Why is Broadcom pushing private clouds?

Simon Edward • 24 January 2025

Recently, Broadcom has told enterprises that private clouds are the way to go. Find out why in our article.

The cloud is here to stay. More than that, its benefits are baked into how we do business. Cost efficiency, remote collaboration, quick scalability – all are now as familiar to us as the Google logo.

But while the cloud's selling points remain the same, infrastructure changes. This can be clearly seen in Broadcom's recent pivot to advocating private clouds.

Of course, private clouds are nothing new. However, the last few years have seen enterprises focus on public rather than private cloud provision.

Today, Broadcom's CEO tells us that "the future of the enterprise – your enterprise – is private… Private cloud, private AI, fuelled by your own private data."

It's not just Broadcom, either. Oracle's Larry Ellison has predicted that private clouds will soon "greatly outnumber" public clouds, chiefly because of their affordability.

So, what's changed? The answer, as so often in life, has multiple dimensions. Two of those are spelt out in those statements from Broadcom and Oracle. One is the rise of AI. The other is the question of affordability.

In this article, we take a look at this renewed focus on private cloud architecture – and what it could mean for you.

Taking back control

In some ways, the challenges facing IT have remained constant since the dawn of the internet. First, there's security. Secondly, there's affordability.

At the same time, the lay of the land is constantly changing. The CIO of a modern-day enterprise is looking at a very different landscape from the IT department of an office branch in the 90s.

There are four sides to this. What they all have in common is a focus on taking back control of costs and infrastructure. First, and for many enterprises foremost, is the question of money.

The million-dollar question

Affordability and cost efficiency have always been key selling points of the public cloud. The sales pitch could be summarised as "do more for less".

But more and more enterprises find themselves experiencing the modern malady of cloud shock. This is an experience akin to booking a flight with a budget airline and then discovering just how many hidden costs there are. The difference is that enterprises have already paid those costs.

There are all sorts of reasons why enterprises miscalculate and end up weeping over invoices. All of them are contributing to the sense that a private cloud could be a more cost-effective option.

Take the case of JPMorgan Chase. The CIO of this financial services firm recently remarked: "Folks that didn't have discipline on-prem but went to the public cloud found that it's far more expensive because you don't have the same control levers available to you."

This is nowhere more apparent than in the deployment of cloud resources to run AI. Technological research firm Gartner, for instance, has found that CIOs can get the costs wrong by a margin of 1,000%.

Cloud shock isn't inevitable. Done well, a lift-and-shift migration to a public cloud can unlock all the benefits of enterprise cloud computing. But it is undeniably one of the reasons why a company like Broadcom is pushing private over public.

Big data

The next factor is data. Enterprises have never held more data. Sometimes, it feels as though data is flowing like water. At other times, it builds up deposits in data silos. Either way, there's a lot of it. And we mean a lot.

What happens if this data gets lost, corrupted or stolen? It's not just a logistical headache as you try to recover your workloads. It can also cost you. In the age of GDPR and similar regulatory frameworks, big data can cost you big money.

Private clouds are built for security. They are, well, private. There's a reason why the Irish government doesn't run its operations from a single public cloud environment. Confidentiality and tight security are essential as far as sensitive data is concerned.

This is another reason why Broadcom and others are advocating for private clouds. It'll cost you less, they say, and it'll keep your data safer.

The AI plot twist

In the world of cloud computing, a lot can change in a short time. Take the huge upswing in cloud adoption during and after the COVID-19 pandemic.

This isn't just a change in the way we collaborate on documents. It's also changed the way we work, with remote and hybrid working now the norm for many enterprises.

In recent years, however, the biggest change has been the curveball thrown by AI. It seems as though every enterprise in town wants a piece of the AI pie.

And, of course, public cloud providers are embracing AI. But whatever its benefits may be, AI has created a problem for enterprises in the form of privacy concerns.

The question for today's CIOs is whether the public cloud can run AI workloads efficiently or whether a private cloud would be better.

When we say better, we mean it in two senses. First, there's the question of performance. But secondly – as always in conversations about cloud architecture – there's the question of affordability.

Deloitte's Akash Tayal, for instance, has revealed that "the number one reason our clients are calling us for private cloud is because of generative AI… They're realising that running generative AI workloads can get really expensive in the public cloud."

Again, it doesn't have to be this way. But the rise and rise of AI is making many enterprises think twice.

Conclusion

Broadcom's recent advocacy of private cloud solutions says a lot about the cloud computing landscape in 2025. Many enterprises feel they need to take back control of their data, their costs and their privacy.

Will these concerns last? Will public clouds step up and answer them? Will the demand for AI-ready cloud computing continue? Only time will tell.

Are you looking for a consultant to help with your private cloud migration strategy? At Ascend Cloud Solutions, we've handled more than 400 migrations and counting. Don't hesitate to get in touch with our experts to book a free fact-finding call.

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