The great migration from the data center to the cloud began with the creation of Amazon Web Services in 2006. By 2021, 96% of companies had made the cloud part of their Data Management plan, leveraging cloud-based services to support their digital infrastructure.

The cloud promised greater mobility, flexibility, scalability, and security, all of which businesses wanted. As a result, using the cloud to store data, manage applications, host websites, and process e-commerce transactions became the dominant business trend.

Recently, however, the tide has started to turn. Cloud repatriation, which involves business shifting from the cloud back to private data centers, has begun.

What Is Driving Cloud Repatriation?

Cost is the primary driver behind the new wave of repatriation. When the cloud was introduced, it was marketed as a cost-saving solution. Those who made the shift were told they could have all the benefits of the data center without the development or maintenance costs. They later found it wasn’t that simple.

Essentially, cloud computing is a landlord-tenant model. Businesses using the cloud rent space in someone else’s data center. Early on, economies of scale allowed those providing cloud services to do so at cheaper prices than businesses were paying to maintain their own data centers. When the cloud reached hyperscale, however, it required a level of complexity that pushed prices higher.

At hyperscale, the cloud involves many data servers, many data centers, and extremely large networks. This creates the potential for more things to go wrong, which means more redundancy and fault tolerance is needed. With more equipment and governance structure comes more costs, which is passed on to cloud tenants.

On top of the technical costs, the cloud provider also needs to pay for large sales and marketing budgets to promote their services. Those factors also drive up expenses, which further increases the costs that must be passed on to customers.

What Do Businesses Gain in the Private Cloud?

Businesses that pursue repatriation will find they can achieve the same benefits they had in the cloud, but with lower costs and higher performance potential. With private clouds, digital infrastructure can be more customized, using the components and configurations that meet the business’s unique needs. In the public cloud, systems must be configured to meet the needs of the masses. 

In terms of performance, private data centers have less latency than public clouds. Data centers can also store data in the servers themselves, rather than in network-type storage, which boosts performance and lowers costs.

For businesses who want private cloud performance and cost with public cloud scalability and agility, a hybrid cloud strategy is a great option. System availability, performance, and efficiency can be improved by deploying a strategy that leverages the strengths of each option while mitigating their weaknesses.

How Does Repatriation Affect Data Management?

For those responsible for Data Management, repatriation requires some special considerations. One of the benefits of the cloud was that key management functions were handled by the provider. With repatriation, the responsibility shifts back to the data center.

If sensitive data is repatriated, data security may need to be updated. This can include reviewing and revising access policies, network controls, compliance plans, and cybersecurity strategies. Data Governance roles and responsibilities may also need to be reviewed and realigned.

Data Architecture should also be assessed as key functions move off the cloud. If the data center does not have the proper tools and configurations for storing, processing, and integrating data, pipelines may slow down or shut down altogether.

For many businesses, repatriation is a logical step in the evolution of their digital strategies. The cloud, in its early phases, gave them what they needed to develop their data framework. Now, leveraging the strengths of the private data center will allow them to refine that framework. For most, a hybrid strategy will provide the best balance, giving the agility and customization needed to take their business to the next level.