For most organizations, owning and operating infrastructure does not differentiate their business. In fact, it's often a burden. It limits an organization staff in several ways. For example, they have to undertake laborious tasks related to infrastructure procurement, provisioning and maintenance. They are using legacy systems that are old, don't add value to the business other than keeping the lights on, and don't support business change. They cannot scale with any ease because they're locked into what they have on premises and forced to pay to over provision for peak usage. One option for reducing this burden is to outsource the company's IT infrastructure as much as possible, and migrate to the cloud. But before we talk about migrating to the cloud, let's go back to a time before the cloud. I'll demonstrate how technology has impacted company business models over the years and use a simplified IT backbone to talk through the various changes. First, let's look at employees, the technology users. These people use or create applications on laptops or computers. And as part of their day to day work, they're storing data or files and connected to each other over the internet. As a company grows, and there's a need for more computers with more processing power, a company might have a data center with servers. Organizations might own their servers, data centers, cooling systems, the physical security features in place and the real estate to house all of that infrastructure. On top of this, they have to pay for maintenance and ongoing security costs. Think of this as similar to owning a house. You're responsible for all of the infrastructure, the bricks and mortar, the fence around your garden, the locks on your door and all of the ongoing costs such as your utilities as well. The first step in moving away from what we call an on premises infrastructure is colocation. Here, a business sets up a large data center, then other organizations rent part of that data center. This means organizations no longer have to pay for the cost associated with hosting the infrastructure, but they still need to pay to maintain it. It's like owning an apartment in a serviced apartment complex or a house in a gated community. You've paid for some infrastructure, the apartment or the house, and you're still responsible for maintenance-- for example, if your heater breaks down-- but some things like the perimeter security are outsourced. With both on premises and colocation, value creation only starts well after a substantial amount of capital expenditure or capex is committed. Given that hardware is often heavily underutilized even in the colocation model, engineers found a way to package applications and their operating systems into what we call a virtual machine. Virtual machines share the same pool of computer processing, storage and networking resources. Virtual machines optimize the use of available resources and enable businesses to have multiple applications running at the same time on a server in a way that is efficient and manageable. Most companies use virtual machines to optimize their use of data centers, whether on premises or co located. The problem though, is that there's still a cap to the physical capacity of existing servers, and companies still have to commit to a substantial amount of capital expenditure upfront. Many companies are now outsourcing their infrastructure entirely. They are growing to deliver their products and services to customers regionally and globally, and need to scale quickly and securely. Setting up and maintaining data centers and network connections that are optimal for their needs is expensive. They don't see the benefit of owning their own data centers if they can outsource to a public cloud that offers Infrastructure as a service. In our analogy, this is like renting an apartment in a service building. Now if your heater breaks, it's your landlord who's responsible for getting it fixed. This means IT costs shift from being capital expenditure heavy to being more operational expenditure heavy. Outsourcing your IT needs at the infrastructure level is called infrastructure as a service. And public cloud providers such as Google Cloud offer several services to help you modernize your infrastructure. If your organization chooses to, it can move some or all of its infrastructure away from physical data centers to virtualized data centers in the cloud. Google Cloud provides you with compute, storage, and network resources, organized in ways familiar to you from your experience with physical and virtualized data centers. The maintenance work is outsourced to the public cloud providers, so it's easier to shift larger portions of company expertise to build processes, and applications that move the business forward. Outsourcing IT resources gives the company flexibility, but requires its teams to continue managing things like web application security. That is the information security that specifically deals with websites, web applications, and web services. In this scenario, you would pay for resources you allocate-- for example, a set number of virtual machines. If you want a more managed service, cloud service providers offer something called a platform as a service. In this case, you don't have to manage the infrastructure and, for some services, you only pay for what you use. As cloud computing has evolved, the momentum has shifted even further towards managed automated infrastructure and services. Google Cloud, for instance, is known for its global access to a pool of configurable resources for every layer of the IT infrastructure in the form of paid services. All right, now that you understand infrastructure as a service, and platform as a service, let's look more closely at compute options. I already mentioned virtual machines as one method for optimizing the use of IT resources. In the next video, I'll examine VMs further and explore alternatives.
