Published by Jessica Weisman-Pitts
Posted on August 1, 2022
6 min readLast updated: February 5, 2026
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By Andy Dunn, Chief Revenue Officer, CSI Ltd
Standfirst: Unless an organisation is ‘born in the cloud’ – with all its assets and infrastructure designed for the cloud – many may be left with applications that cannot be easily shifted
The expected benefits of moving to the cloud are well-known. From faster more efficient, reliable, secure and scalable computing to better collaboration, reduced long-term costs and access to more innovative business apps and processes.
Organisations are now building their entire business around the cloud, moving customers over and commissioning new business in the cloud. The Flexera 2022 State of the Cloud report found that the increasing use of public cloud is driving up cloud spend for organisations of all sizes, and public cloud spend is now a significant line item in IT budgets. In 2022, 53 percent of SMBs will spend more than $1.2 million on public cloud —up from 38 percent last year.
But unless an organisation is ‘born in the cloud’ – with all its assets and infrastructure designed for the cloud – many may be left with applications that cannot be easily shifted to the consumption-based model offered by the public cloud. Consequently, companies large and small will likely be having some issues with this legacy architecture. But how much of an issue does this pose and what can be done about it?
What’s the harm in leaving legacy applications where they are?
Legacy architecture could be in place for many reasons. It could be due to the acquisition history of a company or sharing one application across a group of companies. It could be to do with the complexity of the application’s design and how heavily regulated it is. Perhaps it’s running on outdated computer hardware or old programming languages.
Thanks to the rate of digital transformation, legacy applications can soon become a millstone around a company’s neck. This is especially the case when trying to compete with agile businesses born in the cloud. You only need to look at the start-up market to find out who your next big competitor is. But there are also other challenges that make the need to modernise legacy applications even greater.
Skillsets to maintain outdated legacy applications are scarce
As cloud-native services are attracting more interest, the underlying skillsets required for managing legacy architecture are increasingly rare. As a result, organisations don’t necessarily have the skills to support the applications, or they are no longer supported under licensing agreements.
Organisations can reduce the risk from the legacy skills gap by modernising their application architecture to use containerised microservices that can take advantage of hyperscale public clouds.
It’s why cloud services such as Microsoft Azure or AWS are so appealing as it’s all based on consumption. Once the application has been moved to containers, it’s then possible to move that container wherever you see fit, based on the best deal at the time, just like moving a utility bill around.
Combined legacy and cloud costs start to rocket
There is a perception that moving to the public cloud is cheaper. But the reality is that you often need to consume more to get the same performance levels, or you may end up over-paying for unused resources (the Flexera report found that companies estimate that over 30 percent of cloud spend is wasted). Costs then tend to rocket. But once a company is committed to this strategy and in a contractual position, there is no choice but to consume more.
For example, if you use Azure to consume any compute or storage services, you’re held in a 30-day rolling contract. Alternatively, you could be in a reserved instance which is a forward commitment to a pre-set amount of compute. In this case, you may be getting a better price, but you are obligated in a similar way to a legacy managed service for a 12-month or three-year period. There have been many instances where businesses have had to step back from their public cloud strategy as costs have run away from them.
There is a transformational effort required
Imagine that you have two stacks, one for legacy architecture and one for public cloud. For example, if you’re running legacy applications on on-premises IBM Power servers, those platfors must stay in place until the last workload moves off. If you move workloads into the public cloud in modules – for example, payroll then ERP and so on, you can’t reduce the IBM Power costs as the public cloud spend increases. The baseline IBM Power costs are the same whether you have 1 or 200 workloads on your own infrastructure. This is because the data centre, skills and licence costs remain the same.
Companies can be put in a tricky position if they are stuck in a mix of modernisation without being able to reduce costs. The costs will only increase until the transformation is complete.
A ‘PowerCloud’ removes this block
For many businesses, both large and small, the solution is to use a provider who can offer compatible IBM Power Systems in its own PowerCloud. It’s then possible to ‘lift and shift’ that legacy workload – without any transformation – into a cloud consumption model. These providers also have all the right skills sets to make this happen. This transition can reduce costs as the PowerCloud provider can leverage economies of scale with one platform servicing multiple customers.
Not only does it allow existing core applications to continue running in an optimised IBM architecture, but it creates a foundation for companies to start building cloud-native services that integrate with the legacy applications, extending functionality and improving customer experience.
It’s also possible to introduce wrap-around services including managed security, data protection and disaster recovery to ensure availability, resilience and performance.
Removing the struggle associated with moving legacy architecture
Organisation’s may be stuck halfway in their digital transformation, with both IBM Power and public cloud spend mounting, but there are ways of using a service provider’s PowerCloud to transition much more smoothly. This allows them to cut ties with costly in-house legacy infrastructure, while providing access to the right skills sets and the latest and greatest version of the technology on a consumption basis. This means that the real benefits of the cloud can be obtained for everyone.
About Author:
Andy joined CSI in 2021 having previously been with Daisy Group for five years. Andy is responsible for Sales, Marketing and Commercial engagements at CSI and has a wealth of knowledge about the cloud and how to help organisations improve their business outcomes in the cloud.
Legacy architecture refers to outdated computing systems and applications that are still in use within an organization, often making it difficult to implement modern technology solutions.
Cloud computing is the delivery of computing services over the internet, allowing organizations to access and store data and applications on remote servers instead of local servers.
Microservices are a software architecture style that structures an application as a collection of small, independent services that communicate over well-defined APIs.
Digital transformation is the process of using digital technologies to create new or modify existing business processes, culture, and customer experiences to meet changing market requirements.
A container is a lightweight, standalone, executable package that includes everything needed to run a piece of software, including the code, runtime, libraries, and system tools.
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