The advantages and disadvantages of private cloud 

The
popularity
of

private
cloud
is
growing,
primarily
driven
by
the
need
for
greater

data
security. Across
industries
like
education,
retail
and
government,
organizations
are
choosing
private
cloud
settings
to
conduct
business
use
cases
involving
workloads
with
sensitive
information
and
to
comply
with

data
privacy
and
compliance
needs.

In
a report
from
Technavio (link
resides
outside
ibm.com),
the
private
cloud
services
market
size
is
estimated
to
grow
at
a
CAGR
of
26.71%
between
2023
and
2028,
and
it
is
forecast
to
increase
by
USD
619.08
billion.

The
need
for
private
cloud
settings
is
also
closely
linked
to
a
hybrid
cloud
approach—the
integration
of
on-premises,
private
cloud
and
public
cloud
into
a
single,
flexible
IT
infrastructure—which
is
an
essential
part
of
the
enterprise-business
digital
transformation
journey.
According
to
the IBM
Transformation
Index:
State
of
Cloud report,
71%
of
business
executives surveyed
agree
it’s
challenging
to
realize
the
full
potential
of
a
digital
transformation
without
a
solid
hybrid
cloud
strategy. 

To
determine
how
a
private
cloud
can
bring
business
value
to
their
organization,
business
and
IT
leaders
need
to
review
its
advantages
and
disadvantages.

What
is
private
cloud? 

Before
we
examine
the
pros
and
cons
of
a
private
cloud,
here’s
a
rundown
of
its
essential
features
and
basic
cloud
architecture
components.

A private
cloud is
a cloud
computing environment
where
all
resources
are
isolated
and
operated
exclusively
for
one
organization.
It
may
be
hosted
in-house
within
a
company’s
physical
location,
in
an
off-site data
center on
infrastructure
owned
or
rented
by
a
third
party,
or
in
a
public
cloud
service
provider’s
(CSP’s)
infrastructure
in
one
of
their
data
centers.

Private
cloud
combines
the
main
benefits
of
cloud
computing—chiefly
on-demand
access
to
computing
resources
(e.g.,
cloud
servers, data
storage, networking capabilities,

automation,
software,
data
analytic
tools)—with
the
security
and
control
of
on-premises
IT
infrastructure.

An
organization
can
maintain
sole
responsibility
for
operating
a
private
cloud,
including
its
maintenance
and
overall
management.
Most
companies,
however,
choose
to
outsource
some
or
all
of
their
private
cloud
management
to
a
third-party
provider
like
Amazon
Web
Services
(AWS),
Google
Cloud,
IBM
Cloud
or
Microsoft
Azure.

Four
types
of
private
clouds

There
are
four
main
types
of
private
clouds
from
which
to
choose:

1.
On-premises
private
cloud: An
on-premises
private
cloud
is
hosted
within
a
company’s
on-site
data
center
and
managed
by
its
IT
team.
In
an
on-premises
private
cloud,
an
organization
is
responsible
for
buying
and
maintaining
all
hardware,
software,
security
features,
other
infrastructure
and
so
forth.

2.
Virtual
private
cloud: A virtual
private
cloud (VPC)
provides
an
isolated
private-cloud
environment
within
a
public
cloud.
A
VPC
allows
organizations
to
run
code,
host
websites,
and
more
in
a
secure
setting
with
shared
CSP
resources.

3.
Hosted
private
cloud
(also
referred
to
as
private
cloud
hosting): A
hosted
private
cloud
is
run
off-premises
on
a
CSP’s
servers.
It
differs
from
a
VPC
in
that
it
is
an
environment
with
dedicated
servers
(also
called bare
metal
servers)
used
by
a
single
organization.
In
a
hosted
private
cloud,
the
cloud
provider
owns
and
manages
resources
like
cloud
storage
maintenance,
upgrades
and
security
management
tools.

4.
Managed
private
cloud: A
managed
private
cloud
consists
of
physical
hardware
usually
hosted
in
a
service
provider’s
data
center.
However,
CSPs
also
offer
management
services
for
private
cloud
infrastructure
hosted
in
an
enterprise’s
data
center.
In
this
setting,
the
CSP
carries
out
maintenance,
upgrades,
support
and
management.

Public
vs.
private
vs.
hybrid
cloud 

In
addition
to
private
cloud
computing,
there
are
two
other
main
cloud
computing
models:
private
cloud
and
hybrid
cloud.

In
a public
cloud setting,
IT
infrastructure
is
offered
as
virtual
resources
over
the
internet
on
a
pay-per-use
or
subscription-based
pricing
model.
The
public
cloud
provider
owns,
manages
and
assumes
all
responsibility
for
the
data
centers,
hardware
and
infrastructure
on
which
its
customers’
workloads
run,
providing
high-bandwidth
network
connectivity
to
ensure
high
performance
and
rapid
access
to
applications
and
data.

Unlike
the
single-tenant
architecture
of
a
private
cloud,
a
public
cloud
provides
a multi-tenant setting
that
enables
multiple
clouds to
efficiently
share
scalable
computing
resources
(e.g.,
hardware,
storage,
networking
devices)
accessed
through
a
user-friendly
interface.

In
a
public
cloud,
each
tenant’s
data
is
logically
separated
and
isolated
from
data
related
to
other
tenants.
In
comparison,
private
clouds
offer
a
heightened
layer
of cloud
security through
network
firewalls,
access
controls,

data
encryption
and
authentication
methods
like

identity
and
access
management
(IAM)
tools. 

Today,
most
large
enterprise
businesses
choose
a hybrid
cloud approach
that
combines
on-premises,
private
cloud,
public
cloud
and edge settings.
Today
enterprise
organizations
merge
hybrid
cloud
with

multicloud—the
use
of
services
from
more
than
one
cloud
provider
to
avoid
vendor
lock-in
and
select
best-in-class
offerings
from
different
cloud
vendors.

For
a
more
in-depth
look
at
these
types
of
cloud
deployment
models,
read
our
blog
post,
“Private
cloud
vs.
public
cloud
vs.
hybrid
cloud:
What’s
the
difference?”

Virtualization
and
other
underlying
cloud
technologies 

Public
cloud,
private
cloud
and
hybrid
cloud
all
rely
on

virtualization
technology,
which
is
at
the
heart
of
cloud
computing
and
enterprise
IT
architecture. 

Virtualization
uses
software
called
a hypervisor
to
create
an
abstraction
layer
over
computer
hardware,
enabling
the
division
of
a
single
computer’s
hardware
components—such
as
processors,
memory
and
storage—into
multiple virtual
machines
(VMs).

In
public
cloud,
private
cloud
and
hybrid
cloud
settings,
automation
tools
run
on
top
of
virtual
environments
and
perform
tasks
like container
orchestration with Kubernetes,
the provisioning of
resources
for
workload
deployments
and
updates, performance
monitoring,

disaster
recovery
and
more.
Administrators
control
and
manage
their IT
infrastructure
using
management
software
tools
like APIs.

Cloud
services:
IaaS,
PaaS
and
SaaS

Private,
public
and
hybrid
clouds
can
all
run
the
following
cloud
computing
services:

IaaS,
or
Infrastructure-as-a-Service,
is
on-demand
access
to
cloud-hosted
IT
infrastructure
for
running
applications
and
workloads
in
the
cloud.
IaaS
allows
organizations
to
scale
and
shrink
infrastructure
resources
as
needed,
providing
the
capacity
to
handle
spiky
workloads. 

PaaS,
or
Platform-as-a-Service,
is
on-demand
access
to
a
full-service
cloud
platform
for
developing,
running
and
managing
applications
without
the
cost,
complexity
and
inflexibility
that
often
come
with
building
and
maintaining
that
platform
on-premises.

SaaS,
or
Software-as-a-Service,
is
on-demand
access
to
ready-to-use
software
apps
(e.g.,
Adobe
Creative
Suite,
Slack).
SaaS
offloads
all
software
development
and
infrastructure
management
to
the
cloud
service
provider,
including
maintaining
the
server
hardware
and
software,
managing
user
access
and
security,
storing
and
managing
data,
implementing
upgrades
and
more.

The
advantages
of
private
cloud

A
private
cloud
offers
organizations
a
range
of
business
advantages,
including
the
following:

1. 
   Control: A
   private
   cloud offers
   an
   organization
   full
   control
   over
   its
   environment,
   including
   choices
   regarding
   hardware,
   software
   apps
   and
   different
   levels
   of
   security,
   while
   also
   providing
   many
   benefits
   of
   cloud
   computing
   (e.g.,
   on-demand
   access
   to
   cloud
   resources,
   elasticity,
   scalability
   and
   ease
   of
   service
   delivery).
2. 
   Greater
   control
   and
   visibility: A
   private
   cloud
   offers
   organizations
   greater
   control
   and
   visibility
   by
   storing
   data
   and
   workloads
   behind
   private
   firewalls. 
3. 
   Customization: Private
   clouds
   allow
   businesses
   to
   customize
   their
   hardware
   and
   software
   as
   needed.
   For
   instance,
   IT
   teams
   can
   tailor
   specific
   data
   storage
   and
   backup
   needs,
   boosting
   overall
   efficiency
   and
   cost-effectiveness.
4. 
   Enhanced
   security: In
   general, private
   clouds
   are
   designed
   with
   more
   significant
   layers
   of
   security
   than
   public
   clouds.
   For
   instance,
   private
   clouds
   are
   highly
   sought
   after
   by
   companies
   in
   industries
   like
   government
   and
   finance
   where
   sensitive
   data
   like
   
   personally
   identifiable
   information
   (PII)
   must
   be
   protected
   from
   unauthorized
   users
   or
   bad
   actors.
   Private
   cloud
   security
   measures
   include
   firewall
   configurations,
   virtual
   private
   networks
   (VPNs),
   data
   encryption,
   authorization
   mechanisms
   and
   more
   to
   help
   reduce data
   breaches or cyberattacks. Private
   clouds
   also
   typically
   include
   enhanced
   physical
   security
   measures
   like
   surveillance
   cameras
   and
   security
   personnel.
5. 
   Regulatory
   compliance: Businesses
   can
   tailor
   a
   private
   cloud
   to
   meet
   compliance
   requirements
   and
   regulatory
   standards.
   This
   capability
   is
   crucial
   for
   highly
   regulated
   businesses,
   as
   they
   must
   adhere
   to
   data
   privacy
   and
   data
   sovereignty
   laws
   like
   the General
   Data
   Protection
   Regulation
   (GDPR)
   for
   companies
   operating
   in
   the
   EU
   and
   the
   
   Health
   Insurance
   Portability
   and
   Accountability
   Act
   (HIPAA)
   (link
   resides
   outside
   ibm.com)
   for
   healthcare
   in
   the
   US.
6. 
   Predictable,
   stable
   costs: Private
   cloud
   costs
   are
   generally
   steady
   and
   predictable
   since
   resources
   are
   allocated
   to
   meet
   specific
   needs,
   which
   can
   translate
   into
   cost
   savings.
   This
   is
   in
   comparison
   to
   public
   cloud
   costs,
   which
   can
   be
   unpredictable
   based
   on
   usage,
   new
   services,
   data
   egress
   fees
   and
   more.
7. 
   Improved
   performance: When
   resources
   are
   in
   high
   demand,
   problems
   like
   outages,
   downtime
   or
   bottlenecks
   can
   occur.
   A
   private
   cloud
   can
   optimize
   performance
   by
   isolating
   workloads
   on
   dedicated
   servers.
   This
   capability
   eliminates
   “noisy
   neighbor”
   issues
   like
   
   latency
   and
   other
   performance
   interference
   that
   can
   occur
   in
   multi-tenant
   public
   cloud
   environments. 
8. 
   Modernizing
   legacy
   applications: The
   control
   provided
   by
   a
   private
   cloud
   enables
   more
   seamless
   integration
   of
   existing
   systems.
   For
   instance,
   a
   private
   cloud
   supports application
   modernization,
   the
   transformation
   of
   monolithic
   legacy
   applications
   into
   cloud
   applications
   built
   on
   
   microservices
   architecture,
   which
   supports
   
   DevOps
   methodologies.

Private
cloud
disadvantages

While
private
cloud
has
many
advantages,
particularly
for
organizations
that
seek
heightened
control
and
security
measures,
it
does
have
some
disadvantages
that
are
important
to
consider:

1. 
   High
   initial
   costs
   and
   setup: Private
   clouds
   come
   with
   high
   startup
   (initial
   Capex)
   expenses
   related
   to
   building,
   operating
   and
   managing
   on-premises
   hardware
   and
   infrastructure.
   Moreover,
   private
   cloud
   deployments
   require
   high
   levels
   of
   technical
   expertise.
   This
   disadvantage
   requires
   organizations
   to
   train
   or
   hire
   more
   IT
   staff
   for
   building,
   operating
   and
   managing
   private
   cloud
   infrastructure.
2. 
   Complex,
   ongoing
   maintenance: A
   private
   cloud
   can
   be
   difficult
   for
   organizations
   to
   maintain
   on
   its
   own
   due
   to
   tasks
   like
   performance
   monitoring,
   software
   patching
   and
   planning
   updates.
   Thus,
   many
   organizations
   opt
   for
   a
   certain
   level
   of
   private
   cloud-managed
   services
   from
   a
   CSP
   to
   carry
   out
   smooth
   operational
   maintenance
   and
   reduce
   maintenance
   costs.
3. 
   Lower
   scalability:
   Because
   private
   clouds
   are
   restricted
   by
   a
   limited
   amount
   of
   on-premises
   resources,
   they
   are
   usually
   less
   scalable
   than
   public
   clouds,
   which
   offer
   practically
   unlimited
   scalability. Scaling
   up
   in
   a
   private
   cloud
   requires
   the
   purchase
   of
   more
   and
   more
   hardware
   and
   software.
   However,
   this
   disadvantage
   can
   be
   overcome
   in
   a
   hybrid
   cloud
   setting
   through
   cloud
   bursting—the
   scaling
   of
   public
   cloud
   resources
   to
   run
   workloads
   when
   on-premises
   or
   private
   cloud
   data
   resources
   reach
   peak
   capacity. 
4. 
   Limited
   mobile
   access: Because
   of
   its
   multiple
   security
   features,
   a
   private
   cloud
   can
   limit
   mobile
   user
   access,
   which
   can
   be
   a
   drawback
   for
   organizations
   seeking
   this
   capability.

IBM
and
private
cloud

As
a
leader
in
hybrid
multicloud
solutions,
IBM
is
helping
clients
optimize
private
cloud
solutions
to
meet
their
business
needs,
whether
that
means
leveraging
technologies
like

generative
AI
to
help
automate
IT,
modernizing
applications
for
improved
ROI,
or
building

cloud-native
applications
and
managing
them
at
scale.

IBM
Power
Private
Cloud
Edition
provides
cost-effective
bundles
of
compelling
software
offerings
that
enable
seamless
deployment
and
management
of
private
clouds,
simplify
security
and
compliance
management,
and
ensure
high
availability. 

Explore
IBM
Power
Private
Cloud
Editions