Last year saw the first steps backwards in companies’ ‘move to cloud’ strategies. The Cloud Exit of some companies is a sobering thought.

It’s hard to talk about trends. Nevertheless. Cloud Exit is a reality. The re-internalisation of applications is no longer such a rare phenomenon.

Here and there CIOs are becoming increasingly wary of the “move to cloud” mantra, realising the need to divert certain workloads from the public cloud to platforms where they will run more productively, more efficiently and more cheaply.

“Exiting the cloud has become a major theme in 2023 and there’s a good chance it will turn into a real trend for 2024. The cost savings are simply too great for many companies to ignore,” says David Heinemeier Hansson, CTO, 37signals, which completed a full six-month exit from the cloud last June. “Enough people are realising that the cloud marketing narrative doesn’t necessarily match their reality.”

Misadventures

The idea of a workload-specific approach is now taking centre stage. The resulting infrastructure of choice – a combination of on-premises and hybrid cloud platforms – will aim to reduce cost overruns, contain cloud chaos and ensure adequate funding for GenAI projects.

David Linthicum, ex-Chief Cloud Strategy Officer, Deloitte Consulting LLP, argues that many enterprise CIOs who have found themselves caught up in the cloud race are now repairing their “mishaps” by seeking out the ideal platforms for various applications, whether in a private cloud, on an industrial cloud, within their own data centres, via a managed service provider, at the edge or orchestrated in a multi-cloud architecture.

In a recent post, he explains this trend by companies’ caution about the security of their sensitive data… and the rising costs of cloud services.

“Many find that on-premise or hybrid cloud models offer better cost control and customisation options… The most common motivating factor I’ve seen in favour of repatriation is cost!” He goes on to say that “most corporate workloads are not exactly modern” and are therefore not the best suited to the cloud.

The impact of AI

Various studies address the subject of Cloud Exit indirectly, often without naming it. The arrival of AI is said to be a catalyst. Through AI, many businesses are preparing to re-examine their workloads and ultimately place them on the right infrastructure, whether in the public cloud or on the edge… or by moving them back to their own private cloud or servers.

By repatriating its information system, 37signals continues to create a buzz. David Heinemeier Hansson has literally given his process media coverage, making it possible to follow it through his The Big Cloud Exit FAQ. In this sense, he does a useful job of tackling the issues one by one, such as the additional human costs involved in running the systems on site.

The “it depends” answer that everyone hates

In his FAQs, David Heinemeier Hansson explains the limited ability of native cloud applications to reduce his company’s costs, and highlights the need for a world-class team to address the company’s security issues. In particular, privacy regulations – the famous GDPR. According to him, this is one of the reasons why European companies are opting for hardware that they own themselves rather than relying on the cloud.

Everyone is looking for a single answer… and there isn’t one,” comments David Heinemeier Hansson. The requirements of your systems will dictate which platform you use, not the one that seems fashionable. Sometimes the cloud offers the most value, but not always.”

Reality is complex, he concludes. And the ‘it depends’ answer that everyone hates from consultants is often correct. Each platform needs to be thought through and planned to ensure that we’re moving in the most profitable direction.