What’s The Future Of Private Cloud?

6th July, 2017 by

It was back in 2010 that Gartner first identified cloud computing as a major disruptive force in the market, and they couldn’t have been more right.

Forrester predicts the cloud computing market will expand from $35 billion in 2011 to $150 billion by the year 2020.

Yet, the concept of clouds has changed. For instance – the adoption of private cloud has risen from 63% to 77% in 2016. Organizations are increasingly focusing on the private cloud over going the public way – primarily because of the advantages it offers.

The private cloud has gained significant growth across all providers which have led to an interesting development…

Hybrid Cloud Adoption on the Rise

Private cloud adoption has contributed towards a growing hybrid cloud market – which has grown by as much as 71% year over year.

Hybrid solutions seem to be the answer today for private cloud. While organizations would still continue to use SaaS, PaaS, and IaaS, private cloud will stand out on its own. This is primarily because:

– It’s more secure and risk-averse.

– You’ve more technical control over the environment.

The hybrid platforms allow the business to utilize their existing hardware to avail new technology, and they can use their public cloud servers with some integration of private cloud infrastructure.

How will the changes begin?

Organizations which have already invested in VMware or virtual environment will help invest in the private cloud to take automation and management to the next level.

Organizations that have invested in public cloud infrastructure provision will change slowly. This is primarily because they have to re-architect their applications as well as bring in changes for their compliance and security features. These changes can be cost intensive.

Governments though will be the first to jump onto private clouds – more so because of legislative reasons than security ones. The State Records Act, in the United States, prohibits state governments from storing any information interstate – which means both the internet and public cloud are off limits.

The Federal government of the United States spent as much as $1.7 billion on the private cloud in 2015, compared to just $118.3 million on the public cloud.  The Singapore government invested in private cloud infrastructure as far back as 2012.

However, except for the government, we can see more of a hybrid approach in the short to medium term for most enterprises.

Why Will Private Cloud Providers Will Have an Edge?

Relentless Economies of Scale’– that’s something coined by Steven O’Grady, the RedMonk analyst to describe the advantage enjoyed by the service providers. The providers build their own infrastructure and can buy hardware at reduced costs. The fixed costs are then distributed among a large number of customers which brings down the burden of every single unit.

This enables the providers to offer their services at much lower rates than what it would take for the companies to establish such a system. This creates a win-win situation for everyone when the enterprises are increasingly depending on the cloud for managing workload. In short, company-owned data centers are sure to vanish.

Private Cloud attracts more Enterprise Workload Shift

One of the primary drivers for the change is the increasing amount of workload – something pointed out by Gartner analyst Tom Bittman a long time back. Comparing the growth of VMs running on public clouds, he saw that the percentage increased from 3 to 20 between 2011 and 2015.

The workload continues today, determining private cloud computing. A 2016 cloud survey found that enterprises that were running over 1,000 VMs on public cloud rose from 13% to 17% between 2015 and 2016; but in case of private cloud, the growth was from 22 to 31%.

No, enterprises will not pay for the increased control and security of the cloud.

Low-Cost Hardware

The transformation to low-cost hardware will be possible by 2020, fuelled by programs such as Open Compute Project.

Replacement and upgrades can be done quickly on time as the infrastructure is brought down in basic components. Companies and service providers running big data centers will benefit from this form of commoditized infrastructure in the future.  

There is another development which will help enterprises save their cost in the form of electricity bills. Low power ARM chips are being developed by HP, Dell, and others and will be common hardware for private cloud providers in the future.

You’ll Have to Worry Less About Security Threats

Security has been the number one barrier for organizations when it came to moving to the cloud. The problem was more significant for private cloud, as the whole infrastructure belonged to a single user.

But surprisingly, security is not one of the major concerns now. It has been overtaken by a lack of resource and talent, according to a survey. While there are still many critical gaps to fill, if you have the right compliance and can manage your security policies efficiently, it will be harder for the hackers to get through.

All the private cloud technologies are on a growth stride now, and this will continue in the future. VMware vSphere held the leading position, while Microsoft and OpenStack also created a stir. VMware shot up from 33% to 44% while OpenStack rose from 13% to 19%.

Should You Make the Move?

Private cloud will be the best option for enterprises that are not in a position to share their hosting environment with others. While large organizations can develop such an on-premise private cloud system, the hybrid solutions will be the saving grace for the medium and smaller enterprises.

For many businesses today’s private cloud has limitations. For example, there is the inability to build native apps and the public cloud is more agile. That’s why business often chooses the hybrid way. This has been a recent trend and we’ll see what happens in the medium term as organizations work out exactly what they need.

Private clouds in the future are expected to do it all over the longer term– from storage to computing to virtualization and networking. Therefore all enterprises would need is to have a single SaaS portal as an entry point. It’s something that is sure to make organizational operations more simple and agile.

With a mix of public server advantages, it will also provide reliability and control (some of it, at least) that one expects from a private cloud server.  What are you planning to do?