In talking with clients and partners about the options for organizations moving to the cloud, there has been some confusion as to what the different offerings are and what they mean. The focus of this post is to point out a misconception. This may be obvious for some, but it has become clear that the use of the term “Cloud” has generated so much enthusiasm and marketing hype that it’s used very generically. I get the terminology mixed up sometimes as well.
Cloud / Private Cloud vs Cloud Services
Since I operate in the Microsoft ecosystem, it is easier to use them as the example. Microsoft’s Azure platform offers a lot of services within this framework. When talking with potential customers, many immediately think of the cloud as the place to move all their physical servers and infrastructure (or at least most of them), replacing them with virtual servers in the cloud. They price this out and then compare that to all the marketing materials for cloud-based services they see advertised and think something is amiss. They wonder why this is still pretty expensive. There are two problems here:
- Moving all your physical or virtual machines to an identical hosted environment in the cloud is not what most people are doing to take advantage of the cloud. (Although this is a very viable and often desirable approach for many organizations for some of their infrastructure)
- The full cost analysis is not being performed to understand what on premise costs really are, but that isn’t the focus of this article
The real misunderstanding is that the cost-savings and value are derived from replacing those servers and the software installed on them with cloud services (not servers) meant to duplicate this functionality via a shared service, not just a virtual machine. For example, let’s assume you run Exchange servers, a Lync Server, SharePoint Servers, a Phone System, use GoToMeeting accounts for everyone, buy Office Client, run a bunch of SQL Servers and applications, and more, all internally on physical or virtual machines. Simply moving those machines to the cloud isn’t where the magic happens. The savings and headaches are removed when you migrate all the functionality of those applications to their equivalent multi-tenant solutions in the cloud like Office 365, and let Microsoft manage all the infrastructure. You are now free to spend your resources on making those applications work better for your organization, instead of spending 75% of the costs just keeping the servers running and patched. You stop paying for software, maintenance, assurance, technical refreshes, and just start paying for features, functionality, and services, not virtual machines.
As I mentioned before, this may seem obvious to many folks who have gone down the path, but this confusion has come up enough times to warrant a quick explanation of what moving to the cloud is really all about: It’s what didn’t take off 15 years ago: “Software as a Service”. Everything as a service these days.
The next time you talk to someone about moving to the cloud, or using the cloud, make sure you understand what they are talking about. Cloud infrastructure, Private Cloud or cloud-based services.
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