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Tuesday, April 7, 2020

C-Suite Advisory

A Private Cloud Is Expensive, But It’s Essential in These 4 Scenarios

Business People

Public cloud growth continues to outpace the private cloud. Research from the International Data Corporation indicates that private cloud spending increased by 28.2% from 2017 to 2018 to reach $4.6 billion. Meanwhile, spending on public cloud infrastructure grew an astounding 58.9% to reach $10.9 billion.

Companies clearly are recognizing the numerous benefits of cloud computing, but they could benefit even more by picking the right type. How can you tell whether a private or public cloud is right for your growing company?

Public vs. Private Clouds

Small and midsized businesses, or SMBs, are driving investment to the public cloud. They’re interested in a system that’s available 24/7 that can scale to meet virtually any demand. Because the public cloud typically has multiple locations, it offers redundancy in the case of disasters or data loss. The public cloud doesn’t require a fully staffed IT department to stay up and running, and business owners aren’t required to periodically purchase new equipment or invest in the infrastructure. Instead, organizations can pay a predictable cost each month and allocate their savings to initiatives focused on growth.

Of course, the private cloud shares many of those same benefits. Because the private cloud is tailored specifically to a single company, however, you can build it to optimize performance or meet specific security or regulation requirements. Despite that incredible potential, we’re talking about an expensive proposition typically limited to well-funded enterprises.

With a dedicated IT staff, businesses can implement regulatory compliance programs, customize reporting, maintain a 24/7 data environment, and be on-site to address issues immediately as they arise. For SMBs, this level of control is significant.

If a completely private cloud doesn’t fit within your budget, consider a hybrid alternative. Hybrid clouds allow you to use existing on-premise infrastructure for the most important apps and data while running the rest of your operation in the less expensive public cloud.

When Private Is the Right Choice

In some cases, it’s necessary to pay more for private cloud hosting. If any of the following scenarios describe your business, the private cloud might be an appropriate choice:

  1. Your industry is heavily regulated.
    Because the private cloud offers increased control, it’s particularly popular for organizations dealing with stringent rules and regulations, such as HIPAA and PCI. To maintain compliance, these laws require companies to take significant measures to protect sensitive customer data; hiring a public cloud service provider would require them to follow the same standards. Because this requirement is unrealistic in most cases, private cloud solutions remain a better option.
  1. Security is a constant concern.
    It’s a common misconception that the public cloud is insecure, but different providers will take different measures to protect your data. Still, 90% of IT professionals expressed concern about the security of public cloud services. If security is a top priority in your organization, the private cloud offers certain advantages. It runs on secure networks instead of the public internet, and it allows you to ensure the physical security of on-premise servers.
  1. You have underused servers and need the flexibility of a virtualized environment.
    Virtualization allows you to run a variety of applications on their own virtual servers tailored to meet their specific requirements, giving you the flexibility to control the flow of computing power that runs each application. In some cases, organizations can save money by powering intensive applications on underused servers instead of buying new servers and expanding infrastructure.
  1. Control is critical.
    When you own a private cloud, you don’t need to rely on a provider to fulfill requests. Whether you need increased capacity or more powerful processing, you simply add new servers and move on. One of the primary perks of the private cloud is that it’s entirely within your control.

Private clouds are expensive, but they become less cost-prohibitive as businesses approach the enterprise level. If the above scenarios describe your company, a private cloud might be exactly what you need. The decision becomes even easier if you have on-premise, underused servers and an IT department that can handle the challenge.


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Robin Hau
Robin Hau is the founder and CEO of SimplyClouds, a provider of powerful, affordable cloud services for businesses of any size that utilizes a self-service marketplace for easy ordering, provisioning, and management. Robin Hau is an opinion columnist for the CEOWORLD magazine.
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