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Five Ways to Control the Cost of Cloud Computing Featured

Five Ways to Control the Cost of Cloud Computing person holding red and white love print gift wrapper

One of the reasons many organizations investigate the potential of cloud computing is the promise of cost savings over traditional IT environments. Unfortunately, mismanagement of cloud resources can negate any prospective financial benefits. We’re going to look at some methods companies can use to control the cost of cloud computing and save money on their IT budget.  

Practice capacity planning 

Scalability and flexibility are two big advantages of cloud computing. Companies are attracted by the ability to meet fluctuating requirements by scaling up or down on demand. But on-demand scalability comes at a cost.  

Applications need to be sized correctly when migrating to the cloud. There is a tendency to over-provision resources which can lead to higher monthly costs for excessive capacity. Taking the time to right-size cloud instances will result in long-term cost savings.  

Minimize data egress fees

Cloud service providers (CSPs) impose data egress fees when transferring data from their infrastructure. This may include moving data between the cloud provider’s geographic regions. These fees can quickly add up to a substantial amount of money if you’re not careful. 

You can minimize the fees by reducing the volume of data transfers. The IT architecture can be modified to eliminate excessive data transfers between cloud storage and on-premises systems and applications. Companies should also compare the cost difference between physical transfer devices and dedicated network connection services when determining the best way to move data. 

Maintain visibility into cloud resources

It’s impossible to control costs without adequate visibility into your cloud services and resources. You need to know what products and services are being used throughout the organization, who is using them, and how they address business objectives.  

Companies should reevaluate their cloud environments regularly to identify services that can be scaled back or eliminated. Failure to monitor cloud usage can lead to expensive unused resources and shadow IT. Carefully review bills from your CSP to ensure employees are not using unapproved cloud services. 

Look for less expensive reserved instances

Companies can save money by contracting for cloud resources via reserved instances. By committing to purchasing a pre-defined resource capacity for up to three years, a business can reduce costs when compared to on-demand solutions. Substantial savings can be obtained with reserved instances as seen in discounts of up to 72% offered to Amazon EC2 customers.  

Determining the baseline for reserved instances demands capacity planning and an understanding of future business objectives. The savings available with reserved instances make it worth any time spent on capacity planning projections.  

Consider a third-party managed services provider 

Third-party managed service providers (MSPs) can help companies substantially trim their cloud budgets. A reliable MSP brings a wealth of experience to the table and can provide an organization with a carefully crafted roadmap of cloud services that is economical and meets business objectives. The cost of engaging the MSP will often be offset by the savings possible through more efficient use of the cloud. 

The advantages of cloud computing are real and include cost savings over traditional IT environments. Taking the simple measures outlined above will help your company achieve the expected benefits from the cloud.

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 Robert Agar

I am a freelance writer who graduated from Pace University in New York with a Computer Science degree in 1992. Over the course of a long IT career I have worked for a number of large service providers in a variety of roles revolving around data storage and protection. I currently reside in northeastern Pennsylvania where I write from my home office.

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