Episode XIV: Circle of Life

Author(s): Fatih Nar Chief Architect at Red Hat, Tom Conklin Senior Director at Red Hat
Reviewer(s) & Contributor(s): Azhar Sayeed Senior Director at Red Hat

Introduction

When we see birds up in the air in Autumn, that reminds us the days ahead will get more challenging and hence it is time to re-think where we are and where we shall aim to be for our sakes; time goes on and at next Autumn lather, rinse, and repeat. This is also true for businesses where IT systems bring significant challenges not only for maintaining existing execution but also for scaling based on business needs and complying with standards, regulations, and trends. Hence, they stay alive and relevant in their journey. As we maintain the execution of a business process in some parts of the flow, we may notice circular patterns where some operation can/may/will move back and forth between different hostings based on a given time’s business and operational (BaO) needs.

With the rising popularity of cloud computing, there has been a hot debate about using on-premise data centers vs. cloud, and passionate camps have been established to defend each side. This article will detail each, try to gather the pros & cons, and draw insights into possible cyclic BaO patterns.

On-Premise vs. Cloud (Frenemy)

Whether cloud computing is better than on-premise data centers (or not) depends on various factors, such as the organization’s size and needs, budget, security requirements, and the level of control, it wants to retain over the systems it consumes.

With cloud computing, businesses can;

• access computing resources and services on demand,
• pay only for what they use (intentionally or unintentionally), and
• easily scale up or down as their needs change.
• pay less (even none for the most part) for infrastructure maintenance and upgrades, which can reduce the burden on in-house IT teams.

While cloud computing offers many benefits, on-premise data centers can provide more granular control over infrastructure and data, which can be crucial for specific industries and organizations with high-security and regulatory requirements. The decision to choose between cloud computing and on-premise data centers ultimately depends on the specific needs and circumstances of the organization. Security, compliance, scalability, cost, and performance must be carefully considered before deciding on the right approach. With this in mind, let’s explore when to migrate workloads to or from the cloud.

On-Premise -> Cloud (Rush to Gold)

The decision to move to the cloud from on-premise data centers can be for various reasons:

• Scalability: Organizations that experience fluctuating demands for computing resources may find it more cost-effective to use cloud computing instead of maintaining on-premise data centers sized for peak/burst demand. Cloud computing allows businesses to scale up or down easily as their needs change without investing in additional hardware and space.
• Cost savings: With cloud computing, businesses can pay only for their resources (operational expenditure -opex-), avoiding investing in expensive hardware and infrastructure (capital expenditure -capex-).
• Agility and innovation: Businesses can act faster to adopt new technologies and innovation. Cloud providers often release new features and services faster than on-premise data center vendors, giving businesses a competitive advantage.
• Single Pane (All You Can Eat Menu): Cloud service providers offer a central menu/catalog and access to their products and services, making development and operations relatively easier to implement & convenient with all-you-can-eat from their catalog, which dynamically changes behind the scenes.
• Geographic reach: Businesses can extend their reach to new geographic locations without setting up physical infrastructure. This can be particularly useful for businesses with customers and/or employees in multiple locations.
• Disaster recovery: Cloud computing can provide businesses a more robust and reliable disaster recovery solution than on-premise data centers. Cloud providers typically have redundant systems and backups in multiple geographic locations, which can help ensure business continuity in the event of a disaster based on the service/product they are offering in their catalogs.

Cloud -> On-Premise (Back to Motherland)

The move from the cloud to on-premise data centers can be based on various reasons:

1. Cost: Depending on the usage patterns and workload characteristics, it is possible for on-premise data centers to be more cost-effective than cloud computing in some cases. For example, if a business has stable and predictable traffic that requires significant computing and storage resources over a long period, it may be more cost-effective to invest in on-premise infrastructure rather than pay for cloud resources over time.
2. Data sovereignty: Some organizations may be lawfully required to keep data within specific geographic locations, which may not be possible with cloud computing. The organization may deploy on-premise to comply with data sovereignty regulations in such cases.
3. Security and compliance: Some organizations may have strict security or compliance requirements that are difficult or impossible to meet with cloud computing. In such cases, the organization may bring the workload back on-premise, where they can better control the infrastructure and security policies.
4. Convenience versus Blast Radius: Despite having central access to all-you-can-eat products and services from a cloud service provider providing convenience, the cloud operational record track also showed that it increased the blast radius for failures and outages on a global scale.
5. Balancing Roles and Responsibilities with SLAs: The roles and responsibilities of cloud service providers and their consumers have been a key area of friction in implementing end-to-end services with SLAs. While cloud providers have established a high level of separation between these roles and responsibilities, issues can arise in the operational experience of handling these responsibilities and signing off on end-user SLAs. This can create challenges that are overwhelming for all parties involved.
6. Latency and performance: Applications that require low latency and high performance may not be suitable for cloud computing due to the inherent network latency and potential for contention with other workloads running on the same hardware. In such cases, on-premise data centers can provide better performance and lower latency for critical applications.
7. Unforeseen costs: In some cases, businesses may experience unforeseen costs associated with cloud computing, such as unexpected network transfer fees, storage costs, or licensing costs. These costs may be difficult to control or predict, leading some businesses to bring the workload back on-premise.

Some statistics for reverse migration:

• In a survey conducted by Flexera in 2021, 20% of respondents reported moving applications from the cloud back to on-premises environments, up from 7% in 2020.
• A report by Gartner in 2021 predicted that by 2024, more than 80% of organizations that have deployed cloud infrastructure as a service (IaaS) would adopt a strategy of moving workloads between cloud providers or bringing them back on-premises.
• Another report by IDC in 2021 found that while only 3% of workloads have moved back to on-premises environments from the cloud, 47% of organizations that moved workloads to the cloud experienced unexpected costs.

Figure-1 Flexera 2023 State of the Cloud Report, Top Cloud Challenges (Link)

Talent Factor (So You Think You Can Dance?!)

Cloud migration requires a range of specific skills and strong expertise. The migration task’s difficulty will depend on various factors, such as the size and complexity of the organization, the number and types of applications and workloads being migrated, and the level of integration required with existing systems. Successful migration requires careful planning, execution, and monitoring to ensure that the process is seamless and disruption-free.

Here are some factors that influence cloud migration:

• Know-How: Cloud migration requires a range of skills and expertise, including cloud architecture, security, networking, DevOps, and vendor management. In addition, it may require expertise in the specific cloud platforms and technologies being used and the ability to manage the migration process from planning to execution and ongoing management.
• Effective Program Management: Gathering the right team with the appropriate skills and experience is crucial to successful cloud migration. This requires a robust talent management program and well-established practices. This is where global systems integrators (GSIs) play a significant role. We have seen many cloud migration projects owned, executed, and managed by the biggest GSIs, often close cloud service provider partners with significant cloud spending commitments. A growing trend is for systems integrators to manage on-premise clouds through a “containers as a service” offering. In this model, the GSI deploys platforms and workloads on demand. It handles day-to-day lifecycle management for both, allowing for active management of IT sprawl and reduced shadow IT efforts. Partnering with a GSI can be an excellent way to improve business agility and achieve successful cloud migration.
• Time Factor: Time is a crucial factor in technology for new shiny things to be developed/used and for the dynamics of personal and business life. It is proven that covid has accelerated the cloud migration, and the post-covid economic slow-down showed reverse migration is very real and happening. Over the course of time, talent variety, strength, capacity, and capability would be changing for availability, accessibility, and affordability.

Figure-2 Flexera 2023 State of the Cloud Report, YoY Comparison for Top Cloud Challenges (Link)

Sustainability & Efficiency

Cloud service providers operate large data centers designed to be energy efficient and rely on renewable energy sources. They tend to be located in areas with low energy costs and abundant renewable energy sources, such as hydroelectric or wind power. This results in a relatively low carbon footprint for cloud providers. However, sustainability can vary among on-premises data centers, with smaller facilities often having lower energy efficiency and relying more on non-renewable energy sources. However, larger on-premises data centers can also be designed for high energy efficiency and renewable sources.

While both cloud service providers and on-premises data centers can be efficient, cloud providers tend to offer higher levels of efficiency due to economies of scale. These providers can spread the fixed costs of data centers over more customers, resulting in lower costs for each customer. This allows cloud providers to invest more in advanced technologies, such as AI and machine learning, that improve efficiency. However, on-premises data centers can also be highly efficient, often requiring significant upfront investments in technology and infrastructure.

One way to achieve more efficient operation is through workload migration, where legacy workloads are moved to modern server hardware. Refactoring legacy monolithic applications to be cloud-native and built from microservices can further optimize power savings and reduce the total cost of ownership. Advanced orchestration and automation can also optimize server hardware utilization, with workloads distributed dynamically throughout the data center to improve cooling systems’ performance.

Integrating data from infrastructure into advanced closed-loop automation can also be a significant tool for running a sustainable enterprise, regardless of whether the data center is on-premises or in the cloud. Organizations can achieve significant gains in efficiency and sustainability by taking a hardware-oriented approach and implementing software structures and layers that optimize performance.

Summary

We have adopted the “circle of life” perspective to guide our approach in migrating workloads to and from the cloud. This view recognizes that deployment spans go through different stages in their lifetime, each with unique growth and needs that require optimization to meet evolving TCO versus ROI expectations.

Figure-3 Yin and Yang for Cloud & On-Premise

Throughout this article, we have emphasized the Yin and Yang of cloud versus on-premises infrastructure (Figure-3), highlighting the need for a hybrid cloud strategy to avoid the limitations of an exclusive approach. A hybrid cloud strategy provides greater flexibility, allowing workloads to be placed in the public cloud or on-premise depending on performance, cost, and security factors.

Figure-4 Flexera 2023 State of the Cloud Report, Hybrid & Multi-Cloud Usage Statistics (Link)

If you have made it this far in reading, we don’t want to disappoint you with an ambiguous ending. However, the truth is that every business journey is unique with its own distinct characteristics that may change over time. Decisions made at a given time may need to be revisited later. Just as in the circle of life, a hybrid cloud strategy provides the freedom to adapt to changing circumstances and make necessary revisions. With a hybrid cloud approach, businesses can avoid being locked into rigid, predetermined paths and instead embrace the flexibility to evolve and grow with their changing needs.