You’ve heard the hype: “The cloud will save you money.” “Eliminate capital expenses from your budget with the cloud.” “A cloud-based operational expense model will dramatically lower your costs.” On the basis of statements like these, businesses of every size – from local companies to global enterprises – have joined the cloud party. Unfortunately, when they tallied up the costs of the festivities afterward, the grand total is leaving them with a major hangover headache.
There’s no question that the cloud delivers excellent business benefits. Nearly 250 IT leaders from enterprise companies were surveyed by Sungard Availability Services, a leading provider of information availability through managed IT, cloud, and recovery services, and willingly talked about their experience with the cloud. They confirmed that they had received great favors from the cloud party, including increased agility (74 percent), increased security (73 percent), increased competitive advantage (72 percent), improved response to customer and market demands (68 percent), and increased availability, backup, and disaster recovery capabilities (74 percent). The downside was that many were walloped with unanticipated cloud costs as implementation, integration, and operation costs spiraled. For example, 74 percent of respondents spent $30,000 or more in monthly cloud maintenance fees in addition to their initial investment.
Many costs didn’t materialize until they were fully migrated to the cloud, including upgrade costs (noted by 36 percent of respondents); customization (35 percent); internal maintenance costs for patching, data recovery and compliance software (35 percent); consultancy costs (34 percent); and the cost of staff to manage deployment of the cloud (33 percent). Seventy percent of the survey participants said they spent at least $150,000 in unexpected costs.
The question then becomes, how can businesses prevent the cloud hangover?
The answer lies in having a much clearer understanding of the costs that are involved, and making a strategic plan for moving to the cloud that maximizes the investment being made. “Businesses are experiencing a ‘cloud hangover’ from the unexpected expenses and market perception that indicated all workloads can easily move to the cloud,” said Chris Ortbals, vice president of services product management at Sungard Availability Services. “For many enterprises, the cloud can bring great efficiencies for the right workloads. We work with our customers from the outset to identify what can be optimized by shifting to the cloud and what may be best suited to perform best in a hybrid approach. Sungard Availability Services, by design, is not a cloud-only provider but can tailor a solution that meets the customer’s needs today and in the future.”
To learn more about the true costs of the cloud and what you can do to enjoy the cloud party but avoid the cloud hangover, read the survey press release here.
Related Business Solution: Cloud Services