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The Cloud-Cost Conundrum Life After Public Cloud

The Cloud-Cost Conundrum

Public Cloud is an ideal fit for digital native businesses, such as e-Commerce, online games, and online entertainment. This is especially true for those that rely on subscription-based consumption revenue models and offer services to a global customer base. Those services are primarily provided online and rely on new cloud-native infrastructure to support the entire service lifecycle.

Given the undeniable benefits of cloud computing, it’s important to embrace cloud technologies when reviewing IT strategies, such as Asset-Lite (for better operating costs), and IT methodologies, such as Agile (for faster GTM). However, more and more enterprises are beginning to realize that the “lift and shift” approach of migrating their on-premises data center to public cloud infrastructure-as-a-service (IaaS) leads to higher TCO (Total Cost of Ownership) – direct cost plus the operational cost during its lifecycle.

Providers and proponents of public cloud are aware that it is expensive for enterprises to lift and shift their data center to public cloud IaaS. They also know that many legacy systems simply cannot shift to the public cloud’s non-tailorable platforms. As a result, they’ve suggested platform-as-a-service (PaaS) or SaaS adoption. However, these require modification of existing IT infrastructure and re-platforming, re-architecting, re-factoring, or re-writing applications. This ultimately leads to additional investment in new system infrastructure and introduces potential operational and user experience issues.

Enterprise Saves Millions by Moving Out of Public Cloud

Even digital native businesses like SaaS providers recognize this huge difference. A few years ago, Dropbox, the popular cloud storage and collaboration platform, moved most of its data – including user data – from public cloud to private cloud. Two years later, one of its financial documents revealed that the move had shaved $74.6 million off its operational expenses.

The example of Dropbox is a prime example of solving the cloud-cost conundrum, demonstrating that there is life after public cloud.

Reduce Your TCO with Sangfor Local Cloud

At Sangfor, we are committed to providing our customers with advanced yet cost-effective solutions, because we firmly believe that accessibility to cutting-edge technology is the driver of progress. By offering affordable solutions, we enable more customers to access the tools and resources they need to grow and succeed.

That is why Sangfor Local Cloud offers incredible value, helping customers significantly reduce their TCO for the same level of performance compared to public cloud IaaS.

Cloud TCO Comparison

    • Sangfor Local Cloud saves 50% in TCO for the same public cloud SLA and resources
    • Software defined data center with 40 VMs; total IaaS resource 200vCPU, 400GB RAM, 10TB Storage
Public Cloud with yearly saving pla VM/Year VM Qty 1-Year Cost 3-Year Cost 5-Year Cost
Web Server (2U; 2GB RAM; 30GB Disk) 138 3 565.8 1,697 2,829
App Server (2U; 4GB RAM; 30GB Disk) 630 17 9,967 29,902 49,837
App/DB Server (8U; 16GB RAM; 470GB Disk) 3,012 20 56,810 170,431 284,052
App/DB Server (8U; 16GB RAM; 470GB Disk) 3,012 20 56,810 170,431 284,052
Public Cloud Tenant Spending 67,344 202,031 336,718
Sangfor Local Cloud VM/Year VM Qty 1-Year Cost 3-Year Cost 5-Year Cost
Web Server (2U; 2GB RAM; 30GB Disk) 164 3 492 1,476 2,460
App Server (2U; 4GB RAM; 30GB Disk) 630 17 9,967 29,902 49,837
App Server (2U; 4GB RAM; 30GB Disk) 328 17 5,576 16,728 27,880
App/DB Server (8U; 16GB RAM; 470GB Disk) 1500 20 30,000 90,000 150,000
Local Cloud Tenant Spending 36,068 108,204 180,340
    • Here is an example of a customer that realized significant TCO savings after switching from public cloud to Sangfor Local Cloud.

Organization Cloud Service TCO Comparison TCO Savings
PCI Innovations Tech Center, Philippines Previously: Amazon Web Services (AWS) Annual spend: $100K-150K USD 50%-60%
PCI Innovations Tech Center, Philippines Now: Sangfor Local Cloud Annual spend: $50K-60K USD 50%-60%

Take Back the Wheel of Your Cloud Journey

Public cloud can be an attractive option for businesses that are undergoing transformation or adopting new online channels that require applications to run on the cloud. However, it is crucial to approach this adoption with a wise strategy that carefully considers factors such as return on investment, service availability, data protection, and user experience while exploring other alternatives. By doing so, a business can take a smarter and more measured approach to adopting cloud technologies and ensure its success.

Here are three key ideas to take away with you:

    • Organizations should always have control over their data and infrastructure.
    • Cloud services should cover networking, security, and service continuity.
    • Users should have an exit option that has minimum impact on service and TCO.

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