Public cloud crushing private cloud in growth and revenue

RightScale's numbers from its recent State of the Cloud survey look good, but they may not add up to a rosy future for private cloud. Here's why.

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Reading Rightscale's State of the Cloud 2016 survey data, it would be tempting to assume that the private cloud has finally arrived. Private cloud adoption increased from 63% to 77%! Thirty-one percent of enterprises run more than 1,000 VMs in private clouds, up from 22% in 2015! Cloud users run six clouds on average (and only one of those is AWS)!!!

And so on.

But, clear away the smoke and here's the fire: Amazon Web Services, the dominant public cloud provider, generated $2.4 billion in revenue last quarter, growing 69% year over year. That growth dramatically outpaces the private cloud vendors by a gargantuan margin.

SEE: Power checklist: Managing and troubleshooting cloud storage (Tech Pro Research)

The only sizeable cloud growing faster is Microsoft Azure at 127%.

So, while legacy IT vendors and their slow-moving CIO customers combine to try to breathe life into old IT dressed up as modern cloud, the real numbers speak for themselves, and they scream "public cloud."

Trust the numbers

According to Wikibon estimates, the private cloud market size scrapes $7 billion today. As David Linthicum highlights, that's not even as big as Amazon Web Services, which topped $7.9 billion in 2015. And, it's much smaller than the overall public cloud market.

Yes, that's right: The entire private cloud market, with all those fantastic numbers that the Rightscale survey alleges, isn't even as big as a single public cloud provider.

Nor do the survey results match up with independent analyses. Take Gartner's, for example, which found that public cloud virtual machines (VMs) have grown 20X, compared to private cloud's more miserly 3X growth. (Oh, and let's not bring up the abysmal rate of failure for private cloud projects.)

Let's face it: What counts as private cloud is probably not cloud at all. As AWS cloud chief Andy Jassy declared years ago, "If you look deep into what [private cloud vendors] are offering, you will see that it's basically an internal data center that is virtualized and has some management tools."

In other words, it's not cloud at all. Still, even if we count all sorts of pseudo-cloud instances, the private cloud remains relatively tiny.

So why do we keep trying?

The private cloud dream is really about control; about treating servers like "pets" instead of "cattle." It's about pretending that your data is safer in your internal data center than it is in the data center of Microsoft or Amazon.

In other words, it's mostly about wishful thinking.

It's certainly not about cloud in any real sense, as Linthicum stresses:

"[P]rivate cloud" is another way to say "my own data center," which does not provide the benefits that companies seek from the principles of cloud computing. Both business and IT are increasingly acknowledging that "private cloud" isn't the cloud. The "private cloud" notion has also been perpetuated by traditional enterprise vendors, who needed to cloud-wash their existing wares to be able to keep selling them.

SEE: Changing definitions of the private cloud (ZDNet)

Worse, to the extent many private cloud vendors are going beyond cloud-washing, they're attempting to do so with OpenStack, a project that co-founder Andy Smith lambasts as complicated, rudderless, and doomed.

It may be too soon to say, as Linthicum does in a separate post, "Nobody wants [private clouds]!" Clearly, some still do. But, I agree with Linthicum's general thesis that enterprises hold on to private cloud as a way to hold onto an old way of managing their infrastructure. It may be comfortable, but it's not going to help them keep pace in a rapidly changing market.

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    Matt Asay is a veteran technology columnist who has written for CNET, ReadWrite, and other tech media. Asay has also held a variety of executive roles with leading mobile and big data software companies.

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