Los Alamos offers a model for how to charge for cloud services

How should data center managers bill users for services in a virtualized, cloud environment?

One way might be to embrace user diversity and focus on how they conduct business. At least, that is how the Energy Department’s Los Alamos National Laboratory approached chargeback, the billing of users for IT-related services in a virtualized, cloud environment.

Los Alamos IT officials built a cloud platform about two years ago with a chargeback that included several key points pertinent to a successful implementation, said Anil Karmel, management and operations chief technology officer for the National Nuclear Security Administration/LANL.


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Karmel spoke June 19 at the MeriTalk Data Center Consolidation Brainstorm Exchange in Washington, D.C., during a panel discussion on chargeback challenges and best practices.

The chargeback capability has been rolled out in YourCloud, a secure, hybrid community cloud that lets researchers and scientists in the national labs request virtual servers on demand. The platform also provides desktop hosting. The cloud platform was created as a collaboration between industry and government offering users a secure enclave, full ownership and transparency into their workloads, and full chargeback capability.

“No. 1, it included green IT savings," Karmel said. "It is important because you need to quantify what are the energy savings in the environment." Initially, this was done manually in the virtualized server environment, Karmel added, describing LANL’s six-year journey to the cloud.

But the cloud is about automation. So when the cloud capability was developed, LANL invented a green IT smart meter to dynamically compute the amount of energy saved over time and display it via a website. “It is important to know your cost and energy savings by using the cloud,” he said.

The second important piece is the development of life-cycle management. Data center managers and IT practitioners are good about turning systems on, but not so good at turning them off.

Part of the new cloud paradigm is giving users the capability to request servers from a cloud service broker for a maximum period of one year. Afterward, they must renew the system or it will be decommissioned and taken off the network.

This might sound draconian, but the rationale is twofold, Karmel said. You must know who is taking care of your servers from a security perspective. Someone might have had the funds to start a project and requested a server, then the funding ceased and the people went away, leaving a server exposed for someone to compromise and get into the network.

Also, IT administrators need to be wise stewards of the money they are investing in an infrastructure, especially a private cloud because there are infrastructure and licensing costs as well personnel costs related to the maintenance and support of the environment.

Customers want to know what they will be charged before they get the bill. So LANL developed a dynamic cost calculator that computes the cost for the workload: the amount of CPU, memory and disk usage and the tier of service based on what the workload requires. “So they know what the costs are before provisioning a workload.”

LANL opted for a full allocation payment model over a pay-as-you go approach. You have to take a look at what model makes sense, Karmel said. Pay-as-you-go might sound great if you are only paying a dollar for a server and don’t use the service much. But a $1,000 bill might freak out your budget manger. Or if you purchased 1,000 servers for a dollar, you might get a bill for $1,000 because maybe a cyber criminal is actually using one of those servers.

Full allocation allows users pay on a monthly basis. The money is automatically pulled from the cost center the user present when they provisioned the workload and put into a suite cost center that pays for all the infrastructure-related services the infrastructure, licensing and people.

IT will want to partner with people who pay the energy bill on setting up a chargeback system because usually some other line of business pays those bills. Partner with them so you can implement some rebate program so if their energy costs go down, they can offer incentives for others to use the service, Karmel said.

Karmel added that you can’t force users to move into a virtualized, cloud environment, especially in settings as distributed as the national labs.

“If you go in with a stick and say, ‘Thou shall use my environment,’ they’ll take that stick and whack you over the head with it,” Karmel said.

The best approach is to embrace how users do business. They own their machines in the physical world and don’t want to give up control. But LANL can show them that they can still own and maintain their virtual servers in a secure enclave and can have it in 30 minutes instead of 30 days, and know the fixed costs for that environment, Karmel said.

Reader Comments

Mon, Jul 9, 2012 RealLANL

"Why do a large number of customers prefer not to use the wonder cloud?" Simple, the cloud is just that. A large moving, unstable mass. The underlying infrastructure is not overly stable. The services provided are restrictive and way overpriced. I have read in several areas/article Mr. Karmel state that servers can be prepared and present in minutes not weeks, that is not altogether true. Using VM's may be good for some solutions but not all. Many different systems have felt the performance impact or limitations. Vendor requirements or recommendations are ignored or pared down to fit the cloud resources. Customers can often find solutions where setup, management and use of systems they purchase is far less than the pricing model presented. The only problem with this is, the model designed, deployed and provided by Mr. Karmel and the team he works with is all that is allowed to be used. Denial for using other system(s) is covered by a flurry of excuses or limitations barring customers from seeking more long term cost effective solutions.

Wed, Jun 27, 2012

Upon review of Mr. Karmel's plans, it seems to be they have been well thought out from a user and management perspective. As with any major project for large populations, there may be a few things that could be improved. However, in this case, it seems up to 99% of the features are right on target to let DOE and other agencies achieve improved efficiencies, security, and cost savings by moving to the cloud.

Tue, Jun 26, 2012

RealLANL - Why do a large number of customers prefer not to use the wonder cloud?

Mon, Jun 25, 2012 RealLANL

There are so many statements in this that are only half truths. Mr. Karmel needs to check his facts. There are a large number of customers that would prefer not to use the wonder cloud, but have no choice because they have been basically beat over the head told they had to use it...

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