Bill Tolson
- Jun 5
- 7 min read

Emerging Strategies for Effective Hybrid Cloud Data Management Cost Control

In today's data-driven environment, organizations are dealing with increasing data volume, velocity, and variety (3 V’s). Effective data management is not just crucial for regulatory compliance and business operations, but it also holds the potential to enable informed decision-making, drive innovation, and achieve competitive advantage.

However, the complexity and cost of managing data effectively and securely can be a significant challenge. Organizations are constantly seeking better strategies to control these costs while maximizing the value derived from their data assets and subscriptions. This has intensified debate between on-premises, cloud, and hybrid cloud approaches as businesses strive to balance cost-effectiveness, security, compliance, and operational efficiency.

It's a stark reality that organizations are increasingly shifting to cloud storage and computing. However, a significant number of these organizations are grappling with the issue of rising cloud computing costs, which are in stark contrast to the falling cloud storage costs.

It's worth noting that the cost-efficiency of cloud-based CPU cycles can be a mixed bag, depending on various factors. In some cases, it can outperform on-premises computing resources, particularly for workloads with variable or unpredictable demands. However, the efficiency of cloud CPU costs can fluctuate, hinging on data activity (active versus inactive), the presence of existing on-prem resources, and the specific features and functionality of the application.

Considerations include not just the technical aspects, but also the financial implications, scalability and elasticity, compliance, operational costs, data utilization, backup/DR requirements, and business continuity. Striking the right balance is key.

Ultimately, the crux of the matter is this: evaluating your organization's unique requirements and usage patterns is crucial. While cloud computing has undoubtedly transformed the data landscape, a complete transition to a cloud platform may not always be the most suitable solution. This blog post will delve into the intricacies and advantages of cloud computing, cloud storage, and a hybrid approach, equipping you with a comprehensive understanding of these options to make an informed decision.

On-Premises Data Management: The Traditional Approach

For many years, organizations have relied on on-premises data storage and management. This involves hosting and managing data infrastructure within the organization's physical data center, such as servers, storage systems, disaster recovery, and backup solutions. The benefits of on-premises data storage and management include increased control, data sovereignty, and customization options. Organizations can tailor their infrastructure to meet specific requirements and maintain complete oversight over their data assets.

However, on-premises data storage and management come with significant upfront and ongoing costs. Initial investments in hardware, software licenses, and data center infrastructure can be substantial. Additionally, organizations must consider the costs of maintenance, upgrades, and staffing to manage and secure the on-premises environment. Operational expenses include square footage requirements, energy consumption, and cooling needs.

Despite these challenges, on-premises data storage and management remain viable for organizations with strict data privacy and regulatory compliance requirements. It also suits those relying on legacy applications or systems that are difficult to migrate to the cloud.

Cloud Data Management: The Future of Scalability and Cost-Efficiency

The rise of cloud computing has revolutionized the way organizations approach data management. Cloud data management involves outsourcing data storage, processing, and analytics to third-party cloud service providers, such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform. This approach eliminates the need for substantial upfront capital expenditures and shifts the cost model to an operational expense based on consumption.

One of the primary advantages of cloud data management is its scalability and elasticity. Organizations can rapidly provision or de-provision resources based on fluctuating demands, paying only for what they consume. This eliminates the need for over-provisioning and reduces the risk of underutilization, resulting in significant cost savings compared to on-premises solutions.

Additionally, cloud service providers offer a wide range of managed services and advanced analytics tools, reducing the burden on organizations to maintain and update complex software and infrastructure. These services can be particularly cost-effective for organizations with limited IT resources or those seeking to leverage cutting-edge technologies without substantial upfront investments.

However, cloud data management also presents challenges. Organizations may face concerns about data security, compliance, vendor lock-in, and potential hidden costs associated with data transfer and egress fees. Careful research, planning, and risk assessment ensure that cloud data management's cost savings and benefits outweigh the potential drawbacks.

Hybrid Data Management: Striking a Balance

Organizations face the challenge of managing growing amounts of data securely and cost-effectively. The good news is that a hybrid approach has emerged as a practical strategy for controlling costs and improving operational efficiency. A hybrid data management strategy involves combining on-premises and cloud resources, allowing organizations to benefit from the strengths of both models while addressing their respective weaknesses. As I previously stated, cloud storage costs continue to fall while the cost of cloud computing (CPU usage) has become a significant expense that has overtaken the cost of storage.

However, a new hybrid cloud strategy emerged over the last couple of years to take advantage of these truths. Utilize cheap cloud storage while retaining existing on-prem servers and applications to access and work with your data stored in the cloud.

A hybrid data management strategy also enables seamless integration and data portability between on-premises and cloud environments, empowering organizations to develop hybrid cloud applications to take advantage of on-prem compute capabilities.

However, implementing a hybrid data management strategy introduces connectivity, security, and governance complexities. Organizations must ensure secure and reliable connectivity between their on-premises and cloud environments and establish consistent policies, access controls, and monitoring processes across the hybrid infrastructure.

Cost Optimization with Hybrid Cloud Strategies

Because of the rising costs of cloud computing, organizations are looking to implement cost optimization strategies to effectively manage their data storage/management expenses without affecting overall employee productivity or customer service levels.

The hybrid cloud/on-prem strategy has become a popular approach for cost reduction. A hybrid cloud approach can help organizations avoid vendor lock-in and optimize costs based on specific workload requirements, cloud pricing models, and data activity (active vs inactive).

As organizations move entirely into the cloud, many are left with unused on-prem server capacity. Instead of paying the cloud provider for storage AND computing resources, why not use your underutilized servers for some computing requirements?

Utilizing unused on-prem server CPU in conjunction with cloud-based data storage can be cost-effective for several reasons:

Benefits of a Hybrid Cloud Strategy

1. Maximizing Existing Resources

Utilization of Idle Resources: On-premises servers often have underutilized CPU capacity – especially if your organization is moving to the cloud. By leveraging this idle computational power, businesses can avoid the cost of additional cloud compute resources.
Deferred Capital Expenditure: Fully utilizing existing on-premises infrastructure postpones the need to invest in new hardware, maximizing the return on existing investments.

2. Reduced Cloud Compute Costs

Lower Cloud Compute Fees: Cloud service providers charge for both compute and storage. Businesses can significantly reduce the expenses associated with cloud compute resources by using on-prem CPUs for processing tasks.
Optimized Cost Structure: Cloud storage costs are now typically lower than compute costs. By offloading compute tasks to on-premises servers, companies can benefit from cheaper cloud storage while avoiding the higher costs of cloud-based computation.

3. Improved Performance and Latency

Local Processing: Utilizing on-premises servers for compute-intensive tasks can reduce latency compared to cloud-based computation, as data does not need to be sent back and forth between the cloud and on-premises systems.
Bandwidth Savings: By performing computations locally, there is a reduction in the volume of data that needs to be transferred to and from the cloud, leading to potential savings in bandwidth costs.

4. Enhanced Security and Compliance

Data Security: Sensitive data can be processed locally, reducing the risk of exposure during transit to and from the cloud. This approach can also simplify compliance with regulations that require specific data to remain on-prem.
Control and Customization: On-premises infrastructure provides greater control over the compute environment, allowing for more tailored security measures and performance optimizations.

5. Flexibility and Scalability

Hybrid Solutions: Combining on-premises compute with cloud storage enables a flexible, hybrid approach that can be scaled according to business needs. This provides the ability to handle peak loads by utilizing the cloud while keeping regular operations cost-effective on-premises.
Seamless Integration: Modern cloud services and tools often support hybrid architectures, making integrating on-prem compute resources with current and emerging cloud solutions much more accessible.

As data increases and organizations strive to unlock the full potential of data, efficient and cost-effective data management has become a strategic imperative. The choice between on-prem, cloud, and hybrid approaches depends on an organization's specific requirements, priorities, and risk tolerance.

By carefully evaluating their data management needs, implementing cost optimization strategies, and leveraging emerging technologies and best practices, organizations can balance operational efficiency, cost control, and maximizing the value derived from their data assets by looking at hybrid cloud strategies.

restorVault’s Data Virtualization for the Hybrid-Cloud Strategy

RestorVault is a leader in enterprise/cloud storage virtualization solutions. We have been awarded several US patents for our virtualization technology. Our storage virtualization solutions offer multiple benefits to organizations, including:

Hybrid virtualization capability across both on-prem and cloud platforms
Enhanced storage utilization and simplified data management capabilities
Improved data availability and resilience
Simplified scalability and flexibility
Cost efficiency and investment protection
Data protection against disasters and ransomware attacks (data encryption and immutable storage tiers)
The ability to duplicate, move, and share large, unstructured data sets without the need for time-consuming and risky large-scale data migrations

Based on policies, the restorVault solutions provide a storage virtualization capability that replaces files in an on-prem or cloud repository - such as a file share. It replaces these files with a pointer or virtual data file that directs the user to the original file in the encrypted and immutable restorVault cloud. When a user clicks on a virtual data file (link) in their file explorer, the actual file is instantly retrieved from the restorVault cloud platform for viewing and ongoing work.

Storing your sensitive and inactive files in a secure, trusted, and cost-effective cloud repository can reduce the size of your enterprise backups by approximately 80%. This leads to faster data restoration and helps free up expensive enterprise and tier-1 cloud storage. For every terabyte (TB) of restorVault virtual cloud storage, you can recover 80% of primary, backup, and other cloud platform storage costs.

RestorVault’s cloud storage virtualization platform is compatible with a hybrid cloud strategy. Data from on-premises resources such as file and SharePoint servers can be automatically transferred to the RestorVault cloud. At the same time, placeholders are left in the original on-prem application servers. The on-prem servers can then use their CPU capacity to work with virtualized data in the cloud. This approach leverages the benefits of a hybrid cloud strategy, including cost-effective cloud storage and the use of existing on-premises CPU resources.

restorVault customers can automatically move data between on-prem storage, Microsoft Azure, Amazon AWS, Google Cloud, and other cloud platforms without fear of vendor/platform lock-in. Additionally, the on-prem application servers can now seamlessly use cloud-based data.

There will be times when taking advantage of cloud compute capabilities will be the best solution; however, based on your organization’s workload requirements and uses, a hybrid on-prem/cloud storage strategy allows you to take advantage of lowering cloud storage costs while not being forced to pay for rising cloud compute costs.