Private Cloud

A private cloud provides cloud computing services for authorized users over the internet or an internal network. Since it can only be used by a clearly defined group of users, the private cloud is also referred to as a corporate cloud or internal cloud. Private cloud users benefit from the advantages of cloud computing, like scalability and elasticity, but also from additional control and adaptation options that the private cloud can offer.

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Private cloud: A definition

A private cloud comprises computing services that are not available to the public, only selected users. In contrast to the public cloud, the corresponding provider offers resources specifically intended for this purpose. Private clouds can be accessed through the internet or a private internal network.

Private cloud services are specifically designed to meet a business’s needs. The private cloud infrastructure is hosted directly on site in the service providers’ company or data center, which guarantees a higher level of security. The individual components and services are tailored to the respective company – computers, storage and network operation can be individually adapted.

How does a private cloud work?

The private cloud’s technical foundation is virtualization. Modern virtualization strategies make it possible to decouple IT services and resources from physical devices. Applications no longer have to be run locally on end devices or servers, instead they can be made available virtually, on the cloud.

A private cloud is an ideal solution for companies that have to comply with strict data security and processing requirements. Compared to the public cloud, private clouds offer not only a significantly higher level of security and control, but also a flexible application, since the services are scaled according to the company’s individual requirements, which enables a more efficient way of working.

Authorized users can access private cloud applications through the company’s intranet or through a closed virtual private network (VPN). For this purpose, users are provided with the necessary authentication rights to access cloud services. As a rule, external access to a private cloud is secured by a firewall. Put simply, the firewall protects individual computers or an entire computer network from illegitimate external access.

The different kinds of private cloud available

The private cloud can be divided into four different types:

  • The internal private cloud: The company operates the IT infrastructure for its cloud services itself.
  • The managed private cloud: The cloud’s IT infrastructure is hosted internally, but is managed by an external provider. This enables companies to take advantage of the cloud’s flexibility and customizability, whose functions are tailored to the customer’s needs by the provider. This increases efficiency, and companies always have a reliable contact partner for all issues relating to the cloud.
  • The hosted private cloud: The hosted private cloud is located in the cloud service provider’s external data center. This provider manages the cloud on behalf of the company and provides users with the appropriate applications.
  • The community private cloud: The community private cloud is a special form of the private cloud. Several companies can access a common private cloud. The companies usually come from the same industry or are part of a corporate group. This is why the community private cloud is also referred to as an industry-specific cloud.

Establishing a private cloud requires a great deal of technical know-how and often costs companies a lot of time and money. In most small and medium-sized enterprises, this is only available in a limited form, which can make developing a private cloud a real challenge. In these cases, the managed or hosted private cloud would be the most inexpensive choice for businesses.

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What are the advantages and disadvantages of a private cloud?

Companies benefit from the many advantages of cloud computing without losing control over their own data if they choose to use a private cloud. In contrast to conventional IT structures, cloud computing is a compact system allowing IT solutions to operate more cost-effectively and efficiently.


  • Customization: The cloud applications are customized to the individual requirements of the company. 
  • Infrastructure capacity: Increased infrastructure capacity for large computing and storage requirements.
  • More security: By operating the private cloud separately, security risks are minimized.
  • Cloud features: Users have exclusive access to cloud performance and bandwidth. Limitations due to the simultaneous use of third parties are not to be expected.


  • Management overhead: With internally hosted private cloud solutions, IT has to take responsibility for the cloud, and the effort of managing this is tremendous. With external solutions, private cloud options are typically more expensive than a public cloud (see below).
  • No cost reduction: Operating a private cloud results in comparable personnel, administration and maintenance costs as operating conventional data centers. It is not as easy to reduce costs as using a public cloud.

Private cloud vs. public cloud

There are only a few technical differences between the private and public cloud. Nevertheless, the two forms of cloud computing differ in a number of essential respects. In principle, the services of the public cloud are available to everyone. Although the individual users also act independently of each other here, they all generally make use of the same resource pool. The private cloud only grants authorized users access to cloud services, so resources are not shared. In a private cloud, computer, storage and network capacities can also be adapted to the needs of the company. As a rule, a public cloud cannot be adapted precisely to an individual customer. Nevertheless, the public cloud also offers some decisive advantages:

  • Flexibility, since the cloud is accessible from any location through the internet
  • Decreased personnel costs, as operation and maintenance of IT resources are no longer necessary
  • No investment costs for server hardware
  • Payment based on actual consumption
  • Concentration on core business
  • Professional security management by the provider
  • Upgrades are installed by the provider

The hybrid cloud combines the advantages of the private and the public cloud in one cloud model. The hybrid cloud offers the same high flexibility and low costs as the public cloud, but also meets companies’ security and data protection needs, since certain services can only be used internally like with a private cloud. Companies therefore benefit from cost savings, remain flexible and can still securely store sensitive data in the internal area.

Why should you use a private cloud?

With a private cloud, you can organize, manage, deploy, and use IT services more flexibly. In particular, businesses can use a private cloud to retrieve and analyze information more quickly and make faster decisions. You can also develop and deploy new business functions faster and expand or reduce your business as needed. Unlike other cloud solutions, only you have access to the private cloud for increased data protection.

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