Oi! Leave me out of this...
- Apr 8, 2006
I don't see how that is possible. Backup power generation, HVAC, physical security, replacing hardware (end of life), power costs, staff that maintain the servers on-site (above and beyond the guys that access them remotely as you would in the cloud).
In SA I can't see how any company can claim given the above that it is cheaper to have your own cloud. The scale just isn't there.
Compliance and regulation is much cheaper in cloud.
Amazon has regions with special compliance just for that. ie. ITAR compliance data centers.
At their scale they can afford to build the expensive software tooling to make the data center completely hands off and automated in every way.
From rotating credentials, delivering hands-off credentials, monitoring for bad servers, automated scrubbing of machines when you are done with them, the list is so long I could write pages about it.
Each one of those things has a software cost associated with it. If you had to pay that cost as a company, you'd ultimately be spending billions, which is what Amazon is spending. And when that stuff isn't bringing you in money, it is impossible to justify. Whereas for Amazon it is super easy to justify. That is ultimately why hybrid or on-prem is false economy. Amazon backed down from their position that on-prem doesn't make sense because too many customers just couldn't accept that fact. But it is the less secure option, there is no 2 ways about it. On-prem was how Oracle and M$ tried to sell cloud before they had any meaningful way to compete with Amazon. It didn't hurt that a bunch of "IT techs" were just looking for a reason to say "see I told you so". I can see very few situations in which on-prem could make sense
The Capex/Opex split isn't making comments about a private DCs being cheaper, but merely that taking full advantage of the cloud can end up in a hybrid Capex/Opex model by reserving base capacity from the Cloud provider.
As for Compliance/Regulation being cheaper in the cloud, its actually not that simple by any stretch of the imagination. On a purely "cost" basis, that MAY be the case but its not always just about the pure cost of it, there are risks as well a regulatory requirements that might make the Cloud a non-starter for a specific solution/requirement.