Cloud hosting: Look beyond cost savings and weigh pros, cons - GovCloud Network

blog

0
201
Thursday, September 9, 2015

Cloud hosting: Look beyond cost savings and weigh pros, cons

Cloud hosting: Look beyond cost savings and weigh pros, cons

Is your company struggling with the idea of using “cloud hosting” in order to save money?
Truth be known, using cost savings as the primary reason for moving to cloud will almost guarantee failure. Some reasons that typically lead to cloud computing costing more include:

  • Building and migrating to a private cloud, which will almost always cost more than staying in a traditional data center;
  • Migrating legacy applications that weren’t designed to operate in a virtualized environment or are tied to very specific environments run on older operating systems or require out-of-date drivers;
  • Special or very unique auditing requirements;
  • Failure to modify or update enterprise IT policies to reflect the new IT consumption model; and
  • Failure to modify operational practices in a way that takes advantage of the “pay-as-you-go” economic model.

With that said, however, over 82 percent of companies have saved money just by implementing cloud computing, 14 percent were able to shrink the size of their IT department and 80 percent reported extreme productivity improvements.[1] That means that moving to the cloud can actually make money!
An organization’s decision to move to the cloud is, above all else, a cultural change that could affect much more than the IT department.
First, using either cloud computing or traditional data center hosting comes with a decision to outsource all or a portion of your organization’s IT infrastructure. This should drive your initial decision of whether to consider cloud computing as a viable option. Although characterizing these observations as advantages or disadvantages depends on the enterprise’s specific situation, environment and requirements. Generally accepted views are reflected in Table 1.

Cloud hosting: Look beyond cost savings and weigh pros, cons
 Cloud hosting: Look beyond cost savings and weigh pros, cons

Second, I’d like to point out that the term “cloud hosting” is very misleading. Even though it is broadly used in the marketplace to represent a fusion of cloud computing and data center hosting, the two business models are complete opposite.

  • In data center hosting, the customer dictates the hardware, software, security, and operational processes that will be used by the provider. The provider will customize the offering to meet those dictates. The customer bears the capital expense of doing this through a long-term financial agreement with the provider.
  • In cloud computing, the cloud service provider dictates the hardware, software, security, and operational processes that can be used by the customer. The provider typically will not customize their offerings to meet customer dictates. Because the capital expense of building the cloud offering is borne completely by the provider, it recoups the cost through a pay-per-use operational charging model.

This background is essential to putting the advantages and disadvantages of both into perspective because they are driven by their respective embedded business models. See Table 2.

Cloud hosting: Look beyond cost savings and weigh pros, cons

The choices between outsourcing vs. insourcing or cloud computing vs. data center hosting are not a science, nor are they absolute. An organization of any significant size will most likely pursue an “all the above” strategy with constant corrections driven by cultural and business environments. As soon as you’ve made a decision you’ll probably start the process all over again.
So, my final piece of advice is to plan for and expect constant change because the most successful organizations have change management as a core competency.

For more views regarding this important decision, you should check out the following:

 This post was written as part of the Dell Insight Partners program, which provides news and analysis about the evolving world of tech. For more on these topics, visit Dell’s thought leadership site Power More. Dell sponsored this article, but the opinions are my own and don’t necessarily represent Dell’s positions or strategies.

Cloud Musings
↑ Grab this Headline Animator

( Thank you. If you enjoyed this article, get free updates by email or RSS – © Copyright Kevin L. Jackson 2015)

Follow me at https://Twitter.com/Kevin_Jackson

LEAVE A COMMENT

Name*
E-mail*
Phone number*
Your Message

Latest posts

0
283

Unveiling the end-to-end capabilities for the networked society

An Interview with Henrik Basilier  By Kevin L. Jackson The telecom industry is rapidly moving towards a future i...

0
231

AT&T Finance Solutions GM on Shrimping, Software, and DX

Helping clients address the trends and challenges presented by the Financial Services industry is the main focus for ...

0
5908

The IoT Nexus: Bosch Connected World 2019 in Berlin

Next week, I will be influencing #LikeABosch as I accept an invitation from the company to attend Bosch ConnectedWorl...

0
2114

Survive and Thrive With Digital Transformation

First cloud computing then multi-cloud. How can we get ahead of this digital transformation nightmare? These are the ...

0
415

The “George Jetson” of Today

He grew up in Silicon Valley, landed his first job at Apple Computers, was introduced to Nobel Prize winners by his d...

0
2033

MWC19: Where Telecommunications and Cloud Meet

As a cloud solution architect, my passion is learning the details about how cloud computing uniquely supports specifi...

0
366

Tulane University SoPA Selects “Architechting Cloud Computing Solutions”

Last week, Packt Publishing announced that “Architecting Cloud Computing Solutions” by Kevin L. Jackson a...

0
563

5G Wireless Technology Connecting Healthcare

Healthcare is in the middle of massive change. Called digital transformation by many, this term describes the industr...

0
525

Maria Lensing: The Network Platform for Healthcare’s Future

As a girl, Maria and her family traveled to Memphis, Tennessee to get cancer treatment for her sick brother. The mira...

0
1539

How “Big Iron” Does “Big Regulation”

According to Verizon, there were over there were over 53,000 security incidents in 2017, with over 2,200 of those ide...