Despite the seemingly inevitable march of data and applications into the hands IaaS, SaaS, and PaaS providers, there is another cloud variant that matters greatly to those organisations unwilling or unable to hand over control of their physical infrastructure.

Private cloud is a term that has come to describe both on- and off-premises environments that implement many of the core attributes of public cloud solutions, such as on-demand scaling and the pay-as-you-go usage model, but where the infrastructure is not shared with other organisations.

While the question of whether such models deserve to be labelled ‘cloud’ has become a matter of debate, Gartner’s research vice president Michael Warrilow believes private cloud has always been misunderstood and misrepresented.

“That doesn’t mean it’s not important,” Warrilow said.

“Even though public cloud is growing faster, traditional IT technology markets are still larger today and it’s still where most enterprises run most of their workloads.

“Traditional IT technology markets will continue to exist for the foreseeable future. Modernising on-premises is therefore essential. Legacy environments need to be made “cloud-like” or “cloud-inspired”, integrating the best of on- and off-prem infrastructure.”

The idea has found favour with many Australian IT executives, with Forrester reporting that 54 percent of organisations use private cloud as their primary cloud computing platform, while market research firm Technavio estimates that the global private cloud market will achieve a total value of US$276.36 million ($424 million), with compound growth of 27 percent fuelled by organisations’ desire for enhanced data security and control over data backup and recovery.

And like all cloud variants, private cloud solutions are undergoing significant change as processes and technologies mature, with many hybrid cloud environments adopting cloud principles and technologies such as containerisation and innovative financing arrangements.

Private clouds are also proving attractive for organisations that need compute power to be geographically close to a data source or user, such as in IoT and edge computing implementations, and hosting providers have created a range of private cloud solutions to suit the specific security or sovereignty needs of clients.

NSW-based Tomago Aluminium is one organisation that understands why a private cloud solution can prove superior to public cloud, having joined a select group of organisations that have rejected the public cloud for specific workloads for a level of certainty they can only find on-premises. 

In 2015, the company – which is located north of the Hunter River near Newcastle – had implemented a partner-managed cloud solution to host its SAP ECC6 ERP implementation, but experienced numerous challenges, including the need for its ISP to run 30 kilometres of fibre to meet the multi-interconnect cloud connection resilience strategy that the company needed. 

According to Tomago’s IT superintendent Dennis Moncrieff, the public cloud environment also presented challenges relating to visibility and accountability for performance.

Matters came to a head when it came time to upgrade the ERP, and Tomago assessed that the public cloud solution on offer was unsatisfactory for its needs. Hence Tomago decided to repatriate its SAP workloads back into a private cloud based on the RedHat technology stack running on IBM POWER9 server hardware, with support from the hybrid cloud managed services provider AdventOne. 

Moncrieff highlights control, visibility, and cost as the three standouts benefits of the private cloud environment, including the greater choices now available when upgrading and patching applications. 

“We can choose to install, defer, or delay and bundle, and cost is never a factor,” Moncrieff said. 

“We also know exactly where any issue is and can proactively remediate the solution at a time of our choosing.” 

Critically, Tomago has also witnessed a marked decrease in downtime compared to the intricacies and dependencies of the previous public cloud solution, with a much faster recovery time. 

“We also have the ability to host additional environments, such as a sandbox for our development team to play with, at no cost,” Moncrieff said. 

“We are leveraging this even further now to trial and quantify the SAP S/4 system dependencies and hurdles, all on our private cloud, with no additional infrastructure costs. 

“I report directly to the CFO, and yes he is very happy about the fixed costs we enjoy.” 

As for ensuring that the environment provides Tomago with the scope to innovate, Moncrieff says he and his team were careful to ensure that the new environment would have sufficient capacity to allow sandboxes and proof of concept activities. 

“Do your due diligence and ensure the private solution is fit for the intended purpose, not just today but into the future as well,” Moncrieff said. 

“Not every workload will, but by doing this upfront you can select the appropriate ones.” 

While acknowledging there is some movement of workloads from public or hybrid cloud to private cloud infrastructure occurring – Tomago Aluminium being a case in point - Gartner research vice president Michael Warrilow sees these kinds of migrations as the exception rather than the rule. 

“Around one out of six major cloud initiatives fail, on average,” Warrilow said.  

“Of these, most are remedied by correcting the problem or replacing it with a different cloud solution.”