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Wednesday, 15 February 2017
Cloud: Cost Model
article written by bizdirect
Consider digital transformation today, and you will likely discover a Cloud-based solution that may be what you were looking for.

However, when cloud companies provide their potential customers with a service-level agreement (SLA) that identifies key metrics (service levels), often clients’ ability to understand the billing associated with the availability, reliability, and performance is the key conceptual issue before moving into the Cloud. For businesses trying to decide which solutions are right, it is critical to understand the true value for them.

For small to medium-sized businesses (SMBs), it is often better to leverage cloud-based services than to get enterprise-class solutions on tighter budgets. There probably is not a cloud service offering that SMBs can build themselves, on-premise, with the same budget, as they would have to deal with hardware, software, electricity and data center costs.

While on-premise solutions involve assets that must be purchased, may need to be financed, and must ultimately be replaced, cloud solutions are services to which you subscribe, and as such, can be categorized as operational expenses. At the same time SMBs can get tax benefits with it, they can also focus on their core competencies or things cloud service providers do not offer, like desk-side support.

To enterprises or even startups that are growing, scale is important. If you they have capital to invest, choosing an on-premise solution may sound right. But having money does not mean they do not care about costs right? So, the question is, what is the best cost-effective solution?

One of the big benefits to cloud service providers is the resource pooling. They can afford to offer scale of services you could not provision yourself at any cost. Also, a great advantage is that customers are billed based on some measured consumption. Whatever thing measured, such as licenses, CPU cycles, storage consumed, or number of mailboxes, customers are billed for what they use. But how to control what is used and billed?

Well, to prevent unexpected costs, companies can estimate their expected monthly bill by using a pricing calculator and track the actual account usage and bill at any time using the billing portal. They can even set up automatic e-billing alerts to be notified if the spending goes above an amount they configure.

There is also the ability to quickly compare the total cost of ownership (TCO) of an on-premise infrastructure with an Azure deployment using a TCO Calculator and estimate savings by moving to the Cloud.

If they choose doing so, it is even possible to regularly check the portal for cost breakdown and burn rate.

To finish, we believe that everyone is fond of moving to the Cloud because businesses are now much more dynamic and unstable. It is much harder to predict what is going to happen and so, customers do not want to make risky and long-term investments; they need solutions that can adapt to each moment of their journey.

If you are already inclined to favor a cloud-based solution or if you are just wondering around, feel free to:

CONTACT US!
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