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TAIWAN has been a worldwide leader in computer hardware manufacturing for many years. Cloud computing, a major paradigm shift for the IT industry, threatens that leadership position. Cloud computing drives the value chain increasingly towards systems software and services. It has a major negative impact on the already marginal profit picture that threatens the Taiwan hardware manufacturing industry, and the Taiwan economy as a whole. In its role as a non-profit, non-governmental organization the Institute for Information Industry (III) endeavors to pioneer technology and business methods that advantage the Taiwan IT Industry. Recognizing the need for a transformation the Institute has devised a strategy and is developing technology to address the effects of this technology shift.
In our strategy we chose to focus on appliance products which combine commodity hardware and system software both because of the existing strength of Taiwan's IT manufacturer's connections and sales channels in datacenter and server products and also because the cost and IT skills required to deploy private and hybrid public-private cloud solutions often put them out of reach for many small-to-medium sized business. We believe that the Taiwan IT industry's historical ability to drive costs down especially advantage our industry as a provider of easily deployable solutions in these expense constrained environments.
Many leading international vendors including IBM, HP, Oracle, Dell, EMC, VCE, etc. have announced private cloud appliance products. In many cases these are primarily infrastructure products combining processor, network, and storage hardware in factory pre-built enclosures. Some of the larger vendors like IBM, EMC and Oracle feature their own system software while others partner with software vendors like Microsoft and VMWare to provide needed middleware platforms. In general these packaged infrastructure-as-a-service private cloud offerings are quite expensive and often the cost of the proprietary system software licenses is a major component of that overall expense. While there are some emerging developments in open source system platform software such as Open Stack the competition from proprietary vendors has limited its adoption to date.
While there has been a great deal of emphasis in the general worldwide IT industry on large publically hosted cloud software-as-a-service solutions, and infrastructure-as-a-service hosting there has been less attention paid to private and hybrid cloud solutions that combine services, hardware, system platform software and application-based solutions. Particularly there are few products aimed at delivering deployment ready private cloud solutions in either horizontal or vertical markets and even fewer focus on deployment in small-and-medium sized businesses.
The strategy we have developed combines key infrastructure software such as processor virtualization management, storage virtualization, and desktop application virtualization developed by the Institute, often based on enhancements to open source materials, with low cost commodity priced hardware as a platform for Taiwanese application solutions and system integration partners. The goal is to deliver lowest cost, ready-to-run, easy-to-use, private and hybrid cloud solutions to small-to-medium sized enterprise where funds, IT-expertise, and personnel are general very limited.
Cloud Appliances for Enterprises (CAFÉ) is a major initiative to help traditional Taiwanese OEM/ODM vendors transform themselves from primarily being commodity hardware providers into highly profitable, full-function cloud systems businesses that can reach worldwide markets. III developed key system software components (CAFÉ technology components) that can be integrated with partners' hardware and other technology to create appliances that deliver cloud infrastructure and services enabling enterprises to establish ‘private clouds’ (thus the name ‘Cloud Appliance for Enterprise’). Appliances that offer user-ready services and applications, provide significantly higher value to customers, support higher prices than hardware alone, and thereby increase the profit margin of Taiwanese IT vendors.
Key Taiwan hardware vendors that have already adopted the CAFÉ strategy include ASUS, Delta Electronics, GIGABYTE, In Win, and Promise Technology. They have been developing, integrating and shipping cloud appliances that incorporate CAFÉ technology components, as well as their own technology.
CAFÉ based cloud appliances are designed to be cost efficient; enable significant energy efficient hardware technology; are highly optimized integrations of system software with custom hardware and specifically tailored software; exploit and support open standards components and interfaces; are delivered in plug-and-play, user ready, easily installed and maintained form; and are very easy to use. Most importantly, these cloud appliance offerings have very high business potential as they address the large private cloud global market segment and the emerging hybrid cloud environment.
Using CAFÉ as a cornerstone, Taiwan software vendors can develop leadership cloud offerings that are competitively priced compared to solutions containing more expensive system software licensed from large multi-national companies, provide attractive and valuable functions, and yield higher profit margins.
Partnerships among key Taiwan IT vendors such as ASUS, Delta Electronics, GIGABYTE, In Win, Promise and Institute for Information Industry (III) as part of the Taiwan CAFÉ Alliance is transforming Taiwan's IT industry in Cloud Computing era. The Taiwan CAFÉ Alliance was awarded as a WITSA Global ICT Excellence Awards Merit Winner at the WITSA Conference in October 2012, in Montreal Canada.
Taiwan has been a worldwide leader in computer hardware manufacturing for years. The hardware-led IT industry, directly contributes to roughly a quarter of overall Taiwan industrial revenue, indirectly empowers multiple application industries, and is clearly the cornerstone of the Taiwan economy. Nevertheless, the hardware industry mostly follows a traditional OEM/ODM model, which due to increased competition over the years has a decreasing profit margin and is subject to severe financial risks caused by world-wide economic downturns.
Cloud Computing represents a new computing and business model for both IT technology providers and consumers alike. It is a major paradigm shift for the IT industry. The virtualization of servers, permanent storage, and even applications; which is a major technology component of the Cloud Computing model; significantly reduces the demand for servers/storage from Taiwanese companies. As more and more data and applications are being moved into the ‘cloud’, the demand for client hardware from Taiwanese companies also decreases. Cloud computing thus presents a major negative impact to the already marginal profit picture that threatens the Taiwan hardware manufacturing industry. In addition, the development of services hosted entirely within the network (e.g., Cloud Services, Software as a Service, or SaaS) is a major new opportunity in the Cloud Computing paradigm. Presently, the participation of Taiwan IT companies in the software and services industry is relatively small, consists of primarily small system integrators, that are not well positioned for this major paradigm shift to Cloud Computing. Cloud Computing accelerates the hardware commoditization and causes the value chain to favor developers of systems software, applications and services. Cloud computing thus presents a significant challenge to the Taiwan IT industry, and to the Taiwan economy as a whole.
As major value shifts to systems, software, applications and services, implementations and technology that enable cloud computing are becoming a significant gap in the Taiwan IT eco-system.
While server hardware achieves rather thin profit margins, cloud system software, that supports virtualization, system management, monitoring and operations etc., is often three to four times more expensive than the server hardware it operates on. Presently the development of cloud system software is mostly done by major multi-national companies such as VMWare, Oracle, IBM and Microsoft. Notably, the expense associated with cloud system platform software currently dominates the overall cost of cloud-based solution offerings, and makes it very difficult for application vendors and service providers to build profitable products on top of the cloud infrastructure.
Though public cloud-based infrastructure, applications and services offered on the internet by major providers such as Google Apps, Microsoft Office Live, Salesforce.com, Mozy, Dropbox, Amazon Elastic Cloud Computing (EC2) and Simple Storage Service (S3) are gaining in adoption, many enterprises still have lingering concerns about the reliability and security of depending on large, public, multi-tenant cloud offerings. Recently significant services outages and security breaches by some of these larger cloud services providers have made news and further fueled these concerns.
III has developed a strategy called ‘Cloud Appliances for Enterprises (CAFÉ)’ as a major play to help Taiwan hardware vendors transform themselves into providers of cloud-based systems and infrastructure CAFE creates a cloud computing platform that will encourage the growth of development of cloud-based applications and services.
It focuses on some of the issues cited above: reducing the cost of cloud platform software to permit development of cloud service and application packages that enterprises can easily afford, manage and install on their own premises. Also, CAFÉ enables integration between locally hosted function and applications and services hosted by service providers on the public internet that extend and supplement those local capabilities.
III is developing key cloud system software components.
The CAFÉ system software components developed by III provide basic “platform”-level services like processor, storage, application and desktop virtualization and are integrated with hardware from major Taiwan manufacturers to become key building blocks for cloud infrastructure.
CAFÉ appliances are intended to be very cost effective, extremely easy to install and are tailored to be used by regular employees with very limited IT skills and are packaged to be ready for enterprises to exploit as soon as they are acquired.
CAFÉ exhibits a unique and high potential business opportunity as it attempts to merge the notion of private and public cloud computing into a seamless “hybrid” or “multi-cloud” environment that exploits the power of both public service provider offerings and locally hosted applications and services for both efficiency and to address enterprise concerns associated with availability and security. It will enable enterprises to more rapidly take advantage of cloud computing efficiencies by building their own cloud infrastructure and then combining it with appropriate publically hosted service provider offerings.
CAFÉ is also providing infrastructure that will enable Taiwan software vendors and service providers to more quickly transition to offering applications and services that exploit the Cloud Computing paradigm. It provides an ideal platform for Taiwan software vendors vendors to develop new cloud services and/or to port existing applications to a CAFÉ based cloud infrastructure. Software vendors could also develop pre-packaged CAFÉ-based appliances for particular vertical domains such as Education, Healthcare, Government, Manufacturing etc. With CAFÉ, Taiwan software vendors can develop attractively priced, leadership cloud offerings that have higher profit margins, and avoid the high cost of cloud system software charged by the large multi-national companies.
The CAFÉ strategy significantly increases the profit potential for Taiwan hardware vendors, by transforming present ODM/OEM players into highly profitable cloud solution providers for the worldwide market.
CAFÉ includes key technology components that integrate with (and complement) each other to make it a platform that is both easy for enterprise users to adapt to, as well as an attractive environment for software and service providers to host existing and newly developed applications.
CAFÉ components currently include:
The Cloud Appliance Kernel Environment (CAKE) is a major component of the CAFÉ platform that supports fundamental processor virtualization. CAKE provides extensive capabilities for users and/or programs to manage virtual machines (VMs). These follow the de-facto standard set by Amazon Web Services (AWS) EC2 and include mechanisms for managing the entire life-cycle of virtual machines such as creating, starting and stopping, monitoring, moving, saving and restoring virtual machines.
Personal Cloud Computer (PC2) provides a unique application and desktop virtualization function. PC2 creates a cross-platform virtual desktop that can be accessed from any device that supports a web browser and Java virtual execution environment including both traditional workstations, and mobile devices like smart phones or tablet computers. PC2 provides access to legacy applications running on Windows and Linux application servers as well as integrating web hosted applications. The application and desktop virtualization technology that PC2 makes available moves data and applications to the ‘cloud’ (server), significantly reducing the management overhead associated with traditional “thick” clients. This results in significantly lower TCO (total cost of ownership) while at the same time providing enterprises the flexibility to integrate a variety of application types with a common look and feel.
Cosa provides a file sharing and synchronization capability similar to Dropbox, but hosted entirely within the CAFÉ appliance environment. This means that important information assets are under the complete control and possession of the enterprise. cosa permits users to both access their important data from multiple devices including conventional PCs, mobile smart phones and tablet computers used in various environments (office, home, travel) as well as support convenient information sharing and work collaboration among groups of users. cosa has been designed to be operated with minimal IT expertise. cosa can integrate with various external backup services including Amazon S3, or save user data and configuration information to USB attachable devices.
Finally, to provide simple and consistent user access to the various types of applications that can reach via the PC2 virtual desktop, and that are hosted both within the CAFÉ appliance environment and elsewhere on the internet, we provide a single sign-on capability that can effectively allow users to logon and authenticate to the appliance once per session and with a single set of credentials (userid/password or others). CAFÉ Single Sign-On supports open standard protocols such as OpenID, LDAP and OAuth and can also integrate with Microsoft's Active Directory.
III has partnered with key Taiwan hardware vendors to integrate their hardware products with CAFÉ technology, helping them to transform themselves from hardware manufacturers into highly profitable Cloud system/solution providers for the global market. Current CAFÉ strategic partners include ASUS, Delta Electronics, GIGABYTE, In Win and Promise Technology.
ASUS has decided to enter into the high potential enterprise private cloud market. ASUS is partnering with III to jointly develop the ASUS Cloud Appliance, a first of a kind cloud system product integrating hardware with system software.
The ASUS Cloud Appliance integrates CAKE (Cloud Appliance Kernel Environment) virtual machine management with ASUS system web-based management into a platform that reduces TCO (total cost of ownership), is energy efficient, highly available, easy to use and that supports elastic resource scheduling for enterprises. The ASUS Cloud Appliance provides an Amazon EC2 compatible compute cloud solution which allows enterprises to migrate virtual machines from the externally hosted Amazon Web Service to the appliance easily. With III's CAKE virtualization technology, ASUS is shipping a high value cloud appliance for SMB enterprises.
Delta Electronics, a global leader in a range of IT products, has developed an innovative cloud storage solution for all kinds of businesses to store company data in an enterprise cloud server for backup and archival purposes.
Leveraging CAFE-cosa's user friendly file sharing, synchronization, and collaboration features as a front-end, Delta's cloud storage solution successfully integrates public or enterprise-wide storage cloud with CAFÉ-cosa as an end-user gateway and realizes cloud computing efficiency that brings enterprise data storage management to the next level.
GIGABYTE has gained insight from many years of experience in high-performance hardware manufacturing, covering many cutting edge technologies. By listening closely to the needs of its customers, GIGABYTE is able to provide vertical-integrated, turn-key solutions fully tailored to today's cloud computing requirements.
By embracing the CAFÉ strategy, creating ‘custom-made’ hardware for CAFE and exploiting the entire CAFÉ system software portfolio, GIGABYTE will develop ‘all-in-one’ cloud solutions that include virtual machine management (CAFÉ-CAKE), storage cloud services (CAFÉ-cosa), and desktop virtualization (CAFÉ-PC2). GIGABYTE will also partner with ISVs to build application appliances and start a business approach in emerging marketplace as an initial strategic offering.
To accelerate their positioning of an attractive thin-client capability, In Win is partnering with III to exploit the CAFÉ desktop virtualization technology. In Win announced and demonstrated a Desktop Virtualization Cloud Solution at CeBIT in Hannover earlier in 2012. This Desktop Cloud offering is based on CAFÉ-PC2 desktop virtualization technology with In Win's new K1 and K2 hardware series as Thin Clients to provide an end to end Desktop Cloud Solution. At Computex 2012 Taipei, In Win demonstrated its home cloud vision and announced a joint development partnership with III for CAFÉ based cloud solution offerings. In Win announced a number of ‘Application Appliance’ products with major ISV partners on January 29th 2013.
In Win is now poised to transform their company from a largely commodity-based hardware vendor into a high profit margin cloud solutions and services provider worldwide.
PROMISE Technology is a leader in providing high-performance RAID storage solutions for rich media, surveillance and big data markets through its broad portfolio of products, including network attached storage (NAS) devices. This market is extremely competitive, with a number of vendors battling to introduce the best and latest features. The CAFE storage cloud system software (CAFÉ-cosa) has been a key component to PROMISE Technology as it has helped elevate their offering from a traditional NAS device to a dynamic private cloud storage solution. Integrating CAFÉ-cosa with its own NAS hardware and firmware late 2011, PROMISE Technology has already begun shipping the innovative SmartStor Cloud solution. The SmartStor Cloud offers Dropbox like capabilities in a private cloud appliance that is cost effective, easy to install and manage, and allows an enterprise to retain full control of their own data. SmartStor Cloud was showcased at CeBIT 2012 in Hannover, Germany, as well as at Computex 2012 in Taipei, Taiwan. The functionality, innovation and market potential of the SmartStor Cloud was recognized at Computex 2012 as it was selected amongst an impressive field of entrants as the Best Choice Award winner.
The III CAFÉ strategic partners have transformed themselves into highly profitable cloud systems/solution businesses. Their offerings in cloud storage, virtual desktop, and cloud management are largely complementary and can be combined easily to provide even greater value. Their joint R&D efforts in cooperation with III enhance the CAFÉ technology and benefit all CAFÉ partners in this ecosystem. Jointly they have been building key system software technology assets for Taiwan and moving Taiwan into a leadership position in cloud computing.
CAFÉ Enables ISV (Independent Software Vendor) Transformations.
CAFÉ also enables Taiwan software vendors to transform into the Cloud Computing paradigm.
Software vendors (and content providers) can develop new cloud services or Application Appliances based on the CAFÉ platform, to turn packaged software products into cloud appliance offerings.
Software vendors might also develop CAFÉ-based cloud services for particular vertical domains such as education, healthcare, government, finance, manufacturing etc. Using CAFÉ as a cost efficient, energy saving, open, highly integrated and easy to use infrastructure, ISVs are able to focus on application innovation, realize higher profit margins by not paying the expensive cloud system software licenses to multi-national companies, and move more aggressively into the cloud solutions arena.
III Launched CAFÉ Solution Technology Center (CSTC).
To facilitate the exploitation of the CAFÉ infrastructure and platform provided by hardware partners, III has opened the CAFÉ Solution Technology Center (CSTC) in July 2012 to assist as many Taiwan solution, service and application developers as possible in taking advantage of the CAFÉ infrastructure to deliver cost effective ready-to-run application appliances.
The CSTC, aggregating and integrating cloud resources from Taiwan CAFÉ Alliance, provides ‘cloudification’ expertise; training, cloud hardware and software infrastructure, and development/test tools and environments to support software vendors developing CAFÉ based cloud solutions and services.
By ‘cloudification’ we mean the process of restructuring applications and services to exhibit major cloud characteristics such as scalability, availability, and elasticity as well as the ability to operate in a virtualized and dynamically provisioned environment.
The III CSTC will consult with ISV partners on their application appliance strategy; and collaborate on architecture and high level design. CSTC will also provide the necessary CAFÉ based infrastructure, development/test tools and environment for ISVs to carry out initial Proof-of -Concept (POC) prototyping and also to facilitate introductions to suitable hardware partners to create appliance offerings. Significant effort has been placed in generating synergies among CAFÉ hardware partners, building/establishing CAFÉ based software development process and tools for CSTC users.
The CSTC will continue to integrate hardware resources, provide technical assistance on Application Appliance development, and catalyze further collaborations in the cloud appliance eco-system, with the goal of helping Taiwan hardware vendors transform and making Taiwan's software companies' innovative cloud applications a major winning factor for cloud appliances.
MAKOCI (Multi-Agent Knowledge Oriented Cyber Infrastructure) platform, developed by the Taiwan GIS center, integrates government, enterprise, and academic GIS resources to provide various kinds of real-time information such as bus route maps, traffic conditions, etc. Taiwan GIS Center uses a CAFÉ based ASUS Cloud Appliance as the infrastructure for its GIS Cloud Appliance. By taking advantage of the auto-scaling functions provided by CAFÉ-CAKE, even when the system is overloaded with many online users and very high traffic volume, this application can still ensure a high quality of service. This MAKOCI platform serves as a good demonstration of the flexibility, dynamic load balancing and scalability that the CAFÉ platform provides.
Recently MCU has successfully used ASUS Cloud Appliance to migrate their student course enrollment application from a physical server environment to a CAFÉ based virtual machine infrastructure. This consolidation helped MCU eliminate three physical servers and achieve their goal of increased efficiency, application scalability, energy savings and carbon reduction. Even after the server reduction, the course enrollment system was able to serve more than 20,000 students smoothly, with excellent response time. The MCU Enrollment application is a good demonstration of the performance and server consolidation advantages that the CAFÉ cloud infrastructure can deliver.
While Cloud computing presents a significant technical and economic challenge to the Taiwan IT industry as it is structured today, it also creates an opportunity for transformation of this industry which is a cornerstone of Taiwan's economy. The Institute for Information Industry (III) has developed the CAFÉ (Cloud Appliance for Enterprise) strategy to enable key Taiwan IT technology providers to transition into the Cloud Computing era.
III has partnered with key Taiwan hardware vendors; ASUS, Delta Electronics, GIGABYTE, In Win, and Promise Technology; to integrate their hardware products with CAFÉ technology, and help them evolve from hardware manufacturers into highly profitable Cloud system/solution providers for the global market.
Also, the CAFÉ infrastructure provides the possibility for Taiwan software and solution vendors to move into the lucrative Cloud Computing application and services market Through the CAFÉ Solution Technology Center (CSTC), launched by III in July 2012, software, content and solution providers can develop cloud services and application appliances based on CAFÉ, and turn packaged software products into easily installed and managed enterprise cloud offerings.
III was incorporated in 1979, through the joint efforts of public and private sectors, to support the development/applications of information industry as well as information society in Taiwan. As one of the world's leading ICT innovators, III has about 1,800 dedicated professionals, more than 75% of them have a Master's degree or Ph.D., and two thirds of them are focusing on technology research and development.
The following companies are listed in the alphabetical order.
ASUS has long been at the forefront of IT growth and currently employs over 11,000 people around the world. ASUS makes products in almost every conceivable category of information technology too, including PC components and peripherals, notebooks, tablets, servers and smartphones. ASUS products won many international awards and accolades in 2011, and company revenue was over US$11.9 billion.
For nearly 40 years Delta Group has pursued the mission: “To provide innovative, clean and energy-efficient solutions for a better tomorrow.” With its focus on continuous innovation, Delta has become a global leader in a range of products and has received the Forbes Asia “Fabulous 50” Award for several consecutive years. CNBC European Business magazine recently listed Delta Electronics as a “Global Top 100 Low-Carbon Pioneer”- the only company from Taiwan featured on the list. In 2010, the management team received honors that include Ernst & Young's “Entrepreneur of the Year” and “CSR Entrepreneur” awards, CNBC's “2010 China Business Leader of the Year Award”, and more.
GIGABYTE, founded in 1986, has offered a comprehensive product line covering Servers, Networking Storages, Laptops, Slate Devices, PC Components, PC Peripherals and Mobile Phones. As a Taiwan's Top 20 Brand valued at over US$106 million, GIGABYTE has continually developed advanced technologies and innovative adoption to provide new ways of enhancing customer experiences.
IN WIN Development Inc., an ISO 9001 manufacturer of professional computer chassis, power supplies and digital storage devices, is the leading provider of enclosure solutions to system integrators worldwide. Founded in 1985, IN WIN provides high quality chassis that conform to all safety regulations, as well as unsurpassed customer service. In recent years, In Win has continuously received multiple honors for their innovative creativity and quality excellence, e.g., “iF gold product design award 2011”, “reddot design award 2009”, “US CES award”, and many more. These award honors have solidified In Win as a continued leader in the computer industry.
PROMISE Technology, a leader in providing high-performance storage solutions to the data center, cloud, surveillance and rich media markets and the leader in designing cutting-edge Thunderbolt devices, develops and manufactures sophisticated RAID storage solutions recognized worldwide, ranging from a complete line of RAID controller cards to FC/iSCSI/SAS/SATA RAID subsystems. Catering to enterprise, mid-range, entry-level and consumer data protection needs, PROMISE products are distinguished by their Unified Common RAID Core, management software and unparalleled support. Headquartered in Milpitas, California, PROMISE has operations throughout North America, Asia and Europe.
This work was supported by the Ministry of Economy Affairs, Taiwan.
G. Wang is with the Inventec Corporation, Taipei 111, Taiwan. He was with the Institute for Information Industry, Taipei 106, Taiwan Corresponding author: G. Wang (email@example.com)
J. Unger is with the Institute for Information Industry, Taipei 106, Taiwan
Color versions of one or more of the figures in this paper are available online at http://ieeexplore.ieee.org.
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