The cloud’s popularity has spiraled upwards in the last few years, fueled by the rapid transition to remote/hybrid work. Gartner predicts global cloud spending would reach $482 billion by 2025, 154% higher than $313 billion in 2020. Adopting cloud technology, however, is a double-edged sword. It has its cons – like storage issues, cost complexities, security challenges, and more. This article looks at these issues in detail and brings expert insights on how to tackle them. Read on.
To accommodate a remote/hybrid workforce and rapidly changing technology needs, companies have accelerated their digital transformation plans by three to four years. While some companies are apprehensive about going all-in on the cloud, experts say cloud migration is crucial to staying ahead of changing business and consumer needs. Although some companies have cited “unexpectedly high cloud expenditures†as a justification for delaying cloud migration, there’s no doubt that well-architected and managed cloud deployments provide substantially better infrastructure flexibility and genuine cost-effectiveness.
But how can increased flexibility and cost-effectiveness be achieved? Some of the issues concerning cloud storage, notably the cost factor, are listed below. Experts from the cloud computing industry offer specific explanations on how to efficiently handle cloud storage issues and make the most of cloud services. Let’s delve deeper!
Cloud for Cost-saving, Not Saving Costs
Cloud storage is frequently termed a cost-cutting measure where companies have an option to curtail costs by adopting a cloud service to substitute physical data centers, hardware, and even physical locations. But does adopting cloud storage really help save money?
Below are a few realities that companies may miss when adopting cloud-native environments:
Cloud usage visibility
David Ben Shabat, VP of R&D at Quali, says one of the most prominent challenges organizations face is visibility into how their cloud resources are being used. Sure, companies receive a bill for the top-line costs, but they have very little insight into how and where they are incurred.
See More: Five Major Cloud Security Challenges Businesses Should Prepare for in 2022
Puts pressure on margins
Boyan Ivanov, the CEO & co-founder of StorPool, points out that the companies whose data volumes are stable and/or large, often run into outcomes. These outcomes include– cloud storage putting pressure on margins, and its costs start to outweigh the benefits. Â
Costs benefits hardly materialize
George Crump, former industry analyst and senior executive for StorONE, thinks that the lure of reduced costs from moving workloads to the cloud rarely materializes. There may be some initial savings, especially if the move to the cloud staves off an additional on-premises hardware investment. However, the three-year/five-year TCO (total cost of ownership) of on-premises storage is almost always less expensive with the right storage software.Â
Is cost saving only for companies with upfront, longer commitments?
Some experts contend that the cloud may not save as much cost as it is believed. Cloud storage vendors, however, compete mostly on price flexibility. Does this imply that merchants provide discounts to clients prepared to make a longer-term commitment?
Crump observes that in many cases, evidence of better pricing for long-term commitments is clearly stated on cloud vendors’ websites. He adds that larger, more marquee customers can often negotiate an even better rate than what is publicly listed. The improved discount is almost always tied to a longer-term commitment and a minimum upfront commitment.Â
Richard Hoyer, director of customer FinOps, SADA agrees that commitment discounts save customers money, and when applied correctly, they do not reduce an organization’s flexibility. The major cloud vendors “continue to release new discount programs such as spend-based discounts†that offer even “greater flexibility†than earlier programs.Â
Hoyer believes, “By contrast, without initial investment in cloud customization, companies will sink more resources into maintaining a complex portfolio of on-premise systems that will eliminate almost all infrastructure flexibility.†There’s not a “one size fits all†solution when migrating to the cloud. He suggests that efforts should be focused on optimizing spend by finding and eliminating complexity within existing systems and prioritizing those changes when migrating to the cloud.
“For a truly successful cloud migration, companies should be prepared to analyze existing pain points and invest in a system that is truly tailored to their workforce and business needsâ€
– Richard Hoyer, director of customer FinOps, SADA
More challenges to consider
It is sometimes challenging to understand all specific costs in the cloud, resulting in resource sprawl and unnecessary spending. Shabat illustrates. “If you are using a VM in the cloud, you may also be paying for network, storage, IPs, etc. These things can be difficult to clean up when you take down the VM. It’s important to have someone on your team with a good understanding of your consuming services. Paying for the right internal expertise can be far less costly than paying for mistakes when it comes to your cloud resources and services.â€
Ivanov highlights another significant pain point associated with migration to the cloud. One of the major challenges is getting the performance needed to run mission-critical workloads with heavily loaded MySQL or PostgreSQL databases. As shown in StorPool’s 2022 public cloud performance measurement reportOpens a new window , some of the large public cloud providers like Microsoft Azure, OVHcloud, and Linode, provide compute and storage offerings that deliver sub-par results when running databases.
“End-users need to look at the total cost of running a workload in a given environment (compute and storage), as some providers offer lower costs for one piece while charging more for the other.â€
– Boyan Ivanov, the CEO & co-founder of StorPool
“For example, the Katapult virtual machines with storage come in at $274 per month in the report shared. The next-best offering from AWS costs $402 (almost 50% more) while delivering half the database performance,†he adds.
He further points out a detail that he thinks often goes unnoticed – the complexity of cloud pricing. “The portfolio of services with some providers is so large that it adds costs and complexity, requiring extra people or an external managed service to oversee the stack.â€Â
Often costs can spiral out of control, several times above the budgeted amounts. This might happen for several reasons, but here are two common ones.Â
- The first is mismanagement of a company’s resources, which is almost always a weak procedural point.Â
- Another reason is the explosion of usage due to the trickiness of designing and scaling systems in the public cloud.Â
For Hoyer, the most significant challenges usually surround the culture shifts that need to accompany a migration to the cloud. The variable and dispersed nature of cloud spending creates the need for parties within an organization to factor in cost when they may not have been directly responsible for it in the past.Â
See More: DigitalOcean vs. Vultr: Which Cloud Storage Solution Suits Businesses the Best?Â
Solutions for Cloud Storage Issues
While explaining the challenges in detail, cloud computing experts also suggest the following remedies to help organizations achieve more flexibility and cost-effectiveness:
- Facing the visibility issue: Shabat says companies need to understand the business context better and weigh that against the value to their organization. Then, they can budget, plan, forecast, and, most importantly, become more efficient in using cloud resources and allocating costs. Tagging of environments is one way to achieve this. You need to build systems around reaching your business objectives – especially at scale. Provide the proper guardrails around policies. One example would be to set cloud environments for automatic decommissioning, so you can avoid costs resulting from infrastructure sprawl.
- Perfect for short-term use: Crump thinks the cloud’s ideal use case is for the short-term bursting of temporary workloads driven by seasonal demand or unforeseen compute-intensive workflow changes. In these situations, organizations can scale compute resources to address the spike, returning the results on-premises after the surge passes and long-term data storage is required. Crump believes that the cloud is not an ideal location for long-term backup or archive data retention, ironically a popular initial use case. Data that rarely changes and is rarely updated does not benefit from the cloud’s dynamic nature.Â
On-premises storage systems using modern storage software can deliver the same data integrity and resiliency levels at dramatically less cost. They can even mimic the cloud’s OPEX model to enable customers to avoid the high upfront costs.Â
George Crump, former industry analyst and senior executive for StorONE
- Tackling the margin issues: Ivanov suggests – at scale, repatriating data from the public cloud can save from 50% to 60% of the cost for running equivalent workloads, even when you include everything needed to run your on-premises cloud (racks, real estate/colocation, cooling, network, and engineering costs). This translates directly into improved gross margins and improved profits and valuation of your business.
- Commit “only†to the capacity required: Ivanov cites another solution. Pre-commit, but only for the capacity you actually need. Make sure there are attractive terms for increasing your commitment as your needs increase. When you reach a large scale, or your data volume growth slows down, consider if running your on-premises cloud is better.
- Adopt FinOps Strategy: Hoyer’s best practice for staying ahead of cloud costs is implementing a FinOps strategy right from the start and promoting a cost-conscious culture. Instead of just thinking about ways to reduce costs, it’s important to focus on a strategy that maximizes the return on an organization’s cloud investment. Implementing a strong FinOps strategy can enable the IT, finance, and business teams within an organization to save money while increasing productivity and fueling innovation.
Conclusion
The cost reductions are determined by how well organizations manage their cloud infrastructures and keep track of their expenses. Storage lifecycle management is crucial for cost reductions in object storage, whereas careful provisioning of storage directly connected with compute nodes is required for cost savings in block storage. The advantages of shifting to the cloud go well beyond cost reductions when best practices are followed in those areas.
How has your organization handled the true cost of moving to the cloud? Let us know on LinkedInOpens a new window , TwitterOpens a new window , or FacebookOpens a new window . We’d love to hear from you!Â