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The Worst Conversation in the World of IT - Part I

The Worst Conversation in the World of IT - Part I

The Worst Conversation in the World of IT – Part I

May 11, 2016 – Every IT Manager who uses the cloud has had that conversation.  If you’re lucky it’s the one that occurs when you realize you didn’t budget enough and need to ask for more money.  If you’re unlucky, it’s the one that occurs when you’ve overrun your budget, and need to explain why you didn’t see it coming.

You know, that one…

It’s those kinds of discussions – and the pursuant “explanations” – that have unfairly earned cloud services the reputation of having “hidden” costs.  A quick Google search and I’m sure you’ll find umpteen blogs complaining about any number of different “hidden costs.”  The truth, however, is that they aren’t “hidden” per se. In some cases they are buried under a mountain of small print, confusing language, odd stipulations, and more.  However, in others they are displayed clear as day – customers just weren’t sure what to do with them.

I know you’re thinking: “Is that supposed to make it better?”  The answer is no, it’s not.  However, to their credit, cloud service providers have made a lot of progress towards debunking the myth of “hidden” costs.  Add to those efforts the near-ubiquity of cloud cost monitoring tools, and the issue has been somewhat resolved… to a degree.  Feeling warm and fuzzy yet?

Ultimately, the fact is this: Cloud services are complex, and so is the pricing. Combine that with the difficulty of truly predicting your usage, and no tool alone is going to save you from eventually having the chat.  With a bit of foresight, planning, and help from your cloud service provider (CSP), the minefield of additional costs (both from a CSP-driven and internal business cost perspective) is 100% navigable.  In today’s post, we’ll discuss one of four major causes of that conversation, and talk about the best way to mitigate it.

Resource Management Costs – This is the most obvious of the four categories of hidden costs, and most commonly manifests itself in the form of unforeseen quantities or line items on the bill from your CSP.  The cloud gives you unparalleled insight into the resources you need to run your applications, but if you don’t use that information to your advantage, the cloud can (and will) end up costing more money than it needs to, and sometimes more money than you expect. These costs can pile up from a number of places, but the big ones are:

  • Over-Provisioning – When you are paying for more resources than you actually need, aren’t you defeating the purpose of the cloud?
  • Under-Provisioning – When you don’t give your applications enough resources, you can actually cost yourself money in overages, as well as degraded performance in your application.
  • “Spin It Up and Forget About It” – The cloud makes it easy to temporarily provision resources, but often times these “temporary” resources become a bit more permanent because we forget how easy (and necessary) it is to de-provision them when we are done.
  • Non-Optimized Storage Tier Choices – Storage performance is an extremely critical property of applications. The problem is that very few people truly understand their performance requirements on an app-to-app basis.  Do you really need all the IO you’re paying for, or can you migrate some data to lower performance tiers to save money?
  • Costs of Internal Staff for Resource Management – CSPs typically provide the tools for your staff to manage resources, and often allow customers to scale down internal staff. While it’s true that cloud tools can make staff more efficient in managing your environment, the problem is that using those tools and reviewing resource reports takes both time and expertise for internal staff – don’t overly scale down!

This is just the beginning of these “hidden costs”…  Stay tuned for our next post where we’ll discuss the three other potential “hidden” cost categories that are less obvious, and can seriously impact your budget!