July 09, 2012, 7:37 AM — Since the mid 2000s one of the prevailing trends in the IT world has been to move networks, data, operating systems and servers into an environment where they are not tied to a specific piece of hardware.
In the early days the emphasis was on virtualisation. Organisations concentrated on increasing the number of servers on one machine using a hypervisor program with the activities kept in-house.
More recently there has been an emphasis on cloud computing, with more functions passing into the hands of a third party. The latter includes the option for a private cloud, dedicated to one enterprise.
Virtualisation and private cloud strategies are sometimes confused, not helped by the varying definitions.
The strongest distinction is that virtualised technology is a fixture of an IT estate while cloud computing is offered as an on-demand service, for platform, infrastructure or software, available on a pay-as-you-go basis.
Cloud is currently drawing more attention, with the government opening the Cloudstore for the public sector and a stream of big deals in the private sector, recent examples being at Deloitte and Proctor & Gamble.
But there is still a steady, if more low key, move to virtualised environments, with recent deals for organisations such as Thames Water and Medway NHS Trust. Also, Forrester has recently predicted a rise in demand for data virtualisation technology.
As organisations consider which route to take they have to look closely at which is better to meet their business needs.
This can be difficult, not least because both are often described in language which bears little relation to business processes, but there are a number of factors that should be taken into account.
Cost is the most obvious. It will be higher for virtualisation as it involves a considerable amount of work in setting-up and customising, while the provider of a cloud service has already borne these costs.
The latter also provides the scope for efficiency savings through the utility computing model, in which the customer only pays for what they use; but if the service is heavily used the costs can increase and begin to offset the initial savings.
This is unlikely to be the case for many organisations, but there are times when it is cheaper to own the asset.
Virtualisation can provide clear advantages if an organisation needs a high degree of control. Keeping operations within its own data centre can make it easier to manage and make changes to its IT environment, providing more flexibility.