Is Building Your Own Private Cloud Ever Cheaper Than Going Public?

Private vs. public cloud is a battle many thought was over years ago, and some recent think pieces seem to confirm that notion, claiming no one can match the economies of scale delivered by hyperscale cloud providers.

But private cloud, or on-premise virtualization, can still be a less expensive option — if you have the staff and capabilities to support it. A recent study from 451 Research describes when the tipping point is in the favor of private cloud and when public cloud has a lower total cost of ownership (TCO), based on utilization of hardware and efficiency of your staff.

How big are you willing to build?

The most important considerations at hand are the ability of your company to manage infrastructure and hardware resources and the stability of your IT environment. If you have the staff proficiency to manage a large scale virtualized environment and your applications, data storage needs, network configuration, and other pieces of infrastructure will remain relatively stable over the next few years, then building your own cloud might be cost effective.

On the flip side, if your IT staff is already stretched thin or is part of the two-thirds of IT departments that lack proficiency in internal or external cloud management, then a public cloud provider is likely the more economical choice. The same goes for inconstant workloads and smaller deployments.

What if you want the security of private cloud?

Choosing public over private cloud isn’t always as simple as a cost analysis, however. Security remains a top cloud concern, while some organizations require more granular control over their infrastructure for specific applications, compliance, or integration with legacy hardware and software.

Public cloud doesn’t have to be insecure. It also enables you to take advantage of the latest and greatest software and hardware available, as public cloud vendors adopt and replace their platform components on a much more frequent basis than even the most upgrade-prone internal IT department.

Some cloud providers (including Green House Data) also work with organizations to deploy custom private or hybrid cloud solutions that can tie back into existing infrastructure while enabling the support expertise and scalability of public cloud. This may not always be the cheaper option, but it does enable the security, customization, and compliance benefits of private cloud.