More than 50% of enterprises will use industry cloud platforms to accelerate their business initiatives by 2027, as per the 2023 Gartner report. While the cloud continues to garner a growing share of enterprise IT spending, it is also true that the cloud may not provide all-encompassing solutions. Organizations, in certain instances, opt for cloud repatriation, moving workloads and data back from the cloud. This decision can be motivated by financial, practical, or regulatory factors. Here, we explore the primary drivers for cloud repatriation.
What is Cloud Repatriation?
Cloud repatriation refers to the movement of data, workloads, and applications, previously migrated to the cloud, back to an on-premises data center or transitioning from a public cloud to a private cloud. It is also known as cloud reversal or de-clouding.
5 Top reasons why Businesses are doing it
Despite the various advantages the public cloud provides for businesses of all sizes, there is a growing trend of some organizations choosing to migrate their data back on-premises. The common factors contributing to organizations reconsidering their move to the cloud include:
High cost of public cloud services
One significant reason for adopting cloud repatriation is the escalating cost associated with managing workloads in the cloud. Managing cloud expenditure was identified as the top challenge by 82% of respondents in a 2023 Flexera survey, surpassing concerns about security and resource scarcity. While the cloud can be cost-effective for certain businesses, others witness increasing costs over time due to factors like workload complexity, substantial data transfer, and the expenses associated with cloud services.
Additionally, many businesses encounter unforeseen fees after transitioning to the cloud. According to a 2023 study by Arlington Research, 82% of IT decision-makers observed unnecessary cloud costs, ranging from data transfer fees to licensing fees and storage expenses, making it difficult for companies to predict all charges accurately.
Data security and compliance issues
Security and regulatory compliance are primary concerns leading organizations to repatriate their data. According to Forbes survey, 40% of the respondents cited security and compliance as the primary motivation for moving their workloads back on-premises. While cloud providers implement robust security measures, certain sectors such as healthcare and finance may require more control over their data than a cloud environment can provide.
Enhanced control and flexibility
Organizations opt for cloud repatriation to gain more control and flexibility over their IT infrastructure. This includes aspects like data privacy, performance control, and effective data governance, which some companies find more achievable on-premises.
Data locality needs
The physical location of data is crucial for organizations, particularly in regions with strict data residency regulations. Repatriating data from the cloud ensures that it is stored in a specific location, aligning with local laws.
Dissatisfaction with cloud services performance
While scalability is a key reason for adopting the cloud, it may not be the optimal environment for every type of workload. Some applications may face performance issues, particularly in terms of latency, which can be critical for real-time processing or applications with high data transfer requirements. Examples include remote surgery, real-time video streaming, and self-driving vehicles, where minimal latency is crucial for optimal performance.
Conclusion
Ultimately, the decision whether to remain in the public cloud or repatriate is unique to each organization and depends on what best serves its business operations. Factors like cost, security, performance, availability, human capital, and the desire to avoid vendor lock-in can influence this choice. This is where solutions offering a consistent cloud experience across your entire IT landscape become invaluable, mitigating unwanted complexity that could hinder repatriation efforts. Skillmine’s portfolio of cloud services is designed to address this challenge. We ensure a consistent cloud experience that provides the flexibility to deploy workloads where they make the most sense, ensuring cost control, security maintenance, and equipping your teams with the necessary skills to oversee the entire process.
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