Businesses are increasingly interested in moving their operations back to on-premises systems, or cloud repatriation, but not for all applications.
Ditching the Cloud Wave:
Over 97% of firms in a recent survey are jumping ship from the public cloud, opting for in-house infrastructure instead. It's important to note that this move doesn't signify the end of the public cloud, as the majority of these companies aren't planning to transfer every workload.
Instead, they're strategically relocating a few select applications and workloads, with about half of them planning to shift some workloads in the coming year. A significant portion, around 43%, is aiming to transfer a considerable number of workloads, while a daring 5% is eyeing a full repatriation of all workloads.
As Richard Mosley, CEO of Node4, puts it, "This signifies a clear preference for hybrid environments, signaling a shift from cloud-first to cloud-appropriate. We expect this setup to become the norm for the foreseeable future in the mid-market."
This trend follows last year's research from IDC indicating that cloud migration is on the rise. However, only around 8-9% of companies are aiming for a full workload repatriation, with most entities removing specific apps instead.
To illustrate this cultural shift, take the case of SaaS company Basecamp, which is reportedly planning to save $10 million over the span of five years by abandoning the cloud and embracing its own hardware.
Performance Issues as Main Driver:
The primary factor fueling this shift towards in-house infrastructure is performance. The surveyed firms have discovered that certain workloads just don't align with public cloud environments. The performance of some applications isn't meeting expectations, and users are growing fed up with application latency.
This performance issue was the top reason (44%) for transferring workloads, followed closely by data sovereignty (30%). The emphasis on data sovereignty has been propelled by regulatory concerns but also reflects a broader wariness around control, jurisdiction, and access.
In addition to these reasons, the report highlighted risk management (29%), technical limitations (27%), cost considerations (26%), compliance demands (26%), and security concerns (21%) as contributors to the repatriation trend.
Surprisingly, despite many mid-market entities struggling to replicate the advanced security and access configurations offered by public cloud environments, Node4’s report suggests that only 94% of on-premises-based organizations feel confident in their cybersecurity capabilities, compared to 78% of fully cloud-based organizations.
Recent research by Gartner reveals that a quarter of organizations are grappling with frustration over their cloud adoption projects, with an additional study indicating that a staggering three-quarters of respondents have overshot their cloud budgets.
More from ITPRO:
- Oracle banking on multi-cloud future
- Businesses bracing for $44.5 billion in unnecessary cloud spending
- Cloud spending expected to surge by 19% in 2023
- In light of the performance issues experienced with public cloud environments, many firms are migrating select applications and workloads back to in-house infrastructure, aiming to improve performance and meet expectations.
- A shift towards a hybrid environment is becoming more prevalent, as companies strategically move workloads from the cloud to their on-premises infrastructure, in an effort to ensure compliance, manage risks, and address technical limitations.
- Despite the challenges in replicating advanced security and access configurations found in public cloud environments, only 94% of on-premises-based organizations feel confident in their cybersecurity capabilities, compared to 78% of fully cloud-based organizations, indicating an emphasis on data sovereignty, control, and jurisdiction.
