Cloud cost optimization. Is Cloud Computing worthwhile?

Cost optimization through the cloud is possible in various areas, but how can I use cloud computing to optimize costs in my company? In this article, we take a closer look at this question and compare the costs of an internal IT infrastructure with the costs of a cloud-based solution.

Cloud computing providers provide businesses with extensible, flexible, reliable and cost-effective platforms for cloud services. Many companies are already successfully deploying cloud applications. Others are currently in the decision-making phase, evaluating the costs and benefits of moving their entire IT infrastructure to cloud computing. Basically, it can be said that the use of a cloud offers high cost savings compared to an internal IT infrastructure.

Direct costs.

Existing hardware

In the beginning, high initial investments in hardware have to be made and in the course of time further costs for expansions have to be incurred. In addition, the infrastructure must be maintained regularly. Another disadvantage is the maximum server utilization of only 20%.

High electricity costs

Savings would be possible through optimal use of all resources. However, this is not really feasible in reality.

Redundancy effects

This would require a reliable network connection including redundant hardware as well as transit connections and physical (backup) lines between the individual data centers. In addition to a backup, a concept for a possible worst-case scenario would also have to be available.

Security

Security measures are cost-intensive in order to meet certain standards.

Optimized deployment

The provisioning process is often very lengthy. One solution would be to oversize the infrastructure. However, this leads to suboptimal use and thus to unnecessary costs.

Employees

The employees concerned must be on permanent standby to ensure smooth operations. In addition, regular maintenance work, scaling in the form of renegotiations and purchases, and general administration are also required.

Indirect costs.

Maintenance & Operation

Der Betrieb und die regelmäßige Wartung der aktuellen Infrastruktur ist essenziell, kosten- und zeitaufwändig, zusätzlich muss die kontinuierliche Weiterbildung von Mitarbeitern gewährleistet sein. 

Extension

Cuts in IT budgets prevent the expansion of the infrastructure according to the desired and actually needed needs and thus the realization of projects.

Advantages.

This results in the following advantages for the switch to the cloud:


  • The customer does not need to invest in hardware and can flexibly adapt the infrastructure to the workload.

  • Low costs for expansion through flexible addition of further resources, which can easily be switched off as soon as they are no longer needed.

  • There are no costs for the customer for the maintenance of the infrastructure, as the cloud provider usually takes care of this.

  • Electricity costs are irrelevant for the customer, as he only pays for the computing power used – pay-per-use. 

  • Redundancy effects are also provided by cloud providers – example AWS Ability Zones.

  • Security is also provided by the cloud providers, who usually have various certificates for security standards.

  • Oversizing costs are eliminated because cloud providers can deliver new processing power within minutes.

  • Employee costs can be greatly reduced because the maintenance of the infrastructure is no longer so costly and is largely carried out by the provider.

  • Indirect costs for maintenance and education can be reduced and the saved budget can be used for other projects.

Published On: 07. February 2020 / Categories: AWS, General /