Which Cloud Migration Path is Right for Your Organization – Public or Hybrid?
Once sluggish, cloud adoption in the financial services sector is accelerating. Today, 83% of financial services companies have deployed cloud technology as part of their primary computing infrastructures.
In fact, startups almost always choose to set up a cloud-based infrastructure rather than build out an on-premises infrastructure. Meanwhile, established firms are increasingly migrating to the cloud as part of their efforts to modernize their IT infrastructures.
If you’re considering a cloud-based IT environment, you have several options: public, private, or hybrid. Let’s look at each of these cloud models and which cloud migration path is right for your firm.
What is a public cloud?
A public cloud is a platform in which a cloud service provider makes resources – such as applications, storage, and virtual machines – available to the public over the internet. Microsoft’s Azure public cloud is one of the most popular public cloud options alongside Amazon Web Services and Google Cloud.
For many investment firms – particularly smaller and more agile companies – the scalability, flexibility, and ease of deployment of public cloud infrastructure are persuasive drivers.
What is a private cloud?
Private cloud environments – often managed by a service provider that understands your business environment and compliance directives – have been the go-to option for financial and investment firms.
Some of the drivers that motivate firms to use private clouds include performance, security, and resiliency. A private cloud also enables you to exercise greater control over network traffic in terms of security, quality of service, and availability.
What is a hybrid cloud?
Many investment firms and funds are apprehensive about moving to the public cloud due to the complexity and critical nature of the data they deal with. But managing, monitoring, and maintaining an entirely private or on-premises infrastructure isn’t always feasible.
A hybrid cloud solution is the perfect approach.
Spanning public, private, and sometimes on-premises infrastructure, a hybrid model provides firms with the advantages of the public cloud and the confidence that their most critical data is securely stored in private data centers. That security can be further enhanced with data redundancy, high availability, and other cybersecurity capabilities.
Additionally, hybrid cloud solutions enable firms to move workloads between clouds in response to fluctuating needs.
Public cloud vs private cloud vs hybrid cloud – which is best?
The answer depends on your resources, use cases, service level and security requirements, and more.
As you weigh up your cloud migration strategy, consider the following factors:
Support and service requirements: What type of service would your firm most benefit from? Many financial firms prefer to rely on trusted points of contact who physically touch their machines, and, more importantly, understand their business workflows, security imperatives, and regulatory environment. It’s also critical that issues are resolved quickly to avoid downtime or latency. You want a cloud provider who can deliver one-to-one service and support – when you need it.
Availability and uptime: When crucial elements of your IT environment are hosted elsewhere you need assured uptime and predictable service levels. With a hybrid approach, you can tap into multiple clouds and data centers, achieving maximum availability. For example, you can take advantage of the premium-grade uptimes offered by privately managed infrastructure for production environments and critical functionality (file services and application hosting) while using the public cloud for less critical needs, such as application development, email, and productivity apps.
Proximity to data centers: Depending on your firm’s strategy and trading goals, you may require certain proximity to data centers, whether public or private. It’s also worth considering the quality of service required by your firm as your data travels across these networks. Many investment management firms prefer the comfort and security of private network connectivity, which many private and hybrid managed service providers offer, but few public clouds do.
Security layers: For compliance-driven businesses there are still countless vulnerabilities and exposures that public clouds often fail to address. Managed providers of hybrid/private cloud environments can layer in advanced managed security services such as multi-factor authentication, next generation firewalls, proactive threat detection, patch management, phishing simulations, security training, and more.
Compliance: Investment firms deal with highly sensitive data and are often required to store that data privately. A hybrid cloud is a great option since you can store your most sensitive data privately while less sensitive data is stored in the public cloud. This allows you to capitalize on the power of the cloud, while still meeting regulatory requirements. A private/hybrid cloud environment also puts you in a strong position to ensure – and prove – proper data security, governance, and compliance. With the help of a managed service provider, you can leverage a range of compliance tools – such as file auditing and access controls – to analyze, secure, manage, and migrate volumes of data with confidence.
Cost: At first glance, public clouds can seem like an attractive alternative to private or hybrid clouds. However, firms need to look past the upfront costs for an accurate picture of the total cost, which could end up being bigger in the long run.
Get the best of what each cloud has to offer
For investment advisers and funds, the ultimate strategic IT decision has long revolved around the question of whether to embrace the control and professional management of a private cloud vs. the open, affordable public cloud. However, newer hybrid cloud infrastructures mean that you don’t have to make an either/or commitment.
By partnering with an experienced managed service provider, you can deploy hybrid environments that provide many of the best features of public and private platforms – email and business applications coupled with industry-vertical support, service, availability/uptime, performance, security, regulatory compliance, and better overall control – with an appealing TCO profile that rivals the public cloud.
Ready to migrate to the cloud? Learn more in 5 Steps to Prepare for a Successful Cloud Migration.