Initial purchasing decisions are the preliminary influencers of cloud infrastructure costs. So, how should decision makers evaluate Infrastructure as a Service (IaaS) offerings, knowing which provider is best suited to meet their goals?
Many IT teams gloss over the IaaS due diligence process, and it’s easy to see why. When you get down to it, only a handful of hyperscalers dominate the industry, and all are considered large, trusted providers. But this casual approach can cost companies dearly.
Here’s a simple guide for shopping and comparing public cloud infrastructure services from the biggest platforms in the market.
To IaaS or not to IaaS? This is the first and perhaps the most important question. Five years ago, every CIO and CTO was hot to migrate to the public cloud, but today that appetite has cooled. One study shows 95% of IT and financial leaders plan to repatriate at least some of their public cloud resources to private, on-premise resources. But beware, 80% of those same respondents also report that private cloud costs are trickier to manage.
Repatriation can change the expense profile, making it harder to calculate and track your all-in spending across both physical data centers and virtual assets. While demands for tighter security and compliance typically sway the decision to migrate back to on-premise, diminishing price disparities can blur decision making. Those who carefully track both public and private cloud costs are better positioned to identify the financial tipping point between the two. Learn how Tangoe manages hybrid cloud costs.
47% of public cloud resources will be transitioned back to private, on-premise resources.
You will also want to understand discounting options like commitment use discounts, which give you a price break based on long-term contracts. For example, AWS Reserved Instances (RIs) allow you to reserve cloud computing capacity for a 1- or 3-year term. Unlike the default On-Demand Instances, which are paid for by the hour or second, RIs provide significant cost savings and are best for use cases when workloads are stable and run continuously. Pre-pay discounts are available too. Pay the entire amount upfront and you’ll save the most money. Volume discounts can also be negotiated, so don’t forget to leverage any economies of scale.
On-demand instances are highly scalable resources that can result in unpredictable invoices.
Instance pausing features keep unused resources from generating expenses
Cost-saving capabilities like the AWS Cost Optimization Hub can help control spending — while typically free, these aren’t complete FinOps solutions
FinOps FOCUS standards for billing and cost data assist in cost management across multiple hyperscalers
Consider data center locations and the impact on data transfer speed and latency, compliance, as well as natural disaster and quick recovery
Performance is always a consideration as CPU usage should be significantly below maximum limitations
Now it’s time evaluate their offerings. In the end, it’s more about meeting your biggest business priorities and knowing which provider is offering you the best long-term deal and best volume discount.
All-in-one cloud expense management: Simplify, manage, and optimize IaaS services across four major providers, private cloud environments, as well as SaaS and UCaaS applications
AI-powered cloud optimization: Get sweeping insights into utilization improvements and savings recommendations from AI engines that compare current configurations with millions of cost-optimized pricing schemas
Cost governance: Put protective parameters in place to control costs, track expenses, and customize alerts to notify users of overspending
Real-time analysis: Data is ingested every 4 hours for near real-time optimization with customized reporting for IT and DevOps, finance, procurement and other stakeholder groups
Advanced data normalization: Eliminate manual work and get apples-to-apples comparisons across providers, showing you when and where specific cost-cutting measures would save you the most money
Automated cost allocations: Integration with corporate financial systems and customizable chargeback features make it easy to hold departments financially accountable for shared cloud services
Zero Trust security: Data-level security features aid FinOps practitioners in ensuring their cloud cost optimization programs facilitate and comply with Zero Trust security requirements
