DropBox Turns to On-Premise Storage Rather than the Cloud, Saves $Millions

A story published on GeekWire should make many organizations rethink their storage strategies. It recounts how DropBox bucked industry trends by moving its popular file-storage service away from the cloud—AWS’s S3 storage service—to its own infrastructure (www.geekwire.com/2018/dropbox-saved-almost-75-million-two-years-building-tech-infrastructure/). By investing in its own data centers rather than spending on third-party infrastructure, DropBox saved $39.5 million in 2016 and $35.1 million in 2017. What DropBox discovered through its “Infrastructure Optimization” project is on-premise storage designed for an enterprise’s specific needs can be much more efficient than relatively generic cloud offerings.

There are persistent arguments for on-premise storage. You don’t have the security worries when your data leave the confines of your firewalls—and your control—to traverse the Internet to somebody else’s network. You lack concerns about sketchy neighbors on multi-tenant clouds, which is what most commercial clouds are. Additionally, moving data across your on-premise resources is simpler and faster than moving data between clouds. Your compliance, governance, and peace-of-mind needs can be best met when you maintain local ownership of your data.

Data are far more rapidly accessible when stored locally rather than somewhere else in the country or, worse, somewhere else on the planet. On-premise data benefits such established needs as time-sensitive transactional processing, backups, and data recovery, and there are emerging applications for which speed and safety will be paramount.

For example, analytics now go well beyond Hadoop-style, big-data projects as even small organizations increasingly use analytics to extract more value from their data. Analytics offers the knowledge to improve everything from IT and operational efficiencies to marketing and customer relations. But to avoid latency, especially when real-time or near real-time analysis is required, compute and storage must be close together, not separated by the Internet. The argument for local storage becomes even stronger with the adoption of technologies like NVMe and NVMe over Ethernet, which will greatly speed data movements across local networks and expedite data analytics.

Examples like DropBox show that public clouds are not always the most cost-effective solution for data storage. The best bet is keeping data on premises creating a private cloud, or a hybrid cloud, replicating them to a second site for backup and recovery, and archiving everything on a slow but inexpensive cloud service like private Cloud providers or Amazon Glacier. You’ll gain control, performance, and security. And you can economize on your IT expenses.