Bank of America recently decided to revamp its IT operations around private cloud infrastructure. The bank is seeking to streamline costs and increase it responsiveness to rapidly changing demands. In this regard, it’s not alone, as companies around the world ramp up investment in on-premises setups, but Bank of America’s project is particularly ambitious and appears to go well beyond the heavily virtualized data centers that some organization pass off as “private clouds.”
Bank of America sets up proprietary and OpenStack solutions for private cloud
Bank of America is counting on the private cloud to meet the demands of modern IT. The bank, which currently has more than $2 trillion of assets under management, is overhauling its data centers, lessening its focus on differentiated storage, networking, compute and switch technologies and instead aiming for a highly customized setup.
More specifically, its IT managers are focusing on software-defined appliances, with x86 chips and copious amounts of memory stuffed into a single box. Depending on the current workflows, software can transform these white-boxes into the appropriate device.
Although Bank of America has not disclosed the particular vendors it’s working with, it has characterized them as companies focused on software-defined computing and industry-standard hardware. It is using one proprietary solution and another implementation based on OpenStack, the open source platform for building private and hybrid clouds. While many of the workloads will remain on-premises, Bank of America stated that some may eventually move to public clouds from Amazon Web Services or other providers.
Still, the bank’s new private cloud will roll out slowly. It is running approximately 200 workloads on the test infrastructure, and plans to put about 7,000 of them into production this year. That’s a small portion of all Bank of America cloud operations, but migration could pick up steam in 2015.
Setting up a reliable private cloud will require new skill sets, with more emphasis on software and perhaps less on equipment. This is one of the key challenges that Bank of America faces as it tries to achieve both greater IT scale and lower costs – the goal is to reduce expenses by 50 percent compared to today’s data centers.
The private cloud market will is still strong across the globe
The Bank of America deployment is ambitious, and it’s indicative of ongoing enterprise interest in private infrastructure based on open cloud hardware and software. InformationWeek’s Private Cloud report from last year found that only 23 percent of respondents were not interested in private clouds – the rest of them reported that they used these implementations to run some or all of their applications, or were testing solutions that would do so in the future.
IDC had similar findings after studying European companies. More than half of European enterprises with more than 250 employees use private cloud, and these organizations and cloud service providers will combine to spend more than $10 billion per year on related projects in 2017. When adding in the other services needed to power private deployments, the figure reaches nearly $30 billion.
“Private cloud has an important role to play in the IT landscape over the next few years,” stated Mette Ahorlu research director at IDC European Services. “The market will provide tremendous opportunities for vendors, but competition will be fierce. Clients are very conscious of using cloud to reduce cost and increase efficiency and look for business impact. Despite the optimism about what the technology can do, this is a market driven by the need for business transformation, and cloud is the enabler.”
