The Rise of the Cloud (costs included)

March 8, 2019

Cloud Services, Managed Services, Manufacturing, Retail

By admin

There’s been a large focus on enterprises moving to the cloud over the past few years. Competition between key players like Microsoft Azure, Amazon Web Services and Google Cloud has proven beneficial to consumers, economically, but now that everyone is on board, will the costs begin to rise? Recent studies say, yes.

We’re seeing a fair amount of shock as consumers discover the cost of cloud computing is more than they expected. A progression that shouldn’t be too surprising, considering the natural evolution of supply vs demand—multi-cloud deployments have become the norm and recent years have been all about cloud storage and compute—rising costs should be the expected next step.  

As the market continues to evolve, vendors will be sorting through ways to improve technology management and control cloud spending. Cost optimization and management optimization will be big themes in 2019. Spending on global public cloud services and infrastructure is expected to hit $210 billion this year and $370 billion by 2022, with SaaS representing half of those dollars.  

It’s no wonder enterprises are looking for innovative ways to optimize costs; although, research shows many businesses have been slow to implement even basic cost-optimization strategies. Couple this miss with complications from using containers and SaaS add-ons, and the tab can inflate quickly.  

One thing enterprises are clear about? They want better financial reporting on cloud costs and IT teams to broker services. Or in other words, they’re motivated to understand what’s coming and take a proactive approach to preparing for the costs.  

Here’s a look at the top cloud initiatives in store for 2019, from highest to lowest. 

  1. Optimize existing use of cloud (maximize savings)  
  2. Move more workloads to cloud 
  3. Expand use of containers  
  4. Implement a cloud-first strategy  
  5. Automated policies for governance 
  6. Better financial reporting on cloud costs 
  7. Expand public clouds we use 
  8. Implement CI/CD in the cloud 
  9. Move on-premise software to SaaS 
  10. Manage software licenses in the cloud 
  11. Enable IT to broker cloud services 

(Source: RightScale 2019 State of the Cloud Report from Flexera)

With all this attention on cloud cost optimization, we’re expecting the next move from established players to be in the form of cloud management platform suites. But whether or not these suites will actually contain costs (especially if they’re seen as a magic solution by enterprises) is unclear.  

Companies can jumpstart cost management by implementing simple best practices, like shutting down workloads after hours and leveraging provider discounts. And above all—until that magic solution presents itself—enterprises should pay close attention to market developments and keep an eye on advancing automation.