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Seeing Past the Clouds: Evaluating Hosted vs. On-Premises Infrastructures

By Michael Everly, CIO, D&H Distributing

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Michael Everly, CIO, D&H Distributing

Reigning wisdom in the marketplace is if you’re not migrating your business functions to the cloud, you’re being left behind in the race to future-proof your network. As a distributor of networking technology, we constantly work with purveyors of cloud-based applications and providers—many of whom ask about our stance on utilizing the cloud for our own network.

Let me first state this: There’s much to be said for cloud infrastructures. I’m pro cloud. Yet I’m also pro fiscal accountability. And that’s what the determining factor of cloud purchases should be.

As CIO, it’s my job to run operations and implement technology as cost-effectively as possible, regardless of prevailing trends. I’m therefore very passionate about advocating not just for cloud infrastructures per se, but for infrastructures that meet the needs of an individual business based on their resources and processes. There are various cloud solution suites in the market that will fit an organization’s price point. If certain cloud solutions aren’t financially justifiable and you choose to maintain your premises-based systems in part or even in whole, it doesn’t mean you’re bucking the wave of the future. It means you’re being responsible by considering all levels of solutions, from cloud to hybrid to on-premises. There are pros and cons to each, since hosted infrastructures can produce efficiencies in different environments, and the cloud also has a price tag.

Let’s first examine what cloud infrastructures consist of, and what they cost. There’s nothing magic about the cloud. Despite its vibrant following, “the cloud” is simply an off-premises data center to which companies connect remotely, usually through a third-party facilitator, such as Microsoft, Amazon, or Google, the three largest cloud platform providers in the marketplace. Companies can thereby host their business applications, data storage, backup, and email systems in that third-party datacenter instead of at the company’s own facility. However, as CIOs, we’re still responsible for the integrity, access, control, and backup protection of our systems and data, no matter where they reside.

There are many reasons for embracing hosted infrastructures. Cloud environments present a logical, alternative budgetary option for many organizations that can’t afford the upfront investment to build or maintain their own, on-premises datacenter—at least not one that can provide adequate storage and redundancy. Such data centers can accrue millions in costs, plus additional investments in administrative staff, potential real estate expansion, and environmental considerations such as cooling and increased electricity needs.

Small businesses often have less resources to devote to such a venture. Rather than absorb the huge cash outlay of on-site infrastructure, many companies look to the cloud, and pay for these services via an ongoing—and more financially palatable—monthly service fee. The cloud also proves a beneficial platform with minimal investment for non-data centric companies, start-up businesses, or for organizations looking to launch a new product venture.

When D&H was faced with whether to move its business applications to the cloud, fiscal accountability drove us to consider the breadth of our unique internal resources. As a large-scale North American technology distributor, D&H has access to IT equipment, resources, and talent that many other businesses don’t have. We maintain an extensive data center staffed with highly skilled IT personnel, in addition to an on-site solar farm that reduces our electricity costs. With such resources on-hand, a solution that is primarily premises-based makes sense.

In truth, most companies that our reseller customers encounter have adopted some form of hybrid cloud/ premises model—and so has D&H. As we celebrate 100 years in business, our long-established focus on innovation and commitment to cutting-edge protocols persists. Yet our growth is dictated by both technical and financial sensibility, not trends. We continue to evaluate cloud applications on a case-by-case basis.

"Cloud environments present a logical, alternative budgetary option for many organizations that can’t afford the upfront investment to build or maintain their own, on-premises datacenter"

In that light, here are some recommendations for CIOs when considering cloud-based infrastructures:

• Choose the right provider. Not all cloud vendors are equal. Make sure your partners are reputable. Consider the provider’s longevity in the marketplace, audit their performance, and obtain quality references.

• Stress security. You’re entrusting your data and business applications to a third party, so investigate the provider’s security claims.

• Consider your length of term. No one can predict the future. Think about your growth plans and where you’ll be in five or even ten years. Ask your provider how easily their solution can scale as your business grows. While vendors make it easy to migrate to the cloud, it’s more of a challenge to move in the other direction, so inquire about exit options.

• Document your service level agreements. Be sure that the level of support offered by your cloud is adequate and accommodates your business model. Make sure you can work within their policies regarding down time for software upgrades or network failures. If your organization requires “five-nines,” or 99.999 percent uptime, make sure your cloud provider is capable of that level of support, and that you have it in writing.

There’s no “one size fits all” solution when it comes to migrating to hosted infrastructures. Today’s best options are no longer black and white. Your decision must be needs-based, considering short- and long-term costs and existing resources, rather than based on a misconception that cloud is the only viable protocol of the future.

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