IDC: Enterprises still moving workloads back from the cloud

An overwhelming majority of enterprises continue to move workloads from the cloud back to on-premises data centers, although it is a smaller percentage than before, according to IDG research.

A survey found that 71% of respondents expect to move all or some of their workloads currently running in public clouds back to private IT environments over the next two years. Only 13% expect to run all their workloads in the cloud, according to the survey sponsored by Supermicro.

In the past, those expecting to move workloads back from the cloud was as high as 85%, according to Natalya Yezhkova, research vice president in IDC’s enterprise infrastructure practice.

Reasons for repatriating workloads from cloud to on-premises include cost, performance, security, regulatory compliance, and control over IT infrastructure, she said, with the emphasis shifting over time. For example, a couple of years ago one of the main reasons for moving from the cloud was security. Since then, cloud providers have improved it, and enterprises have become more comfortable placing sensitive resources in the cloud.

Other times repatriation was prompted by unexpected cost. For example, workloads may start small and incur modest costs, but as they increase, so do the costs, which enterprises might not have planned for. That could lead to dissatisfaction and moving those workloads back on-premises, she said.

Some workloads never make it to the cloud because performance isn’t good enough to support them. Companies may experiment with compute-intensive workloads like artificial intelligence and machine learning, but never fully deploy because cloud performance isn’t good enough, she said.

Line of business applications, like CRM, ERP, HR, and accounting have all proven to be cloud-friendly because they are not performance-intensive. Despite the challenges, high-performance cloud services like data warehousing and AI-as-a-service can still be a fit for certain organizations, she said.

An IDC estimate says that half of the spending on server and storage infrastructure in 2021 was driven by on-premises purchases, and they will grow to $77.5 billion in 2026.