Cloud migration is a much-discussed term, especially in recent times. Gone are those days when considerable CAPEX had to be apportioned for having an on-premise infrastructure in place to store data and software on-site. A bigger picture would mean the business hosts its own data center on-site. At the outset, running applications on-site would require companies to buy and maintain in-house servers and infrastructure. Notwithstanding the physical space that is required, having an on-premise solution would also demand a dedicated IT staff qualified to maintain and monitor servers and their security 24X7.
Let us begin with a stellar case study to bring home the point.
Back in the year 1999, Blockbuster had an opportunity to buy a fledgling Netflix which was also severely affected by the dot-com bust at a mere $ 50 million. A hapless Netflix was convinced that it could be a lifeline during those troubled times and was ready to be acquired only to be later laughed off by the erstwhile entertainment giant. What seemed like a joke to the Blockbuster CEO at that time proved to be the cringe-worthy blunder for all times to come. Unbeknownst to the DVD rental mammoth, Netflix quietly stole its thunder in the next few years to become the largest video streaming services provider in the world. As of today, Netflix’s revenue stands at $ 15.8 billion with a subscriber base of more than 150 million. Blockbuster on the other hand has a single franchise store that remains open in Bend, Oregon, and has positioned itself as a nostalgic reminder to those who wish to revisit the bygone days when you had to remind yourself to rewind that VHS tape and return it in time to avoid a late fee.
Netflix is a technology company. It was one of the first companies to visualize the potential of media streaming technology and began its transition from a humble DVD-by-mail service to a subscription video-on-demand model in 2007.
So, what makes Netflix a poster boy for cloud migration? Only a year after introducing the concept of online streaming of its huge video archives, the Netflix management realized they had a huge problem. Their backend could not cope with the increasing subscriber base and they kept having issues with connections and threads. At that time Netflix had already inked a deal with Microsoft to feature its app on the Xbox 360 and agreed to service the customers of the manufacturers of Blu-ray players and TV set-top boxes. At a time when people barely knew of the existence of the cloud, the top brass at Netflix decided to migrate entirely to the cloud. While there were not many options in the market at that time, Netflix chose AWS over other public cloud suppliers owing to its breadth of features, the scalability it provided, as well as the broad spectrum of APIs that were included in its offering. This proved to be a prophetic decision because between December 2007 and December 2015, there was a 1000X increase in the number of hours of content streamed on Netflix, and there was an eight-fold increase in the number of people who signed up for the service at the end of its cloud migration process than they did at the start.
The Netflix of today which is a television and movie studio that rivals some of the biggest names in Hollywood would never have existed if they had not thought about migrating to the cloud. Just by migrating to the cloud, not only did they manage to eliminate database corruption but also grew their revenue from 1.36 billion to around 15.8 billion in just ten years. Their subscriber base also grew from sub 22 million in 2011 to nearly 150 million in 2019. Cloud infrastructure was able to stretch to meet this expanding demand. This also proved to be a major cost-saving initiative.
For the uninitiated, cloud migration is the process of transferring critical services from on-premise or co-located hardware to the cloud. Unless you are living under a rock, you would have interacted with the cloud when you have used Zoom for an official meeting or google drive to save and share content or simply Gmail or office 365 when you have wanted to send an email. Amazon Web Services, Google Cloud Platform, Microsoft Azure are some of the renowned cloud service providers. By signing up with the cloud service providers, companies can manage their entire IT infrastructure remotely without the security risk, inconvenience, and costs incurred in maintaining on-premise hardware.
Irrespective of the size of the company and the quantum of the work they do, cloud computing has become a business imperative as it provides cost benefits, agility, and reliable IT resources. Instead of bothering about the maintenance of their own private data centers storing information, companies can depend upon the scalability of cloud storage to build out storage as and when it is required thereby increasing their adaptability and reducing the total cost of ownership. We gave the example of Netflix at the beginning of the blog because regardless of the industry a company belongs to, it is always beneficial to understand the technological trends in the market, the best practices that are being followed across industries, and subsequently use the learnings to gain a competitive advantage. Cloud computing has already helped power thousands of companies both large and small across the globe.
There are multiple benefits of moving to the cloud, both to your business and to your customers. If your business needs improved scalability, enhanced security, reduced total cost of ownership (TCO), seamless software integrations, and greater access to business-critical functionality, you should consider getting in touch with a cloud migration company to help you execute a smooth transition to the cloud. With HSC’s expertise and experience in the business, we can provide the required cloud migration services suitable to your business requirements. Our cloud migration service offerings include lift and shift cloud migration services, cloud re-engineering services, cloud-native application development services, and legacy modernization services. HSC has also partnered with all the major cloud providers such as AWS, Google Cloud Platform, and Microsoft Azure and can help you in your cloud migration journey. Connect with us for more information about our offerings.
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