Opportunities and Challenges

Trends (presented in Section 2.2.1) indicate that clouds are set to trigger compe-tition among providers to create value-added service propositions, novel selling mechanisms and intensify demands for reliable service delivery. In this context, clouds incarnate a self-reinforcing Krebs cycle, where they catalyze innovation which in turn increases their demand even more [8]. Growth in such large dy-namic systems is best managed through automated and autonomic techniques that control the entire service lifecycle [9]. Management of cloud based services is finely related with the management of cloud infrastructure. This duality holds many innovation opportunities, which nevertheless also embody challenges. We expose these opportunities and challenges by presenting two key perspectives on the SLA lifecycle as shown in Fig. 3.2, namely:

• Value Creation Perspective.

• Infrastructure Management Perspective.

3.2.1. Value Creation Perspective

This perspective deals with the marketing opportunities for SLA-based cloud computing and comprises the first two phases i.e., service development and SLA negotiation. Much focus in prior works has been paid to technical aspects such as the ones we address in the infrastructure management perspective, yet it is the somewhat neglected value creation perspective that determines a provider’s

3.2. Opportunities and Challenges position or share in the cloud market. Value is usually derived when service providers collaborate in a service chain, which may have a complex hierarchy.

This leads to business value networks where providers act as producer or con-sumer of a service. NESSI (a European consortium of over 300 ICT companies and research community focusing on networked services) highlights value net-works as viable business models for ICT infrastructures [14]. ICT providers such as cloud providers are keen to explore sustainable business models to maximize infrastructure use, so profits can be accumulated over amortized investments.

Added-value service propositions represent composite or aggregated services spanning multiple providers and administrative domains. The fundamental issue is to configure the service instance by resolving SLA dependencies throughout the service chain according to the SLA requirements of the customer. Here, nego-tiation is an acclaimed business model to dynamically engage a customer and the string of provider(s), in order to resolve SLA dependencies among background services and infrastructure resources. Besides collaboration, negotiation mech-anisms serve to differentiate providers and may lead to a monopoly in certain market or market segment, such as enjoyed by Amazon incase of spot instances.

In refined terms, value creation demands methods to develop and investigate negotiation mechanisms that engage stakeholders in accommodating interactions to customize a service, resolve QoS dependencies or preference conflicts. Such methods would be fundamental in nascent cloud markets where IaaS, PaaS and SaaS based providers are already chaining together to quickly proliferate added-value services. Current offerings however lack the notion of negotiable SLAs, but the prevalent take-it-or-leave-it SLAs do not meet demands to customize services by mutually agreeing on service level guarantees and liabilities [15, 98].

Automated negotiations, steered by negotiation protocols and complimented by intelligent negotiation strategies can address this challenge. Therefore, in this work, value is created by means of negotiation protocols and negotiation strategies. Together, these tools can sustain competitive advantage for cloud providers. Negotiation protocols not only facilitate collaboration between parties, but can also fuel competition among providers by diversifying selling mechanisms.

This gives providers the much coveted differentiating factor and can lead to disruptive new service propositions with negotiable SLAs replacing the rigid take-it-or-leave-it SLAs. However, since a single protocol may not be used in all scenarios, therefore the challenge is to develop and operate shared protocols in

Chapter 3. SLA Management in Cloud Computing

a seamless manner at all ends of the service chain. Similarly, no single strategy outperforms others in all negotiation scenarios and test-and-trial is the usual approach to estimate outcomes in terms of individual utility and social welfare of the overall market.

Negotiation driven value creation ultimately envisions an open, distributed and inter-operable system of marketplaces. Ideally, a party should have the means to establish a foothold in multiple markets and create SLAs whose business worth is more than the best alternative to no agreement (BATNA) [25].

3.2.2. Infrastructure Management Perspective

The infrastructure management perspective comprises the phases of implemen-tation, execution, assessment and decommission of SLAs. Arguably, the most important objectives of cloud providers are cost savings and customer satisfac-tion. Upon closer inspection, infrastructure management perspective reveals a blend of technical, ecological, economical and customer relationship aspects.

Infrastructure management primarily aims at improving machine utilization.

It is well known that data centers commonly utilize only 10-20% of their server resources [124] while clouds can increase utilization upto 70% [15]. Low utiliza-tion wastes energy, which is economically not viable and raises ecological con-cerns. In 2010, data centers consumed between 1.1%-1.5% of global energy use [9]. However, improving utilization to save power costs risks over provisioning, which degrades availability or performance of deployed services. The Interna-tional Working Group on Cloud Computing Resiliency (IWGCR) reported that in period 2007-12, major cloud providers served an average of 99.9% availability, which amounts to 7.5 hours of unavailability per service per year. Many indus-try adopters remain unaware of this fact [16] and demand more (performance related) QoS guarantees such as response times, latency or throughput [73].

Thus, utilization needs to be improved considering the vital notion of SLA violations, which must include performance degradation due to contention on resources as well as due to migrations. The former can assess if system resources such as CPU, memory, disk or network bandwidth are being utilized beyond a safe limit as this leads to machine failures. The latter can estimate unavailability or performance compromises caused by migration of deployment units belonging to a service e.g., virtual machines or containers. Moreover, modern clouds are built to target multiple availability zones. However, such large scale of cloud,

3.3. Related Work