The cloud-based system means users don't have to worry about how virtual machines are created, making it more practical to use them. Because a virtual machine is less expensive than a new desktop computer, DB management wanted to encourage employees to use the virtual machines. Removing barriers to their adoption was important, which is why they designed the cloud-based system to manage user identities.

Currently, programmers and other system developers use DB's cloud system for application development and testing. If a developer is working with a computer that runs Solaris and wants to test an application under Windows 7 or Windows Vista, he or she can do so using a virtual machine quickly and efficiently. The cloud system will be used next for DB production applications, except for those that need 100 percent uptime (such as the one that operates a network of ATMs). After that? Who knows?

Discussion Questions
1. What was innovative about the manner in which the Deutsche Bank manages identities?

2. What other types of companies could use this innovation to cut IT costs?

Critical Thinking Questions
1. Would cloud computing be useful to your school? To a specific small business you can think of?

2. How does the location independence of cloud computing help Deutsche Bank or any other organization?