Governments are reaching a new inflection point that favors private cloud adoption. That is the clear conclusion of a just-released, in-depth global survey of 1,800 senior government and private sector IT leaders conducted by Illuminas, in partnership with Broadcom.
The report, Private Cloud Outlook 2025: The Cloud Reset, reveals that government IT leaders no longer view cloud strategy with an emphasis on public cloud over private. Just the opposite: Private cloud is now the favored choice and central to government IT modernization strategies worldwide.
The study shows that a decisive “cloud reset” is taking place in government IT, driven by real-world experience, economic/cost and geopolitical pressures, growing workload demands — accelerated by generative AI — and a heightened need to address security and compliance concerns. The report also highlights another remarkable shift: government IT cloud strategy is now in near lock-step alignment with that of the private sector — and in some respects, even ahead of the same trends that are driving enterprise private cloud adoption.
The report identifies three major themes shaping this reset:
- Private cloud is now rated as a strategic equal to public cloud
- Security, GenAI, and cost predictability are driving private cloud adoption and repatriation
- Opportunities exist to accelerate private cloud adoption
Private cloud is now rated as a strategic equal to public cloud
Public cloud services have traditionally been considered the default destination for cloud workloads in both government and the private sector. A decade or so ago, if government agencies wanted a cloud operating model, the only option was adopting a public cloud and usually engaging with one of the hyperscalers. But the Illuminas report demonstrates that the world has changed as more options have become available. Now governments, like private sector enterprises, have seized the opportunity to implement a full, optimal cloud operating environment using private cloud.
The survey reveals that 93 percent of government IT respondents currently run strategic workloads in the private cloud, and over half (55%) of them are prioritizing building new workloads in the private cloud versus the public cloud over the next three years.
In addition, more than 70 percent of government IT leaders are considering repatriating workloads from public cloud to private cloud and nearly 50 percent say they have already begun that repatriation process.
For IT leaders, repatriation is all about smarter workload placement. Governments say they are reclaiming data-intensive — driven by generative AI — mission-critical, and cloud-native applications. The top two accelerants fueling repatriation are the challenges with security and compliance for these AI workloads and a desire to have greater control over their costs, infrastructure, and resources.
Security, GenAI, and cost predictability are driving private cloud adoption.
For governments around the world, staying ahead of the technology — their own and that of potential adversaries — demands more security and control of their own systems. Their top challenges to public cloud map to what Broadcom President and CEO Hock Tan, calls the “three ‘C’s of public cloud”: cost, complexity, and compliance.
As might be expected, cost control is the biggest concern. Virtually all IT leaders — nearly 95 percent — in both the government and private sector believe that at least some of their public cloud spend is wasted. Even more noteworthy is that nearly half believe that the amount of that waste exceeds at least 25% of their entire cloud investment!
The complexities in using public cloud for developing AI are also clear. More than half say they prefer private cloud for their AI model training, tuning, and inference. And overwhelmingly, more than nine-in-ten respondents now trust private cloud over public for their security and compliance needs.
Opportunities exist to accelerate private cloud momentum
The report also highlights how legacy approaches to IT — such as a lack of in-house skills and siloed IT teams — pose challenges to private cloud adoption. Addressing those challenges is another major driver powering the “reset” to private cloud. Governments are moving forward by up-skilling their people and technology to bridge the cloud-skills gap. Many say they are looking towards a turn-key solution, like VMware by Broadcom’s VMware Cloud Foundation 9.0, to streamline and accelerate private cloud adoption.
Taken together, the survey reinforces that we are now at a new inflection point for adoption of private cloud: A “cloud reset” where government IT leaders are realizing that private cloud as a cloud operating model is an important, cost-effective driver of innovation, while maintaining security and compliance. And, as the survey reveals, the majority of them are already moving in that direction.
To learn more, download the full report here.