Just a handful of years ago, it seemed public cloud was the answer to everyone’s needs. Adoption surged so quickly that it created thousands of jobs and injected billions into the South African economy.
But once the initial rush plateaued, many users realised there were quite a few gaps between the promise of public cloud and the lived reality: cost creep, billing complexity, vendor lock-in and compliance exposure being just a few issues that quickly arose.
And now, the pendulum is swinging back the other way. A Barclays CIO survey revealed that 83% of enterprises plan to move workloads back from public cloud to private cloud environments, while the Flexera 2025 State of the Cloud report shows that more than a fifth (21%) of workloads have already been repatriated from public cloud to on-premises or private cloud environments.
On local shores, industry experts are also seeing a rise in customers who want to exit hyperscaler environments, says Lee Syse, Director of Product & GTM at Routed, a local cloud platform provider and VMware specialist.
“This doesn’t mean public cloud is unsound in some way. For certain workloads and use cases, it makes absolute sense. But those reaching maturity in their cloud journey are now starting to understand when public cloud is no longer the right fit – cloud repatriation is becoming a strategic move for many South African enterprises.”
Public cloud pitfalls
According to industry research, around half of cloud buyers spent more than expected on cloud in 2023, and 59% predicted similar cost overruns for 2024.
This is usually the first and biggest complaint public cloud users have – and, often, they’re in complete shock at their bill. “Public cloud cost is often unpredictable, especially due to complex billing structures and metering, with variable usage-based pricing,” says Syse. “It’s so complex, in fact, that it’s created a whole new industry – consulting firms have opened up with a purpose of explaining and managing public cloud bills.”
“Many users are also caught unaware as they sign up for discount models that offer upfront savings but come with locked-in multi-year spend targets,” he continues. “If businesses don’t hit these targets, they face penalties or lose access to discounted rates, making costs even higher. Some companies, unfortunately, only realise the problem after their budgets has been maxed.”
“Many companies don’t fully understand the commercial commitments they’re making at contract stage. The value can be worth it if you understand how public cloud billing works, and you know what to expect,” he adds.
And that’s the crux of almost every public cloud drawback – it requires some level of expertise to make the most of all those tantalising bells and whistles that draw users in before they sign up. Without the necessary in-house know-how, companies often struggle with issues such as:
- Management complexity: The vast number of features, services and configuration options offered by hyperscalers can be overwhelming to manage and require a deep understanding of cloud architectures.
- Security risks: The sheer scale of hyperscaler infrastructure creates a larger attack surface with more vulnerabilities and entry points for security threats. End-user misconfiguration can further expose these vulnerabilities.
- Compliance: As data crosses borders, compliance becomes more complicated, particularly regarding data sovereignty and privacy regulations.
The repatriation movement
Many companies are now considering cloud repatriation – returning workloads to private cloud or on-premises environments – as a cost and control recovery strategy.
Some view repatriation as a step backward, but it’s more often a sign of business maturity. When businesses make this shift, they regain control, stabilise costs, improve compliance and reduce risk. “Repatriation is a maturity move. It shows the business has done the numbers and realised what’s sustainable in the long run. Repatriation doesn’t mean cloud was the wrong choice – it simply means that a locally hosted cloud is a great alternative,” says Syse.
For those looking to repatriate, a Virtual Private Cloud (VPC) is often the perfect answer, as it strikes just the right balance between the benefits of cloud they enjoyed with a hyperscaler and the predictability and control of on-prem infrastructure. A VPC offers all the touted cloud benefits such as predictable operations, disaster recovery options and backups, and enterprise-grade performance. But clients also benefit from more predictable pricing, simpler contract terms and localised data hosting.
Syse warns that businesses planning to repatriate from a hyperscaler should do their homework to avoid falling in the same traps they did with public cloud: “Repatriation isn’t just about bringing workloads home – it’s about making smarter long-term decisions. Businesses need providers who offer clarity, control and the ability to move at their pace without hidden risks or surprises.”
Repatriation won’t always be fast or easy, but for many, it’s necessary. “Cloud isn’t one-size-fits-all, and migrations also vary. Some clients can move in a day, while for others it may take many months due to integration, scale or complexity,” says Syse.
“Whatever that journey looks like for you, remember that repatriation is not a step back, and it certainly isn’t the end of a cloud journey – it’s the beginning of a more sustainable, mature and considered one.”
Routed is a true cloud provider. Secure, robust and reliable, the Routed cloud platform is vendor-neutral and offers scalable, full or hybrid cloud hosting. Engaging directly or within a channel, Routed delivers cloud and infrastructure solutions to enterprise customers, wholesale partners, resellers and affiliates.
Founded in 2016 in response to a growing demand for data centre hosting solutions following the rapid growth and penetration of fast, reliable connectivity services in South Africa. Routed is led by industry veterans with over 35 years of experience in delivering and managing secure cloud and infrastructure solutions both locally and internationally.
