There is a strong pull for CIOs to get out of the data center business and reduce their corporate data center footprint. Public clouds present a significant opportunity for corporate enterprise organizations. According to IDC, the growth of public cloud adoption will be three times that of private cloud by 2019.
However, various studies show that more than one-third of companies migrate data from public cloud to private clouds. Forrester Research shows migration to (hosted) private clouds are on the upswing, with adoption rising around 28% to 33% in North America in Europe. Those figures are supported by the 451 Research’s Voice of the Enterprise (VotE) Cloud Transformation, Organizational Dynamics 2017 survey.
Why are enterprises moving away from public clouds such as AWS and Azure cloud
An important reason why enterprises pull workloads back out of the cloud has to do with economics. On the surface, it may seem to be cheaper to use a public cloud option instead of a private one. However, cost goes beyond just the ‘sticker price’ – you have to take into account other factors, such as labor efficiency and scale.
According to 451 Research’s Cloud Price Index, there’s a turning point where private cloud beats public on price, and in a custom survey for VMware, 41 percent of users claimed to be in this turning point. It depends on your specific business needs, but you can safely reject the idea that public cloud is the cheapest option in all situations.
Beyond just costs, there are various reasons that enterprises exit public cloud services based on the study of 451 Research, the top 5 reasons:
- Performance/availability issues;
- Improved on-premised cloud;
- Data sovereignty regulation change;
- Latency issues;
Reasons for multiple infrastructure environments
451 Research believes that the outcome of their study isn’t a repatriation or a reverse migration, but rather a cloud evolution. Their data shows more businesses see the value of a hybrid IT strategy. In fact, 58% of VotE survey respondents said that they are “moving toward a hybrid IT environment that leverages both on-premises systems and off-premises cloud/hosted resources in an integrated fashion.” Hybrid IT does offer the opportunity to build a framework for workload portability and mobility to match the ever-changing needs of an organization.
The bottom line is to fully understand your requirements, think ahead before you move your critical infrastructure towards any form of cloud. Enterprises have successfully moved traditional corporate applications to public cloud, even those with significant regulatory & compliance requirements. The challenge is to shed legacy thinking and consider where and how best to leverage public cloud for each application and where to locate your private cloud.