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Patrick Shuff

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Cloud computing

Great, just what we need. Another term that is a marketing buzz saw. Unfortunately, this one makes sense. Cloud Computing. First there was parallel processing. Then there was grid computing which is a very confusing term. Oracle and Amazon announced yesterday that are pre-built. What does this really mean? It means that you can have a static ip address allocated to some processors and memory hosted by Amazon using preconfigured images created by Oracle. It also means that you can request a higher level of service as needed. More processor, more storage, and more memory by requesting a new service or expanded service. Oracle has agreed to shorter terms for licensing if you are testing or trying out services. Licensing can go from one year to five years if you choose to lease the service with a one year price coming in at 20% of the list price. The cost is the part that appears to be the interesting part. The cost of a processing unit is $0.10 for a small instance upto $0.80 for a large instance per hour. This ranges from $72/month ($864/year) to $576/month ($6912/year) to cover the cost of the processor and memory. If you want to back up your database into persistent storage you will need to pay $253/month ($3042/year). What this means is that for a small startup, the cost of deploying an Oracle database will work out to be - $864/year hardware cost - $1500/year storage cost (800G of storage for OS, Database, and data) - $3500/year for the database (one year lease Standard Edition) --------------- $5864/year This is pretty amazing considering the cost of configuring the same system to run Windows and SQL Server or Linux and MySQL. You truly don't need a DBA or Unix admin full time on these systems so you can assume that you can outsource these at $1K/day for roughly one day a month. This brings the grand total to run a system to $30K with $24K of that being people to support the system. At this point the labor cost is roughly 4x that of the hardware and software acquisition and management cost. For a small company this is significant. This is roughly what many spend on advertising and can provide an alternative way of communicating with customers. Think of a doctors office or a small law firm. Think of a car dealership or a small chain or restaurants. It allows the businesses to create a one on one relationship at all times of the day with their customers. Interesting announcement and great possibilities. more later.....