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What is a Private Cloud?

Enterprises love the cloud because of its scalability and efficiency. However, many organizations cannot take advantage of cloud computing for one of multiple reasons. The federal government, as well as local state and municipal governments, are often legally barred from using externally hosted and controlled computing resources. Also, companies in the financial services sector and public universities often have compliance rules which stipulate that data has to be stored on-premise and behind their firewall.

A private cloud is a cloud-computing platform that is constructed for only one organization to use and is setup behind that organization’s firewall. The cloud-computing platform will be hosted and managed by a department within the company and their services will be made available to other departments within the same company on an as-needed basis. In a sense, the company is basically setting up a pool of resources and linking them together so they can be provisioned efficiently to meet the needs of other sections of their organization. This is opposed to the old way of doing things in which individual departments would have their own IT staff and purchase, setup, and manage their own servers, databases, and computers. Private clouds centralize these tasks to reduce overhead and improve efficiency. The people in the private cloud-computing department are essentially starting their own cloud company within the organization and can only provide services only for internal customers instead of external.

There are some obvious and nonobvious benefits of a private cloud. The most apparent is greater control over the cloud infrastructure. When you host and run a cloud-computing platform, you have ultimate say over how things are setup and operate. You get to choose what servers to buy, how they are setup, and what virtualization software to use. Another benefit is greater security since everything is behind a company’s firewall and security software. Private clouds may be cheaper to operate than using a public cloud like Amazon AWS or Microsoft Azure because there is no inherent profit margin built-in, but that’s not a guarantee. However, costs will definitely be more transparent and clear than using a public cloud.

Some companies have decided to take advantage of the benefits of both the public cloud, like Amazon Web Services (AWS), Microsoft Azure, and the Google Cloud Platform, and their own private cloud by linking them together to get a hybrid cloud. Another setup option some organizations opt for is what is referred to as “cloud bursting”, which is when non-critical processes are moved to public cloud infrastructure only when their private cloud is operating at capacity.

Many companies have jumped into the private cloud sector by offering software and bundled solutions. RackSpace and NASA have developed and released OpenStack, which facilitates the deployment of a private cloud within an organization. OpenStack is now free and open source, so it’s particularly appealing to companies on a budget. Ubuntu, the most popular consumer distribution of Linux offers a private cloud product that uses OpenStack. Also, Microsoft and VMWare both offer private cloud solutions that utilize their various products and services. And finally, Amazon has their Virtual Private Cloud (VPC) platform that is part of Amazon Web Services (AWS).


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