As a result, it’s becoming harder and harder to justify the CapEx expense of owning tin rather than the OpEx expense of paying for what you need in the cloud.
Keep in mind, even with the upfront expense of buying data centre hardware, you still have ongoing expenses. You may own that tin outright, but you still need to pay every month to power, cool, connect and maintain it.
In-house hardware also requires in-house skills to manage it, which is another significant expense, as well as a hiring challenge when such skills are in high demand. For many organisations, the economics of running their own data centre simply don’t stack up when compared to cloud economics.
Beyond budgeting considerations, relying on your own in-house tin can leave your organisation at a competitive disadvantage when it comes to reliability and agility. Replicating those extra 9s of availability in-house can prove quite challenging when your business isn’t primarily in the business of running compute resources. Generally, it makes more sense to hand this over to the experts – think of it as a form of outsourcing – so your organisation can focus on what it does best.
Meanwhile, the cloud’s ability to scale on demand, spinning servers and services up and down as required, makes the concept of owning your own tin look rather archaic.
However, while it’s becoming more and more difficult to justify owning your own hardware, tin is by no means dead yet. It’s important to do your homework before you make the decision, as there are still circumstances in which investing in tin is the most prudent approach.
When it comes to raw compute, there are times when it is actually more economical to buy rather than rent when in the pursuit of high performance computing. Costs can blow out when building a supercomputer in the cloud with terabytes of RAM and petaflops of processing power.
Latency concerns can also make it more practical to run some workloads locally rather than in the cloud. Then there is the cost of data ingress and egress – getting your data into the cloud and then out again.
Concerns regarding data jurisdiction and compliance in some industry sectors have also traditionally been a key driver on maintaining in-house tin, although these are becoming less of an issue as compliance frameworks become more cloud friendly.
As a general rule, the numbers don’t stack up when it comes to buying tin but, if you are managing your own hardware, you can still take advantage of the cloud without needing to write off that in-house investment. The hybrid model offers the best of both worlds while offering a smooth migration path to the cloud, so you can squeeze the last drop of value out of your investment in tin.