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How to control your cloud costs without compromising

Hyve Co-Founder and Director, Jon Lucas, explores the challenges currently faced by businesses looking to optimise their IT infrastructure and shares insights on controlling costs when operating in the cloud.
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Originally published by Business Reporter and The Independent

The whole point of the cloud was to reduce IT costs for businesses. Moving data, workloads and applications to the cloud removes the need for legacy infrastructure and cuts out the capex costs of data centres.

As businesses began to recognise the benefits of leaving legacy equipment behind and going cloud-native, the public cloud (offered by hyperscalers such as AWS, Microsoft Azure and Google Cloud Platform) became the go-to option for many. It promised to remove computing complexities for businesses while helping them scale, as well as helping them remain agile while they grew. This, along with its pay-as-you-go cost model, made the public cloud a very attractive choice – both for enterprises as well as smaller companies without dedicated IT teams that were looking for a cheap and easy way to outsource computing.

Hidden costs and complexities of the public cloud

The problem is, hidden costs and complexities associated with using the public cloud have begun to emerge which, for many, have made it a far more expensive option to manage than they originally estimated. The vast majority – 82 per cent – of enterprises surveyed last year named cloud costs as their top cloud challenge.

For example, companies often encounter issues with resource provision when relying on the public cloud. Organisations often leave their servers running all the time because they’ve bought into a “plug-in and go” cloud solution that they think they don’t need to maintain. However, letting the servers spin without any active jobs means these businesses can end up paying a public cloud provider for resources they aren’t using, cutting into the cost benefits of using the cloud in the first place. What’s more, even if a business decides to start managing their cloud resources more closely and switch off servers if they’re not needed, it’s adding a layer of complexity to a cloud approach it chose for its simplicity.

This becomes more pressing as companies try to scale their cloud resources as they grow. Public cloud providers not only charge for the amount of data stored but also the number of requests made to access this data. If organisations aren’t keeping a constant eye on their cloud resources and don’t have a clear understanding of how it works for their business or how to keep processes optimised, costs will soon begin to spiral – especially as companies feed more and more data into their public cloud environments.

The truth is, to achieve optimal performance and efficiency, the company needs to maintain its chosen cloud solution. However, support costs are yet another added expense to consider when it comes to the public cloud – especially for those organisations who require more support.

Cloud repatriation: a new trend?

One thing has become clear to a lot of businesses that originally opted for the public cloud: they need more control over their resources than the public cloud offers. This isn’t just about cost and management. Many businesses have also found that the public cloud isn’t secure enough for storing their more sensitive data or critical applications.

The hidden public cloud costs and complexities associated with obtaining this control, flexibility, security and scalability of resources mean that many companies have decided to repatriate their data from the public cloud to a private cloud environment. Dedicated to one organisation, the private cloud is far more secure, and hosting providers can offer fixed monthly billing, meaning actual cloud costs will no longer deviate from those estimates.

In any case, cloud repatriation isn’t a new phenomenon. In fact, analyst firm IDC claims that as soon as public cloud became mainstream, cloud repatriation also started up and became a steady trend, with as many as 70-80 per cent of businesses repatriating at least some of their data from the public cloud each year.

Isn’t cloud repatriation a complex challenge in itself, though?

It can be, but it doesn’t have to.

Frankly, cloud repatriation is neither easy nor a spur-of-the-moment decision. Considering public cloud providers charge for data transfer between their own services (yet another hidden cost), it might not come as a surprise to learn that they also make it hard to leave. Often, you end up subscribed to services that are exclusive to the provider, making it extremely difficult and expensive to move and replicate data and applications.

Secondly, it’s a complex process to move huge amounts of data and applications between environments and systems. It’s essential to ensure you have a proper strategy in place before you begin so that cloud repatriation doesn’t disrupt the day-to-day operations or distract from your high-level business goals.

These are the main challenges businesses tend to face when migrating data from the public cloud to a private cloud environment:

  • Shortage of internal skills and expertise
  • Difficulty integrating with existing systems
  • Complicated legacy applications and infrastructure
  • Concerns about security and compliance
  • Cost and budget constraints

If these issues sound familiar, it may be worth seeking a managed service provider who can work out the best approach for your individual business. It should never be a one-size-fits-all approach when it comes to cloud, and these companies specialise in helping to work out which data to migrate, then deploying and managing it in the private cloud, making the whole process simple and painless.

Unlocking cloud benefits through a tailored approach

While the public cloud remains popular because it’s flexible and scalable, it lacks adaptability. This means that the one thing the modern business strives for above all – agility – is difficult to accomplish.

Armed with this information about the public cloud, companies should work out whether it’s truly the right option for them from the outset. But for those businesses facing public cloud challenges for whom this advice comes a bit too late, cloud repatriation may be the answer, despite the scale of the job. When you sit down and run the numbers, you’re likely to find it will save you a significant amount of time, money, and effort in the long run.

Indeed, our customers often complete this process with great success. In one specific example, a customer was trying to manage its cloud resources effectively without internal technical experts or paying the costly hyperscaler support charge. In the end, the customer ended up with multiple MSPs managing its public cloud environments, which was both costly and hard to keep track of. We helped repatriate the customer’s workloads and data into a private cloud environment which we then fully manage for them at half the original monthly cost.

Every business is different: each has distinct goals and needs its applications to perform in different ways and at different speeds and levels. Repatriating data back from the public cloud is not the desired outcome – it’s the vehicle by which businesses can achieve their desired outcome. The goal with cloud is always a combination of efficiency, performance and keeping costs as low as possible.

Depending on your needs, a hybrid cloud approach – incorporating both the public and the private cloud into your overall cloud strategy and reaping the benefits of both – might be your best bet. But whatever the answer, the aim for all businesses now should be to work out their individual requirements when it comes to the cloud and then find a balance and management solution that truly works for them.

The best way to do this? Partner with a managed hosting provider who can talk you through the process and manage it effectively, scaling resources to guarantee uptime and making sure you never pay for idle resources.

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