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Spiraling public cloud costs making private option attractive

An increasing number of companies are bringing their data back in-house and managed cloud providers are in an ideal position to

Many users who piled into public cloud have become only too aware of how much it costs and have moved back to an on-prem environment.

The initial reason for turning to the public cloud was to enjoy the flexibility and speed of deployment with costs not always clear to gauge, with different charging models based on users and data usage.

The public relations job that the public cloud industry did managed to tarnish the staying on-prem option as failing to deliver the cost benefits or being able to support the speed of change users were looking for, but that now appears to have been largely a myth.

A study from 451 Research launched by Canonical has charted significant drops in the price of private cloud.

The main findings found that rising costs had led to 35% of users bringing data back into a private infrastructure.

Managed cloud providers are sitting in a strong position because of their ability to advise where data should reside.

“The last few years has seen enterprises consume more and more public cloud services as they looked to grow revenue and increase productivity. These same companies are now finding themselves faced with spiraling costs as their cloud needs continue to evolve,” said Dr. Owen Rogers, Research Director, Digital Economics Unit, 451 Research.

“As a result, over a third of enterprises are having to move data back to the private cloud but varying costs has created grey areas on the options available and it is perceived as an expensive alternative," he added.

The report also gave a nod to managed cloud providers as those in the position to use automated tools to make sure that user data is deployed to the best fitting platform. The analyst house felt that the flexibility that customers were looking for could be best delivered through a partnership with cloud experts.

Mark Shuttleworth, CEO of Canonical, said that private cloud was a viable part of a multi-cloud strategy.

“Combining competitive public cloud with Canonical’s private cloud delivers the maximum efficiency over time, with the flexibility to run the right workload in the right place every day of the week," he said.

Spiraling costs

According to the Busting the Myth of Private Cloud Economics report from 451 Research although many users view public cloud as a good option the costs quickly get away from them.

"Once companies start consuming cloud services, they realize the value that on-demand access to IT resources brings to  the  business  in  terms  of  quicker  time  to  market,  easier  product  development  and  the  ability  to scale  to  meet  unexpected  opportunities.  As  a  result,  enterprises  consume  more  and  more  cloud  services as they look to grow revenue and increase productivity. With scale, public cloud costs can mount rapidly, without savings from economies of scale being passed on," the report stated.

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