Cloud computing is undoubtedly the wave of the future, and migration offers so many benefits to businesses. What most businesses don’t realize, however, is that there are some hidden costs in cloud computing.
As more businesses make the move to the cloud, one of the most important concerns has become the total cost of ownership, or the TOC. Many businesses are wondering if and when they’ll see a return for their cloud investment.
Data Integration
Data integration is often incorrectly implemented or underestimated. In many cases, incorrect data is not the fault of the business because the models for calculating data integration are extremely complex and ever changing, making it difficult to establish an exact cost.
Multiple Public Clouds
Most businesses use multiple public clouds, also referred to as a “multi-cloud” environment. Workloads are often located on different clouds, and this setup can randomly change at any given time. Proper planning is required to calculate the correct TCO. This means the business must work with specific workload profiles.
Assumptions must also be made as to where these workloads will be running. Typically, the longer the technology has been around, the lower the prices. These changes in price can cause the business’s final estimation to be off.
Talent Expenses
Under normal circumstances, talent expenses are not factored in. These expenses can be significant depending on the business’s needs. To be successful at cloud computing, most businesses must hire multiple employees. This includes architects, administrators, and developers. These employees affect the TCO.
Security and Governance
Most businesses add increased security and governance once the cloud has been implemented. This can increase the TCO by approximately twenty to thirty percent. Once all the above costs are factored into equation, many businesses are in shock. These expenses are often never considered, which can easily place a business far above the TCO they originally expected.
Incorporating the Total Costs of Cloud Computing
Once a business makes the decision to migrate to cloud computing, it’s important that all the costs are incorporated into their calculations from the start. This can be accomplished in the same manner other expenses are incorporated. The fixed and variable portions must both be considered. Companies new to the cloud have seriously blown their entire budget because they didn’t properly consider every cost involved.
The only way to fix this situation is to understand that some aspects are going to change. By understanding these concepts, the business will learn how both the costs and benefits will impact their bottom line.
Another crucial step is monitoring the consumption patterns. These patterns can be better adjusted to fit the business model.
Cloud computing can be profitable, depending on how much your business is able to comfortably spend.
Do some research prior to deciding to switch to cloud computing. There are numerous articles out there, and a ton of information online. Once you fully understands the concept, the implementation, and the cost of cloud migration, you can make an educated and informed decision.
Reducing the Costs for Cloud Computing
Efficiency is the best possible way to reduce the costs for cloud computing. Whether your organization is a managed service provider or an enterprise, specific steps must be taken. The right networks, storage, and servers must be put in place so that specific workloads can be executed properly. These resources must be well managed by the organization.
The Multi-Platform Approach
In some cases, a sizeable amount of time, resources, and money can be saved using a multi-platform approach. The average expected savings from using a strict process overlay with a multi-platform approach is thirty to forty percent. MSP’s using this approach have a major advantage over the MSP’s using a x86-only architecture to run their cloud environments.
In multi-platform approach, RISC servers can perform more work per core. This means less servers are required to process the work. Fewer software licenses are necessary, and this can save businesses thousands to millions of dollars per year in the cost of software.