Hybrid multi-cloud managed service provider Aptum this week released Part Three of its annual Cloud Impact Study 2022, with the main takeaway being that cloud computing has resulted in higher-than-expected costs for 73 per cent of IT decision makers surveyed.
Marvin Sharp, the company’s vice president of product and strategy, said, “unforeseen costs associated with the cloud can be a challenge for many businesses that lack a comprehensive cloud strategy. Typically, unanticipated costs come about due to a lack of familiarity with the cloud.”
Businesses, he said, do not always “fully understand how consumption models work and which one is best for their organization. For example, the original migration can often cause a peak in price due to lack of successful refactoring of applications. This price increase can be large, and isn’t always explained to businesses, causing unnecessary concern.”
Based on responses from 400 senior IT professionals based in Canada, the U.S., and the U.K., Part One of the study was released in February and explored the deployment of workloads on different cloud infrastructures, and the decision-making process behind their placement.
Part Two was released in June and examined the “complexities inherent in hybrid cloud environments and their implications on security, data governance, compliance and disaster recovery.” Its findings revealed that managing security effectively is no longer just an issue of securing data within each environment, for data must also be secured as it moves between locations.
“Businesses use different environments for different purposes,” said Sharp. “A platform for application development and another as a production site, for example. That’s where you achieve the benefits of a hybrid cloud environment, but moving workloads between the two environments puts data at risk. Therefore, in a hybrid work environment, organizations need to consider securing point A and point B, as well as the movement of data between them.”
As to the issue of unforeseen costs examined in the latest installment, authors of the report note that the 73 per cent figure is a “notable increase of 28 per cent from just over half (57 per cent) of companies in 2021.”
And in what amounts to a good news-bad news scenario, findings revealed that 71 per cent of IT executives believe cloud transformation “positively impacts operational efficiency,” however, 65 per cent of surveyed IT decision-makers say they have “wasted significant IT spend due to cloud inefficiencies.”
Top causes of unforeseen costs, according to Aptum, include:
- Lack of familiarity with the cloud – Limited internal knowledge, expertise and resources are obstacles to managing cloud effectively.
- Runaway cloud costs – When businesses do not configure the cloud to scale up and down effectively, they often consume more resources than predicted.
- The ‘Hotel California of Cloud’ effect – Cloud is temptingly easy to enter, but hard to leave. To avoid egress charges, planning and expertise are crucial when choosing the best cloud infrastructure for workloads.
- Hybrid complexity – Mixing hybrid, multi-cloud and legacy infrastructure platforms has its own additional management costs.
- Cloud modernization – Organizations are increasingly looking to modernize their cloud applications. However, lack of expertise and the existence of legacy systems often add complexity and costs for those looking to do this.
- Wrong consumption model – Companies unfamiliar with cloud may find themselves adopting the wrong consumption model.
The report also notes that the “cost implications of inflation represent some of our respondents’ most significant worries. In fact, cost cutting was the fourth-ranked driver for cloud transformation at 37 per cent. At the same time, almost as many organizations (35 per cent) anticipate that controlling cloud costs will be their biggest challenge.”
It goes on to say that there is “clear evidence that the benefits of cloud can have a positive influence on business financials, with 90 per cent of organizations surveyed saying cloud computing has delivered on expected efficiencies.
“However, one of the big challenges for companies lies in their technical and strategic approach to cloud transformation, and whether they have the resources to deliver on an effective approach.”