All insights

Modernizing the Hybrid Cloud: Putting Incumbents Aside

Ayman Abouelwafa Ayman Abouelwafa
Chief Technology Officer

November 11, 2024

Modernizing the Hybrid Cloud: Putting Incumbents Aside

Businesses of all sizes and across industries are embracing the hybrid cloud model and, more importantly, evolving and defining their approach to it. While their architectures vary, their rationales for change are consistent. They all face cost challenges, data ownership issues, and a proliferation of distributed applications.

A closer look at their needs leads us to examine different scenarios and technology themes, with a careful eye to balancing modernization against potential risks.

At Hitachi Vantara, we’ve identified three key scenarios for approaching hybrid cloud modernization and change:

  1. Maintaining current operations without change.
  2. Adopting open-source or commercial alternatives.
  3. Accelerating public cloud adoption.

Each scenario offers its own unique benefits and drawbacks, which I’ll explore below. We’ll also evaluate alternative solutions and providers, with a significant focus on open-source options, and discuss the growing interest in cloud-native technologies.

At Hitachi Vantara, we’re focused on helping our customers modernize their hybrid clouds using open-source technology and integrating management and data interfaces with tools including Kubernetes, OpenStack and Ansible.

What’s Driving Demand for Modernization?

While finding winning use cases for generative AI/ML is at the top of everyone’s mind, lurking closely in the background is the imperative to modernize your hybrid cloud infrastructure/environment. And for good reason. This modernization can bring about significant benefits, from cost savings to improved performance and scalability.

First, business model revisions from incumbent private cloud software providers can generate significant user pain., since business model shifts can cause serious “sticker shock,” and replacements can be complex. In a limited number of cases, the cost of retaining the incumbent solution drives users to consider alternatives.

Generally, when deliberating alternative solutions, one of the three scenarios listed above occur. The question is, which one best fits you?

To reach the right scenario, users must plan for a spectrum of potential outcomes. Some, but not all, require the following planning and navigation:

  • Reimplementing business processes (e.g., automated provisioning) tied to incumbent resource management technologies to the new technology stack.
  • Choosing the right migration target (e.g., from virtual machine to container) for each workload.
  • Moving implementations of service level objectives (e.g., disaster recovery for cyber resiliency) from the incumbent integration to the target integration.

At Hitachi Vantara, we understand that every business is unique, and we're committed to providing solutions that allow you to choose your preferred technology stack and provider. Our approach is flexible and adaptable, ensuring that you can navigate the modernization process with confidence.

Three Modernization Scenarios

Business continues without change

While enterprise users may be more willing to accept business model and pricing changes, small to mid-size organizations are far more sensitive to significant cost increases. Those that minimize or abandon the incumbent are more likely to consider moving to an open-source or commercial alternative.

Customer Segment

Pros

Cons

Enterprise

  • Unchanged business processes and technology platforms.
  • Vendor positions itself as 40% less costly for running cloud infrastructure and workloads than public cloud.
  • Increased costs potentially jeopardize investment areas, e.g., GenAI.
  • Missed opportunity to buy down technical debt through modernization
  • Remains locked in.

Small to Mid-Size Enterprise

  • Removed costs for the incumbent provider.
  • Seized opportunity to modernize, buying down technical debt.
  • Open alternative maximizes future potential to gain flexibility with lower costs.
  • Changed business processes and technology platforms.
  • Likely to incur migration costs.
  • If a proprietary alternative is selected, swap one lock-in for another.

Alternatives emerge to succeed or supplant the incumbent provider

As the incumbent technology provider remains inflexible, customers of all sizes become dissatisfied and actively pursue alternatives. In this scenario, migration planning, prototyping and execution consume significant time, resources and spending, but the payoff is a modern hybrid cloud architecture supporting current and future workloads/needs.

Segment

Pros

Cons

Enterprise

  • Decreased costs associated with the incumbent provider.
  • Leverages opportunity to modernize and buy down technical debt.
  • Open alternative maximizes future potential to gain flexibility with lower costs.
  • Incumbent provider remains for non-migratable workloads.
  • Changed business processes and technology platforms.
  • Likely to incur migration costs.
  • If a proprietary alternative is selected, swap one lock-in for another.

Small to Mid-Size Enterprise

  • Eliminated association with the incumbent provider.
  • Leveraged opportunity to modernize and buy down technical debt.
  • Changed business processes and technology platforms.
  • Likely to incur migration costs.

 

Public cloud adoption accelerates

Driven by the need for a strong and stable provider, the organization accelerates cloud adoption as all cloud services providers (CSPs) now offer managed bare metal, virtual machine and container environments. Depending on motivation and in-house expertise, users choose from a major CSP or a sovereign cloud provider or opt for managed hybrid cloud services.

Segment

Pros

Cons

Enterprise

  • Removed costs for the incumbent provider.
  • Seized opportunity to modernize, buying down technical debt.
  • With existing cloud relationships an opportunity exists to consume committed cloud spend.
  • Incumbent provider remains for non-migratable workloads.
  • Changed business processes and technology platforms.
  • Likely to incur migration costs
  • Swaps previous provider lock-in for cloud provider lock-in.
  • Can’t take advantage of depreciation.

Small to Mid-Size Enterprise

  • Decreased platform licensing costs.
  • Seized opportunity to modernize, buying down technical debt.
  • Changed business processes and technology platforms.
  • Likely to incur migration costs.
  • Swaps previous provider lock-in for cloud provider lock-in
  • Can’t take advantage of depreciation.

Weighing Your Modernization Scenario Options

We know no one scenario wins out over another in all instances. Most organizations are likely to experience at least two, if not all three of these scenarios in some form at some point.

Here inside Hitachi Vantara, our own IT organization is experimenting with open source alternatives to reduce the footprint of the incumbent solution provider. And we’re running numerous services in the public cloud, meaning all three scenarios are at play within our own company.

For this reason, we’re building and implementing approaches and solutions under the assumption that all three scenarios will coexist. By acknowledging and preparing for this reality, we can ensure our customers are fully informed and ready for the potential challenges and opportunities that lie ahead.

Hybrid Cloud Modernization Alternatives

There are two classes of alternative technology providers. First, self-proclaimed alternatives to the market incumbent. And second, the primary Linux distributors.

Self-proclaimed modernization alternatives

There are a variety of self-proclaimed alternatives, each with varying degrees of capability. They typically target niche market segments due to their level or lack of maturity, intended design or both. The following table outlines the pros and cons of each:

Alternative Category

Pros

Cons

Public Cloud Hyperscalers with Hybrid Cloud Extensions

Consistent management across hybrid cloud.

Full range of bare metal, VMs, containers and Kubernetes (K8s).

Full suite of software-defined services available (NFV/SDN, SDS Block, SDS Object and others).

  • Locks users into walled gardens via the use of proprietary services.
  • Expensive to operate vs. running workloads on-prem.
  • On-prem extensions are unique to each hyperscaler and may include differences in business models.
  • Complex pricing models and service catalogs.
  • Infrastructure management is complex and unique to each hyperscaler.

Established Hybrid Cloud Platform Providers

  • Consistent management across hybrid cloud.
  • Full range of bare metal, VMs, containers and Kubernetes (K8s).
  • Offers some set of software-defined infrastructure.
  • May lock in users due to proprietary extensions to hypervisor, software-defined storage, SDN and container runtimes.
  • Public cloud connections use integrated hyperscaler technologies.
  • May focus on solving problems in specific niches, e.g., edge computing.

Emerging Hybrid Cloud Platform Providers

  • Covers core hypervisor with KVM or containers with K8s with improved manageability.
  • Mostly open-source focus ensures customers maintain easier options to switch.
  • May include some software-defined infrastructure capabilities.
  • Smaller upstarts with unclear track records for enterprise support
  • Incomplete software-defined infrastructure capabilities.
  • K8s/container capability can be less of a focus if the company emphasizes VMs.
  • Companies focusing on K8s do not have any VM capability.

 

Major Linux distributors

All major Linux distributors offer operating systems alongside cloud-native platforms and technologies. These cloud-native technologies, in turn, support bare metal, virtual machine and container-based computing formats. And for these computing formats, each distributor provides unique yet open source management and monitoring software. These are well-known projects such as Kubernetes, OpenStack, KVM, Ansible, LibVirt and Docker.

Major Linux distributors

These cloud native and operating system stacks are compelling options because of their common and open source nature across most distributors. As a result, users experience minimal friction when switching from one Linux provider stack to another, engaging with a global systems integrator (GSI) specializing in hybrid cloud solutions, or deciding to maintain their infrastructure independently.

Your Next Steps Towards Hybrid Cloud Modernization

A key challenge with the open cloud native stacks is the ecosystem’s maturity, along with support and maintenance costs. Ease of use and integration with advanced infrastructure features, such as disaster recovery services and similar functionalities, may require additional work, software packages or more intensive services.

There are many variables to consider when looking for the right approach to hybrid cloud modernization. Especially when evaluating your incumbent solution provider.

Every organization’s needs will be unique based on a wide range of variables. While no single solution will prevail, every organization can benefit from finding the right approach and working with a proven provider like Hitachi Vantara with our deep perspective into the evolving market.

We’ll discuss that in our next post as we articulate our recommended approach to hybrid cloud modernization. I hope to see you back here soon.

Read more


Ayman Abouelwafa

Ayman Abouelwafa

Ayman Abouelwafa is the Chief Technology Officer at Hitachi Vantara, responsible for identifying and evaluating emerging technologies, and developing and executing a strategic and forward-looking technology roadmap that aligns with the business strategy. Read more.