The public cloud sales pitch is simple: we buy custom kit in huge volumes; optimize our software to use it efficiently; and our management costs are tiny. How can a mere enterprise compete with that?
Five years ago, no way. Today, no problem. Commodity hardware costs are low for everyone. Open source software is even cheaper than what Amazon pays its coders. And well-designed systems need little management while better instrumentation eases problem solving.
The obvious application is storage for backup and archive. Most business documents get created and accessed no more than five times. Moving cold data from high-performance storage arrays to what is being called active archives is a sure savings - and you don't lose control of your data.
But archives and backup aren't the only use case. Nor is price the only reason to keep data in-house. You may need lower latency for local users, or certainty that erased data isn't knocking around in a public cloud somewhere.
Cost: cloud vs you
As of this writing, Amazon's S3 storage charges 2¢-3¢ per GB per month. That's $20-$30 per TB per month - and you can buy raw hard drive capacity for that and own it. The AWS archive storage is cheaper, but not by much. AWS also charges for reads and writes and sometimes bandwidth.
So yes, it can be more economical to own rather than rent. Our first example is a company whose goal is to provide enterprise-class storage, before moving on to other private cloud options.
Zadara offers a unique value proposition: use their software in the cloud (AWS or Azure) on a pay-by-the-hour basis or, for the exact same price, you can have it in-house on their hardware. There's no difference between the public cloud price and the private, in-house, cloud price.
In either case, Zadara manages the underlying infrastructure remotely, so you don't have to. This is high performance enterprise storage, with all the flexibility of the cloud - but local, on-prem hardware. Zadara tells me that they're growing at about 10% per month - and I believe it.
Spectra is a long-time tape vendor - keep reading! - whose BlackPearl S3 gateway provides access to disk and tape using AWS S3 protocols. BlackPearl keeps the object directory in the gateway, so directory searches are fast, and the system looks at access patterns to cache most-used files on local disk. And it does this at a fraction of the price of cloud storage because, hey, it's tape and low-cost disk.
HGST is a division of Western Digital, a company rapidly morphing into a full-line storage company, not just drives. Their HGST Active Archive system scales to almost five petabytes and is capacity-efficient thanks to its advanced erasure coding.
HGST offers a calculator that you can use to compare their cost to your favorite cloud provider.
Cloudian is a sophisticated and highly scalable S3 and NFS compliant storage platform intended for firms that want the benefits of public cloud storage in a private cloud. High-end features include multi-tenancy, inline data compression, replication, advanced erasure coding, distributed recovery, and object streaming.
They deliver their software in a range of appliances. Their all-in 5 year price is less than 1¢ per GB per month.
If you're still having trouble believing that a private cloud can be cheaper than a public one, consider the case of B2 cloud storage from Backblaze. As they put it: "The lowest cost cloud storage on the planet: $0.005/GB a month."
That's a quarter of the cost of Amazon's S3. And it's coming from a much smaller company that, until recently, never took VC money. So yeah, it's possible.
The Storage Bits take
The web giants offer services and flexibility that go far beyond storage, such as the ability to spin up thousands of CPUs in minutes. But if your workload fits, private clouds can save you money.
10 years ago I wrote about the Google File System - an early cloud - and concluded that GFS
. . . would not be very successful on the open market. . . . As a model for what can be done however, it is invaluable. . . . GFS is not the future. But it shows us what the future can be.
That future has arrived - and it can save us a lot of money.
Disclosure: I haven't consulted for any of these companies, but that could change. I am a customer of Backblaze's backup service.
Courteous comments welcome, of course. This isn't an exhaustive list of private cloud alternatives. What others do you know of?