2022 saw the beginnings of a quiet revolution.  The growth of businesses using the public cloud began to decline. For some businesses, the direction of travel reversed, backing away from cloud and considering alternatives. 

Despite the massive hype – and undeniable potential advantages – around public cloud, organisations began shifting data and entire platforms to on-site, private data centres.

Cloud – or data – repatriation was born.

The cost imperative

The first question commentators had was what was ‘pushing’ these businesses off of the public cloud. After all, the cloud was supposed to offer businesses all they needed for digital success.

The first answer was cost.

The cloud was originally sold as a razor-sharp alignment of technology to business. Organisations loved the idea of a feature-rich, super-flexible data centre without the expense of building and maintaining one. Who wouldn’t love a Rolls Royce as a taxi if you don’t have to pay for its storage, MoTs, and servicing – especially if the fare is still kept competitive?

In this analogy, cloud computing providers could offer this because they had fleets of these Rolls Royces’ and could deploy them wherever and whenever they needed. It is the classic economies of scale argument.

But then came hyperscale.

The problems of scale 

Get big enough and issues of management, redundancy and complexity hit a point where opportunities for things to go wrong, grow exponentially. It is one thing to have a fleet of 25 Rollers in the UK.  It is quite another to need to secure, coordinate and direct the parts and skills to keep 200,000 on the road across the globe.   

Huge ecosystems require equally huge investments. Which then demands going after big markets.

Ironically enough, the cloud giants responded with a land-grab. They added massive levels of capability and features to outdo one another. For example, there are over 200 discrete “products” in AWS.

But the majority of customers don’t need and won’t use those products.

To stretch our analogy: a Rolls has a drinks dispenser, mahogany fascia, automatic aerial, massaging driver’s chair and a television in the back.  Businesses don’t mind paying for that functionality if it is needed. But it might be too much when all that was needed was an affordable taxi.

The levels of this excess are scary: we have seen business cases for moves to public cloud collapse under the weight of 200% cost increases.

It is the recurrent, circular lesson of technology: cost, times scale, equals complexity, which then forces a reassessment of cost to ‘right-size’ investment.

Why are businesses surprised cloud is expensive?

The development and scale of global cloud platforms does not come cheap. For many use cases there are simpler, cheaper and more manageable options.  Developments in private data centres mean companies can realise the benefits of the public cloud in their own estates. 

They can actually go one better. Private clouds offer tighter security and better performance at competitive costs. And they can still integrate with public clouds to enable scalability and agility.

In this context, repatriation is inevitable as businesses put the right workload, in the right place.

Of course, businesses will not ditch cloud completely. ‘Scalability and agility’ are still critical for competitive advantage, especially in a modern, digital business climate that demands the fast deployment of new applications.

But delivering both benefits of lower cost and increased capability, depends on the right size of technology for the business.  A global data centre setup, with a bloated platform and expensive third party to manage all of it, is an unnecessary over-investment for most SMEs.

Achieving maximum performance with a hybrid strategy

So, how can businesses develop a ‘repatriation profile’ that uses the public cloud for what it does best, alongside private options to secure maximum capacity and performance at the lowest cost?

We propose one such guiding principle is proximity: geographical closeness to the business in question. You could call it regional repatriation.

Private clouds typically perform better because of the higher latency of public cloud, arising from the distance between the public cloud DCs and the customer business.

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Pulsant was built on delivering the best infrastructure to medium-sized, high growth businesses throughout the UK. We created the UK’s first platform that could bring nationwide, next-generation edge infrastructure to the regions.  And we invested more than £100 million in doing so.

We connected our portfolio of 12 data centres with a low-latency backbone that offers the highest performance in both primary and failover states.  We turned these data centres into local connectivity hubs that have become the technological focal point for regional businesses.

Finally, we connected this UK resource to public cloud and international data centres to offer unparalleled opportunities for growth.

The guiding principle is simple: data processed closer, can be acted upon quicker, which makes business better.  By keeping data ‘closer to home’, local software development can use it to drive experimentation and innovation.

Of course, regionalism is not the ONLY guiding rod that can guide repatriation: we will explore industry specific and vertical considerations in an upcoming blog. But having put more than £100m where our mouth is, we invite regional businesses to explore how a regionally driven, hybrid strategy could position them.