Saugatuck Research: Cloud TCO Considerations

Recently published Saugatuck research (1021CLS,Cloud Costs: Understand Vendor Pricing and Sum the Pieces, 07Feb2012) focusing on the true costs of running various workloads in the Cloud highlights two key facts that are frustrating IT buyers:

1. Cloud pricing is not consistent. When investigating potential costs for running a workload in a Public Cloud offering, a factor which rapidly becomes apparent is the “granularity” of the potential server configurations. Some Cloud providers, such as IBM, and Rackspace, currently offer a number of pre-defined server configurations. Others, such as OpSource (Dimension Data) provide more granular flexibility – within limits – in defining a server configuration. Pre-defined server configurations have a tendency to create “stair-step” pricing models. Such models often result in purchasing more of one resource than is needed to attain the required amount of another resource.
2. Workloads are not homogeneous. Most IT workloads exhibit common attributes – independent of the size of the enterprise – and, they consume resources ranging from IT infrastructure to personnel. The extent of resources consumed by a workload depends on factors such as the designed attributes of the workload, the volume of transactions or records processed, and the desired performance or throughput.

When evaluating migration of a workload to a Cloud offering, it is critically important for IT organizations to have a solid understanding of the resources required – and, their associated costs for each of the Cloud offerings being considered. To enable an informed decision by IT management, all costs must be identified and sized.

Note: Ongoing Saugatuck subscription clients can access this premium research piece (1021MKT) by clicking here, and inputting your ID and password.