Cloud computing promises to cut down on costs, but it seems that there are a lot of companies that are not getting that benefit. Or at least, they are not saving as much as they have hoped to.
This means there are some businesses that are migrating the applications they have previously moved to the cloud back on premises. Companies are now taking care of their own data again, after a failed or disappointing romp in the cloud.
According to the 2017 Cloud and Infrastructure Priorities survey, 62% of companies have brought their apps, data and workloads back on site. That’s close to two for every three enterprises that the recent Pacific Crest Securities study interviewed. These companies belong to different industries, including manufacturing, retail, public sector, financial services and technology.
Is it any wonder why we are back to the debate on whether migrating to the cloud is the answer or should we just keep our workloads in our own data centers?
A lot of businesses move to the cloud holding on to promises of saving big. But they are disappointed when the monthly bill comes in and shows them that they are not saving that much after all, and in some instances, they are even paying more than keeping the application onsite.
More interesting, technology-related businesses and bigger corporations are more prone to see less cost savings on the cloud, forcing them to move back their data and applications.
When cloud computing technology is the way to go
That is not to say that you should immediately shut down any proposal to get on the cloud.
For smaller enterprises and for companies that are just starting up, cloud computing technology is still a good idea.
Public cloud services are particularly attractive for new and small businesses. There are no upfront costs and they do not have to pay for licenses, hire engineers, or earmark money for hardware when they get on the cloud. That means that they can easily forego on spending thousands and thousands of dollars just to have the infrastructure in place.
Yet, public cloud services can help these businesses get their servers, storage or applications up and running in only a few hours. And if they need to scale it up or down, they can do so easily.
When keeping applications on your onsite server makes sense
However, more mature companies might have more savings when their apps and data stay onsite. There are also instances when you will find it easier not to move to the cloud. For instance, it would be easier to comply with customer data and privacy regulations if you use an onsite data center. This way, your data and customer information are on your own hardware and behind your firewall.
You do not have to worry about privacy issues that come with using cloud services. You do not have to grapple with who owns which or who is responsible for tasks and duties. For instance, when you keep things onsite, you do not have to worry whether Amazon can or will access your customer data.
A shift in attitude
Some companies might be doing it wrong. They hold on to the traditional thinking that they have become best practice with on-premise systems that they inadvertently make cloud computing services more expensive.
For instance, IT professionals tend to allocate extra resources to make sure that their workloads can handle any spikes in demand. This redundancy is a best practice to make sure that there are no outages even when there are a lot of people using the application. If you carry that thinking over to cloud computing services, and you allocate redundant resources on a pay as you go system, you end up paying more per hour.
Using cloud computing services have a lot of benefits, not just cutting down on costs. Businesses should evaluate their reasons for moving their applications to the cloud. Often times, even if they are paying more to use cloud computing services, that added cost is easily mitigated by other benefits.
Also, you might be overlooking certain types of cost. It is entirely possible that you might be looking at costs narrowly and leaving out the costs of maintaining a facility or the cost of delivering power to your systems.
While cloud computing services can help you avoid huge upfront capital spending and give you the chance to make operational expenses more manageable by helping you avail of compute resources in chunks. The fact remains, however, that there are some instances where using cloud computing technology can end up more expensive, especially in the long term.
If you are a start-up or a small business, using cloud computing technologies will certainly make sense as you do not have to worry about getting that much money all at once to get the hardware and other resources.
You can use cloud computing in the interim while you save up money to get the compute, networking and storage resources you need for your workloads.
However, large companies and those involved in technology would more or less have the hardware and other resources they need to host their workloads on premises. For this instance, cloud computing will generally be more expensive.
Thinking of migrating your applications and workloads to the cloud? Four Cornerstone can help you with getting the technology and the expertise that can ensure that your migration is headache-free. We can also help you fully understand the costs associated with using cloud computing technology for your workloads and compare them to the costs you would have when hosting these workloads yourselves.
All it takes is one phone call. You can reach us at (817) 377-1144. Call Four Cornerstone and talk to us about your plans to use cloud computing services for your business. Alternatively, you can just fill out our short contact form and we would get in touch with you at your most convenient time.
Photo courtesy of Pictures of Money.