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In the clouds
Cloud computing can reduce costs and accelerate time to market.
Exchanges have long been able to obtain computer services through application service providers (ASPs). Instead of buying and installing software, they simply execute a computer program over a network. The ASP model is sometimes called Software as a Service (SaaS). 
“While many people view cloud computing as the emperor’s new clothes, it is in reality a very flexible extension of theASP model,” says Carl-Magnus Hallberg, Senior Vice President of Global IT Services Operations, NASDAQ OMX. “Key additions to the concept are on-demand computing with utility payment models as well as Platform as a Service (PaaS), where your own applications are delivered from the provider’s servers, and Infrastructure as a Service (IaaS) which enables exchanges to lease server capacity on a per hour basis from providers such as Amazon, Google or Microsoft.” The many advantages of cloud computing include lower costs, scalability and the elasticity to cope with ariations such as trading spikes. Exchanges can scale their server capacity up or down depending on their needs, and they only pay for what they use. They can also speed their time-to-market for new products and services. The concept is particularly compelling for smaller exchanges that cannot afford highend software or custom outsourcing arrangements.
Any data that is not sensitive can be put in a cloud. For instance, exchanges can run most of their web services there, store non-critical market and reference data, and support purchasing and vendor management. David Linthicum, author of Cloud Computing and SOA Convergence in Your Enterprise, points out that cloud computing works best when the applications and processes are new and independent or loosely coupled.That makes it easier to move certain parts into the cloud and retain others on premises. He also notes that the points of integration should be well defined and exist as an API, and that the IT staff should know how to get information in and out of a system. Moreover, the core internal enterprise architecture should be healthy; otherwise adding clouds could make it too complex. | | 
David Linthicum,
author of Cloud
Computing and
SOA Convergence
in Your Enterprise
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Despite its advantages, some exchanges are reluctant to adopt cloud computing due to concerns about ecurity, confidentiality, auditability, transparency and latency. Over the long term, according to Carl-Magnus Hallberg, these issues will likely be resolved.
Moving to the clouds
According to David Linthicum, the four core steps to implementing cloud computing are: Step 1:List the candidate platforms. Identify the categories needed and which providers should appear on the list. The categories will depend on requirements for storage, database, processes, services,
security, governance and management.
Step 2:analyze and test the candidate platforms. Validate how the platform supports the requirements of the architectural components including services, data and processes before deploying them on the platform. Set performance expectations.
Step 3:Select the target platforms. Consider the viability of the provider; its ability to recover from hardware, software and network failures; the service level agreement; and the provider’s policies and what denotes a violation.
Step 4:Deploy to the target platforms. Port code, migrate data, and create new services, processes and databases. Test and validate that all services, databases and processes work correctly. Migration and development over time is preferable to a big bang approach.
Source: InfoWorld.com Deep Dive Series, September 2009 Illustration: Lena Sjöberg
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