Windows 2000, Capex, and IT budget alignment: Three reasons the cloud is not right for your organization

"There's nothing new under the sun," or so it may seem in the technology world.  If you've been around the block a few times, you see common themes: virtualization that was invented in the 80's is back, hosted email from the early 2000's is trending, and you've heard enough about "cloud" to last a life time.  The reasons to buy cloud are likely filling up your inbox and they promise the world of "ROI" and "elasticity" - but does this ensure a guaranteed choice? No - here's why:

After deploying hundreds of private clouds over the past decade, there are several trends that emerge as reasons that the cloud is not the right fit for your organization.

CapEx is king.  

At the C-level, budgets are typically set for the year, in advance, and take into consideration best practices and historical trends to allocate capital expenditures (CapEx) and operating expenditures (OpEx).  While fleet trucks fall into CapEx purchases, the internet phone bills fall in to OpEx.  Midway through the year, OpEx line items may be exhausted while CapEx items still have dollars available.   Private or public cloud services are utility-based operating expenditures and will effectively normalize the aggregated cost of deliverables over 3 years (for example).   The only other work-around would be to pre-pay for cloud services for a year(s) in advance. 

In an apples-to-apples comparison, datacenter expenses totaling $500k over 3 years, might effectively cost $100k per year over 3 years in a cloud-model.  Because cloud services are a utility, cash is conserved.  If that's a concern for the C-suite who are driving business goals that are set with a different standard in mind, then cloud may not be ...