Nearly half of large enterprises will have hybrid cloud deployments by the end of 2017, according to Gartner, Inc. In the past three years, private cloud computing has moved from an aspiration to a tentative reality for nearly half of large enterprises. Hybrid cloud computing is at the same place today that private cloud was three years ago; as actual deployments are low, but aspirations are high.

When it comes to drivers of private cloud computing, while cost is always an important consideration, a business case for private cloud cannot rely on lower costs as the primary justification.

"Virtualization reduces capital expenses, and standards and automation reduce operational expenses," says Thomas Bittman, VP and distinguished analyst at Gartner. "However, taking the next step of adding usage metrics, self-service offerings and automated provisioning requires investment in technologies without a significant reduction in operational cost. With this in mind, the driving factor for going that next step should primarily be agility."

Since agility is the key driver to private cloud computing, Bittman says that IT needs to understand where agility could make a difference in current services, understand what new services would be useful if provided with agility, and work closely with IT's customers to make those determinations.

Organizations that are well on their way with private cloud projects rarely consider technology the major issue. Certainly the technologies to deliver private cloud are relatively immature and evolving, and many enterprises find that custom work is required to meet their needs, but much more difficult are the transformational adjustments needed to use the technology. Cloud services require operational processes that are designed for speed and customized for the services offered. An ingrained IT culture focused on technical expertise doesn't fit a fully automated, self-service model that requires a service-oriented, team approach.

"Too often, private cloud projects are started by choosing a technology, but technology itself does not solve the transformational people and process issues," says Bittman. "It is much better to focus first on an approach to make transformative changes. In many cases, that means creating a separate organization outside of traditional IT processes — at least to incubate these projects — and focusing first on a simple project that has buy-in between IT and IT's customers."

Progress made with private cloud varies enormously, according to Gartner. Most deployments are starting small, with a limited scope of functionality. However, as those private cloud portfolios grow the resulting cloud infrastructures will likely be based on the technologies chosen for pilot projects. Gartner believes that in a market with a lot of vendors vying for market share, the winners and losers will be determined very quickly and because of the importance of integration throughout the cloud management platform, smaller players will likely be acquired or go out of business within the next few years.

"Vendors are promoting private cloud computing as 'the next thing' for infrastructure and operations — and it is, but only for the right services," says Bittman. "Virtualization is a horizontal, very broad trend, impacting a high percentage of IT infrastructure. Private cloud is a specific style of computing that will leverage virtualization, but is not appropriate for all services. While the majority of midsize and large enterprises will build and deploy private cloud services over the next few years, private cloud will only be used for specific, appropriate services."

Where organizations do decide to deploy cloud services, the technology they choose matters tremendously. While pilot projects will tend to start small, with limited functionality, it's important to choose a technology foundation that offers room for expansion — both in terms of functionality richness, and in terms of hybrid cloud interoperability for the future. The other alternative is to choose a technology that provides a rapid return on investment — for example, two years — with the possibility of changing technologies in the future.

Related Links:

Gartner Report: Private Cloud Matures, Hybrid Cloud Is Next

Gartner Report: Hybrid Cloud: The Shift from IT Control to IT Coordination