Understanding Your Cloud Costs
Understanding your cloud spend is the first step to managing costs. While choosing cloud services in favor of on-site or off-site infrastructure may seem cost effective now, you need to understand all your costs to calculate your total cost of ownership accurately. This includes monitoring all uses of your cloud services across environments. There are cloud optimization platforms that track and analyze cloud usage to help optimize your cloud spending. This type of monitoring is essential to first understanding and then optimizing your cloud costs.
The Right Tools for Cloud Spend Optimization
Understanding the total cost of ownership (TCO) of internal data centers is very different than that of cloud procurement. Cloud spend relies on the pricing models of your service providers as well as knowing your own capacity needs. If your optimization platform does not include these analysis tools, it will be important that your IT team has the expertise and experience to make sense of this data.
Once you have a handle on your cloud usage data, it is time to optimize. Optimization involves understanding where waste may exist when your demands grow and shrink, and how tiered cloud pricing can help you make a difference in your spending. You can also move work to maximize your cloud capacity or select alternate cloud providers for specific workloads or projects.
Strategies for Lowering Cloud Costs
Cloud pricing is affected by demands and peak times. It can be beneficial to move workloads to areas of lower demand to shave costs on larger projects. For essential workloads, scaling core services to event-driven instances can also help you use computing when you need and release it when you don’t.
While having in-the-moment flexibility is critical, using smart instance reservations can also save you money. If your computing demands are predictable or steady, you can save money with your provider by signing up for longer reservations for your known needs. These reserved prices are most often steeply discounted compared to on-demand fees.
The use of policies and procedures will complement any decisions that relate to cloud spend optimization. As your needs change over time and pricing structures change, your policies should reflect your current spending priorities to ensure all employees are aware of and accountable for cloud costs. You can use services from your cloud provider, like alerts and notifications, to monitor usage and enforce policies in all areas.