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Cloud Management: Citigroup Confidently Says Yes to Private Cloud

To go private or public with the cloud? That, our dear William Shakespeare, is the true question.

For many IT managers, the decision of whether to embrace a private, public or hybrid cloud model is challenging as managers are looking to realize cost savings, enjoy increased efficiencies and enhance their offerings – all while working under constrained budgets and limited resources. But for Citigroup, the decision was seamless as the company knew that the only way to enjoy all the benefits afforded by cloud while still having tight security was to go with a private cloud model.

"Facebook (News - Alert) has more data than we do," said Antonio "Yobie" Benjamin, chief technology officer at Citigroup's global transaction services in San Francisco, in a recent article. "Citi has roughly 250 million accounts. Facebook has about 900 million accounts and trillions of photos. A complaint Facebook is likely to get will be along the lines of, 'Dude, where's my photos?' With us, it's 'Where's my money?'"

Constructing a private cloud for Citigroup, however, was no small feat as Citigroup operates in 100 countries, has $13 trillion in assets under management, and moves $3 trillion worth of transactions every day.

“That's roughly a quadrillion a year," said Benjamin. “There's nothing here that can be left to chance." And, when it comes to doing business with other cloud-based firms, he said, "If you have a public cloud, don't talk to us."

In 2010, Citigroup first began its entree into the cloud, when a handful of employees started working on an internal infrastructure that evolved into the private cloud model. The benefits of private cloud were quickly realized. Among the advantages of private cloud are: increased scalability, heightened security, greater computing power, and enhanced efficiencies. And, for Citigroup, one of the most compelling arguments for adopting private cloud management strategies was the money saved because of economies of scale.

“The benefits that Citi gets are, in a word, elasticity," said Benjamin. "When you need computing power, it's there, so you gin it up. When you don't need it, you gin it down. You can adjust that along the information-supply chain, depending on the processing speed or the bandwidth that you need."

For Citigroup, one of the main advantages of the cloud is its ability to enable high-frequency trading, which requires sending trade data to stock exchanges. According to Benjamin, Citigroup wants to go past the millisecond level to the microsecond level. A millisecond refers to about how long it takes for you to swipe your credit card at a store to purchase that item, something which takes about half a second.

But, according to Benjamin, that’s not fast enough for high-frequency trading or any high-performance computing. In fact, it’s “immensely slow.”

“The goal is to move to nanoseconds. So that credit card swipe would speed up 100-fold,” he said.

Citigroup’s high-frequency trading initiative supports algorithmic trading in equities, foreign exchange, and asset classes in which large trades are often chopped up into smaller ones for quick execution, according to company officials. Moreover, it provides services to hedge funds.

While some analysts remain skeptical about financial services using cloud computing, especially since these groups have a lot to lose, Citigroup remains confident that it is miles ahead of any potential security breach or cyber threat thanks to its private cloud model.

"I'm gratified we're not in the public cloud. The Internet can be a dangerous place," said Benjamin. "There's no need for us to move critical infrastructure where we would commingle data. I like disruptive technology, but not if it means disrupting security."

Edited by Rich Steeves

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