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Which is cheaper: Public or private clouds?

Brandon Butler | Oct. 20, 2016
That depends on how good you are at managing infrastructure. 451 finds labor efficiency and utilization severely impact total cost of ownership for private clouds

public vs. private cloud cost comparison

451 finds that labor efficiency and utilization of resources are two critical factors for determining if a public or private cloud is most cost effective.

Another metric to consider in the OpenStack vs. proprietary private cloud decision is the cost of labor. Rogers estimates that an OpenStack engineer average salary is $140,000 compared to that of a VMware or Microsoft administrator’s $100,000. New training and certification programs from OpenStack should increase the talent pool of available open source cloud engineers, which could even out the salary discrepancies, Rogers also notes.

Public clouds have their advantages. Most notably, public clouds are the least wasteful deployment option because they offer on-demand provisioning of resources. This frees the customer from investments or capacity planning exercises that are critical to a private cloud deployment. Cloud vendors do offer customers discounts for committing to longer-term contracts of use, however.

Rogers warns that a private cloud deployment can turn into a financial quagmire if utilization and efficiency rates are not achieved. It’s difficult to predict how many engineers it will take to manage a fleet of VMs and how well utilized it will be within an organization. “These (unknowns) are real risks – get them wrong, and a black hole effect can make resources disproportionally expensive,” Rogers notes. There are other X factors to consider as well, including cost of migration, existing infrastructure investments, in-house expertise of systems management and potential training.

TCO is also just one factor, he notes. “Often the security and control inherent in private clouds outweigh financial considerations,” Rogers reports, adding that a long-term strategy should be considered to determine what the future path of the company is and which platform offers the key features most important to them.


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