diff --git a/cmd/kube-controller-manager/app/BUILD b/cmd/kube-controller-manager/app/BUILD
index 3f4ef57af39..ba84f354501 100644
--- a/cmd/kube-controller-manager/app/BUILD
+++ b/cmd/kube-controller-manager/app/BUILD
@@ -14,6 +14,7 @@ go_library(
         "batch.go",
         "bootstrap.go",
         "certificates.go",
+        "cloudproviders.go",
         "controllermanager.go",
         "core.go",
         "extensions.go",
diff --git a/cmd/kube-controller-manager/app/cloudproviders.go b/cmd/kube-controller-manager/app/cloudproviders.go
new file mode 100644
index 00000000000..4c87a258547
--- /dev/null
+++ b/cmd/kube-controller-manager/app/cloudproviders.go
@@ -0,0 +1,63 @@
+/*
+Copyright 2018 The Kubernetes Authors.
+
+Licensed under the Apache License, Version 2.0 (the "License");
+you may not use this file except in compliance with the License.
+You may obtain a copy of the License at
+
+    http://www.apache.org/licenses/LICENSE-2.0
+
+Unless required by applicable law or agreed to in writing, software
+distributed under the License is distributed on an "AS IS" BASIS,
+WITHOUT WARRANTIES OR CONDITIONS OF ANY KIND, either express or implied.
+See the License for the specific language governing permissions and
+limitations under the License.
+*/
+
+package app
+
+import (
+	"fmt"
+
+	"github.com/golang/glog"
+
+	"k8s.io/client-go/informers"
+	"k8s.io/kubernetes/pkg/cloudprovider"
+)
+
+// createCloudProvider helps consolidate what is needed for cloud providers, we explicitly list the things
+// that the cloud providers need as parameters, so we can control
+func createCloudProvider(cloudProvider string, externalCloudVolumePlugin string, cloudConfigFile string,
+	allowUntaggedCloud bool, sharedInformers informers.SharedInformerFactory) (cloudprovider.Interface, ControllerLoopMode, error) {
+	var cloud cloudprovider.Interface
+	var loopMode ControllerLoopMode
+	var err error
+	if cloudprovider.IsExternal(cloudProvider) {
+		loopMode = ExternalLoops
+		if externalCloudVolumePlugin == "" {
+			// externalCloudVolumePlugin is temporary until we split all cloud providers out.
+			// So we just tell the caller that we need to run ExternalLoops without any cloud provider.
+			return nil, loopMode, nil
+		}
+		cloud, err = cloudprovider.InitCloudProvider(externalCloudVolumePlugin, cloudConfigFile)
+	} else {
+		loopMode = IncludeCloudLoops
+		cloud, err = cloudprovider.InitCloudProvider(cloudProvider, cloudConfigFile)
+	}
+	if err != nil {
+		return nil, loopMode, fmt.Errorf("cloud provider could not be initialized: %v", err)
+	}
+
+	if cloud != nil && cloud.HasClusterID() == false {
+		if allowUntaggedCloud == true {
+			glog.Warning("detected a cluster without a ClusterID.  A ClusterID will be required in the future.  Please tag your cluster to avoid any future issues")
+		} else {
+			return nil, loopMode, fmt.Errorf("no ClusterID Found.  A ClusterID is required for the cloud provider to function properly.  This check can be bypassed by setting the allow-untagged-cloud option")
+		}
+	}
+
+	if informerUserCloud, ok := cloud.(cloudprovider.InformerUser); ok {
+		informerUserCloud.SetInformers(sharedInformers)
+	}
+	return cloud, loopMode, err
+}
diff --git a/cmd/kube-controller-manager/app/controllermanager.go b/cmd/kube-controller-manager/app/controllermanager.go
index c5db0d375a8..dab77f9f809 100644
--- a/cmd/kube-controller-manager/app/controllermanager.go
+++ b/cmd/kube-controller-manager/app/controllermanager.go
@@ -455,31 +455,10 @@ func CreateControllerContext(s *options.CMServer, rootClientBuilder, clientBuild
 		return ControllerContext{}, err
 	}
 
-	var cloud cloudprovider.Interface
-	var loopMode ControllerLoopMode
-	if cloudprovider.IsExternal(s.CloudProvider) {
-		loopMode = ExternalLoops
-		if s.ExternalCloudVolumePlugin != "" {
-			cloud, err = cloudprovider.InitCloudProvider(s.ExternalCloudVolumePlugin, s.CloudConfigFile)
-		}
-	} else {
-		loopMode = IncludeCloudLoops
-		cloud, err = cloudprovider.InitCloudProvider(s.CloudProvider, s.CloudConfigFile)
-	}
+	cloud, loopMode, err := createCloudProvider(s.CloudProvider, s.ExternalCloudVolumePlugin,
+		s.CloudConfigFile, s.AllowUntaggedCloud, sharedInformers)
 	if err != nil {
-		return ControllerContext{}, fmt.Errorf("cloud provider could not be initialized: %v", err)
-	}
-
-	if cloud != nil && cloud.HasClusterID() == false {
-		if s.AllowUntaggedCloud == true {
-			glog.Warning("detected a cluster without a ClusterID.  A ClusterID will be required in the future.  Please tag your cluster to avoid any future issues")
-		} else {
-			return ControllerContext{}, fmt.Errorf("no ClusterID Found.  A ClusterID is required for the cloud provider to function properly.  This check can be bypassed by setting the allow-untagged-cloud option")
-		}
-	}
-
-	if informerUserCloud, ok := cloud.(cloudprovider.InformerUser); ok {
-		informerUserCloud.SetInformers(sharedInformers)
+		return ControllerContext{}, err
 	}
 
 	ctx := ControllerContext{