The Challenges of Optimizing Your Cloud Spend in 2022


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There’s a misconception that being in the “cloud” automatically means you’re saving money. In fact, in 2022, one of the major initiatives many companies are looking to achieve is to reduce cloud costs. A report on the state of the cloud conducted in 2021 by Flexera reveals that 61% of companies had plans to optimize cloud costs.

“Respondents estimate that their organizations are wasting about 30% of their spending in the cloud,” Flexera added. As a result, these companies are struggling to optimize cloud costs effectively.

In fact, a McKinsey report states that “About 80% of businesses see managing spending in the cloud as a challenge.” But what is the main cause of this problem? Read on to find out the top cost optimization issues in the cloud and learn how to solve them.

Related: The new normal has come to stay: companies will only grow in the cloud

Types of cloud computing services

  • Containers as a service: This type of service allows easy, scalable and secure management of applications in containers owned by an organization.

  • Platform as a service: It is a platform-based cloud computing service that enables organizations to easily create, run, and manage applications.

  • Multicloud as a service: It involves using cloud computing services from various cloud services, platforms, or software.

  • Works as a service: This cloud service allows you to perform coding to respond to events without using complex infrastructure.

  • FinOps as a service: It is a cloud service that creates a culture based on financial responsibility for an organization’s cloud services.

Related: Cloud technology: how large companies can increase efficiency

Bar metal vs. cloud servers

The installation of the bare metal server, also known as a physical or dedicated server, takes place in a controlled and highly supervised environment. Instead, the cloud server has its hardware resources shared with other companies.

Although both server types have the same basic speed, bare metal servers will overshadow shared servers, due to their physical and direct access to processing resources.

A shared server uses a network-connected (shared) storage block, while bare servers use their local storage. But everyone can use hard drive and flash or SDD-based storage.

A bare metal server is more expensive than a shared cloud server in terms of cost, because a bare metal server user has to pay for idle hardware resources because it is only dedicated to supporting specific users.

Here are the top five cost-optimization cloud issues to avoid and how to address them:

1. Convince yourself with savings plans, start-up credits and reservations

Organizations opt for reserves or savings plans because of their impressive discounts compared to those in an on-demand pricing model. While this may seem like a great starting point for your spending in the cloud, you may need to commit to discounts for a few more years. This compromises your cost-cutting goals in the cloud. At the other end of the spectrum, many of the public clouds offer free credit to startups, knowing that they will offset more than credit in long-term use.

The best option is to avoid reservations and savings plans. Also, don’t buy resources in advance, instead opt for approaches like:

  • Automatic scaling

  • Trash packaging

  • Rights size

  • Resource scheduling

2. Oversupply

Oversupply means choosing more resources than you really need to ease your company’s workload. It involves a waste of cloud costs and uncontrollable but unnecessary expenses. Investing in custom oversight, cost management solutions, and proper sizing can help reduce reliance on over-provisioned resources to save on cloud spending.

3. Inefficient management of peaks and falls in demand

You can apply cost management solutions to the cloud, such as automation, to help you control your spending in the cloud and better address this issue.

4. Delayed implementation of automated cloud optimization

Cloud automation is fast becoming the new standard in the technology industry. It helps reduce the manual effort companies need to set up virtual machines, select the right resources, create clusters, and more.

According to the McKinsey report, “Fear of being replaced by artificial intelligence is endemic among workers.” However, automation brings many benefits such as the freedom to choose types and sizes of applications, better management of the ups and downs of demand, the reduction of unnecessary expenses, and so on.

By delaying cloud automation, you’ll lose these benefits. The best solution is to overcome your resistance to change and adopt automated cloud cost optimization.

5. Missed opportunities offered by one-time instances

Cloud service providers provide one-time instances for a specific duration. You may never know how long these offers will last. They may also give you a brief warning of 30 seconds to 2 minutes, denying you enough time to react. Cloud automation can help you take advantage of one-time instances even when you’re not available.

Conclusion: New market to address the problem: smart workloads as a service

Smart workloads as a service (IWaaS) is a new way to address the problem, using predictive and reactive analytics, as well as bare metal performance to stop outsourcing and an incredibly affordable multi-cloud computing service. Give your company the opportunity to enjoy perfect performance with an increase of up to 60%. Dave Wattel, CEO of an artificial intelligence software company, acknowledged this need for more transparency in their businesses, and spending in the cloud has been instrumental in finding a solution to these painful points. leading state in the IWaaS space.

You’ll also enjoy improved developer efficiency by reducing the repetitive tasks associated with traditional clouds.

Related: Driving Change: Four Steps to Enabling a Cloud Transformation in Your Business



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