Pre-cloud era. You have a decision to make. Do you define your capacity and performance requirements in the belief that you'll build the next top 1000 web-site in the world or start out with the view that you'll likely build a dud which will be lucky to get more than a handful of visits each day?
If the former then you'll need to build your own data-centres (redundant globally distributed data-centres). If the latter then you may as well climb into your grave before you start. But most likely you'll go for something in the middle, or rather at the lower end, something which you can afford.
The problem comes when your site becomes popular. Worse still, when that popularity is temporary. In most cases you'll suffer something like a slashdot effect for a day or so which will knock you out temporarily but could trash your image permanently. If you started at the higher end then your problems have probably become terminal (at least financially) already.
It's a dilemma that every new web-site needs to address.
Post-cloud era. You have a choice - IaaS or PaaS? If you go with infrastructure then you can possibly scale out horizontally by adding more servers when needed. This though is relatively slow to provision* since you need to spin up a new server, install your applications and components, add it to the cluster, configure load-balancing, DNS resiliency and so on. Vertical scaling may be quicker but provides limited additional headroom. And this assumes you designed the application to scale in the first place - if you didn't then chances are probably 1 in 10 that you'll get lucky. On the up side, the IaaS solution gives you the flexibility to do-your-own-thing and your existing legacy applications have a good chance they can be made to run in the cloud this way (everything is relative of course).
If you go with PaaS then you're leveraging (in theory) a platform which has been designed to scale but which constrains your solution design in doing so. Your existing applications have little chance they'll run off-the-shelf (actually, no chance at all really) though if you're lucky some of your libraries may (may!) work depending on compatibility (Google App Engine for Java, Microsoft Azure for .NET for example). The transition is more painful with PaaS but where you gain is in highly elastic scalability at low cost because it's designed into the framework.
IaaS is great (this site runs on it), is flexible with minimal constraints, low cost and can be provisioned quickly (compared to the pre-cloud world).
PaaS provides a more limited set of capabilities at a low price point and constrains how applications can be built so that they scale and co-host with other users applications (introducing multi-tenancy issues).
A mix of these options probably provides the best solution overall depending on individual component requirements and other NFRs (security for example).
Anyway, it traverses the rats maze of my mind today due to relevance in the news... Many Government web-sites have pitiful visitor numbers until they get slashdotted or are placed at #1 on the BBC website - something which happens quite regularly though most of the time the sites get very little traffic - peaky. Todays victim is the Get Safe Online site which collapsed under load - probably as result of the BBC advertising it. For such sites perhaps PaaS is the way forward.
* I can't really believe I'm calling IaaS "slow" given provisioning can be measured in the minutes and hours when previously you'd be talking days, weeks and likely months...
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