Matt Young, Senior Vice President and Head of Asia Pacific and Japan, Nutanix
The public cloud sector in Singapore is flourishing. According to a 2017 study released by Structure Research, the pace of growth for public cloud computing stands at more than 45 per cent annually (source), even as the world’s cloud providers like Amazon Web Services, Microsoft and Google are opting to build their own data centres in the country.
Businesses looking to push their digital transformation efforts and leverage IT-intensive evolutions such as data analytics, AI and VR, are looking to the cloud to help them quickly develop and launch these new services.
But within this seemingly unstoppable growth, there is a small fraction of former public cloud advocates who are going against the trend and backing out of the public cloud. For example, Singapore-based ticketing services provider, SISTIC, hopped aboard the private cloud train in 2016, citing cost benefits, reduced server footprint and quick backup timings as reasons for their choice (source).
So, what are the cost factors that are tipping the scales away from all-in public cloud strategies, and what other factors might be driving this trend?
In its early days, one of the key selling points of the public cloud was fulfilling the much-desired move from CAPEX to OPEX – businesses no longer needed to make large upfront investments in IT infrastructure; they could just rent it from a cloud provider.
Over time, and after the honeymoon period, you realise that many of your simple, predictable applications are now running in the cloud at a relatively costly rate, whereas they used to be easily and cheaply managed within your own in-house data centre.
As cloud use grows, it becomes like a variable mortgage being hit regularly with increased interest rates – it’s a recipe that can quickly get out of control.
Throwing away the key
Another point of concern for businesses when considering the public cloud approach is becoming locked-down to a provider.
The issue is relatively common, but it may make you think twice before going down an all-cloud route if you’re not aware of it. When you move workloads and applications over to the public cloud, ‘data gravity’ tends to set in – whether you intend it to or not, whatever you’ve put into this resource will grow and subsequently trigger higher costs.
The effect can grow to the point where it makes sense to move at least some resources back out of the cloud. This is usually the point where businesses discover that most public cloud providers attach a hefty cost to retreat. How much will depend on the extent of your use of it, but realising these costs at this late stage can be incredibly damaging.
Another common grievance in using the public cloud is governance – where does all that potentially sensitive data go when you hand it over?
The intercontinental web of subsea cables ensures that data can travel all around the world in a heartbeat, and this can often mean that customer data and other sensitive information could end up in jurisdictions that break your country’s or your own business’ governance policies.
These policies are becoming more stringent. That restricts the amount and type of data you can keep in the public cloud. Yes, there are options available to keep the data local, but these are likely to be more expensive and may not justify bringing those data sets into the cloud in the first place.
Making the cloud work
Despite these concerns, the public cloud will continue to grow, but we’re already starting to see a sharp decline in all-in strategies – the maths simply doesn’t add up.
The real aim of the game is hybrid cloud, a concept that has long existed but has never really been fully developed or even defined. At a high level, it means a balance between public and private cloud resources that seamlessly allows them to work together.
If we can get it right, we’ll get the best of both worlds – the speed and elasticity of the public cloud, perfect for businesses launching new digital services where they’re unsure of the initial impact they will have on IT resources, and the cost-predictive, open, governance-considerate nature of modern, in-house, enterprise clouds.
We’re starting to see signs of this becoming reality – public cloud providers are pushing a hybrid cloud message and collaborating with the ‘other side’ to create real hybrid options. We recently announced a partnership with Google to help achieve this, and even launched a service called Calm which will help automate the process of moving apps across different environments.
As the public cloud continues to grow, companies need to realise its limitations and risks, and find a balance that allows them to make their infrastructure work for them, and enables them to take full advantage of the business value technology can bring.