Public Cloud-to-Cloud Repatriation Trend

Cloud repatriation is the process of moving a workload or application from a public cloud to an on-prem or private cloud. The statistics of cloud repatriation, its possible effects, and the justifications for company adoption are all included in the paper. According to recent estimates, in 2021, over 80% of businesses will pull some workloads from the public cloud. The Public Cloud Repatriation Trend statistic initially seems to indicate a significant return to on-prem data centers.

Over the past 12-15 years, the public cloud trend has become more popular. AWS introduced the public cloud in 2006, Microsoft Azure in 2010, and Google Cloud in 2008. The cloud trend took off in 2012-13, and most startups developed and grew in the public cloud, like Dropbox, Netflix, DocuSign, Box, etc.

Thanks to cutting-edge new technologies such as document sharing and internet streaming, customers can access data and watch movies from any location. As a result, some major enterprise firms started moving their development workloads to the public cloud first to save costs associated with operating on-prem data centers, expensive hardware maintenance costs, software license fees, data center space, power, and cooling costs.

Critical production workloads were then migrated to the public cloud as well. However, as they grew, they learned that moving demanding workloads to the public cloud was more expensive and complicated than doing it in on-prem data centers. As a result, shadow IT has also evolved over time and now governs the IT industry.

What Is Cloud Repatriation?

Cloud repatriation is the process of migrating IT workloads or applications from public clouds to on-prem or co-located data centers. Due to hybrid cloud adoption, data security of the public cloud, regulation, app performance, vendor lock-in, downtime, and data security of the public cloud, the organization's strategy to shift some workloads from the public cloud to on-prem has been forced to be rethought.

For instance, a former Amazon Web Service (AWS) employee was charged with stealing data regarding Capital One from the AWS system in 2019. Because of these issues, organizations that now demand total control over their data in the public cloud have major security concerns. Instead of the start of the end for public cloud providers, Cloud Repatriation heralds the end of the beginning for the cloud itself.

Why Do Companies Employ Cloud Repatriation?

Large company IT leaders are beginning to understand that not all data and application workloads are suitable for the public cloud. Some workloads perform better in an on-site data center. Over the years, they have developed their skills in managing their environment in the public cloud. They have identified the optimum method for executing various workloads on either the public cloud or on-prem. 

To minimize the high ongoing costs of extending the public cloud, they frequently move archive data, static workloads, low latency application workloads, and regulatory and compliance workloads back to on-prem data centers.

A great case study on Dropbox (Kurt Marko) shows how the company successfully relocated its workload out of the public cloud and built software-defined data centers on-prem, resulting in annual cost savings of millions of dollars for the enterprise.

The Potential Implications of the Cloud Repatriation

There has been substantial debate about what the phenomena of cloud repatriation would signal for the future of the sector. The hyper-scale cloud companies may minimize or ignore the idea by extolling the freedom and agility of public clouds. At the same time, the data center incumbent vendors highlight the security and operational control benefits of on-prem and private infrastructure (implying that the repatriation trend is much larger or permanent than it is).

However, information on cloud repatriation is frequently taken out of context. Most businesses now seek an IT estate that can satisfy the cost, performance, and governance requirements of the diverse workloads (a concept we've been calling "best execution venue" for years).

This is because most companies no longer look for a single, all-encompassing answer to their IT requirements. Cloud repatriation is happening, according to data from 451 Research's surveys on IaaS/PaaS public cloud and datacenter/colocation public cloud, but not to the exclusion of the hyper scalers' capacity to stay in business. 

On-prem/private cloud environments are preferred by certain firms for a variety of good reasons; some of them have to do with the public cloud, while others are more focused on organizational/ governance difficulties and the availability of cloud expertise/skills. 

Moving data, workloads, and applications often across environments won't be a unique IT practice anymore. It is not a boomerang but a rotating door.

Statistics About Cloud Repatriation

Between June and July, 451 Research polled over 600 data center/colocation respondents for its Voice of the Enterprise: Data Centers 2021 survey. It found that over the previous 12 months, 48% of those surveyed stated they had migrated a workload or application away from the hyper-scale public cloud providers (such as Amazon Web Services, Microsoft Azure, and Google Cloud Platform) to another place. 

This number might initially seem concerning, but it just shows if firms have experienced any back-to-on-prem data centers situations in the last year. Therefore, the fact that approximately 50% of workloads were moved out of public cloud settings in 2020–2021 should not be concluded (whether they were hosted on hyper-scale platforms or not).

Few companies with their data centers or leased colocation facilities have opted for cloud repatriation during the last five years. However, according to a comparable 2016 study, 68% of respondents stated that their companies had used the hyper-scale public cloud in the preceding year.

When asked where those organizations transmitted their workloads, 87 percent of respondents selected self-managed infrastructure, with 14 percent selecting a colocation facility and 86 percent selecting their data center. Contrarily, 28% of organizations chose infrastructure that a third party controlled, suggesting a modest overlap of those selecting a combination of the two choices.

According to Figure 1, 40% of companies who went with a third-party alternative selected a hosted private cloud, 21% went with a small-scale public cloud, and 13% selected managed colocation.

Conclusion 

Top IT executives predict that in the future years, business firms may see a trend where certain public cloud workloads migrate to on-prem. In the future, enterprises will not have to be vendor-locked and will be allowed to move their data to other cloud providers.

Moreover, resulting in ROI-justified administration of multi-cloud platforms from a single dashboard as technology advances and some of the problems with public cloud are rectified. As a result, businesses may once more employ the public cloud.

The main problem of companies is that they think that the public cloud will work the same as their corporate data centers and that the claims of cloud service providers that their solutions are affordable and simple to adopt are true. Unfortunately, more often than not, such fundamental errors in understanding the technology are responsible for the disappointments.