Cloud Repatriation: Balancing Cost, Performance, and Compliance

Cloud Repatriation

After years of significant adoption of cloud computing, there has been a noticeable shift towards moving workloads back into private cloud or on-premises data centres, a trend often referred to as "cloud repatriation."

This shift is highlighted in the Barclays CIO Survey conducted in 2024, which shows a steady increase in organisations planning repatriation. The only exception is 2020-2021, likely due to the COVID-19 pandemic.

Several notable organisations, including Dropbox, GEICO, and Adobe, have already taken steps to repatriate workloads.

Basecamp creator 37signals is another example. By moving away from public cloud infrastructure, 37signals anticipates savings of $7 million over the next five years.

The Emergence of Cloud Repatriation

The factors driving this trend may differ across organisations; however, we have identified several common reasons, which we will explore below:

• Cost Optimisation: While cloud computing offers excellent flexibility, making it ideal for dynamic use, organisations with predictable, high-volume workloads often find it more expensive than on-premises solutions. This can lead to 'bill shock' as usage scales.
• Data Sovereignty and Compliance: Compliance and regulatory requirements often mandate that businesses store data in specific countries or regions. While cloud platforms can provide this functionality, managing data sovereignty can be more complex in the cloud, with the risk of accidental misconfiguration leading to a breach of regulatory requirements.
• Performance Requirements: Certain applications perform better on local hardware; this is especially true for ultra-low latency applications. An IEEE study found that for specific AI workloads, on-premises GPU clusters outperformed cloud-based solutions by up to 30% in terms of performance per dollar.
• Security Concerns: Despite significant advancements in security, cloud resources remain primary targets for cyber-attacks. The 2024 Thales Cloud Security Study reports that 44% of organisations have experienced a cloud data breach, with human error and misconfiguration being the top root causes.
• Customisation: On-premises infrastructure offers greater control over configurations, allowing organisations to tailor solutions that may not be possible in public cloud environments.
  
  

Key Drivers Behind the Shift

While cloud repatriation is well underway, it does not signal the end of the public cloud. Instead, it indicates that cloud adoption is maturing into a more pragmatic hybrid approach.

When assessing whether to repatriate your public cloud workloads, it is critical to take a thoughtful approach to maximise its benefits:

• Cost Analysis of Cloud Workloads: Assess your Azure spending before deciding on repatriation. Tools like SCOUT can help organisations identify where savings can be made, with an average reduction of 30% in annual Azure costs. If cost is the main reason for considering repatriation, then ensuring you have the most cost-efficient usage should be the first step. This will also help you determine the potential savings that repatriating workloads will provide.
• Assess Workload Characteristics: Review your workloads to determine which are best suited for public cloud versus private cloud or on-premises environments. Consider performance, security, and compliance requirements to identify the most suitable environment.

• Prepare for Migration: For workloads and applications you decide to repatriate, ensure the new environment is appropriately planned and deployed. Whether on-premises or in a private cloud/data centre, getting support from a trusted partner will ensure a successful deployment.

Strategies for Successful Repatriation

Cloud repatriation involves adopting a hybrid approach that balances cost, performance, security, and compliance. By evaluating workloads and optimising cloud usage, organisations can maximise efficiency and control expenses.

Maximising the Benefits of a Hybrid Approach

At Flow, we help businesses make informed cloud strategy decisions, ensuring seamless transitions with minimal risk and maximum benefits. Our services include cloud cost optimisation through our SCOUT tool, which helps reduce Azure costs by an average of 30%.

We also offer seamless deployment services with expert-led migration and modernisation for on-premises and private cloud environments.

Additionally, we provide ongoing infrastructure support to ensure long-term efficiency, security, and performance for hybrid IT environments.

Are you considering cloud repatriation or need guidance on optimising your strategy?
Contact our team to explore how Flow can help you achieve your goals.