Private cloud is NOT dead – and for one good reason: Control of data

Privacy, security, information sovereignty, what we all want, right?


Comment Reports that private clouds are dead are greatly exaggerated.

Far from being dead, IDC’s latest research shows that private clouds are expected to grow at the same rate as public clouds for the next five years. This will not surprise anyone who has worked in or with an enterprise IT operation. Even public cloud giant AWS is building one of the largest private clouds for the CIA.

In spite of armchair pundits claiming private cloud is a failure, both private and public clouds are doing very well and the reasons should be obvious.

To start, I need to get some disclosures out of the way. I work for Hitachi Data Systems. While I do not speak for HDS, I do speak about HDS and I get the opportunity to work with some of the largest IT operations in the world. We genuinely don’t have a horse in the “Public vs Private Cloud” race: our technology is used by some of the largest public, private and hybrid cloud implementations in the world. I also host a successful podcast here on The Register, “Speaking in Tech,” where we get to talk with industry leaders that span IT vendors and users.

I’m far from being an expert but I am fortunate to have a front row seat to witness the dramatic transformations taking place in our industry.

Cloud adoption, whether it is public, private or hybrid, is growing as are the strategic challenges. Adopting a cloud strategy isn’t about a specific technology as much as it is about organization transformation and specifically IT transformation. While this may be well known, some pundits and analysts keep slipping into the technology adoption debate of “public vs. private” clouds.

These types of debates almost always avoid the strategic challenges CIOs face between business requirements and the IT services they provide. Without organization transformation aligned to clear business objectives, any cloud service is doomed for failure.

There is also the recognition that different businesses have different IT requirements and not all of them fall into a clean definition for cloud delivery. Contrary to some rather narrow minded thinking among some analysts and pundits, there is no one true cloud. While one business may have web scale applications that require IT resource elasticity, another may have business requirements with a fixed or predictable workload.

Some businesses view IT as pure overhead and outsource the management of IT infrastructure while others believe that internal management of IT drives business value. Interestingly enough, none of these are features that call for a specific type of cloud delivery.

Security, privacy and data sovereignty

There is, however, one consistent defining feature that directly impacts cloud delivery strategy: control of data. This includes security, privacy and data sovereignty. While agility, elasticity, cost, speed of deployment are all very important attributes of a cloud deployment, I’ve never heard a CIO claim any of these were a higher priority than control of data.

As further validation, a recent survey [PDF] by The Economist (disclosure: the survey was commissioned by HDS), 87 per cent of the respondents cited that their senior management team is strongly concerned about protecting the security and privacy of corporate data as part of their organization’s strategy for cloud computing adoption. It’s worth noting that “faster access to infrastructure” ranked 7th among business objectives for cloud deployments which is likely a reflection on CIO priorities rather than those of developers.

As a consequence, different companies will take different approaches to their cloud strategy based on the business objectives and their perceived risks. No single type of cloud deployment addresses every business requirement or risk profile, but it does explain why private clouds are just as viable and growing at the same rate as public clouds.

While control of data may be a barrier to public cloud adoption, deploying a private cloud can also be a barrier for others. Private cloud adoption doesn’t necessarily mean that enterprises are buying, building and managing their own infrastructure. Many choose a hosted private cloud service to leverage both scale and resources while still managing and controlling their own data.

A comprehensive 451 Research report recently identified that hosted private clouds today accounted 25 per cent of budget for off-premises infrastructure spending and growing to 29 per cent in two years. Public cloud accounted for 17 per cent today and growing to 18 per cent in two years.

Again, this is not about private clouds being a better option than public clouds. The point is that private clouds are not dying or failing. Both have strong value propositions based on business requirements and this is validated by the market adoption of each. ®

Broader topics


Other stories you might like

  • Cheers ransomware hits VMware ESXi systems
    Now we can say extortionware has jumped the shark

    Another ransomware strain is targeting VMware ESXi servers, which have been the focus of extortionists and other miscreants in recent months.

    ESXi, a bare-metal hypervisor used by a broad range of organizations throughout the world, has become the target of such ransomware families as LockBit, Hive, and RansomEXX. The ubiquitous use of the technology, and the size of some companies that use it has made it an efficient way for crooks to infect large numbers of virtualized systems and connected devices and equipment, according to researchers with Trend Micro.

    "ESXi is widely used in enterprise settings for server virtualization," Trend Micro noted in a write-up this week. "It is therefore a popular target for ransomware attacks … Compromising ESXi servers has been a scheme used by some notorious cybercriminal groups because it is a means to swiftly spread the ransomware to many devices."

    Continue reading
  • Twitter founder Dorsey beats hasty retweet from the board
    As shareholders sue the social network amid Elon Musk's takeover scramble

    Twitter has officially entered the post-Dorsey age: its founder and two-time CEO's board term expired Wednesday, marking the first time the social media company hasn't had him around in some capacity.

    Jack Dorsey announced his resignation as Twitter chief exec in November 2021, and passed the baton to Parag Agrawal while remaining on the board. Now that board term has ended, and Dorsey has stepped down as expected. Agrawal has taken Dorsey's board seat; Salesforce co-CEO Bret Taylor has assumed the role of Twitter's board chair. 

    In his resignation announcement, Dorsey – who co-founded and is CEO of Block (formerly Square) – said having founders leading the companies they created can be severely limiting for an organization and can serve as a single point of failure. "I believe it's critical a company can stand on its own, free of its founder's influence or direction," Dorsey said. He didn't respond to a request for further comment today. 

    Continue reading
  • Snowflake stock drops as some top customers cut usage
    You might say its valuation is melting away

    IPO darling Snowflake's share price took a beating in an already bearish market for tech stocks after filing weaker than expected financial guidance amid a slowdown in orders from some of its largest customers.

    For its first quarter of fiscal 2023, ended April 30, Snowflake's revenue grew 85 percent year-on-year to $422.4 million. The company made an operating loss of $188.8 million, albeit down from $205.6 million a year ago.

    Although surpassing revenue expectations, the cloud-based data warehousing business saw its valuation tumble 16 percent in extended trading on Wednesday. Its stock price dived from $133 apiece to $117 in after-hours trading, and today is cruising back at $127. That stumble arrived amid a general tech stock sell-off some observers said was overdue.

    Continue reading
  • Amazon investors nuke proposed ethics overhaul and say yes to $212m CEO pay
    Workplace safety, labor organizing, sustainability and, um, wage 'fairness' all struck down in vote

    Amazon CEO Andy Jassy's first shareholder meeting was a rousing success for Amazon leadership and Jassy's bank account. But for activist investors intent on making Amazon more open and transparent, it was nothing short of a disaster.

    While actual voting results haven't been released yet, Amazon general counsel David Zapolsky told Reuters that stock owners voted down fifteen shareholder resolutions addressing topics including workplace safety, labor organizing, sustainability, and pay fairness. Amazon's board recommended voting no on all of the proposals.

    Jassy and the board scored additional victories in the form of shareholder approval for board appointments, executive compensation and a 20-for-1 stock split. Jassy's executive compensation package, which is tied to Amazon stock price and mostly delivered as stock awards over a multi-year period, was $212 million in 2021. 

    Continue reading
  • Confirmed: Broadcom, VMware agree to $61b merger
    Unless anyone out there can make a better offer. Oh, Elon?

    Broadcom has confirmed it intends to acquire VMware in a deal that looks set to be worth $61 billion, if it goes ahead: the agreement provides for a “go-shop” provision under which the virtualization giant may solicit alternative offers.

    Rumors of the proposed merger emerged earlier this week, amid much speculation, but neither of the companies was prepared to comment on the deal before today, when it was disclosed that the boards of directors of both organizations have unanimously approved the agreement.

    Michael Dell and Silver Lake investors, which own just over half of the outstanding shares in VMware between both, have apparently signed support agreements to vote in favor of the transaction, so long as the VMware board continues to recommend the proposed transaction with chip designer Broadcom.

    Continue reading

Biting the hand that feeds IT © 1998–2022