The cloud is everywhere these days and is used for everything. According to Gartner, spending on public cloud applications worldwide will grow to approximately $600 billion this year and will continue to grow by 21% in 2024. In recent years, hybrid and multi-cloud environments have become commonplace, with organizations’ data and workloads residing in different locations.

On the surface, this offers organizations more flexibility and scalability, but the ability to move data and workloads between different clouds is often more complex and expensive than expected. Organizations face high exit costs while the security, integrations, tools, and skills needed to manage data vary across cloud providers. Due to the high costs and complexity, many companies are stuck with cloud services.

In the UK, the communications services regulator Ofcom has started examining the business of major cloud providers to examine the existence and impact of a lock-in.

include risks

Ofcom sees three potential risks in the behavior of large cloud providers. First, the exit fees they charge for transferring data to another provider can be significantly higher than other cloud service providers (CSPs). The second aspect is also financial: discounts encourage companies to use a single hyperscaler, even when there are better alternatives. And third, technical limitations that make interoperability between different cloud platforms difficult, since each hyperscaler has its own machines, security policies, tools and configurations. All of this requires unique skills to manage all clouds.

Discounts encourage companies to use a single hyperscaler even when there are better alternatives.

rein de Jong, Regional Vice President BeNeLux Cloudera

These risks go beyond the challenges of increased regulation. A lock-in can leave public cloud customers with significant price increases and no alternative cost-effective options for moving all data and applications. Over time, businesses may also find that their provider no longer offers the features they need, but are still forced to stay. Finally, when many important service providers such as banks or telecom companies become dependent on a small number of cloud providers, both they and their customers are at risk of experiencing service disruptions.

As a result, organizations are not shying away from the cloud, but are becoming more cautious about the data and workloads stored there. Recent research shows that nine out of ten ITDMs (92%) plan to migrate more data to the cloud over the next three years. While only 4% have moved data back to on-premises in the past 12 months, 76% plan to move some data back to on-premises in the next 36 months. More than half (54%) say this is due to fear of vendor lock-in.

Switching is easy everywhere except in the cloud

Think how difficult it used to be to change banks, energy, internet and mobile providers. Due to unnecessary delays and administrative burdens, this was often more of a hassle than it was worth. To solve this, regulators stepped in, the industry modernized, and it became much easier to switch service providers, giving consumers more flexibility and choice. The same is actually true for public clouds to give customers more freedom to choose and switch between service providers.

If regulators decide to take action soon, it’s unlikely to trigger a wave of changes that would upend the status quo. Why? Because any regulatory action will likely target the exit fees and rebates granted. There may even be attempts to enforce more consistency in public cloud environments. But ultimately, switching cloud providers requires both time and resources, as well as specialized skills.

Therefore, in the hybrid and multi-cloud era, companies need more flexibility in moving data between their clouds. A unified data platform can help by providing a layer of abstraction that makes it easier to move data securely from cloud to cloud or from on-premises to any cloud. Having the choice to switch cloud providers is one thing, but having an easy and inexpensive way to do so is quite another.

This is a contribution from Rein de Jong, Regional Vice President BeNeLux at Cloudera. Click here to learn more about the company’s solutions.