21CSE362T NEHA GUPTA

Define Cloud Computing, Cloud Types, Characteristics of Cloud Computing, Benefits and
disadvantages of cloud systems, Assessing the Value Proposition, Measuring the Cloud’s Value,
Capital Expenditures,
Total Cost of Ownership, Service Level Agreements, Licensing Models

UNIT-1
Introduction to cloud computing

The term cloud refers to a network or the internet. It is a technology that uses remote servers
on the internet to store, manage, and access data online rather than local drives. The data can
be anything such as files, images, documents, audio, video, and more.
There are the following operations that we can do using cloud computing:

∙ Developing new applications and services

∙ Storage, back up, and recovery of data
∙ Hosting blogs and websites
∙ Delivery of software on demand
∙ Analysis of data
∙ Streaming videos and audios

Why Cloud Computing?

∙ Small as well as large IT companies, follow the traditional methods to provide the IT
infrastructure. That means for any IT company, we need a Server Room that is the basic
need of IT companies.
∙ In that server room, there should be a database server, mail server, networking, firewalls,
routers, modem, switches, QPS (Query Per Second means how much queries or load will be
handled by the server), configurable system, high net speed, and the maintenance engineers.
∙ To establish such IT infrastructure, we need to spend lots of money. To overcome all these
problems and to reduce the IT infrastructure cost, Cloud Computing comes into existence.

Characteristics of Cloud Computing

The characteristics of cloud computing are given below:
1) Agility
The cloud works in a distributed computing environment. It shares resources among
users and works very fast.
2) High availability and reliability
The availability of servers is high and more reliable because the chances of infrastructure
failure are minimum.
 3) High Scalability
21CSE362T NEHA GUPTA
Cloud offers "on-demand" provisioning of resources on a large scale, without having
engineers for peak loads.
4) Multi-Sharing
With the help of cloud computing, multiple users and applications can work more
efficiently with cost reductions by sharing common infrastructure.
5) Device and Location Independence
Cloud computing enables the users to access systems using a web browser regardless of
their location or what device they use e.g. PC, mobile phone, etc. As infrastructure is off
site (typically provided by a third-party) and accessed via the Internet, users can connect
from anywhere.
6) Maintenance
Maintenance of cloud computing applications is easier, since they do not need to be
installed on each user's computer and can be accessed from different places. So, it
reduces the cost also.
7) Low Cost
By using cloud computing, the cost will be reduced because to take the services of cloud
computing, IT Company need not to set its own infrastructure and pay-as-per usage of
resources.
8) Services in the pay-per-use mode
Application Programming Interfaces (APIs) are provided to the users so that they can
access services on the cloud by using these APIs and pay the charges as per the usage of
services.

2. Cloud deployment models, Private, Public, Hybrid, community cloud

Types of Cloud
There are the following 4 types of cloud that you can deploy according to the organization's

needs-

∙ Public Cloud
∙ Private Cloud
∙ Hybrid Cloud
∙ Community Cloud
21CSE362T NEHA GUPTA
Public Cloud
Public cloud is open to all to store and access information via the Internet using the pay-per-usage
method. In public cloud, computing resources are managed and operated by the Cloud Service
Provider (CSP).
Example: Amazon elastic compute cloud (EC2), IBM SmartCloud Enterprise, Microsoft, Google
App Engine, Windows Azure Services Platform.
Advantages of Public Cloud
There are the following advantages of Public Cloud -

∙ Public cloud is owned at a lower cost than the private and hybrid cloud.
∙ Public cloud is maintained by the cloud service provider, so do not need to worry about the
maintenance.
∙ Public cloud is easier to integrate. Hence it offers a better flexibility approach to consumers. ∙
Public cloud is location independent because its services are delivered through the internet. ∙
Public cloud is highly scalable as per the requirement of computing resources. ∙ It is accessible
by the general public, so there is no limit to the number of users.

Disadvantages of Public Cloud

∙ Public Cloud is less secure because resources are shared publicly.

∙ Performance depends upon the high-speed internet network link to the cloud provider. ∙
The Client has no control of data.

Private Cloud
Private cloud is also known as an internal cloud or corporate cloud. It is used by organizations to
build and manage their own data centers internally or by the third party. It can be deployed using
Open source tools such as Openstack and Eucalyptus.
Based on the location and management, National Institute of Standards and Technology (NIST)
divide private cloud into the following two parts-

∙ On-premise private cloud

∙ Outsourced private cloud
21CSE362T NEHA GUPTA
Advantages of Private Cloud
There are the following advantages of the Private Cloud -

∙ Private cloud provides a high level of security and privacy to the users.
∙ Private cloud offers better performance with improved speed and space capacity. ∙ It allows the
IT team to quickly allocate and deliver on-demand IT resources. ∙ The organization has full
control over the cloud because it is managed by the organization itself. So, there is no need for
the organization to depends on anybody.
∙ It is suitable for organizations that require a separate cloud for their personal use and data
security is the first priority.

Disadvantages of Private Cloud

∙ Skilled people are required to manage and operate cloud services.

∙ Private cloud is accessible within the organization, so the area of operations is limited. ∙
Private cloud is not suitable for organizations that have a high user base, and organizations that
do not have the prebuilt infrastructure, sufficient manpower to maintain and manage the cloud.

Hybrid Cloud
Hybrid Cloud is a combination of the public cloud and the private cloud. We can
say: Hybrid Cloud = Public Cloud + Private Cloud
Hybrid cloud is partially secure because the services which are running on the public cloud can be
accessed by anyone, while the services which are running on a private cloud can be accessed only
by the organization's users.
Example: Google Application Suite (Gmail, Google Apps, and Google Drive), Office 365 (MS
Office on the Web and One Drive), Amazon Web Services.
21CSE362T NEHA GUPTA

Advantages of Hybrid Cloud

There are the following advantages of Hybrid Cloud -

∙ Hybrid cloud is suitable for organizations that require more security than the public cloud. ∙
Hybrid cloud helps you to deliver new products and services more quickly. ∙ Hybrid cloud
provides an excellent way to reduce the risk.
∙ Hybrid cloud offers flexible resources because of the public cloud and secure resources
because of the private cloud.

Disadvantages of Hybrid Cloud

∙ In Hybrid Cloud, security feature is not as good as the private cloud.

∙ Managing a hybrid cloud is complex because it is difficult to manage more than one type of
deployment model.
∙ In the hybrid cloud, the reliability of the services depends on cloud service providers.

Community Cloud
Community cloud allows systems and services to be accessible by a group of several organizations
to share the information between the organization and a specific community. It is owned, managed,
and operated by one or more organizations in the community, a third party, or a combination of
them.
Example: Health Care community cloud
21CSE362T NEHA GUPTA

Advantages of Community Cloud

There are the following advantages of Community Cloud -

∙ Community cloud is cost-effective because the whole cloud is being shared by several
organizations or communities.
∙ Community cloud is suitable for organizations that want to have a collaborative cloud with
more security features than the public cloud.
∙ It provides better security than the public cloud.
∙ It provides collaborative and distributive environment.
∙ Community cloud allows us to share cloud resources, infrastructure, and other capabilities
among various organizations.

Disadvantages of Community Cloud

∙ Community cloud is not a good choice for every organization.

∙ Security features are not as good as the private cloud.
∙ It is not suitable if there is no collaboration.
∙ The fixed amount of data storage and bandwidth is shared among all community members. ∙
Difference between public cloud, private cloud, hybrid cloud, and community cloud - ∙ The
below table shows the difference between public cloud, private cloud, hybrid cloud, and
community cloud.

Parameter Public Cloud Private Cloud Hybrid Cloud Community Cloud

Host Service Enterprise (Third Enterprise (Third Community

provider party) party) (Third party)

Users General public Selected users Selected users Community

members
21CSE362T NEHA GUPTA
Access Internet Internet, VPN Internet, VPN Internet, VPN

Owner Service Enterprise Enterprise Community

provider

3. Cloud services: IaaS, PaaS, SaaS

There are the following three types of cloud service models -

1. Infrastructure as a Service (IaaS)

2. Platform as a Service (PaaS)
3. Software as a Service (SaaS)

Infrastructure as a Service (IaaS)

IaaS is also known as Hardware as a Service (HaaS). It is a computing infrastructure managed
over the internet. The main advantage of using IaaS is that it helps users to avoid the cost and
complexity of purchasing and managing the physical servers.
Characteristics of IaaS
There are the following characteristics of IaaS -

∙ Resources are available as a service

∙ Services are highly scalable
∙ Dynamic and flexible
∙ GUI and API-based access
∙ Automated administrative tasks

Example: DigitalOcean, Linode, Amazon Web Services (AWS), Microsoft Azure, Google Compute
Engine (GCE), Rackspace, and Cisco Metacloud.
Platform as a Service (PaaS)
PaaS cloud computing platform is created for the programmer to develop, test, run, and manage the
applications.
Characteristics of PaaS
There are the following characteristics of PaaS -

∙ Accessible to various users via the same development application.

∙ Integrates with web services and databases.
∙ Builds on virtualization technology, so resources can easily be scaled up or down as per the
 organization's need.
21CSE362T NEHA GUPTA ∙ Support multiple languages and frameworks.
∙ Provides ability to "Auto-scale".

Example: AWS Elastic Beanstalk, Windows Azure, Heroku, Force.com, Google App Engine,
Apache Stratos, Magento Commerce Cloud, and OpenShift.
Software as a Service (SaaS)
SaaS is also known as "on-demand software". It is a software in which the applications are hosted
by a cloud service provider. Users can access these applications with the help of internet connection
and web browser.
Characteristics of SaaS
There are the following characteristics of SaaS -

∙ Managed from a central location

∙ Hosted on a remote server
∙ Accessible over the internet
∙ Users are not responsible for hardware and software updates. Updates are applied
automatically.
∙ The services are purchased on the pay-as-per-use basis

Example: BigCommerce, Google Apps, Salesforce, Dropbox, ZenDesk, Cisco WebEx, ZenDesk,
Slack, and GoToMeeting.

Benefits and challenges of cloud computing

Advantages of Cloud Computing

1) Back-up and restore data
Once the data is stored in the cloud, it is easier to get back-up and restore that data using the
cloud. 2) Improved collaboration
Cloud applications improve collaboration by allowing groups of people to quickly and easily share
information in the cloud via shared storage.
3) Excellent accessibility
Cloud allows us to quickly and easily access store information anywhere, anytime in the whole
world, using an internet connection. An internet cloud infrastructure increases organization
productivity and efficiency by ensuring that our data is always accessible.
4) Low maintenance cost
Cloud computing reduces both hardware and software maintenance costs for
organizations. 5) Mobility
Cloud computing allows us to easily access all cloud data via mobile.
21CSE362T NEHA GUPTA 6) IServices in the pay-per-use model
Cloud computing offers Application Programming Interfaces (APIs) to the users for access services
on the cloud and pays the charges as per the usage of service.
7) Unlimited storage capacity
Cloud offers us a huge amount of storing capacity for storing our important data such as documents,
images, audio, video, etc. in one place.
8) Data security
Data security is one of the biggest advantages of cloud computing. Cloud offers many advanced
features related to security and ensures that data is securely stored and handled.

Disadvantages of Cloud Computing

A list of the disadvantage of cloud computing is given below -
1) Internet Connectivity
As we know, in cloud computing, every data (image, audio, video, etc.) is stored on the cloud, and
we access these data through the cloud by using the internet connection. If you do not have good
internet connectivity, you cannot access these data. However, we have no any other way to access
data from the cloud.
2) Vendor lock-in
Vendor lock-in is the biggest disadvantage of cloud computing. Organizations may face problems
when transferring their services from one vendor to another. As different vendors provide different
platforms, that can cause difficulty moving from one cloud to another.
21CSE362T NEHA GUPTA 3) Limited Control
As we know, cloud infrastructure is completely owned, managed, and monitored by the service
provider, so the cloud users have less control over the function and execution of services within a
cloud infrastructure.
4) Security
Although, cloud service providers implements the best security standards to store important
information but, before adopting cloud technology, one should be aware that you will be sending all
your organization's sensitive information to a third party, i.e., a cloud computing service provider.
While sending the data on the cloud, there may be a chance that your organization's information is
hacked by Hackers.

Cloud Applications

Applications of Cloud Computing in real-world:

Cloud Service Providers (CSP) are providing many types of cloud services and now if we
sill cloud computing has touched every sector by providing various cloud applications.
Sharing and managing resources is easy in cloud computing that’s why it is one of the
dominant fields of computing. These properties have made it an active component in many
fields. Now let’s know some of the real-world applications of cloud computing. ∙ Online
Data Storage :
Cloud computing allows storing data like files, images, audios, and videos, etc on the cloud
storage. The organization need not set physical storage systems to store a huge volume of
business data which costs so high nowadays. As they are growing technologically, data
generation is also growing with respect to time, and storing that becoming problem. In that
situation, Cloud storage is providing this service to store and access data any time as per
requirement.
∙ Backup and Recovery:
Cloud vendors provide security from their side by storing safe to the data as well as
providing a backup facility to the data. They offer various recovery application for retrieving
the lost data. In the traditional way backup of data is a very complex problem and also it is
very difficult sometimes impossible to recover the lost data. But cloud computing has made
backup and recovery applications very easy where there is no fear of running out of backup
media or loss of data.
∙ Big data Analysis:
We know the volume of big data is so high where storing that in traditional data
management system for an organization is impossible. But cloud computing has resolved
that problem by allowing the organizations to store their large volume of data in cloud
storage without worrying about physical storage. Next comes analyzing the raw data and
21CSE362T NEHA GUPTA finding out insights or useful information from it is a big
challenge as it requires high quality tools for data analytics. Cloud computing
provides the biggest facility to organizations in terms of storing and analyzing big
data.
∙ Testing and development :
 Setting up the platform for development and finally performing different types of testing to
check the readiness of the product before delivery requires different types of IT resources
and infrastructure. But Cloud computing provides the easiest approach for development as
well as testing even if deployment by using their IT resources with minimal expenses.
Organizations find it more helpful as they got scalable and flexible cloud services for
product development, testing, and deployment.
∙ Anti-Virus Applications:
Previously, organizations were installing antivirus software within their system even if we
will see we personally also keep antivirus software in our system for safety from outside
cyber threats. But nowadays cloud computing provides cloud antivirus software which
means the software is stored in the cloud and monitors your system/organization’s system
remotely. This antivirus software identifies the security risks and fixes them. Sometimes also
they give a feature to download the software.
∙ E-commerce Applications:
Cloud-based e-commerce allows responding quickly to the opportunities which are
emerging. Users respond quickly to the market opportunities as well as the traditional e
commerce responds to the challenges quickly. Cloud-based e-commerce gives a new
approach to doing business with the minimum amount as well as minimum time possible.
Customer data, product data, and other operational systems are managed in cloud
environments.
∙ Cloud computing in education:
Cloud computing in the education sector brings an unbelievable change in learning by
providing e-learning, online distance learning platforms and student information portals to
the students. It is a new trend in education that provides an attractive environment for
learning, teaching, experimenting, etc to students, faculty members, and researchers.
Everyone associated with the field can connect to the cloud of their organization and access
data and information from there.
∙ E-Governance Application:
Cloud computing can provide its services to multiple activities conducted by the
government. It can support the government to move from the traditional ways of
management and service providers to an advanced way of everything by expanding the
availability of the environment, making the environment more scalable and customized. It
can help the government to reduce the unnecessary cost in managing, installing, and
21CSE362T NEHA GUPTA upgrading applications and doing all these with help of could
computing and utilizing that money public service.
∙ Cloud Computing in Medical Fields:
In the medical field also nowadays cloud computing is used for storing and accessing the
data as it allows storing data and accessing it through the internet without worrying about
 any physical setup. It facilitates easier access and distribution of information among the
various medical professional and the individual patients. Similarly, with help of cloud
computing offsite buildings and treatment facilities like labs, doctors making emergency
house calls and ambulances information, etc can be easily accessed and updated remotely
instead of having to wait until they can access a hospital computer.
∙ Entertainment Applications:
Many people get entertainment from the internet, in that case, cloud computing is the perfect
place for reaching to a varied consumer base. Therefore different types of entertainment
industries reach near the target audience by adopting a multi-cloud strategy. Cloud-based
entertainment provides various entertainment applications such as online music/video,
online games and video conferencing, streaming services, etc and it can reach any device be
it TV, mobile, set-top box, or any other form. It is a new form of entertainment called On
Demand Entertainment (ODE).
With respect to this as a cloud, the market is growing rapidly and it is providing various services
day by day. So other application of cloud computing includes social applications, management
application, business applications, art application, and many more. So in the future cloud computing
is going to touch many more sectors by providing more applications and services.

The Cloud Cube Model

The Open Group maintains an association called the Jericho Forum has an interesting model that
attempts to categorize a cloud network based on four dimensional factors called “Cloud Cube
Model" where the boundary between the client's network and the cloud begins and ends.

The four dimensions of the Cloud Cube Model are

• Physical location of the data: Internal (I) / External (E) determines your organization's
boundaries.

• Ownership: Proprietary (P) / Open (O) is a measure of not only the technology ownership, but of

interoperability, ease of data transfer, and degree of vendor application lock-in. • Security

boundary: Perimeterised (Per) / De-perimiterised (D-p) is a measure of whether the operation is

inside or outside the security boundary or network firewall.

21CSE362T NEHA GUPTA • Sourcing: Insourced or Outsourced means whether the service is
provided by the customer or the

service provider.
, Measuring the Cloud’s Value, Capital Expenditures,
Total Cost of Ownership, Service Level Agreements, Licensing Models

Assessing the Value Proposition

Assessing the Value Proposition in cloud computing involves evaluating the benefits an
organization can derive from moving to the cloud, compared to traditional on-premises
infrastructure or other alternatives.

The cloud provides several key advantages that can directly impact a business’s bottom line,
scalability, agility, and innovation. The value proposition isn't just about cost savings but
also the strategic and operational benefits that cloud computing enables.

The main benefits of cloud computing include scalability, flexibility, pay-per-use pricing,
reduced infrastructure management, faster deployment times, and potential cost savings
compared to traditional on-premises systems.

1.Measuring the Cloud’s Value

To measure the value of the cloud, organizations typically analyze metrics like cloud
utilization, performance (latency, response time), cost savings, operational efficiency gains,
improved agility, increased innovation potential, user satisfaction, and compliance with
service level agreements (SLAs), all while considering the specific business needs and goals
achieved by leveraging cloud services.
Key aspects to consider when measuring cloud value:

Cost per unit of compute: Analyzing how much is spent on cloud resources per unit of
processing power used.
21CSE362T NEHA GUPTA Resource utilization: Monitoring how effectively cloud resources
are being utilized to avoid over-provisioning.

Cost reduction compared to on-premise infrastructure: Assessing the cost savings

 achieved by migrating to the cloud.

Latency: Measuring the time taken for data to travel between different cloud components.

Uptime: Tracking the percentage of time a cloud service is available.

Throughput: Assessing the rate at which data can be transferred.

Response time: How quickly applications respond to user requests.

The virtualization of pooled resources—processors or compute engines, storage, and

network connectivity—optimizes these investments and allows the cloud provider to pass
along these economies to customers. Pooling also blurs the differences between a small
deployment and a large one because scale becomes tied only to demand.
Companies become cloud computing providers for several reasons:
• Profit: The economies of scale can make this a profitable business.
• Optimization: The infrastructure already exists and isn't fully utilized.
This was certainly the case for Amazon Web Services.
• Strategic: A cloud computing platform extends the company's products and defends
their franchise. This is the case for Microsoft's Windows Azure Platform.
• Extension: A branded cloud computing platform can extend customer relationships by
offering additional service options. This is the case with IBM Global Services and the
various IBM cloud services.
• Presence: Establish a presence in a market before a large competitor can emerge. Google
App Engine allows a developer to scale an application immediately. For Google, its office
applications can be rolled out quickly and to large audiences.
• Platform: A cloud computing provider can become a hub master at the center of many
ISV's (Independent Software Vendor) offerings.

2.Capital Expenditures (CapEx)

∙ Capital expenditure (CapEx) in cloud computing refers to the upfront investment required to
purchase and set up the necessary infrastructure and resources to run applications or services
on a cloud platform. In traditional on-premise IT environments, organizations would need to
invest in physical hardware, servers, storage devices, networking equipment, and data
centers. This would tie up capital in long-term assets.
∙ Operational Expenditures (OpEx):
21CSE362T NEHA GUPTA These are the ongoing costs associated with using cloud services,
such as monthly subscription fees, data transfer charges, and usage-based billing for
compute, storage, and network resources.

In the context of cloud computing, the idea of CapEx shifts. Most cloud providers (like
AWS, Azure, or Google Cloud) offer their services on a pay-as-you-go or subscription basis,
 which typically falls under operating expenditure (OpEx). This means that instead of buying
and maintaining physical infrastructure, organizations rent resources as needed, paying only
for what they consume.

That said, there could still be some CapEx involved in cloud computing, especially in hybrid or
private cloud scenarios. For example:

1. Private Cloud Setup: An organization may set up its own data center or a dedicated cloud
infrastructure, which requires significant upfront investment in hardware and software.

2. Hybrid Cloud Infrastructure: Organizations combining on-premises data centers with

public cloud services may need to make some capital investments in infrastructure to
connect the two environments or build additional layers of security.

3. Initial Licensing and Setup Fees: Certain cloud services may involve a significant initial
cost for licensing, specialized software, or proprietary hardware (e.g., a cloud-based
enterprise solution like SAP or Oracle).

3.Total Cost of Ownership (TCO)

TCO is a key metric used to measure its overall value by considering both the initial capital
expenditures (CapEx) and ongoing operational expenses (OpEx), allowing businesses to
compare the cost of cloud services against maintaining their own on-premises infrastructure,
taking into account factors like hardware, software, personnel, maintenance, and potential
intangible benefits like scalability and agility.

To assess the true value of cloud, organizations calculate their TCO by comparing the
combined costs of their existing on-premises infrastructure with the estimated costs of
migrating to the cloud, including both CapEx and OpEx components.
∙ Cost components in TCO analysis:
∙ Hardware costs: Cost of servers, storage devices, network equipment.
∙ Software costs: Operating system licenses, application licenses, management tools ∙
Personnel costs: IT staff required to manage on-premises infrastructure
∙ Energy costs: Power consumption of data centers
∙ Maintenance costs: Hardware and software upgrades, patching, maintenance
contracts
21CSE362T NEHA GUPTA ∙ Cloud service fees: Subscription costs, usage fees, data
transfer charges

To assist with estimating TCO, cloud providers often offer TCO calculators. These tools
allow businesses to input their current infrastructure usage, projected cloud usage, and
operational costs to compare potential savings when migrating to the cloud. Examples
include:
 ∙ AWS TCO Calculator

∙ Azure TCO Calculator

∙ Google Cloud TCO Calculator

These tools help organizations get a more accurate picture of how their costs might change when
they migrate to the cloud.

Service Level Agreement (SLA)

A service level agreement (SLA) is an outsourcing and technology vendor contract that outlines a
level of service that a supplier promises to deliver to the customer. It outlines metrics such as
uptime, delivery time, response time, and resolution time. An SLA also details the course of action
when requirements are not met, such as additional support or pricing discounts. SLAs are typically
agreed upon between a client and a service provider, although business units within the same
company can also make SLAs with each other.

Types of service level agreements

Here are some common types of service level agreements (SLAs).
Customer-level SLA
A customer-based SLA is an agreement that covers all of the services used by a customer. A
customer service level agreement covers specific details of services, provisions of service
availability, an outline of responsibilities, escalation procedures, and terms for cancellation.
Service-level SLA
A service-level SLA is a contract that details an identical service offered to multiple customers. For
example, if a service provider had multiple clients using its virtual help desk, the same service based
SLA would be issued to all clients.
Multi-level SLA
This type of agreement is split into multiple levels that integrate several conditions into the same
system. This approach is suitable for providers that have many customers using their product at
different price ranges or service levels. These differing service levels can be built into a multi-level
SLA.
Common elements of a service level agreement
There are a number of common elements that you can include in a service level agreement
(SLA). Agreement overview
An agreement overview includes the start and end dates of an SLA, details of the parties involved,
and an overview of the services included.
Description of services
A description of services outlines all services provided within an SLA. It details information such as
turnaround times, technologies and applications, maintenance schedules, and processes and
procedures.
Exclusions
This section describes all exclusions and exemptions that are agreed upon by both
parties. Service level objective
A service level objective (SLO) is an agreement within an SLA about a specific metric like response
time or uptime. Both parties agree to key service performance metrics backed by data.
21CSE362T NEHA GUPTA

Security standards
Both the service provider and the client use security standards to demonstrate the security measures
and protocols in place. This section also commonly includes non-disclosure agreements (NDAs)
and anti-poaching agreements.
Disaster recovery process
An SLA will often detail the process of disaster recovery and outline the mechanisms and processes
to follow in case of service failure of the vendor. This section also includes information on the
restarting process, including restart times and alerts.
Penalties
This section clearly states the penalties, financial or otherwise, that either side incurs if they fail to
live up to their SLA obligations.
Termination processes
There may come a time when you want to bring your agreement to an end. In addition to requiring a
notice period from either party, the SLA also clearly outlines the circumstances that permit
termination or expiration.
Review and change processes
It is important that you regularly review your SLA and any key performance indicators (KPIs) that
you are using to measure performance. Any large-scale changes in your requirements need to be
recorded in the agreement.
Signatures
The agreement to each item contained in the document is reviewed and signed by authorized
individuals and pertinent stakeholders from both sides. As long as the agreement is in effect, both
parties are bound by it.

SLA Lifecycle

Steps in SLA Lifecycle

1. Discover service provider: This step involves identifying a service provider that can meet the
needs of the organization and has the capability to provide the required service. This can be
done through research, requesting proposals, or reaching out to vendors.
2. Define SLA: In this step, the service level requirements are defined and agreed upon between the
service provider and the organization. This includes defining the service level objectives,
metrics, and targets that will be used to measure the performance of the service provider.
3. Establish Agreement: After the service level requirements have been defined, an agreement is
established between the organization and the service provider outlining the terms
21CSE362T NEHA GUPTA
and conditions of the service. This agreement should include the SLA, any penalties for non
compliance, and the process for monitoring and reporting on the service level objectives. 4. Monitor
SLA violation: This step involves regularly monitoring the service level objectives to ensure that
the service provider is meeting their commitments. If any violations are identified, they should be
reported and addressed in a timely manner.
5. Terminate SLA: If the service provider is unable to meet the service level objectives, or if the
organization is not satisfied with the service provided, the SLA can be terminated. This can be
done through mutual agreement or through the enforcement of penalties for non compliance.
6. Enforce penalties for SLA Violation: If the service provider is found to be in violation of the
SLA, penalties can be imposed as outlined in the agreement. These penalties can include
financial penalties, reduced service level objectives, or termination of the agreement.

License models in Cloud Computing

On-demand, pay-as-per-use, and short-range licensing models are termed as cloud computing
licensing models. It is suggested that clients should not agree long term agreements or contracts
with respect to volumes and time period. There are various licensing models which are described
below with the issues occurs in respective licensing models.
Types of cloud software and service licensing models

There are multiple cloud-based software and service licensing models available. Each model is
unique, so users are not forced into a one-license-fits-all-subscriptions situation:

∙ Subscription-based licensing. This option is one of the more popular cloud software licensing
models. Users pay a recurring monthly or annual fee to access the software, with the
flexibility to adjust subscriptions based on changing needs.

∙ Feature-based licensing. A feature-based license enables users to select and pay for specific
features or components so they can tailor their experience by choosing only the features they
need.

∙ Concurrent licensing. A more cost-effective license for small or changing businesses, it

enables a set number of users to access the software simultaneously.

∙ User-based licensing. This model ties licenses to specific users rather than devices or groups
of users. It is suited for BYOD and remote work environments.

∙ Consumption-based licensing. Otherwise known as pay-per-use or metered licensing, a

consumption-based license is cost-effective in certain use cases.

∙ Outcome-based licensing. Pricing ties to measurable business results from agreed-upon

metrics between the provider and customer