Businesses continue to turn to cloud, perhaps in greater numbers than ever before as they wrestle with challenging economic conditions. The attraction of cloud is clear: a fully managed, cost-effective and scalable environment is perfect for many workloads. For other workloads, however, migration is not so easy. Among the barriers are regulatory demands, including data residency, and a need for low-latency connections.
For these and other reasons, sometimes on-premise is the more sensible destination. And it’s why hybrid cloud – combining public cloud solutions with on-premise resources, often in your own or co-lo facilities – is proving attractive.
To test this idea and to understand the challenges and opportunities of cloud, Tech Monitor brought together a group of IT decision-makers in early July. The event, titled ‘Finding value in the hybrid cloud’, took place in London and was put together in association with Lenovo.
The companies represented around the table – a majority of which were drawn from the financial services sector – are at various stages along the cloud adoption curve. More than one delegate wanted to hear the case for a hybrid cloud before making the leap. One works for an organisation that is committed to ridding itself of all its owned data centres, a move motivated by a desire to control costs, provide greater flexibility, and reduce risks. “We’re in the data business,” he said. “We shouldn’t be in the business of setting up data centres.”
Another is yet to commit to public cloud but acknowledged that position is likely to change: “You can hide from cloud but not for long.” A third, a proponent of hybrid cloud, was bold enough to claim that “we have just finished our journey to the cloud”.
The early part of the conversation was dominated by questions and concerns about environmental sustainability. At least two delegates are responsible for ESG (environmental, social and governance) and net-zero mandates within their organisations. Others have an indirect responsibility to push decarbonisation and broader sustainability – including the reclamation of precious metals, green decommissioning and the modular design of products.
Asked whether a vendor’s lack of sustainability credentials is a “deal breaker” at the proposal stage, a delegate modified this description. “It’s a qualifier,” he said. Only one attendee argued that other factors – including cost, speed and compute power – were far more important in the decision-making process. For the rest, a clear demonstration of sustainability undertakings is a significant part of the selection process.
Efforts by vendors to meet the sustainability challenge include moving from air freight to rail freight, introducing recyclable packaging, carbon off-setting and the drive to introduce higher-quality code given the positive impact it can have on an organisation’s compute and storage footprint. Meanwhile, efforts are continuing to build hardware that optimises power usage. Consider, for example, that a fifth of the energy required to power a server is devoted to running the fan. Reconfigured, fanless servers might prove game-changing.
Later, the conversation turned to the escalating cost of the public cloud. Two figures illustrate this point. First, the three big hyperscalers – Microsoft Azure, AWS, and Google Cloud – experienced a 19% rise in revenues between 2022 and 2023. Second, the cost of cloud is estimated to have risen by 30% in a similar time period.
So, is it a mistake to commit to the public cloud if cost reduction is the primary aim? Not necessarily, argued more than one delegate. Cloud – and cloud-like services delivered on-premise – allow for levels of accountability uncommon in traditional infrastructure environments. In other words, it is now possible to gauge utilisation on an application-by-application basis, focusing the minds of project owners and making overspending much easier to identify and address.
‘Finding value in the hybrid cloud’ – a Tech Monitor roundtable discussion in association with Lenovo – took place on 5 July 2023 at 1 Lombard Street, London.
