Local vs Global, part 2: What’s the difference between a local and hyperscale cloud?

By Arthur Shih

We are still on the journey to discover if your business is ready to move to a hyperscale cloud. While we discussed the key differentiating factors in our previous blog, let’s take a look at the key benefits.

Step 2: What are the benefits and differences of local and hyperscale clouds?

Design for Failure

The main difference between the local clouds and the hyperscale clouds that users will experience is the concept of “design for failure”. The local clouds utilise enterprise software and hardware, creating “bullet proof” environments that are protected from hardware failures, meaning you can just move your environments and always be protected from hardware failures.

Hyperscale clouds use more commodity hardware. Individual virtual machines and workloads do not have guaranteed uptimes at all, and when something fails, the whole virtual machine will fail. SLAs for hyperscale clouds typically only guarantee availability if you have two instances of everything – otherwise they offer no guarantees. This is where the concept of design for failure comes into play. You will have to ensure you design around the availability limitations of the hyperscale clouds.

Having said that, let’s take a look at the benefits of each of the cloud platforms.

Local Clouds

Migrate workloads “as is” –  Due to the nature of local clouds being built on enterprise infrastructure that protects itself from failure, workloads and applications can be migrated into them without any re-architecture or design. Simply pick up your current environment and deploy it on the local clouds and you are away.

Customised managed services –  Local clouds are by nature able to offer a more granular and tailored SLA. Most hyperscale clouds offer SLAs based on the virtual infrastructure of a customer environment, but never the operating systems or applications within the infrastructure. Local clouds are able to offer guaranteed agreements for the restoration of full end to end services for customers.

Fixed price – Local clouds generally offer guaranteed infrastructure at guaranteed prices. Once purchased, the infrastructure is there for you to use without any extra costs – there are no extra bandwidth utilisation or storage input/output charges to access something you have already purchased. Hyperscale clouds, while offering unlimited flexibility, also offer the risk that costs may blow out in scenarios while scaling out automatically or in an uncontrolled fashion.

Local contacts and management – The team providing your managed services on top, and your cloud infrastructure are typically part of the same company. This means that when there is an issue that affects your critical business application, local cloud providers are wholly responsible for delivering your application through to your customers. There is no need to contact large out of country corporations, and no confusion over accountability.

More flexible licensing deployments – One of the show stoppers for organisations going to cloud computing is around the licensing of their applications. Many times organisations are only licensed to run their applications on their own equipment and not on shared equipment (e.g. customers without Software Assurance). Local clouds are more flexible to “pinning” customer virtual infrastructure to individual pieces of hardware, catering to strict software licensing rules while offering customers the benefit of high availability and scalability that clouds can provide.

Certainty over data ownership and recovery – Local clouds are very flexible when it comes to retaining the ownership of data that you put into their clouds, allowing you greater freedom when it comes to retrieving your data in the event of a contract termination. Hyperscale clouds often reserve the ability to view, modify, or move your data without your knowledge. Some hyperscale vendors have clauses within their contracts giving them the right to delete your data (most of the time without prior warning) if they deem it to be “suspicious.”

Know where your data is at any time – Local clouds are typically more transparent, and by their very nature give you the ability to understand the exact location of your information, even allowing you to visit the data centres where they are located. Global cloud providers are less transparent about the location of your data, typically only advising you of the regions they are in, with terms that allow them to move the data as required.

Avoid exchange rate risk – Local clouds transact in local dollars, meaning that your month to month spend is predictable and understood. When purchasing services from global clouds, transactions normally occur in foreign currencies, which is subject to unpredictable fluctuations, making your bill unpredictable. A five cent move in USD – NZD or AUD conversion rates will mean an extra $10,000 cost per annum on a $10,000 per month bill.

Hyperscale clouds

Faster to deploy – Hyperscale cloud deployments are all internet based, with no solution design required. This allows customers to deploy infrastructure within minutes.

Lower cost – Hyperscale clouds provide very little flexibility in their deployment, and very broad SLAs, meaning they are able to offer what seems to be cheaper infrastructure costs.

Larger number of development tools – Hyperscale clouds were initially developed to cater towards start-ups and the development market, and as such have plenty of tools and APIs catering to automatic deployments and quick provisioning. Local clouds are more catered to the enterprise market, with more focus on the traditional design and build processes.

Unlimited and instant scalability – Hyperscale clouds have much larger deployments, and as a result have much more scale than what a local cloud provider may be able to offer. This allows global cloud vendors to offer much larger flexibility for scaling resources up and down. Local clouds, due to the realities of having smaller scale deployments, may have restrictions on the ability to scale up and down. This is also sometimes reflected in different service termination rights and obligations.

We’ve taken a close look at the differing benefits of local and hyperscale clouds. In our next blog we’ll ask the right questions to determine whether your business is ready to move to a hyperscale cloud.

Arthur Shih is Datacom’s cloud solutions manager.

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