Public cloud vs. private cloud: cloud models explained

If you’re looking for a cloud deployment service then you have a choice between four main cloud options: public cloud, private cloud, and combinations of these referred to as hybrid cloud and multi cloud. Since the scope of service differs greatly from cloud to cloud, it’s worthwhile to understand the differences between the two main forms, as well as their positive and negative aspects.

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Which cloud models exist?

The cloud is everywhere. At least, that’s the impression that Internet users may get when looking at recent years’ developments. But it’s not only private end users who are increasingly using cloud services such as Google Drive or Microsoft OneDrive. Companies are also increasingly dependent on the cloud’s concentrated computing power, flexible access, and high data security. Where demand is high, supply naturally grows. Currently, users can choose between two different cloud models and two combinations:

  1. Public cloud: Virtual resources and IT services provided by third-party providers over the Internet for multiple mandates simultaneously.
  2. Private cloud: Computing services and IT environments that are not provided and hosted for multiple clients, but in-house as intranets or data centers. The cloud environment is reserved for one organization.
  3. Hybrid cloud: Combines cloud services from public and private clouds using local data centers and external public cloud services.
  4. Multi cloud: Stands for the simultaneous use of the same cloud model (either public or private cloud) from different cloud providers. Companies use several private or public clouds in parallel.

The type of cloud provision is also closely linked to the type of services and functions offered within the framework of cloud computing. Here we can differentiate between three main types:

  1. IaaS (Infrastructure-as-a-Service): Provides instantly available IT resources and scalable network infrastructure virtually over the Internet.
  2. PaaS (Platform-as-a-Service): Provides APIs via the cloud or the Internet as a developer and computing platform for application developers.
  3. SaaS (Software-as-a-Service): Software and IT environments are provided by third-party providers as a service in the form of complete packages or needs-based models.

Public cloud vs. private cloud: key differences

When choosing between different cloud models, there is no blanket solution. Depending on individual requirements, each cloud model can offer its own advantages or disadvantages. One of the most popular cloud services is undoubtedly the public cloud, which only requires a browser. The private cloud, on the other hand, offers advantages primarily for companies that prefer autonomous IT infrastructures and private data centers. Many private users also use it to back up their photos and other important data, for example.

To make the right choice, you should know the differences between a public and private cloud. Since the services of the two are known to merge, differences and similarities may even overlap.

Public cloud Private cloud
Multi-tenancy: IT infrastructure is shared with other cloud mandates (private users or enterprises). Companies use dedicated, organization-owned IT infrastructure that is not shared with other mandates.
Typically resides off-premises in non-local data centers hosted by cloud providers (but is also deployed on-premises in enterprise data centers). Can reside in both on-premises enterprise data centers and exclusive clouds hosted by cloud providers, as well as off-premises data centers.
Services and applications are always part of the cloud provider’s external, hosted IT environment. Services and applications always remain within the private network and are not included in networks shared with third parties.
Cloud services are usually offered in various subscriptions, plans, or complete packages. Cloud services and cloud computing can be precisely adapted to the requirements of a company.
Despite the highest security precautions and extremely secure data centers, the multi-client approach may pose a low, but nonetheless existing, security risk to sensitive corporate data under strict regulatory compliance requirements. As an exclusive cloud service, private clouds provide higher levels of security, especially for business-critical processes or sensitive, government operations.
Require no investment in infrastructure, as clients use the IT landscape provided by the cloud providers. Require personal investment in hardware and software for own on-premises cloud infrastructure.

Advantages and disadvantages of the two cloud models

The advantages and disadvantages of a public or private cloud model are defined not so much by its vulnerabilities, but by the individual requirements of the clients. For example, public clouds offer highly scalable IT resources whose infrastructure is shared with other users. For users such as government agencies, security services, or financial institutions, multi-client capability and external cloud IT can already be considered a small but unsustainable security risk. Private clouds, on the other hand, offer high security standards, but require investments in building an on-premises cloud environment.

Public cloud: advantages and disadvantages

Advantages

Disadvantages

Costs are saved by outsourcing IT operating costs to cloud providers and easy access to provisioned, low-cost cloud environment.

Multi-tenancy can pose a security risk to organizations with high regulatory compliance and security standards.

Managed public cloud services reduce the burden of server management and adherence to security and compliance standards.

The use of cloud services from external providers can lead to dependence on the provider’s IT environment.

High security standards relieve the burden on small or medium-sized companies with limited IT security resources.

Cloud infrastructure isn’t always located in the client’s country, which can lead to data security gaps if legislation differs (see US Cloud Act).

Software and cloud applications are always up to date and can be upgraded and scaled up as needed.

Public cloud providers often don’t offer customized enterprise solutions, but subscriptions, different plans, or complete packages for cloud services.

Private cloud: advantages and disadvantages

Advantages

Disadvantages

Highest security standards by way of exclusive, proprietary cloud infrastructure.

Higher capital expenditure for exclusive cloud services, IT resources, hardware and software licenses.

Is possible both on-premises with own IT resources and off-premises with virtualized IT resources maintained by means of managed cloud hosting.

Somewhat less flexibility compared to public clouds.

Flexible, fast access to corporate IT environment for selected user groups.

With an on-premises private cloud without virtualization, building IT capacity requires more effort and maintenance.

Customized cloud services that can be adapted and expanded as needed.

On-premises cloud servers with poor IT security may be more vulnerable than highly secured cloud provider servers.

Application examples of both cloud models

Public cloud

Where the public cloud is used depends not so much on the industry or the company, but on the company’s own resources and IT needs. However, the public cloud is particularly suitable for high scalability and the processing of large workloads. Companies that both offer and use public cloud technology are:

  • AWS (Amazon Web Services)
  • Microsoft Azure ExpressRoute
  • IBM Blue Cloud
  • Google Cloud Platform
  • Alibaba Cloud
  • Oracle Cloud FastConnect

Highly scalable public cloud capacities are particularly suitable for companies that have limited IT resources, want to focus on their core business, and at the same time, process enormous amounts of data. Well-known companies that use public clouds or hybrid clouds are:

  • Netflix: The streaming service has been using the AWS cloud since 2016 and no longer maintains its own data centers. This step has not only resulted in significant savings, but also in an increase in the number of streaming users.
  • Twitter: The social media platform is in a partnership with Google and transfers large volumes of data to the Google Cloud. In addition to the scalability gained as a result, it was also the diverse, attractive cloud functions, for example, that prompted Twitter to make this decision.
  • Lufthansa: In 2020, the airline decided to use Google Cloud to improve its work processes. For example, the planning of aircraft operations and maintenance is carried out via the cloud.

Private cloud

Companies and private users who value as much autonomy and independence as possible are opting for a private cloud environment that can be implemented both with a local IT environment and via virtualization off-premises. Companies that provide private and hybrid cloud services are:

  • Oracle
  • IBM
  • VMware
  • Hewlett Packard Enterprise
  • Amazon Virtual Private Cloud
  • Google Virtual Private Cloud
  • Ubuntu OpenStack (Open Source)
  • Apache CloudStack (Open Source)

Well-known companies that rely on their own private cloud or hybrid cloud are:

  • Walmart: The retail group has invested several million dollars in its cloud system. Improved data handling can boost e-commerce sales.
  • NASA: The U.S. aerospace agency has a cloud data center called Nebula that combines private cloud and open source. Thanks to it, NASA employees can, for example, share research data with business partners much more easily.

Hybrid cloud – a solid alternative?

Hybrid cloud deployment is a combination of public cloud services with on-premises IT or a combination of public clouds with a private cloud. With the hybrid model, companies have the option of splitting services and applications between private and public clouds. Since public clouds offer particularly powerful capacities, the high security of a private cloud can be combined with the performance of public clouds. Costs can also be adapted to requirements by flexibly distributing workloads.


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