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November 19, 2018updated 30 Jun 2022 5:22am

Cloudy, with a Chance of Overspend

"Close scrutiny needed after stability is achieved so that expensive instances can be wound back to something that meets a satisfactory cost/performance ratio"

By CBR Staff Writer

Some 35 percent of public cloud service users are overspending their budgets, with a mere six percent of users coming in under budget.

That’s according to a survey [pdf] of 2,300 IT decision makers by enterprise cloud specialists Nutanix, published last week.

The report assessed enterprise plans for public, private and hybrid cloud adoption and found that the latter is surging.

Read this: Now IBM’s Bought Red Hat, Who Does Google Buy?

California-based Nutanix found enterprises plan to increase hybrid cloud usage, with 91 percent saying hybrid cloud was the ideal IT model. But only 18 percent have that model today.

“The bullish outlook for hybrid cloud adoption is reflective of an IT landscape growing automated and flexible enough that enterprises have the choice to buy, build, or rent their IT infrastructure resources based on application requirements,” Nutanix said.

“As a result, enterprises have started taking an “application-first” approach to their cloud deployments and plans.”

Cloud Overspend: What’s to Blame?

Failure to stick to budgets is indicative of challenges surrounding initial cloud adoption and can be resolved with careful management, industry experts told Computer Business Review. Cloud overspend can be controlled…

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Richard Best, general manager at COMPAREX, told us: “This is chiefly an issue of optimisation, and highlights the current greater drive for cloud stability as a priority over cost, but that is slowly changing.”

“The best approach to avoiding cloud overspend is to ensure infrastructure moved to the cloud is scrutinised closely after stability has been achieved, so that expensive instances can be wound back to something that meets a satisfactory cost/performance ratio.”

He added: “In addition, real-time visibility into consumption – best achieved with an overarching management layer that gives CIOs clarity over all services and applications running – is essential to keep tabs on expenditure.”

Remind Me, What is Public/Private/Hybrid Cloud?

“Public cloud” refers to the use of infrastructure-as-a-service (IaaS) managed by a third-party provider.

“Private cloud” meanwhile refers to IT infrastructure managed by an organisation’s own IT team.

“Hybrid cloud” describes the combined use of at least one private cloud and at least one public cloud service, typically with some degree of integration between the two cloud environments.

See also: UK Cloud Infrastructure Spend Outstrips Legacy IT Spend for the First Time

Bill Mew, cloud strategist at UKCloud, told Computer Business Review: “Most firms during the migration phase, focus on which applications to migrate and in which order. Once you are in the cloud, the focus moves from apps to storage.”

He added: “The number of apps you have remains relatively stable, but your data volumes are typically growing exponentially. With budgets that are static or in decline, dealing with the exploding data volumes, as well as heavy ingress and egress charges to move data, firms will face a massive data problem if they don’t plan ahead.”

IBM estimates that 80 percent of business workloads have yet to move to the cloud, held back by the proprietary nature of today’s cloud market. It describes hybrid cloud as an “emerging $1 trillion growth market”.

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