May 9, 2019 - Blog

Cloud Economics: Whose Responsibility Is It Anyway?

Jason Pepper, SAM Practice Head, Version 1

Cloud Economics: Whose Responsibility Is It Anyway?

Public Cloud Services…the cure to all our problems, the ultimate solution that we’ve been waiting for? I guess that depends on your personal perspective and how your role relates to these services.

From an operational perspective, I believe that Public Cloud Services could well be an operational cure-all. Embracing powerful technology like Kubernetes and adopting DevOps processes coupled with SaaS best-of-breed services means that the life of a ‘techie’ nowadays is an easier task than it once was.

Public Cloud and SaaS services have made life much easier in many fundamental ways for businesses when you consider the ability to quickly deploy and configure large and complicated infrastructure projects, proof-of-concepts and on-premise migrations today. Gone is the critical need for datacentre employees skilled in the art of managing chunky and expensive large frames containing database servers, tape-drives, racks of blades or networking. You can do it all from the comfort of your local coffee-shop through a web-browser whilst sipping on a coffee.

However, from an organisational control perspective, I’d say that the complete opposite is true for today’s cloud economics.

Before the era of the Public Cloud behomoths, businesses ensured that their employees’ wildest flights of fancy were kept in check by developing sophisticated control mechanisms, strict purchasing and approval policies as well as rigorous change control. These control mechanisms ultimately ensured that any proposals for spend had to be approved by a responsible person with the experience and knowledge to control spend excesses.

Not anymore!

Trust not their presents, nor admit the horse.
- John Dryden on accepting the gift of the Trojan Horse

Is the Trojan Horse concept applicable in the era of Public Cloud?

Absolutely. While the gifts on offer for the techie community provide ease of access, speed of deployment, scalability on tap and a playground for the latest concepts ‘on-demand’ – from an organisational control perspective they come with a latent financial sting in the tail.

Devolving responsibility for decisions about architectural and operational choices in a Public Cloud environment, without the necessary fiscal verification or control of deployment, will come back to haunt you. Usually about one month after an associated decision to do something was taken by the technical person with (technical) control. Why one month? Because that’s often the billing cycle used by the cloud service provider. Once the resource has been consumed you cannot get a refund, the resource has been ‘used’ (maybe not in any meaningful way) and you are contractually committed to pay for it, end of discussion.

This is not scaremongering, it is a fact. Here are some examples:

  • A blob storage of 4 Tb replicated across region to test the speed of the process and resiliency of a failover approach. This was done 3 times to 3 separate regions then, when successful, the ops team forgot about the blob storage. 30 days later a bill for £36k came through the door, the estimate (and budget) had been £9k.
  • Virtual machines are created as part of a data centre migration which match the on-premise specs for the machines. Once deployed their utilisation levels are far below the specs. No-one ever revisits the sizing of these virtual machines, even though the Public Cloud provider publishes recommendations in your console. 30% wastage is not uncommon.
  • A service provider spins up a number of environments on a customer’s Public Cloud during a proof of concept exercise. After the POC is complete the customer receives a bill for £400k which the service provider refuses to pay, because “it’s the customer’s responsibility to control infrastructure costs”
28% of spending in key enterprise IT markets will shift to the cloud by 2022, up from 19% in 2018. So, failure to control this problem now is likely to be exacerbated in the future
- Gartner

Not all is lost, however, there are (as ever) solutions on hand.

If you have the know-how there are tools on the market who will connect to your Public Cloud tenancies and help you identify wastage and optimisation opportunities within your Public Cloud estate. These do, however, require some expertise to decipher and to utilise to their best effects. Some tools are very capable, some promise a lot and deliver little.

It is often simpler to employ the services of experts in this arena who can utilise an appropriate tool (used expertly by consultants who know exactly what they are doing) and also help you implement the necessary changes to take advantage of the optimisations.

With our specialist Public Cloud Optimisation Service, Version 1 is offering you this exact solution. By blending our expert knowledge of Public Cloud platforms with our SAM expertise and backing it up with industry-leading toolsets, Version 1 is offering you access to a flexible Public Cloud Optimisation Service based on your unique deployments and operational needs.

So, to answer the question I posed earlier, “Whose responsibility is it to manage the economics of Public Cloud?”. I’d say everyone is responsible, but the likelihood is that you will realise the most effective benefits through a combination of financial and operational expertise which is often manifest in SAM practitioners.


Cloud Economics are complicated.

The plethora of pricing and provisioning options available mean that it’s often difficult to understand what’s available to you, and what might be the best option for your particular use case.

In the second of our series, our SAM Experts delve into Spot Pricing, read more here.


Take Control and Manage Risk: Public Cloud Optimisation Service

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