Why Companies Are Ditching the Cloud: The Rise of Cloud Repatriation

This is partially the result of cloud providers and partially business leadership. They, for whatever reason, insufficiently educated their clients on migration requirements. Lift & shift from on-premises to cloud only work for emergency. The shifted resources must be converted to cloud stack, or the cost will be multiples of on-prem costs. Business leadership was (is?) ignoring IT teams screaming of the problem with lift & shift.

Now, businesses shifting back to on-prem because they are still uneducated on how to make cloud useful. They will just shift all non-core activities to XaaS vendors, reducing their own cloud managed solutions.

Source: dealing with multiple non-software, tech firms that are doing just that, shifting own things back to on-prem, non-core resources to XaaS.

I keep reading ´ Lift and shift is bad ‘ on HN - what is the opposite of lift and shift ? ( ´cloud native ´ does not mean much to me). Is it that instead of oracle running on a rented vm you use whatever db your cloud provider is selling you, you move your monolith to a service oriented architecture running in k8s, etc ?

In simple terms, yes.

The term “native” refers to adopting the vendor’s technology stack, which typically includes managed data stores, containerized microservices, serverless functions, and immutable infrastructure.

lift & shift = move your instances, which are expensive and not at all competitive

cloud native = use more serverless products (pay as you go with no base price)

For instance, one could implement internal DNS using instance which run bind, and connect everything through some VPC, and put a load balancer in front of the instances. One could also rework its DNS architecture and use route53, with private hosted zones associated with all the appropriate VPCs

Another real example: one could have hundreds of instance running gitlab runners, running all day, waiting for some job to do. One could put those gitlab runners into an autoscaled kubernetes, where nodes are added when there are lots of jobs, and deleted afterwards. One could even run the gitlab runners on Fargate, where a pod is created for each job, to run that job and then exit. No job = no pod = no money spent.

Of course, some work is required to extract the best value of cloud providers. If you use only instances, well, surprise: it costs a lot, and you still have to manage lots of stuff.

I ran our CI on fargate at my last job. It was a mess. The time from api request for an instance to it being ready to handle a job was minutes. It was about 50x slower than running on a mid range laptop that I occasionally used for development, and in order to work around that we kept hot EBS volumes of caches around (which cost $$$$ and a decent amount of developer time).

Just before I left I was investigating using hetzner instead - our compute bill would have been about 15% cheaper, we would have had no cache storage costs (which was about 5x our compute costs), and the builds would have finished before fargate had processed the request.

Our numbers were small fry, but we spent more on that CI system than we did on every other part of our infra combined.

Of course, while this move to cloud native, along the path from IaaS to PaaS to SaaS, saves money on one dimension, it also binds the customer more and more immovably to the cloud vendor...

Thanks.

I work for a very large org, and cloud benefits are not obvious to me ( ie we’re large enough to absorb the cost of a team managing k8s for everyone, another team managing our own data centers around the world etc ).

I view cloud as mutualizing costs and expertise with other people ( engineers and infra), but adding a very hefty margin on top of it, along with vendor lockin.

If you’re big enough to mutualize internally, or don’t need some of the specific ultra scale cloud products, it’s not an obvious fit to me ( in particular , you don’t want to pay the margin )

I understand that for a significant chunk of people it’s useful provided that they use as many mutualizing levers as possible which is what going native is about.

Is my understanding correct ?

The opposite of lift and shift is rearchitecting for auto-scaling. Pretty much every price advantage comes from using the fact that the cloud provider absorbs the cost of idle resources instead of you.

So you either adopt serverless patterns (the kind of serverless that means scale to zero and pay nothing when you do) or you adopt auto-scaling, where you shut down instances when traffic is lower, to minimize idle time. Or both.

Yes, the profit margin for cloud providers is very real—and quite costly.

I think one point that’s often overlooked is the knowledge gap between the engineers at cloud providers (such as systems, platform, or site reliability engineers) and those that an individual company, even a large one, is able to hire.

This gap is a key reason why some companies are willing—or even forced—to pay the premium.

If average or mediocre management skills and a moderately complex tech stack are sufficient, then on-premise can still be the most cost-effective choice today.

Thanks a lot for the detailed answer.

I agree with the gap, and I understand why people would like to pay for the premium.

Where I work currently, wherever we don’t have the right people ( and usually because we can’t find them ), our cloud-like on-premise offering doesn’t work which ends up causing significant extra costs further down the chain.