There are many different cloud hosting companies. Finding the best possible solution at the optimum price that doesn’t compromise on reliability can seem an impossible task.
Organisations that have moved to Public Cloud often find the savings envisaged do not materialise
Unused Capacity – Customers often have many different cloud accounts that being managed by different departments without considering the costs of each environment. Reserved instances run 24X7, despite the fact they are not utilised during the night hours. This behaviour creates a lot of unused capacity that’s running without being put to good use.
Cloud waste – additional costs can often be aligned to poor cloud management processes and how cloud is consumed with public cloud providers pushing customers towards reserved capacity models which lock customers into contracts where customers are paying for more than they need.
Market Pressures on Cloud Operations
Reserved Instances –If your organisation is buying Reserved Instances in the cloud, you’re making a huge investment up front. Although reserved instances are significantly better value than on demand services (up to 60%), they are often the wrong size or time frame to meet the business needs in a constantly changing market place.
Ideally a companies reserved instance should be continuously managed and closely aligned to the organisations strategy.
Complexity – Typically there are hundreds of decisions which need to made every month in order to optimise your cloud environment with:
- 100’s of usage groups to consider
- 12 contract options per RI purchase
- Utilisation targets
- RI Expirations
- Manual conversions
- Avoiding customer RI overlap
- Missed RI marketplace opportunities
- AWS pricing changes
- React to usage patterns
Through 2020, 80% of organisations will overshoot their IaaS budget, due to a lack of automated cloud cost optimisation or misguided upfront cloud spend commitments.
Lower Your AWS IaaS Costs – Gartner Research G00326261