How about both? Migrating to a cloud data center means organizations don’t need their own data center, so this appears to be an either/or question. But actually, few existing organizations have figured out how to completely get rid of their own data center.
One strategy is to repurpose existing older hardware as the data center is downsized to handle the remaining load. But there’s a good argument for migrating to a new hyperconverged infrastructure even as you’re shutting off servers and SANs, because it’s cheaper to maintain.
If you think you’re going to need 20 to 50 servers forever just to handle local applications (such as printing, DHCP and DNS, file servers, environmental/security systems and Voice over IP), a small hyperconverged infrastructure may be the answer to keeping things running while getting rid of high-end network, storage and server hardware and management expertise.
To better understand how hyperconvergence can be used in your IT environment, read "When Is Hyperconvergence Right for Your IT?"