Data Centers

The Data Center Boomerang Effect: Will It Affect Your Business?

By July 19, 2017 November 6th, 2019 No Comments

There has been a lot of talk in the data center industry about 2017’s data center “boomerang effect”. The term refers to the actions of tech companies and large enterprises that had embraced public cloud computing early on and are now moving away from it and bringing the operations back in-house.

Why do reversals like this happen? In many cases, it comes down to cost.

Costs Create The Boomerang

Public cloud computing was billed as a way for businesses to rein in IT expenses. And it works. For a time. In certain situations. If you don’t get too big. By using the public cloud to leverage IT needs, businesses and enterprises are able to save on hardware and software costs as well as IT personnel expenses. Ideally, the amount the business spends on their monthly public cloud bills is less than the cost of managing the entire process in-house. And for many start-ups and small businesses this is exactly what happens.

But that doesn’t always last. Sometimes, business growth demands more from the public cloud than an enterprise is willing or able to afford. When that happens, the boomerang is activated and IT managers bring the function back in-house.

Maximizing Cloud Services

The boomerang effect does not mean that a business will stop using the public cloud altogether, although that can and does occur. What happens more often is companies re-think their approach and maximize their resources by creating a new multi-cloud system. They may use a combination of public, private and hybrid cloud solutions along with software-as-a-service and managed services, depending on their needs and capabilities. This hybrid approach allows businesses to optimize workloads, improve system agility, and make the most of their IT budgets.

We’re curious. Has your business experienced a data center boomerang effect? Are you bringing outsourced services back in-house? Do you foresee it happening in the future?