What is Private Cloud?


A private cloud is a cloud deployment model where a single organization owns and administers its own cloud and the underpinning networking infrastructure to support it. This model creates central access to IT resources for departments and staff across multiple locations and potential regions. Private clouds are implemented behind the organization’s firewall which is the major distinguishing factor from other cloud deployments models. In the private cloud model, the organization that owns the private cloud is both cloud consumer and cloud service provider (CSP).

Because private clouds rely on internal resources, companies primarily choose the model so they retain security and control over their network. Recouping recurring costs from public CSPs is another major motivator for operating a private cloud. However, service level agreements (SLA) agreed to when companies use CSPs can also help keep costs down by shifting operational risk to the CSP and holding them to a particular quality of service (QoS).

Adopting a private cloud strategy demands that companies consider the worth of the network based on its business use, the necessity of private resources, and the cost of maintaining the network and supporting infrastructure, versus alternatives such as virtual private clouds (VPC), that enable private clouds in a public cloud space.


Private clouds are operated behind a single owner's firewall, because of this, they are referred to as single-tenant environments with isolated access to resources. Compared to public CSP, private cloud infrastructure is usually hosted on-premises in the owner’s data center. Alternatively, the company can rent infrastructure from an IaaS vendor placing their infrastructure offsite but still under company control. In either case, virtualization is the key technology that enables both private and public clouds.

Virtualization uses various technologies to abstract the physical infrastructure from the mind of the user—in the end, cloud consumers will see only the cloud and its capability to host a seemingly infinite amount of data and services. Underneath, virtualization turns compute resources into a centralized, sharable pool of resources that an organization can allocate to its business units on demand, while still maintaining control of resources and applications.

Cloud management platforms offer IT administrators visibility that assists them in controlling and extending the private cloud resources. Integrations with cloud infrastructure monitoring software and infrastructure automation software extend these management platform capabilities for private clouds in much the same way that public CSPs. By monitoring and automating many tasks CSP adds easy capacity scaling while reducing human error.


While each cloud architecture is specific to the organizational owner, cloud provisioning technology is similar across all cloud types—private, public, hybrid, multicloud. These provisioning technologies enable the pooling of resources and the creation of virtual machines to emulate many computing environments on limited infrastructure. For private clouds, provisioning is performed behind the company firewall, for the use of the company only. The three key cloud-enabling technologies in private cloud architectures are:

1. Virtualization — Virtualization is key to cloud computing. By abstracting how cloud consumers utilize IT resources, the underpinning IT infrastructure can be managed separately. This means that multiple virtual environments can coexist on the same hardware—virtual machines are these virtual environments, interacting with hardware through the assistance of a coordinator called the hypervisor. Abstraction allows CSPs to dole out resources in pieces rather than chunks to fit many use cases (purchasing an entire server is not necessary when you can rent a portion of it), they can adjust pricing based on usage, and they can extend and scale services on-demand at the request of the cloud consumer or automatically in peak times.

2. Cloud Management Software — Cloud management software centralizes cloud monitoring and controls over network infrastructure and applications running on private clouds. These toolsets feature controls for many cloud-related functions: monitoring, orchestration, optimization, costs, and security. More sophisticated cloud management platforms (CMPs) are used to help companies manage two or more dynamic cloud environments, any combination of private, public, hybrid, or multicloud.

3. Cloud Automation Software — Cloud management is filled with complex processes with significant minutiae that are prone to human errors, and cause lag on business processes when tasks must be performed manually. For these reasons, many cloud-dependent organizations turn to automation to relieve themselves of these burdens. In reality, many cloud tasks can and should be automated, especially as the number of cloud consumers grows which makes automation the only viable solution for efficiency gains.


In a private cloud deployment model, ownership of the cloud is the primary benefit for companies. Ownership guarantees companies complete control over configuration and access to IT resources in the most effective and efficient deployment for their needs. They can customize based on staff, departments, and regional locations. Private cloud solutions are usually implemented behind the corporate firewall allowing the following benefits.

  • Complete control over infrastructure and software choices — Because private clouds are owned and operated behind a corporate firewall, all infrastructure and software choices are open, which grants companies the freedom to develop and deploy assets to match their most particular needs. However, this also holds companies responsible for maintaining their network systems, including scaling if needed, and responding to performance and security threats.
  • Maximum control over configurations and customization — Companies have different needs. Complete control over infrastructure purchases enables companies to also configure and customize based on organizational structure and business goals.
  • Ownership of network visibility and security measures — Operating private clouds can allow owners greater visibility into their networks provided that network performance and visibility software or appliances are in place.
  • Ownership of compliance responsibilities — Depending on the industry, particularly education, health, finance, and utilities, compliance is staggeringly strict. While public CSPs have programs that assist with compliance, sometimes the nuances are too much and the risk too great to relinquish compliance to outside vendors. Private clouds allow enterprises with vast and complex user data to build custom systems to comply with regulations and protect their customers.

While not a guarantee, owning and operating private clouds tend to cost more than other public cloud options. For small and medium businesses, public clouds often prove to be strategically better choices since much of the IT responsibilities are offloaded onto the CSP, effectively reducing the cloud consumer’s IT department to a budget line item.


In today’s cloud technology and cloud vendor landscape, single-tenant cloud models can conceivably be configured with any combination of private, public, multicloud, and hybrid deployments. While these terms are useful in categorizing solutions, practically they are combined together in ways that blur their meaning in all but the most fundamental ways. Novel deployment configurations are satisfying the ever-changing needs of enterprises. Building a private cloud once meant it to be physically behind an enterprise’s firewall, but today it’s more synonymous with ownership, access, and control. “Cloud within a cloud” models, or virtual private clouds, have allowed organizations to reap the benefits of both private and public clouds. The key in building a private cloud is to conduct an honest cost-benefit analysis of the organization's cloud needs—and then align them to practical considerations of operating a cloud or the benefits of a ready solution.


A virtual private cloud (VPC) is a “cloud within a cloud” configuration where an organization establishes a private virtual networking environment within a cloud service provider’s public cloud. This “private cloud in the public cloud” usually grants complete control over the private virtual space, security, and where resources are located depending on availability by the CSP. The major benefit of the VPC deployment is to offload infrastructure risk onto a CSP, with many subsequent benefits like reduced IT staff, and associated infrastructure and staffing costs, and future-proofing the organization's tech stack.

There are similar concepts that sometimes are crossed with VPCs, such as virtual private servers, and virtual private networks. Virtual private clouds are very similar to virtual private servers (VPS) but with significant differences. A VPS, like a VPC, exists in the cloud, but uses only a fixed portion of the server with fixed resources—when accessing VPS, users can interface with it as if it were a local drive. A VPS lacks efficient scalability, which distinguishes it from other virtual cloud models. A VPC, contrastingly, is not bound by the underlying infrastructure, but rather their architecture allows them to scale on-demand.

VPNs are not a server technology. Virtual private networks (VPNs) allows users to securely access a company's intranet from outside the firewall, and can be said to make a secure line over a public network like the Internet. Likewise, a worker can use a VPN connection to securely connect to a company’s VPC from anywhere they can access the Internet. VPNs are used to secure connections and transmit and receive data privately.


Storage is the backbone of cloud technologies. Private cloud storage—also known as internal cloud storage—is storage infrastructure services within a private cloud. A private cloud storage model is owned and controlled by one organization that typically serves from its own on-premise infrastructure or dedicated data centers. Access is granted to business units or partners as if it were a public cloud service, and those services behave in the same manner. If more resources need to be provisioned, then they can be as if they were in the public cloud, but with the added protection of being behind the company’s firewall.


Private cloud management best practices develop a foundation of sustainability. The following practices create shared understanding and central thinking that reduces management burden.

  • Standard Operating Procedures — SOPs ensure that tasks are performed consistently and without deviation from standards. After SOPs are established, moving to automation offloads mundane and repetitive maintenance and other tasks from IT staff.
  • Workflow Modeling — Workflows organize business processes into discrete tasks from the beginning to the end of an operation. Workflow modeling visualizes workflows by situating a task on a timeline and including dependencies to show prerequisite or parallel tasks that form paths of independent tasks. Performing critical path analysis identifies those paths that during peak times should be granted the highest priority.
  • Capacity Management — Capacity management is the process of ensuring that current and future IT capacity and performance can be delivered with reasonable costs. By baselining operations and understanding network performance and usage, and utilizing network monitoring and capacity planning tools, IT teams can easily determine their current and future capacity needs.

Enterprises and organizations have a plethora of private cloud solutions to choose from. When considering options, there are some general categories of solutions to be aware of.

  • Open-source Solutions — Red Hat, SUSE, and Apache are examples of open-source cloud management solutions. Open-source solutions provide tremendous flexibility with no price tag. The tradeoff is that proprietary software is normally better supported with committed customer support, specific and enhanced features, better user experience, and constant innovative improvements. Whereas, open-source tend to require a greater level of skill to work with. And while support can be found in open-source communities, the drawback of fielding questions to a wide community of amateurs and professionals is the longer time it may take to get a quality answer to a critical problem that is actively crippling your cloud.
  • Cloud Solutions Provider — Cloud solutions providers (CSP) are companies that provide a set of cloud-based IT-related services to organizations. They are responsible for administrative maintenance and management of the cloud infrastructure resources, which allows cloud consumers to focus their efforts on their business. These services are paid.
  • Proprietary Private Cloud Solutions — Proprietary private cloud solutions like Microsoft, Cisco, VMware, enable companies to architect their own cloud service models and deploy clouds in their own data centers. Proprietary solutions typically offer the greatest control and support, but with the proportionate recurring cost.
  • Managed Private Cloud Solutions — Managed private cloud solutions are outsourcing strategies. A third-party service provider is contracted with the responsibility of managing an organization’s virtual private cloud, either on their own on-premise systems, the consumer organization’s systems, or an external data center.