Cloud Spending Continues to Grow Amid COVID-19. Here’s How to Keep it in Check.
With the shift away from dedicated offices, we’re using more cloud services than before—and likely spending more than we need to, leading to sticker shock. Here are some suggestions to keep your cloud computing expenses in check.
Cloud computing was once a nice to have—but over time, it’s increasingly become something of a business imperative, especially after the pandemic changed priorities (and work environments) for many associations.
In the past, it was pitched as a great way to save money on functions that were previously handled in-house.
But some who have looked at their bills of late might not feel quite that way.
A Wall Street Journal story highlights this dynamic in action: Recently, a subsidiary of the Volkswagen-owned automaker Audi saw its cloud spending jump by 12 percent between March and April, a period when many organizations were going fully remote for the first time. But after Amazon Web Services worked with the subsidiary, it was able to turn off unused services, cutting costs by 30 percent this past month.
If you have a similar moment of sticker shock in your own association, you may not be using your cloud offerings in the most efficient way possible. That’s the bad news. The good news is that there are things you can do to optimize your association’s cloud spending. A few examples:
Get a better understanding of your bill. When you’re literally paying by the bit, odds are good that the detailed bills you get are going to be confusing. A 2019 CIO piece cited the example of the software-as-a-service provider AvePoint, which found its bill so confusing that it actually built its own cost-management tool—and ended up cutting its monthly fees by more than a third. “We wanted to know if our spend aligned with the revenue targets of our organization,” said John Hodges, the firm’s vice president of product strategy, in comments to the magazine. “That’s a surprisingly hard question for many cloud vendors to answer when their quarterly or month-to-month bills arrive.”
Shut down offerings you’re no longer using. In a May 2019 Digiday story about business challenges at Salon, it was revealed that the news outlet was greatly overspending on its hosting services, including ad servers and the paid version of Google Analytics. By moving to the free version of GA and dropping other services it wasn’t using, Salon cut its hosting costs by more than six figures while decreasing site load times. This approach also translates when you’re dealing directly with cloud vendors. Meanwhile, CIO also reported that the Broad Institute research center, which is funded by federal grants, created a tool to turn off cloud servers that were no longer being used, allowing it to cut its costs and resource use.
Build (and keep building) for efficiency. Often, a tool is state of the art when you first build and use it—but five years down the road, newer techniques have emerged, patches to your existing structure have slowed things down and added costs, and your organization hasn’t adapted to those needs. Another approach: Build tools that are meant to adapt from the outset.
The 2020 State of the Cloud Report, from the firm Flexera [registration], noted that respondents estimated that around 30 percent of cloud computing spend is wasted. And that may be an undercount. “In working with customers to identify waste, Flexera has found that actual waste is 35 percent or even higher on average,” the company said in a blog post.
On the plus side, 73 percent of respondents expect to take steps to better optimize for cloud use. But figuring out the right optimizations—including using lower-cost cloud offerings or eliminating inactive storage—can take time if not specifically designed to be automated.
If you build software with future cost and speed efficiencies in mind, you’ll have better luck avoiding some of the pitfalls that come with a cloud infrastructure.
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