Search our website

How is private cloud different from on-premise?

10th Aug 2022

For clarity, private cloud and on-premise are not mutually exclusive, since private cloud can be hosted on-premise. Nevertheless, there are historical deployments which characterise legacy on‑premise environments, and distinguish them from more advanced cloud technology.

Generally speaking, on-premise networks are proprietary, in-house implementations, based within an organisation’s own data centre and supported by in-house engineers.  As such they represent a significant CapEx cost on the company’s balance sheet.


On-premise connectivity

Typically they are connected through dedicated, private leased lines provided by Network Service Providers such as BT or AT&T. However, such exchanges are not necessarily sufficiently powered to satisfy the high compute demands in the financial sector.

Furthermore, the older power supply infrastructure can suffer brown-outs, and often black-outs.


On-premise security

On-premise environments should meet the required security standards such as ISO 27001.

However, historically on-premise data centres have been situated in office-building basements, enhancing the risk of environmental disaster. For example, the vast majority of New York data centres were taken out by Hurricane Sandy in 2012.

Today, particularly in financial markets, there are specific security standards enforced by the Financial Conduct Authority and the Federal Communications Commission that require data centres to be at specific distances and kept in specific conditions to ensure recoverability.


On-premise advantages and disadvantages

By choosing an on-premise approach organisations retain full control of their own design and security as well as regulatory compliance measures.

Nevertheless, legacy on-premise environments have been largely superseded due to their limited scalability, higher latency and long lead times to refresh the infrastructure. These are historical features of on-premise data centres which are less and less viable.


Private cloud commissioning

Private cloud environments can be implemented on-premise, or in a co-location data centre, or hosted by a third party.

As service models move ever further towards subscription-style and pay-as-you-go arrangements, third parties can offer private cloud Infrastructure as a Service, saving businesses huge CapEx costs and taking the responsibility for all infrastructure refreshes out of companies’ hands.


Private cloud advantages and disadvantages

The conversion of CapEx to OpEx costs is an extremely attractive proposition in favour of private cloud Infrastructure as a Service (IaaS).

Private cloud infrastructure also has the latest security standards baked-in, and can be quickly deployed close to liquidity providers and execution venues to reduce latency.

It’s a dedicated scalable infrastructure offering secure private connections and improved application performance for remote users.

Where the private cloud has been implemented within an on-premise strategy that means the organisation is liable for running and maintenance costs, and the high expense of real estate.


Beeks offering

Beeks can deliver private cloud technology to on-premise and third party data centres. With replicable private cloud environments in key financial hubs globally, Beeks can put capital markets organisations right at the heart of trading venues.

Offering comprehensive Infrastructure as a Service private cloud access with guaranteed security and performance, and 24/7 support and monitoring, Beeks help customers focus with confidence on their core business, without worrying about cloud or network resources.

Get in touch to see how you could benefit from Beeks’ solutions:


Share article

LinkedIn Twitter Facebook Email