By IT Brew Staff
less than 3 min read
Definition:
A private cloud offers computing (virtual machines), networking services (virtual private networks), security features (identity-management tools), and many other IT capabilities, all of it isolated for the use of one client.
Unlike public clouds run by well-known tech giants such as Google, Amazon, Oracle, and Microsoft, where many tenants can access a swimming pool of hosted computing and data resources, a private cloud is a personal jacuzzi.
This exclusive, single-tenant arrangement—a good option when an organization requires control and customization for availability or security reasons—has variations:
- Onsite private cloud: A company maintains necessary resources, including host machines that serve virtual environments supporting on-demand, storage, memory, and networking.
- Managed third-party private clouds: Vendors handle the maintenance of the single-tenant server, including tasks like identity management. In a “hosted” private cloud, a service provider enacts updates and configurations.
- Virtual private cloud: Public-cloud vendors offer isolated running of workloads, though companies share the same server.
Upsides and downsides
In theory, a one-tenant setup provides the benefits typical of having something all to yourself.
- Availability: If you require lots of hardware, you want to make sure other tenants aren’t hogging what you potentially need. For example, a public cloud provider can restrict client usage of highly desirable resources such as GPU instances.
- Security: With exclusivity, a server tenant is firmly walled off from other clients’ data.
Exclusivity, however, has its costs compared to cheaper, public-code options. In addition, an organization in the market for private cloud usage also likely needs a knowledgeable IT staff capable of handling company-specific permissions and configurations.
Trending skyward
While public cloud investment remains strong, a recent report revealed an increased reliance on private clouds. A survey of 283 global IT leaders released by Hanover Research on behalf of GTT Communications in June 2025 found that private-cloud spend is growing at about double the rate of public cloud. “Starting at 36% of all in 2023, the $10 million-plus spenders have grown to 43% in 2024 and expected to grow to 53% of all in 2025 for an estimated growth rate of 24%,” the report found.
Top reasons for private clouds included enhanced security, compliance reasons, and secured, partitioned AI deployments.
