Businesses Can’t Afford to Ignore Hidden Public Cloud Costs

By: Josh Rhine

October 20, 2017

Let’s stop acting like public clouds aren’t expensive.


Businesses are getting deeper into cloud computing as the technology emerges as an essential component of enterprise IT strategies. However, when you become more reliant on the cloud, you may not be getting what you expect.

The public cloud, particularly AWS environments, come with a wide range of hidden costs that can add up in a hurry. Careful management and governance, not to mention streamlined cloud ecosystems, are necessary to help you combat this issue.

Looking at the Shifting Cloud Market

CompTIA found that more than 90 percent of organizations use cloud computing in some form. More businesses are using the cloud, with non-critical use cases standing out. Twenty-seven percent of companies adopted the cloud for non-critical workflows in 2014, and 38 percent did so in 2016.

According to CompTIA, these figures point to increased cloud maturity and a growing awareness that businesses are still figuring out the best ways to use the cloud.

As your business deals with the changing cloud climate, it’s important to gain a greater understanding of the cloud cost landscape. Not all clouds are created equal. And everything from network management practices to service level agreements can have an impact on costs.

Understanding and Dealing With Hidden Public Cloud Costs

Many businesses deploy their cloud initiatives to reduce capital costs but spend much more than expected over time. The cost-savings emphasis has hit cloud vendors, who often look at how much public cloud providers like Amazon Web Services charges and work to offer lower prices to gain an edge, InfoWorld reported.

The problem with this industry pricing model, according to the news source, is that cloud vendors set service fees based on the compute and storage resources subscribed to at the start of the relationship. Businesses will generally set up their cloud subscription plans based on their historic use patterns and expected data consumption. This is not only a complex process, but it must also incorporate network and security services. All told, it’s common for businesses like yours to expect to experience a fairly stagnant monthly usage fee, but then your use patterns change.

What happens, for most businesses, is changes in application and infrastructure use patterns lead to high costs, unexpected fees and similar expenses that add up well beyond your initial pricing expectations. The solution, according to InfoWorld, is to establish a greater degree of governance and oversight within corporate cloud plans so your company can understand costs and predict expenses with greater accuracy.

Consider this for a moment: With unexpected costs and a greater demand for oversight, you are now not only spending more than expected for the cloud, but also putting more effort into the cloud than you wanted to. Businesses like yours are being asked to increase their spending and put time and resources into management – both principles that undermine how the cloud is meant to create value.

Alternative options are available. As many unexpected public cloud costs are caused by infrastructure resource usage beyond expectations, vendors that specialize in scalability and flexibility can help organizations keep costs under control. For example, burstable bandwidth plans offer you a chance to expand network use within a cloud environment during peak usage without having to take on additional fees. Similarly, managed services built around cost-efficient operational models eliminate overhead and allow you to put your resources into alternative systems.

Getting More Bang for Your Buck

At Lume, our solutions are built using a global footprint of edge data centers, enterprise-grade infrastructure, and high preforming network connectivity. Our data center footprint allows us to easily scale based on customer demands without incurring added operational overhead. Plus, our bandwidth is billed using 95th percentile which means lower network costs (and no monthly surprises).  These savings are passed on to our customers and are just some of the reasons we are typically 40-60% cheaper than AWS and other public cloud options.

 

Leave a Comment