UK organisations are undergoing a “cloud reset” as private cloud moves from underdog to strategic priority, according to new research.

The Private Cloud Outlook 2025 report, based on a survey of 200 senior UK IT leaders by Illuminas in partnership with Broadcom, finds that public cloud is no longer the default choice, and private cloud is now driving enterprise cloud strategies across AI, compliance, and cost control.

More than half (57%) of respondents identified deploying new workloads in private cloud as their top priority for the next three years -meanwhile, 73% are considering moving workloads from public to private cloud – with a third having already done so.

The report reveals that private cloud is no longer simply a secondary environment for legacy systems, but an equal or preferred setting for modern workloads: 68% say they prefer private cloud or hybrid environments for containerised and Kubernetes-based applications, and 60% favour private cloud for training and tuning AI models.

Security and compliance are central to this strategic shift.

An overwhelming 96% of IT leaders trust private cloud to meet their security and compliance needs, while 69% say they are “very” or “extremely” concerned about public cloud compliance. Security was the top driver cited for repatriating workloads from public cloud, indicating that sensitivity around data governance is directly shaping cloud decisions.

GenAI is another key pressure point influencing infrastructure choices. Nearly half of respondents (47%) identified data privacy and security concerns as the biggest challenges to adopting GenAI. Private cloud appears to be meeting this demand head-on, with organisations choosing it for AI workloads at nearly the same rate as public cloud – 60% compared to 55%.

Financial considerations are also accelerating the pivot toward private cloud, with 94% of IT leaders saying they value the financial visibility and predictability that private cloud offers.

Despite the scale and flexibility of public cloud, 95% of organisations report some level of waste in their public cloud spending, and 47% believe more than a quarter of that spend is unnecessary. This has created strong incentives to reassess where workloads are best placed.

However, the shift is not without challenges.

Siloed IT teams are seen as the biggest obstacle to private cloud adoption, cited by 30% of respondents, followed closely by the skills gap, with 29% pointing to a lack of in-house expertise.

Addressing these barriers is seen as critical to unlocking the full benefits of private cloud. Encouragingly, 86% of organisations are now structuring their technical teams around platform models rather than isolated technology stacks — a move that supports cross-functional collaboration and staff upskilling while reducing dependence on external service providers.

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“This report makes it clear: private cloud is a strategic platform for IT modernisation,” said Prashanth Shenoy, vice president of product marketing, VMware Cloud Foundation Division (VCF) at Broadcom.

“Customers are intentionally architecting for flexibility, placing workloads in environments that offer the best balance of performance, control, and cost efficiency.

“The cloud reset presents an opportunity to create a more effective, secure and cost-efficient IT environment. Organisations that strategically adopt a modern private cloud can better support secure genAI innovation, improve fiscal visibility, and accelerate workload repatriation.”