Is Private Cloud a Business Opportunity for Public Cloud Providers?

There are five common misconceptions about “private cloud,” which sometimes is seen as server virtualization at existing enterprise computing facilities, or simply the adoption of infrastructure as a service, according to Gartner analysts. The implications are important for some service providers supplying enterprise cloud services.

To be sure, virtualization and cloud computing are driving private cloud computing, says Tom Bittman, vice president and distinguished analyst at Gartner. But virtualization and virtualization management are not, by themselves, private cloud computing.

Virtualization makes it easier to dynamically and granularly pool and reallocate infrastructure resources, Gartner says. The point is that some form of virtualization is used to create a cloud computing service.

Private cloud computing is a form of cloud computing that is used by only one organization, or that ensures that an organization is completely isolated from others. Sometimes that leads to the notion that private cloud computing is another way of conducting computing operations

Private cloud computing is defined by privacy, not location, ownership or management responsibility, says Gartner. That’s an important distinction for providers of cloud computing services, as it does not mean private cloud “only” is operated from an enterprise’s own facilities. Private cloud computing can be hosted from a third-party cloud computing center, in other words.

Though the majority of private clouds likely will be on-premises (based on the evolution of existing virtualization investments), Gartner says, a growing percentage of private clouds will be outsourced and supported off-premises. That means private cloud is as much a business opportunity as public cloud.

Private cloud includes both infrastructure as a service and platform as a service, especially for enterprises that want to foster faster software development, or routinely work with lots of third-party app developers.

Over time, some private clouds will be moved completely to the public cloud. The majority of private cloud services will evolve to enable hybrid cloud computing, blending public cloud services and third-party resources.

The bottom line is that private cloud computing often will represent a sales opportunity for cloud service providers and some hosting operations.