Mark Grindey, CEO, Zeus Cloud UKBSS, explains why it’s time to go ‘back to the future’ and build an in-house, on-premise private cloud.

Organisations of every size, across the private and public sector, have bought into the idea that a shared IT infrastructure offers better value for money than a dedicated, on-premise set up.  As a result, the UK cloud computing market is now worth £7.5 billion – and its domination by just three vendors is being investigated by the CMA. But this review, designed to address concerns raised by Ofcom about exit fees, the lack of flexibility and the structure of financial agreements, while valid, is a distraction from the biggest problem: the cost of public cloud services is typically double the equivalent on-premise set up.

Every single organisation using one of the big three hyperscalers is effectively paying twice as much as they should for essential IT systems, including storage and application hosting. Even worse, they are paying for a service that is significantly less secure and typically less well supported than an on-premise alternative. 

Security is becoming a very real concern for businesses reliant on the public cloud. By default, the dominance of the big three hyperscalers makes them a prime target for hackers. Distributed Denial of Service (DDoS) attacks on these organisations are occurring almost continuously, creating huge security vulnerabilities. Not only can a DDoS attack prevent access to key services, causing serious operational issues, but more dangerously, expose vulnerabilities in the security posture that can be used to access critical data. 

So why are organisations still opting in large numbers to pay through the nose for a service that is less secure and less flexible than on-premise alternatives?

Beware the hidden costs

Of course, at first glance, the cloud model is appealing, especially the shift from capital expenditure (capex) to operational expenditure (opex). The idea that costs are known, with a set monthly subscription, is compelling. The option to scale up and down in line with demand is appealing, especially when compared to the challenges of spinning up new servers within traditional on-premise models. However, it is the hidden costs of the cloud that have caught so many companies by surprise. 

The hyperscalers’ financial calculators look simple; but buried in the small print is the information that every additional slice of service and support costs more. The extra – and much needed – security, costs more. Storage cost models are also disturbingly opaque: the promised price per terabyte looks great, until a company discovers it is being charged not just to store data but also to delete it. That uploads are free but the business is then charged for every object downloaded. The monthly bill can often be two-, even three-times the expected amount. And that creates a huge hole in the planned budget.

Add in the limitations on bandwidth, the additional charges for cpu or RAM, plus the fact that if the business is using VMWare, it will be paying again based on those same usage factors, and it is little wonder that the cost of the public cloud has far exceeded any CTO’s original expectations. 

On-premise taking centre stage

So how can businesses achieve the required level of security at an affordable cost, without having to revert to large and unaffordable capital expenditure? The answer is to retake control and bring equipment back on premise – while also retaining the benefits of cloud technology, including remote support and flexible finance and usage models to meet operational requirements. 

A growing number of Service Integration and Management (SIAM) companies have recognised the fundamental issues associated with public cloud services and are offering this ‘back to the future’ on-premise model with the essential flexibility. Servers can be spun up on-premise as required, with costs linked to usage. Support is included and, by moving back on-premise, the security risks are allayed.

For any business concerned about the need to rebuild a server room or employ dedicated tech experts, neither is an issue. The latest generation of servers can be run at higher temperatures, which means there is no need to recreate the air-conditioned server rooms of the past. The servers can simply be located within existing network rooms or offices. Or, if the business lacks space, the entire system can be securely co-located within a dedicated and locked rack. Tech support is included as part of the service, with providers leveraging the remote, open source technology used to deliver cloud services to cost effectively ensure the on-premise systems are working effectively. 

Preparing for the future 

Bringing essential infrastructure back into the corporate fold isn’t just a matter of cost savings; it’s a profound leap in security. Unlike the open access model suggested by the major hyperscalers, an on-premise setup flips the script, prioritising lockdown measures and granting access only through highly secure tunnels, meticulously safeguarding your business. Moreover, complete ownership of the private cloud setup by an organisation empowers immediate security adjustments when needed, eliminating the perils of the interconnected public cloud vulnerabilities that have triggered far-reaching, protracted attacks in recent years on critical public services. 

The allure of this regained control is inspiring organisations, spanning both public and private sectors, to relocate their data and systems in-house.  Concerns regarding data security loom large, exacerbated by the growing latency challenges linked to hyperscalers’ increasingly layered security measures, issues that evaporate in an on-premise system. In addition, there is a recognition that a reliance on the public cloud adds operational risk: any interruption to the internet connection leaves an entire organisation unable to operate. 

Conclusion

The paradigm is shifting again. The public cloud has its place. It is an ideal location for hosting a website or public-facing apps. Nevertheless, as awareness grows that every IT deployment can be both more cost-effective and more secure with an on-premise setup – and attitudes are evolving. It’s time to regain control, go back to the future and embrace the advantages of an on-premise private cloud.