Implementing and Running

Your Own Cloud Service

OnApp VS. OpenStack

Cloud Management Platforms (CMPs) currently focus on two markets: enterprise businesses and service
providers. The following analysis will concentrate on implementation and use for service providers.

Overview of Cloud Management Platforms

Simply put, CMPs deliver an environment for providers and their respective customers. Customers can provision, monitor and manage virtual
machines. They allow the service provider a means of metering usage and billing customers, as well as Role-Based Access Control (RBAC),
allowing administrators to control user permissions and resource limits. Most CMPs provide a multi-cloud architecture that enables service
providers to deploy public, private, hybrid and other types of clouds. All clouds and tasks are managed from one all-inclusive control panel.

Key Considerations in Selecting a Cloud Management Platform

Ease of Use

Reliability & Security

An easy-to-use platform allows service providers to be up and

running quickly, while an intuitive control panel provides all of the
tools that they need to be successful. This results in fewer
headaches and quick deployments, leaving more time to improve
and maintain other services and operations. Moreover, decreasing
time to market can significantly improve a services market share.

These two considerations are essential. It is crucial for any Cloud

Management Platform to minimize downtime and keep the
customers and the companys information safe. Automated failover
and hot migration keep services up and running despite unforeseen
issues, while VM firewalls and antisniff software keep sensitive
information safe.

Features

Automation

Competing with well-established services is not easy. Providing

customers with easy-to-use features fundamentally improves the
attractiveness of the service. With more options and more
functionality, a robust feature offering gives providers the flexibility
to design services that appeal to a wide variety of customers.

Improving profit margins is a process, hindered significantly by timeconsuming administrative tasks. Automating provisioning (customer
self-service), VM management, cloud maintenance and billing can
decrease the number of employees required to run your business.
The result is a high level of efficiency and a smooth environment.

Basic features that a Cloud Management Platform should have:

VM provisioning and management (start, stop, reboot and clone)

A customizable management dashboard with the ability to be rebranded
A customer user-interface
The ability to scale both vertically and horizontally
Real-time usage metering
Library of image templates
Multi-language support

API
Easy integration with billing, monitoring systems
Role-based access control
Failover
Pricing model flexibility (utility basis, plan basis,
packages, etc.)

Cloud Spectator | Implementing and Running Your own Cloud Service

Getting to Know OnApp

Getting to Know OpenStack

The OnApp Cloud was designed by former service providers with a

unique goal in particular: to create a platform tailored specifically for
providers, highlighting their direct needs and concerns as the
building blocks for creating the product. As a result, OnApp provides
a quick and easy-to-use, turnkey solution for many uses and users.
The solution can be deployed quickly, and with little support
intervention. OnApps clients typically praise their platforms
flexibility, as it does not impose specific provisioning or inflexible
billing models. User permissions/limits are granular, allowing for
high levels of customization. Customers are also offered access to
many different cloud services (public, private, hybrid, VPS). Pricing
structures are not restrictive, and can be fully customized to suit the
needs of the customer. These pricing models include hourly,
monthly, and tiered packages, and can also be modified with
performance requirements and specified availability zones.

OpenStack, originally a project by NASA, became a cloud

computing movement in 2010 when several companies including
Rackspace, AMD, Intel, Dell, and Cisco became involved.
OpenStack is free, open source cloud management software
released under the Apache 2.0 License.

OnApp has many other features, such as Content Delivery

Networks (CDNs), Anycast DNS capabilities and a tremendously
popular iPad/iPhone application to supplement their CMP solution.
OnApps Federated Cloud is one of the most fascinating things
about its service and will be detailed later on. Their implementation,
business model, and 24/7 technical support show a clear
commitment to help their customers be efficient and successful.
OnApp provides comprehensive support, with a 15-minute SLA
(average is an impressive 4 minutes). More importantly, OnApp
support is provided at no additional cost. The free support includes
implementation and support for significant upgrades; customers
typically upgrade 2-3 times per year. OnApps pricing model is
simple, transparent and all-inclusive. This goes back to OnApp
being designed from a service provider perspective, by former
service providers.
Out of the box, OnApp Cloud is a broad and extensive service with
everything you will need to get started quickly. The Cloud solution
tracks usage of any resource your customers need, including RAM,
vCPUs, IOPS, IPs, primary disk and backup disk. It allows you to
set different prices and pricing structures for those resources and
even calculates billing values accordingly, all while storing customer
payments. This is all part of a customizable and intuitive control
panel.

OpenStack has gained significant momentum through the backing

of 150+ companies that are contributing to the project. It is meant to
be highly customizable and configurable with the ability to provide
different networking (VLAN, Flat, FlatDHCP) and storage (AOE, IET
iSCSI, LVM volume RBD, Sheepdog, Solaris iSCSI HP SAN)
options. OpenStack Compute strives to be both hardware and
hypervisor agnostic. OpenStack is not seen as an easy, turnkey
platform; it requires a high level of configuration and understanding
because of the many components that must be stitched together.
Out of the box, OpenStack does not include many of the basic
features of most CMPs. OpenStack is best suited for
knowledgeable, tech-savvy providers and operators that want to
take the time to customize and configure their own solution. To that
note, OpenStack welcomes the integration of customized tools,
whether it is third party applications or customers writing/integrating
their own software.
OpenStacks recent Essex release focused on making the platform
more stable and easier to use. After its Diablo release, many early
adopters reported a considerable amount of bugs and instability.
OpenStack Compute (code-named Nova) was integrated with
Dashboard (self-service portal) and Identity (authentication system)
in the Essex release. The other components of OpenStack besides
Nova, Dashboard (code-named Horizon) and Identity (Keystone)
are: Image Service (Glance) and Object Storage (Swift).
Some analysts consider OpenStacks code immature, while others
point to its configurability and flexibility as the reason for the code
being the way it is. OpenStack is targeted at service providers with
large amounts of resources at their disposal: a significant amount of
capital and most importantly, technical expertise. In any case, timeto-market and costs are currently major concerns with OpenStack.

OnApp's cloud platform appeals to a wide range of service

providers. Launched in mid-2010, OnApp Cloud has since been
deployed by hundreds of service providers, including VPS.NET,
GMO, TDC and Peer1 Hosting.

Cloud Spectator | Implementing and Running Your own Cloud Service

Out-of-the-Box Features

OpenStack

OnApp

The following chart shows the features that each solution comes with before any customization or integration. OpenStack is hardly relevant in this
comparison because it provides only the bare bones. OpenStack emphasizes creativity and creation from scratch, while OnApp provides a strong
feature offering out of the box.

EASE OF USE
Implement in 1-2 Days
Integrated Load Balancing
User-Friendly Control Panel
Intelligent Deployment of VMs
Customer Self-Provisioning
Pre-Built Billing Integration
Image Library
Amazon EC2 API Support
Diskless Boot for Hypervisors
Usage Metering Presentation

x
*

x
x
x
x
x
x

x
x

Hypervisors Supported
Multi-Cloud Environment
Vertical Autoscaling
Clone VMs
Language Files
Object Storage
Block Storage
Utility and Plan-Based Billing

3**

7
x
x

x
x

Open-Source
Customizable Control Panel with Branding
Open API

Firewall Configuration
Role-Based Access Control
VM Backup
Automatic VM Failover
Track and Limit Resource Utilization

Free Implementation Support

Free Tech Support

x
x

FLEXIBILITY

CUSTOMIZABILITY

SECURITY & RELIABILITY

SUPPORT
*Full functionality coming in OnApp Cloud v3 rolling out in July.
**VMware will be supported in July.

Cloud Spectator | Implementing and Running Your own Cloud Service

Additional Services Available from OnApp

Cloud Federation, CDN and DNS:
OnApps federated cloud concept is one of the most impressive aspects of its platform.
OnApp sees its cloud platform as a common 'hub' for service providers that takes care
of core aspects of the cloud service (provisioning, billing, failover, scaling, UI,
permissions and so on), while enabling providers to add value to end users with specific
applications, services, pricing models and support. Providers using the platform are
connected by a global marketplace where they may act in the role of buyer, seller, or
both.
Buyers on the federated marketplace can expand their cloud services by purchasing
capacity and other services from other members of the federation. This enables
providers to compete in markets they would otherwise not be able to reach, and is
particularly significant for smaller players, who can use the federation to globalize their
offering. If a provider is located in the US and wants to sell infrastructure in Japan, they
can obtain unused infrastructure in Japan through OnApps Marketplace and be able to
provide cloud services to clients in Japan in just a couple of minutes. This sort of reseller mentality encourages expansion and marketability.
Sellers on the marketplace can monetize their unused infrastructure and capitalize on
their specialisms (for example, in applications or specific industries) by selling to other
providers through the marketplace. OnApp acts as a broker in these relationships to
make the process of federation simple and transparent for all participants.

Providers using the OnApp

platform are connected by a global
marketplace where they may act in
the role of buyer, seller, or both.

Buyers on the federated

marketplace can expand their
cloud services by purchasing
capacity and other services from
other members of the federation.
This enables providers to compete
in markets they would otherwise
not be able to reach, and is
particularly significant for smaller
players, who can use the
federation to globalize their
offering.

OnApps CDN platform is the first example of this federated model at work. Service
providers can use OnApp CDN to monetize unused infrastructure, and to extend their
cloud presence globally through OnApp's federated CDN marketplace. This offers a
way for providers to create new service areas and revenue streams without additional
capital expenditure on infrastructure. OnApp CDN currently has more than 80 locations
available for providers to subscribe to, on demand, and appears to still be growing.
OnApps CDN uses a global Anycast DNS service that OnApp hosts at datacenters
around the world. This service is responsible for routing end user content requests to
the CDN's most appropriate point of presence for delivering that content, based on the
user's location and the availability of each location in the CDN. An interesting benefit of
this for providers using OnApp Cloud is that they can also use this capability to manage
DNS for their hosting clients. These tools are available through the OnApp Control
Panel at no additional cost.

Storage:
OnApps storage offering, currently in beta, integrates with OnApp Cloud and provides
fast, reliable and, most of all, affordable enterprise-class storage at no additional cost.
OnApps solution solves common problems in the industry: lack of scalability and
performance for low-cost SANs, as well as the complexity and lack of reliability of open
source offerings. Built on commodity hardware, OnApps Storage product provides
levels of scalability and efficiency that are difficult to find in todays market. The modular
design of this offering allows providers to add additional storage capacity without having
to rebuild the whole SAN. Also, no centralized disk management system means no
single point of failure, signaling reliability. OnApps Smart Disk Technology makes your
SAN a smart, self-managing unit, capable of making decisions about data
synchronization, load balancing, and moving content around efficiently.

OnApps solution solves

common problems in the
industry: lack of
scalability and
performance for low-cost
SANs, as well as the
complexity and lack of
reliability of open source
offerings.

Cloud Spectator | Implementing and Running Your own Cloud Service

Implementing Cloud Management Platforms

Minimum Required Hardware
OnApp

OpenStack

1 x OnApp Controller Server

8GB RAM (16GB+ Recommended)

Dual or Quad Core 2Ghz+

100GB RAID 1

2 x 1GB NIC
2 x Hypervisors

8GB+ RAM

Quad Core 2Ghz+

30GB HD (SSD recommended)

3 x 1GB NIC (4 recommended)

Cloud Controller Node

12GB RAM

64-bit x86 CPU (32-bit will work)

30GB (SATA, SAS or SSD)

1 x 1GB NIC (2 recommended)

Compute Nodes

32GB RAM (2GB OK for test)

64-bit x86 CPU (must be same architecture as controller)

30GB SATA

2 x 1GB NIC

1 x Data Store

1TB block storage

iSCSI, AoE or Fiber it can even be on a shared SAN

1 x Backup Store

2TB+ NAS

Alternatively, a large HD can be used on the Controller Server

Data Store: could be included in Controller Node

2TB RAID 1
Backup Store not Included in Requirements

Required Software
OnApp

OpenStack
Platform: OnApp Cloud
OS: CentOS 5
Hypervisor: Xen, KVM or VMWare VSPP 3.0
Billing Software

Platform: OpenStack
OS: OpenStack is available for all major Linux distributions.
Hypervisor: XCP, XenServer, KVM, ESX, ESXi, LXC, QEMU
LDAP
Open Source Monitoring Software
Metering & Billing Software

Implementation Time Frame

OnApp

OpenStack
1 to 2 days

1 Week for out-of-the-box implementation using Crowbar

(very limited functionality)
2 - 6 months for a complete solution with the basic features
listed on page 1 (timeframe depends on complexity of
implementation)

Cloud Spectator | Implementing and Running Your own Cloud Service

Total Cost of Ownership in 3 Years

For more information, please see TCO Methodology on page 8.

48 Cores, 1 Cloud
CMP License
Open LDAP
Open Monitoring
Metering & Billing
Implementation Support
Technical Support
Upgrade Support
Total:

Year 1
OnApp
$6,960
$2,000
$8,960

Year 2
OpenStack
$14,000
$150,000
$60,000
$90,000
$314,000

OnApp
$6,960
$2,000
$8,960

OpenStack
$17,000
$200,000
$60,000
$120,000
$397,000

OnApp
$25,200
$3,000
$28,200

OpenStack
$22,000
$250,000
$66,000
$150,000
$488,000

OnApp
$55,622
$5,000
$60,622

OpenStack
$31,000
$350,000
$75,000
$210,000
$666,000

OnApp
$87,360
$8,000
$95,360

OpenStack
$113,000
$500,000
$240,000
$300,000
$1,153,000

OnApp
$602,280
$8,000
$610,280

Year 3
OpenStack
$7,000
$60,000
$90,000
$157,000

OnApp
$6,960
$2,000
$8,960

OpenStack
$10,000
$60,000
$120,000
$190,000

OnApp
$25,200
$3,000
$28,200

OpenStack
$15,000
$66,000
$150,000
$231,000

OnApp
$55,622
$5,000
$60,622

OpenStack
$24,000
$75,000
$210,000
$309,000

OnApp
$87,360
$8,000
$95,360

OpenStack
$106,000
$240,000
$300,000
$646,000

OnApp
$602,280
$8,000
$610,280

OpenStack
$7,000
$60,000
$90,000
$157,000

OnApp Total: $26,880

OpenStack Total: $628,000

200 Cores, 1 Cloud

CMP License
Open LDAP
Open Monitoring
Metering & Billing
Implementation Support
Technical Support
Upgrades
Total:

Year 1
OnApp
$25,200
$3,000
$28,200

Year 2

Year 3
OpenStack
$10,000
$60,000
$120,000
$190,000

OnApp Total: $84,600

OpenStack Total: $777,000

504 Cores, 2 Clouds

CMP License
Open LDAP
Open Monitoring
Metering & Billing
Implementation Support
Technical Support
Upgrades
Total:

Year 1
OnApp
$55,622
$5,000
$60,622

Year 2

Year 3
OpenStack
$15,000
$66,000
$150,000
$231,000

OnApp Total: $181,866

OpenStack Total: $950,000

1,000 Cores, 3 Clouds

CMP License (20% discount)
Open LDAP
Open Monitoring
Metering & Billing
Implementation Support
Technical Support
Upgrades
Total:

Year 1
OnApp
$87,360
$8,000
$95,360

Year 2

Year 3
OpenStack
$24,000
$75,000
$210,000
$309,000

OnApp Total: $286,080

OpenStack Total: $1,284,000

10,000 Cores, 20 Clouds

CMP License (30% discount)
Open LDAP
Open Monitoring
Metering & Billing
Implementation Support
Technical Support
Upgrades
Total:

Year 1
OnApp
$602,280
$8,000
$610,280

Year 2

Year 3
OpenStack
$106,000
$240,000
$300,000
$646,000

OnApp Total: $1,830,840

OpenStack Total: $2,445,000

Cloud Spectator | Implementing and Running Your own Cloud Service

Conclusion
OnApp is the best choice for providers because it delivers an all-in-one solution with features such as
flexible user management, metering calculations, billing flexibility, autoscaling and load balancing.
OnApp was built specifically for the service provider market, and it shows. OnApp is the best choice for providers because it delivers an all-in-one
solution with features such as flexible user management, metering calculations, billing flexibility, autoscaling and load balancing. The feature
offering does not complicate running a provider business, however, because of OnApps focus on ease of use. OnApp is best suited for service
providers looking to get to market quickly, control their costs and see a return on investment as soon as possible.
OnApps strengths also lie in the area of price, ease of use and speed to market. As the TCO analysis shows, OnApp is the less expensive choice
for most deployments. OnApp gives its customers every chance to be successful through its different services like the OnApp Marketplace and its
free support. OnApps new storage functionality provides another potential revenue stream without any additional cost. Implementing OnApp is
easy and fast; you can have your business running within one to two days. OnApps support team also helps you through the implementation
process to make sure everything is smooth, at no additional cost. OnApp is a well-tested and mature solution that has been implemented by many
reputable service providers. Maintaining a high level of service and profitability is much easier with OnApp.

As the OpenStack movement matures, implementation costs may come down, different flavors of
OpenStack may be brought to market, and more open source software that helps build out functionality
may materialize.
OnApp Cloud and OpenStack are very different from each other, and thus, cater to different markets. OpenStack is more favorable for service
providers looking to initiate extremely large deployments with a 100% customizable solution. This is not to say OnApp isnt highly customizable
because it is, but OpenStack has the advantage of being an open source solution so anything is possible. OpenStack is very basic in nature,
allowing for this extensive configuration, but at the cost of a much longer and more involved deployment process, sacrificing time and resources.
OpenStack is seen as production ready by some and not even close by others; opinions on OpenStack are highly variable. It seems that this
product is a much better fit for enterprises than service providers. Out of the box, OpenStack is essentially a private cloud that can be
implemented using Dells Crowbar for about $9,000-$10,000. OpenStack can be deployed on any type of hardware, using almost any type of
hypervisor. As previously mentioned, implementing and running OpenStack for service providers is much more complicated, leading to high costs
for implementation and support. As the OpenStack movement matures, implementation costs may come down, different flavors of OpenStack may
be brought to market, and more open source software that helps build out functionality may materialize. In its current state, OpenStack makes
more sense for enterprises than service providers, while OnApp operates as a complete and comprehensive solution built specifically for service
providers.

In its current state, OpenStack makes more sense for enterprises than service providers, while OnApp
operates as a complete and comprehensive solution built specifically for service providers.

Cloud Spectator | Implementing and Running Your own Cloud Service

TCO Methodology
The following will outline the assumptions, methods and strategies used in the Total Cost of Ownership (TCO) measurements for OnApp and OpenStack. It should be noted that the
following core assumptions played a critical role in the overall calculation.
1.
Hardware costs are equal
2.
Estimates are calculated on the basis of what would be needed for a full service provider solution
3.
Estimates assume there is no in-house expertise on OpenStack and all support is outsourced
4.
Only 1 controller
5.
Only nodes are scaled up
6.
No cost for operating systems or hypervisors

OnApp
CMP License
The cost of the CMP license is highly variable, initiating incentives for larger deployments. OnApp prices for deployments above 200 cores are based on a two year
committed deal. Additionally, customers with large deployments (over 1,000 cores) are assumed to be resellers and are provided a discount. These discounts increase
with the size of the deployment.

Metering & Billing

Since OnApps platform already provides metering, third party billing software is the only additional component needed for full service capabilities. Cost for this software
was calculated by using the pricing structure of one of OnApps partners, which includes a base rate and a variable rate that is based on the number of customers
invoiced. There is an option that allows the provider to pay a high base rate with no variable rate, which becomes more economical with a large amount of customers. For
the TCO calculation, we assumed 4 VMs per core and 2 VMs per customer.
OnApps implementation, technical support and upgrades are free, which is the biggest reason why OnApps TCO is much more attractive. The total price estimates for
OnApp are represented dually by the CMP license and billing software license.

OpenStack
CMP License
OpenStack is open-source software, and doesnt require the purchase of a license. This is an important distinction.

Open LDAP & Open Monitoring

Since there are currently open source software offerings for these capabilities, no costs were assumed.

Metering & Billing

Research of leading providers for OpenStack metering and billing software has shown that an additional charge is necessary for the installation of an OpenStack billing
system, leading to an inflated initial rate. Beyond the implementation after the first year, the billing rate is dually conceived: a fixed base along with a variable rate that
factors in a percentage of the providers revenue. Any increases in revenue result in a higher price. The assumptions used in this calculation include an 80% usage of
capacity (leaving 20% for reserve), presumed by average resource pricing from the cloud industry according to Cloud Spectators Pricing Report.

Implementation Support
With no in-house OpenStack expertise, significant implementation charges are required in the first year, a direct result of the basic nature of OpenStack. These costs are
for turning OpenStack into a complete solution for service providers that can rival OnApps offering. Through research of leading companies providing OpenStack
implementation support, we concluded that as OpenStack deployments increase in size, complexity also increases. As a result, implementation costs are higher with large
deployments to supplement the technical complexity. These costs are exclusive to the first year of the deployment. OpenStack requires an extensive amount of
configuration and time to create a complete solution for service providers, which is the reason for the high implementation costs.

Technical Support
Market research shows that OpenStack support is typically billed at a fixed rate up to a certain amount of resources, and increases with larger deployment sizes.

Upgrades
OpenStack produces two new versions every year. This analysis assumes that providers upgrade after every new version OpenStack releases. Research of companies
providing OpenStack upgrade support has led to the assumption that pricing for upgrades is about 30% of the original implementation cost per upgrade (60% per year).
The Essex release provides an upgrade path for the next version of OpenStack (Folsom), which decreases costs because a provider would not have to start clean with a
new version. Upgrades can still be very expensive because of the amount of labor involved time frames can be anywhere from one week to three months. Although
these costs are extremely expensive in the analysis, the estimates are conservative.