A company I worked for maintained a very large on prem data center to much success. We maintained some production / user facing infra, but it was mostly for internal stuff.
We had one massive compute cluster running vmware as our personal cloud. Any dev could spin up VMs as they needed. Once this was set up (which was a lot of work), the maintenance cost in $ and time was basically 0. We also had as assortment of baremetal servers used for all sorts of things.
One of the reasons I think it worked so well for us is because IT/Linux/sysadmin skills were very high throughout the company (which I have since learned is rare). Any engineer could manage VM images, recable a server, configure VLANs, etc. If this wasn't the case, we probably would have needed double the IT team, and a lot of the cost savings would disappear.
vSphere has significant licensing and support costs. Last time I checked a minimal, managed vSphere cluster runs like $3600/month. I’m not sure how this can translate to “basically $0”.
We had one massive compute cluster running vmware as our personal cloud. Any dev could spin up VMs as they needed. Once this was set up (which was a lot of work), the maintenance cost in $ and time was basically 0. We also had as assortment of baremetal servers used for all sorts of things.
One of the reasons I think it worked so well for us is because IT/Linux/sysadmin skills were very high throughout the company (which I have since learned is rare). Any engineer could manage VM images, recable a server, configure VLANs, etc. If this wasn't the case, we probably would have needed double the IT team, and a lot of the cost savings would disappear.