He said he’ll turn to public cloud services only when he knows the exact cost associated with them “so that I can plan for the annual budget without any overages.”
That could take a while. Findings from the past two annual ECI surveys show that about 35% of businesses using public cloud services are over budget. In addition, these studies repeatedly find that, on average, as much as 35% of public cloud spend is going to waste because companies choose the wrong service or pricing plan, or leave resources idle or forgotten, racking up unwanted charges each month.
Some companies might simply be finding that the initial upfront savings they enjoyed with the public cloud have reached their expiration date, according to Ryan Arnold, IT director at Acumen, LLC in Mesa, Ariz. He pointed out that while the public cloud works well for instant access to resources without upfront capital costs, “between the two- and three-year mark, you generally start saving more with your own equipment,” he told The Forecast.
“Initially, the public cloud is cheaper,” he said. “But over time, you start losing your ROI.”
Reliability Is Key
Cloud Academy, a cloud computing training company, cites downtime as one of the biggest disadvantages of the public cloud. The reason is that the cloud relies on access via the public Internet, whose service levels can be unpredictable, according to Cloud Academy blogger Andrew Larkin, an AWS certified professional.
He indicated that when high-profile companies such as Amazon and Slack suffer cloud outages that receive a lot of publicity, the general reliability of the public cloud is called into question. How much an outage affects a given business can vary, but for companies that rely on near-100% network and system uptime for delivering critical healthcare services or completing financial trades, for example, downtime can be devastating and costly.
Gartner reports that one minute of system downtime within an organization costs about $5,600 or about $300,000 per hour, depending on industry and other factors. Scale that across larger enterprises and that number can climb into the millions, whether those losses take the form of a revenue hit, compliance liability, brand damage or a combination.
But downtime is a persistent issue with no easy answers. Some enterprises might perceive that moving systems on-premises is one way to circumvent it. However,Green House Data blogger Joe Kozlowicz points out the bottom line about owned IT infrastructure.
“An on-premise solution doesn’t negate downtime — but it does introduce a sense of control over the infrastructure,” he wrote.