PayPal Seeking Cloud Host, Looking to Google

PayPal is on its way to building the next generation of its global infrastructure and payment platform employing cutting-edge technologies and a homegrown cloud. This will enable it to scale its infrastructure as needed, provide and attend to demands that continue shifting seasonally and get innovative with designing solutions to meet its customers’ needs.

Officially, they had announced moving towards infrastructural automation and independence by redesigning their architecture and shifting it from a traditional manual-build-on-demand model to a multi-tenant private cloud infrastructure way back on 2011 when they adopted OpenStack to replace Diane Green’s VMware in their data centers. At the time, the team overseeing infrastructure at PayPal had started routing approximately 20 percent of their workloads to the OpenStack cloud.

PayPal started investing in its own financial cloud with the sole target to build up its stake in a secure and reliable infrastructure and approximate scalability for its business, the volume of which keeps changing throughout the year in bouts and phases.

Why Is PayPal Seeking a Cloud Host?

Sri Shivananda, VP, Global Platform and Infrastructure, PayPal, wrote on the company’s blog that in all of 2014, 162 million customers used PayPal to transact a total volume of $228 billion in 26 different currencies. He also informed that this data had been collected across 203 markets, going on to explain how PayPal has remained at the top of its game when it came to innovation and ensuring a robust infrastructure and security for their clients.

Shivananda further wrote that “As we continuously deliver experiences that delight our customers and scale to meet this expanding demand in traffic, we have had to disrupt traditional approaches to infrastructure through innovation. To keep pace with innovation at this scale and growth, we have been reinventing our core infrastructure from the ground up. As you might imagine, that’s an enormous project. In fact, PayPal is one of the largest financial clouds in the world.”

Currently, the PayPal cloud runs on 4,100 servers; it stands at 8,500 if one adds the eBay online marketplace to the list. Given this massive infrastructure and the numerous benefits a cloud infrastructure offers, there’s little doubt that sooner or later all big players that deal with sensitive data will want to shift to the cloud. And PayPal is no exception.

Why is Cloud the New Big Thing?

Most big corporate houses, IT, and hosting companies are now adapting to cloud computing either privately or in a mixed array of private and shared cloud infrastructures. It’s wiser that way because investing in one’s high space makes one agile, efficient, and independent. Owning an internal cloud also allows a company to create and manage resources better, with an edge over security.

In January 2016, RightScale published the results of its yearly study of cloud computing trends called the Cloud Survey that focuses on real cloud buyers and users and not just the cloud vendors. The survey threw light upon several facts and trends in the fast growing cloud market. It showed that hybrid cloud adoption is becoming the trend and that the availability of skilled cloud tech professionals is becoming difficult. Most importantly, it revealed that more and more enterprises are shifting workloads to private clouds, with 17 percent businesses acquiring more than 1,000 virtual machines (VMs) in the public cloud, which is 13 percent higher than 2015 figures. Private clouds, on the other hand, showed a further stronger growth — 31 percent of the enterprises were running over 1,000 VMs. This was 22 percent higher than in 2015.

This trend only justifies PayPal’s attempt at acquiring its own cloud.

What’s all This Fuss About OpenStack?

PayPal had started Phase 1 of its shift to its private cloud in December 2011. The cloud hosting infrastructure was based on OpenStack, banking heavily on open source technologies. This is where PayPal assumes novelty and drift from the traditional route. They engage actively with the open technology community, building on a library of collective innovation.

In March 2015, PayPal replaced VMware with OpenStack. Virtually 100 percent of PayPal’s traffic running through its web and API applications, as well as mid-tier services, is now facilitated by its own OpenStack cloud.

To make things clear, OpenStack is an open-source software platform for cloud computing that can be installed as an IaaS or infrastructure-as-a-service. Using the interrelated components of this software platform, constant interaction with the data center can be maintained by the hosts.

OpenStack is also anti-Amazon. Hence, for anyone looking at curbing the stronghold of Amazon Web Services (AWS) in the cloud computing market, OpenStack throws up a fair choice. The philosophy behind open technology spreads across a wider range of magnanimous benefitting, and it is believed that it will lead the world through to greater and faster technological developments.

Why is PayPal Looking to Google?

In 2015, Google joined the OpenStack Foundation. Ever since, it’s working on merging its technological know-how with that of OpenStack’s, in a bid to make it more valuable for customers and to realize greater efficiency.

In 2017, PayPal will take the next step ahead and tie-up with Google, to enhance its freedom to customize and avoid vendor lock-in. And why not? For such a broad-based company that had trusted and invested so much into OpenStack, Google with its promises and commitment to be a more lucrative cloud partner than its competitors.

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