Cost of Ownership on Public vs. Private Cloud Arrangements: A Matter of Realism

Cost of Ownership on Public vs. Private Cloud Arrangements: A Matter of Realism

A long-standing assumption in cloud services has been that public cloud is less expensive than a private cloud arrangement. Professionals in IT seem to be sharply divided into one camp or the other on this topic. The answer depends upon how the company is equipped to manage hardware and infrastructure components as well as the format of the organization.


As with any technology decision, private and public clouds each have a set of advantages and drawbacks. Choosing a solution that fits well requires some honest self-analysis by stakeholders.


Public Cloud

The target user of public cloud is generally a company that has a smaller environment with a workload that fluctuates. They may be early adopters who like to use bleeding edge solutions. When it comes to the ability to manage infrastructure, these organizations may be less efficient or skilled and therefore need more engineers to handle such tasks.


Using public cloud offers less control over managing the system. This can be both positive and negative as it removes much of the burden from IT personnel, but may raise some questions around security and responsiveness. Public cloud may not comply with certain industry regulations, so those in highly governed sectors might not even have this option.


Public cloud options help reduce overspending because of their on-demand scalability. Subscribers only pay for what they need. Sometimes, the need to add other security tools may negate public cloud savings.


Private Cloud

The private version of cloud systems may be a challenge to implement and maintain without the right personnel in place. These are self-provisioned and are sometimes complicated to properly configure, even with a decent UI in place. Security and controllability are key advantages that private has over public cloud, making it perfect for companies with more stringent compliance requirements.


IT departments that are able to handle hundreds of machines per tech or engineer most likely have the skill level to use a private configuration optimally. That is the tipping point where the cost advantage shifts from public cloud to private.


Pricing variances will exist between different cloud manufacturers depending on the volume of virtual machines needed and the number of engineers who manage them. Selecting a proprietary systems versus open source (or a modification of open source) may increase or decrease the expense of the system itself, plus the labor component (staffing properly trained engineers) may differ.


Failing to be honest about resource utilization and how efficient the company’s engineers are will quickly turn private cloud into a money pit. Making the choice between public and private cloud should encompass many other considerations aside from pricing. Finding the right balance of Private and Public cloud is critical in staying competitive in the digital world. Assessing the organization honestly will help identify real requirements so the right selection can be made. To learn more about finding the right balance of Private and Public Cloud, contact Coda Global today.

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