3 misguided reasons for avoiding public cloud

3 misguided reasons for avoiding public cloud

Summary: Some of the most common, yet misguided reasons, for not considering public cloud can come from both smaller companies with fully automated deployments and Fortune 500 enterprises integrating public cloud for the first time, according to Dimension Data.

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TOPICS: Cloud
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Some of the most common, yet misguided reasons, for not considering public cloud can come from both smaller companies with fully automated deployments and Fortune 500 enterprises thinking about integrating public cloud for the first time.

Jason Cumberland, vice president for SaaS Solutions at Dimension Data, shares some of the highlights from talking to his clients. He adds that if companies are still citing these reasons, they are in danger of being left behind by their competition.

Reason #1: "I don't know how much it will cost me. My current costs are definitive."

"It's understandable that CFOs initially feel more comfortable approving a PO for a fixed amount for capital equipment, but that doesn't tell the whole story. It's one thing to be able to definitely forecast your costs for previously purchased equipment, it's another thing entirely to be able to forecast your demand. If you're able to do both, congratulations," said Cumberland.

He pointed out the reality is that very few clients can predict demand, or can expect it to grow consistently without peaks and valleys.  To optimize the economics of the public cloud, users must be consider both the hidden costs of maintaining unused capacity, and the opportunity costs of not being able to meet unexpected demand exactly when needed.

"In a recurring revenue business, delaying delivery on an environment/implementation means losing revenue you will never recover.  Even in non-recurring revenue models, cutting delivery time means improving cash flow.  Delaying order delivery because of lack of infrastructure is a hidden cost often not accounted for when comparing legacy infrastructure to cloud," he added.

Reason #2: "Shared public cloud architectures don't offer the performance my applications require."

Virtual machines running on a shared infrastructure do offer less performance than their physical counterparts with similar specifications, admited Cumberland. However, he pointed out using that as a reason not to migrate applications to cloud was accepting the strawman argument. 

"Yes, virtual performance is inferior to physical, but virtual machines also cost considerably less, come with no long-term commitments, and allow for automation of operations in ways that are significantly more difficult when relying on physical machines," said the Dimension Data executive.

The advance of hybrid cloud compute options and virtualized, high-performance storage solutions also allow a broad range of applications to effectively run in the public cloud regardless of the performance requirements, he added.

Reason #3: "We're 80% virtualized, so using public cloud offers limited benefits."

Virtualization and public cloud, while related, offer different benefits, pointed out Cumberland. "While virtualization is an important step on the path to public cloud adoption, hosting everything internally still forces you to deal with the inefficiencies of capacity management, equipment procurement, installation, and maintenance of the physical systems, including training of your staff to remain current on the latest technologies."

It also requires adherence to expensive security and compliance standards that may not be in the company's long-term interest to continue to maintain and pay for, he added.

"If you're already largely virtualized, the good news is that you are one step closer to conducting a critical evaluation of your current costs and infrastructure and beginning an evaluation of the public cloud. During that evaluation, it is important to critically evaluate the extent to which the time and budget spent hosting various applications and systems internally deliver a competitive advantage to your business, or whether they're hosted internally only because they always have been, and no one before you has done the hard work to bring increased agility and lower costs to your business," said Cumberland.

Topic: Cloud

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Loves caption contests, leisurely strolls along supermarket aisles and watching How It's Made. Ryan has covered finance, politics, tech and sports for TV, radio and print. He is also co-author of best seller "Profit from the Panic". Ryan is an editor at ZDNet's Asia/Singapore office.

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9 comments
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  • How about...

    1. I prefer to retain control of my own data instead of ceding it to an outside provider.
    2. The larger the repository of data, the more tempting the hacking target.
    John L. Ries
  • Errr.. you realise that all three of these...

    have replies that can be summed up as "yes.. it's true, but..."

    That's not really a compelling argument.

    Also, a thought - starting a conversation by labelling other people's views as 'misguided' isn't a great way to get buy in. You could have tried this entire article this way: "We know you have concerns - here are your top three and why it's not as bad as you think..."
    TheWerewolf
    • In addition...

      ...there is the underlying assumption that we're under some obligation to embrace cloud computing, whether we like it or not.
      John L. Ries
  • you left out two of the most obvious

    Reasons against cloud computing

    1) data control. By moving applications and workflows to the cloud you effectively allow a third party unrestricted access to the data, furthermore it also means you are at the mercy of that third party when it comes to any disruptions.

    2) reliance on wide are network. No WAN and your people are not doing any work. The time that WAN connections are as fast and reliable as LAN connections is still a long way off.
    sjaak327
    • and I forgot

      2) also means you are at the mercy of yet another third party, as the could provider usually doesn't provide the connection.
      sjaak327
  • cloud bubble

    Wonder how long before the cloud bubble bursts and companies that moded to it realize that in many cases public cloud costs more, have more security issues (you can't ignore security because you move to the cloud), and cloud providers have an even harder time dealing with inefficiencies of capacity management due to the greater difference in clients causing higher costs because of the cookie cutter model they are forced to implement in their machine sizing leading to higher costs.

    There are good cases for the cloud, but mostly for smaller organizations where the cloud bill will be only a few thousand a month or less.
    John Lauro
  • three reasons, eh?

    1. you don't know who will be getting your data from the "cloud";
    2. you don't know if you can reliably get you data back from the cloud;
    3. you don't know what sort of burden the cloud will put on your network service.
    Mike~Acker
  • I'll give you ONE very good reason to think twice about cloud storage.

    From one year ago:

    "Cloud computing is a ticket to losing data for two in five companies, a new study finds."

    http://finance.yahoo.com/news/cloud-computing-users-losing-data-205500612.html
    IT_Fella
  • Thanks for the comments

    To clarify the title of the blog post, the assertion was not that there are no good reasons to avoid public cloud. The blog focused on a handful of frequently-cited concerns that are no longer a strong reason to avoid the public cloud.

    Depending on your industry, the data you're dealing with, etc., there are valid reasons to avoid cloud computing, and the comments above pointed out the concerns still prevalent in the mind of buyers.

    Regarding security concerns, the real question for companies is, "Are your internal security measures more mature than those of public cloud providers?" Sometimes they are, but many times, internal security teams (if they exist) are understaffed and under-funded, meaning that in-house security is no better or worse than that in the cloud.

    To agree with many of the points above, getting into the cloud properly requires companies to conduct significant due diligence to avoid some of the risks highlighted above. In the next week or two, we'll be releasing a ~20 page Cloud buyer's guide showing the questions to ask your future IaaS / Cloud provider before moving your data and applications to the Cloud.

    Please look me up on Twitter @Jcumb3r if you're interested in keeping in touch or getting a copy when we release it.
    JasonCumberland