Sunday, February 15, 2009

HPC-Clouds will make money

One colleague asked. What makes you think that an HPC cloud will be in demand with commercial customers?

Because, I said, you own a computer site where you know what resources are used in the cloud, and how they are automatically re-allocated . You know when you have to go outside and “borrow” temporarily virtual resources. Thus you know how much your system costs. You also know who your users are and you bill them. If some users do not pay by definition, you have the tools to show your CIO how much the benevolence costs. And finally , you know whether the HPC Cloud or Private Cloud or Enterprise Cloud makes a profit, or looses money, and you can say exactly what this amount is in real time. Also by being easy to use, more people can have access to HPC and the profits will soars while the fees will go down.

If I tell now to a private customer to buy a Big Blue computer of IBM for $100M , he would look at the sales team bewildered. A $100M for what?

The customer says; “This is my business, this is not the Government and Department of Defense business, they spend money based on Visions, pure Science, Politics and Fear of Enemies. I have a business, and I have to make a living. This is why I am called - by you - a commercial account.”

The HPC Grid answers the idea of value perception from the commercial customer for HPC. Sure all Financial Traders and all risk takers need high powered HPC. They thought they could not afford it.

To make a sale, we need the customer to see the value of what they buy. For the first time, HPC can make money, in the hands of right people.

We are getting there for the HPC, via HPC-clouds. Big profits are about to be made. In HPC? Yes, in High Performance Computing, aka HPC. Click here for the TC Health cloud coverage on

Saturday, February 07, 2009

The HPC Cloud

What is HPC (High Performance Computing)? It is something big and expensive, hard to use and administrate, that consumes a lot of power, can be used only by an elite group of HPC specialists. No two HPC sites are similar, and mostly governments, non-profit agencies and the like are giving money. Traditionally - there is NO expectation of $ profits. HPC is sort of sacrificial price society pays to advance science in a political sense. The only measurable attribute to define success was the participation in the TOP-500 list. Using a 25-year old performance test, called LINPACK, the biggest goal is to rank any new HPC site among the top 500 according to some metrics called Rmax and Rpeak that mean absolutely nothing to the 99.99% of the population.

An HPC site is a cost center. It gobbles and gobbles money, in return for a favorable Rmax ranking

A large IT site uses 150 MW of energy and costs about $60 million to built. (see Horst Simon, Lawrence Berkeley National Lab, slide 20)

The electrical utility in California, - where I live - is named PG&E. Last month, quietly, they increased the rate for residential power to 24 cents per KW from 22 cents. At this rate, the HPC site will have to pay $36,000 per hour or, for full 365 days. As far as I know each day has 24 active computing hours, we land at $315M per year in energy costs alone. Even assuming a 90% discounted industrial electricity rate versus residential rates, this is still whooping $2.5 millions per month or $30M per year.

This is equivalent to employing 200 highly skilled engineers

Sure we can not have HPC installations like this in NYC, Sacramento or San Francisco itself. PG&E is an HPC show stopper in California, which ironically is the state where Silicon Valley is and where the great innovator companies have head offices.

Here is how HPC will be saved and becomes main stream: we will build a cloud named HPC-cloud that meets what the users seek. I mean any user, the type of user who uses Google today, will be able access a directly or indirectly an HPC-cloud. That significantly much larger number of HPC users (in comparison to the HPC elite today)

- will always have all resources s/he needs
- will pay only for what it uses
- will use the HPC applications as a service

The users will have no idea where the HPC-cloud is located and what's inside the HPC cloud. They are shielded from all complexity. Power Optimization software will turn off the power on all unused resources when demand is low. Turning the power on means that there are enough paying users to cover the cost of the additional power from the billings sent to users.

An HPC-cloud will not be a cost center. It will be a Profit Center. This means it can be sold to the commercial enterprises. The sale is much simple. Companies that need HPC (and today with all risk analysis and security concerns most companies do need HPC), will loose money every single day that did not buy an HPC cloud for their employees and and their customers.

I believe in the Adam Smith principle promulgated in 1776: "Individuals trading freely with one another, following their self-interest leads to a growing and stable economy." It is time to free the HPC from eternal subsidies from governments and military, or iron-fist bureaucratic regulators.

It is the time to democratize the HPC, by making it a business that meets real needs for all the people engaged in producing wealth - in USA and elsewhere in the world.

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