Cloud Platform, Part 3 of 3

How to Choose the Right Type of Cloud for Your Organization
Introduction

Through the first two newsletters, we gave you have a preliminary understanding of the development, technology, advantages of the cloud platform, and the benefits that it can bring to your business.

According to the Gartner Group’s forecast, IT investment in cloud installations is expected to grow 18% by the end of this year, and by 2024, is projected will grow to over 14% of IT expenditures. At the same time, as organizations begin to recover as the Covid-19 epidemic begins to wane adoption, we expect that cloud platforms will be more widely adopted and continue to accelerate even more. With this change, an organization’s ability to choose the appropriate cloud architecture will become essential for business success.

In this issue, we’ll highlight some of the key technical, financial and business considerations in this increasingly important area of IT.

Key Factors to Consider

Do you need a private or public cloud? Or should it be a hybrid cloud? Before you decide, here are some important factors to consider: 

• Business needs: What are your business needs? How will cloud help you address these? What scale and scope of capabilities are needed today or In the near future? Answers to these questions are essential for choosing the right type of cloud architecture and capabilities.
• Budget: Budget will affect the time and quality of your cloud platform development. If cost is not a primary consideration, top cloud providers already in the market can provide you with services, and will likely give you the quickest path to completion. On the other hand, if budget is a major constraint, you may have to make tradeoffs in capabilities and time to completion.
• Technical capabilities of your current IT organization: Choosing a cloud platform compatible with the technical capabilities of the company’s organization will help you stay ahead of maintenance and operational problems, and promote clearer planning of future expansion and upgrades.

Private Cloud

Private Cloud refers to a cloud computing solution dedicated to a single enterprise or group of employees. Here, the supplier uses its own infrastructure or customer’s data center to deploy a customized cloud platform to provide on-demand compute capabilities, through a dedicated network thereby providing unique business capabilities while addressing internal requirements with ready ability to respond to changes in organizational business development.

This solution is attractive because it offers a high degree of controllability and security, and it is suitable for large organizations in data-sensitive industries and government units that are especially sensitive to these issues. However, deployment requires an advanced data center, requisite technical capabilities, and the ability to support infrastructure expansion as business demand grows.

Advantages of Private Cloud

• Customization: The architecture specification can be customized according to the user’s special business and security requirements.
• Security: A local data center provides an isolated environment, with no direct access by external staff, but can set identity verification to specify access permissions from outside the data center, providing better security and privacy of system information than a geographically distributed system.
• Low latency data access: Because the resources are located in a local data center, data latency is inherently low.
• Flexibility: IT can flexibly adjust the infrastructure when the business changes.

Disadvantages of Private Cloud

• High cost: Costs such as maintaining and upgrading software and hardware, etc. are borne by the owner rather than shared, making the fixed cost of a private cloud high.
• High skill threshold for operation and maintenance management: It is necessary to invest in training the IT team to have sufficient ability to manage operation and maintenance.
• Lower scalability: Scaling is subject to availability of local computing resources, thereby limiting response when faced with unpredictable needs.

Public Cloud

Public Cloud refers to a cloud computing service solution provided by a third-party provider over the Internet. Computing resources are shared by multiple customers, and each customer can purchase or expand services on demand. With low cost and high scalability, it is especially suitable for small and medium enterprises or software development and testing organizations with limited funds more predictable business and computing needs. Well-known examples include Amazon Web Services, Microsoft Azure and Google Cloud Platform, as well as domestic Alibaba Cloud, Tencent Cloud and other ultra-large-scale public cloud solutions.

Advantages of Public Cloud

• Low barriers to access and use: IT infrastructure can be deployed and maintained without the need to invest in capital expenditures or train internal IT personnel with complex expertise.
• High scalability: Purchasing on demand can meet the increasing workload demands of business development.

Disadvantages of Public Cloud

• Security: Because sharing computer resources introduces potential security concerns based on external access, it is not suitable for security-sensitive businesses.
• Cost control: Although public cloud does not have high initial capital expenditures, the total cost of ownership (TCO) will increase gradually with scale of use. It will be difficult to control overall cost in the long run, especially for medium and larger organizations.
• Lower flexibility: Users have little control over the public cloud infrastructure. Compared with private clouds, public clouds are limited in their ability to address unique business or individual needs.

Hybrid Cloud

Hybrid Cloud is a cloud computing solution that combines one or more public cloud and private cloud environments through network connections, allowing organizations to distribute workloads to different cloud environments according to different business needs, while also sharing applications and data among users. Examples include: running core services and confidential data in a private cloud environment, using public clouds to process non-sensitive data or provide additional capacity on demand to respond to occasional spikes in network traffic.

Hybrid Cloud offers the economy and agility of a public cloud, while also providing the security and privacy of a private cloud. As such, it offers the agility, flexibility and efficiency according to many workloads encountered by a variety of organizations.

Advantages of Hybrid Cloud

• Flexibility: The workload of deploying public and private clouds can be flexibly allocated according to business or data security, performance requirements, and budgeted costs.
• Cost: According to data and load requirements, the cloud environment needs can be determined flexibly, and investment costs are more controllable.
• Performance and Security: The hybrid architecture is capable of providing low-latency requirements while offering the security of a private cloud for sensitive data.

Disadvantages of Hybrid Cloud

• Complexity: With the development of enterprise organizations and management changes, the combination of public and private clouds need to be frequently monitored and adjusted, thereby increasing management and implementation complexity.
• Management: Cloud architectures of different types and locations require good integration, system compatibility and well-integrated management systems.

How To Make The Best Choice For Your Business

 In summary, each type of cloud has its advantages and disadvantages.

Public Cloud can be likened to a company renting a shared office or meeting room. It can flexibly determine the location and time of the leased office based on business needs. The cost may be relatively low but it is not possible to determine the office space configuration by itself. Therefore, the public cloud is very suitable for performing diversified tasks, and is usually a good choice for software development and testing, backup of non-sensitive data, as well as big data processing and analysis.

By comparison, Private Cloud is more like an office space that an enterprise needs for long-term fixed use with no need to share the space with other organizations. In this arrangement, the enterprise needs to pay more for its exclusive office, but it has more freedom to choose the workspace design and allocation. Choice, control, confidentiality, and security are some of its main advantages. Private Cloud is a good choice for banks and research centers that require specific system needs and data confidentiality; it is also a good choice for enterprise organizations that place a premium on information security and management.

If your company has requirements for customization, high security, low risk, etc., and has the technical and financial capabilities to expand the infrastructure as your business grows, then you may want to consider using a private cloud. If your business wants to quickly deploy services, configure on-demand, and streamline infrastructure costs and related management, then a public cloud will be a relatively good choice for you. However, the most versatile and cost-effective choice for an enterprise is usually a hybrid cloud using a combination of public and private clouds. In a report commissioned by IDC in 2021, IBM estimated that a hybrid cloud could help increase the business value of an enterprise by 2 ½ times.

Summary

In summary, each type of cloud has its advantages and disadvantages.

Whether you choose a public cloud, a private cloud, or a hybrid cloud, new considerations for operation and maintenance management are a requirement. Organizations that fail to account for inherently different operation and maintenance management for Cloud, risk successful implementation and may fail to achieve the economies of sound Cloud operation. For these reasons, we believe a cloud management trend is beginning to emerge: companies and organizations are now choosing a commercial cloud platform provider, and buying managed services to avoid operational and scaling issues. We expect managed service is to become the predominant service solution for cloud platform providers in the future. This is a new topic; let’s leave further detailed discussion for another time.