Why over half of UK organisations think the public cloud is over-hyped and overpriced
June 7, 2020

No one is doubting the lure of the cloud. 

But a recent report by Capita has revealed that the majority of UK organisations are becoming increasingly disillusioned by their decision to move to the cloud. The research which covered 200 decision makers across the IT sector also found that ‘unforeseen factors’ had resulted in their organisation’s cloud migration being behind schedule. 

The main factor behind the push to adopt the cloud was undoubtedly to reduce the cost of storing data on premise. But the reality is that even though many organisations have been planning the move as long ago as 2015, the promised savings simply haven’t materialised. 

According to the survey, less than half of the proposed workloads and applications have successfully migrated, with just 1 out of every 20 respondents stating that they had not encountered any challenges on the road to cloud migration. 

Security issues and lack of internal skills. 

The key obstacles that have resulted in such slow progress and disillusionment were quoted as being security issues and the lack of internal skills. 

In addition, many organisations took a ‘lift and shift’ approach which entailed simply gathering up everything they were storing on-premise and shifting it over to the public cloud. The problem with this approach is that they failed to realise that in the vast majority of instances you need to re-architect the application in order to optimise them for the cloud. 

As the challenges continue to mount up, so has the cost. 

Nearly 60% of organisations admit that moving to the cloud has been far more expensive than anticipated. 

The increasing cost of moving to the public cloud isn’t confined to the UK. Across the world organisations invested $107 billion (£83 billion) on cloud computing last year, an increase of 37% on the previous year and this amount is predicted to spiral over the next 5 years. 

Research by Gartner predicts that over the coming year 80% of organisations will exceed their cloud infrastructure budgets due to their inability to manage cost optimisation. 

Yet infrastructure isn’t the only growing cost when moving to the cloud. The total spend on cloud services themselves are set to hit $500 billion (£388.4 billion) by 2023. 

These escalating costs of moving to the public cloud are clearly coming as quite a shock, not least because cutting costs was one of the prime drivers behind the moving to the cloud in the first instance. 

The way forward. 

If you are considering adopting public cloud services, then it’s worth taking the time to validate your strategy before committing your organisation to what could become a very costly and ultimately frustrating exercise. 

For those organisations who are already way down that path, the main aim at this moment in time should be how to control escalating costs; and at the heart of this should be better planning.  

As a result, you need to understand the characteristics of your different workloads and then focus first on migrating those with characteristics that map well to the benefits of the cloud. These are likely to be applications that have burstable resource demands and/or, are well architected for public cloud services. 

For workloads with relatively stable resource demands and that maybe not be well architected for the public cloud, you are likely to experience better value and control keeping them on a hosted private cloud platform. Equally importantly, it shouldn’t be regarded as a one-off event, the cloud is dynamic, so you need to continually monitor its performance.  

Only 33% of organisations state that their costs have decreased and only 16% are extremely satisfied.  

While many IT decision-makers still firmly believe that its benefits will eventually outweigh its drawbacks, and that the public cloud is the way forward, yet again this belief is undermined by statistics which show that only 33% of organisations state that their costs have decreased since migrating to the cloud and only 16% are extremely satisfied with the move. 

So, it’s fair to say that very few organisations have seen the benefits, let alone the transformational potential of their investment. No wonder that the majority of IT leaders have been left frustrated and underwhelmed by the promises made by the purveyors of cloud technology. CSPs have been quick to jump to its defence, claiming that expectations have been misplaced and the actual purpose of the move is to enable innovation. 

Little consolation for those IT leaders who have taken on the responsibility for migrating to the cloud and have been left to explain to their colleagues and Directors why it has failed to deliver. 

To discuss your IT requirements and the different options available to you, contact Peter Grayson on 0161 537 4980 or email peter.grayson@quadris.cp.uk

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