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Navigating the Cloud: A Healthcare CIO's Guide Post-Broadcom's VMware Acquisition


Broadcom's acquisition of VMware, while posing significant changes in infrastructure and operations and IT modernization, also presents a positive opportunity for healthcare CIOs. Those who understand these shifts and their implications can craft actionable strategies to navigate the technological and business disruptions ahead, accelerating their journey toward a more efficient IT landscape. With anticipated cost increases ranging from 2x to 5x, healthcare CIOs are exploring public cloud or SaaS migrations. This acquisition offers an opportunity to speed up these migrations, as recent VMware licensing changes have made even the traditionally costly lift-and-shift cloud strategy a financially viable option.


Transitioning from physical on-premises data centers to a cloud-native Infrastructure as a Service (IaaS) offers the three following benefits:


Agile Healthcare

Healthcare CIOs can use public cloud providers such as Amazon Web Services (AWS) to achieve exceptional scalability and agility. These cloud platforms improve scalability, allowing organizations to adjust resources dynamically and pay only for their use, optimizing costs. This 'Agile Healthcare' approach significantly reduces the time to market for new healthcare applications, enabling the deployment of third-party applications within just 12 to 16 hours of engineering labor. This is a significant improvement compared to the lengthy timelines associated with traditional on-premises setups. Furthermore, as cloud providers release new and more efficient computing and storage options, the cost of maintaining and scaling these services tends to decrease over time, improving the financial viability of scaling operations without the burden of significant initial capital investments. This reassurance about the long-term economic viability can increase healthcare CIOs' confidence in transitioning to cloud-native infrastructure.


TCO

As a CIO considering a cloud migration focusing on TCO, I believe recent VMware licensing changes could favor the cloud. In a lift-and-shift approach, public cloud IaaS acts as "rented virtualization," requiring minimal IT operations or application changes.


On-premises infrastructure usually has a lower monthly cost over a five-year hardware depreciation cycle than public cloud IaaS, even with enterprise discounts like reserved instances. However, these cost benefits can fade if the operational approach stays the same with the cloud migration.


To realize cost savings in the cloud, reduce operational costs. Using the same manual processes in the cloud as on-premises makes savings unlikely. A comprehensive TCO analysis must include operating system and database licensing expenses, OS patching, and automated solutions for backup, disaster recovery, and business continuity. It should also factor in costs for IAM, Malware Detection and Protection, WAF, and other essential tools for hosting EHR. Public cloud providers offer Private Pricing Agreements for 3 to 5-year commitments, potentially reducing costs by about 20%.


Security

Moving to a public cloud provider offers significant security benefits. Cloud platforms provide advanced security features often beyond the capabilities of on-premises solutions. These include rest and transit encryption, robust identity and access management (IAM) systems, and comprehensive threat detection and response services. By leveraging these built-in security features, healthcare organizations can better protect sensitive data, such as electronic health records (EHRs), from unauthorized access and breaches. Additionally, public cloud providers comply with stringent regulatory standards, including HIPAA, ensuring that legal requirements manage healthcare data. This robust security framework gives healthcare CIOs the confidence and reassurance they need to transition to cloud-native infrastructure.


Improved disaster recovery and data durability are standout features of cloud platforms, particularly critical for healthcare organizations where data availability is paramount. Public cloud providers offer robust disaster recovery capabilities with multi-regional backup options, greatly enhancing the durability and availability of critical healthcare data. For EHRs, AWS can achieve a Recovery Point Objective (RPO) and Recovery Time Objective (RTO) of zero hours, ensuring virtually no data loss or downtime during a disaster. This high level of resilience is essential for maintaining continuous healthcare operations and ensuring patient data is always accessible and secure.


Given the Broadcom/VMware acquisition, these are the three benefits for healthcare CIOs transitioning to a cloud provider. This is a four-part series in which we dive into the details and execution of a successful healthcare cloud migration.

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