Cloud Step 7: Why is Cost analysis of the Cloud so Important?

The business case for cloud application migration is never complete without taking the target cloud platform into consideration. The migration and overhead costs vary widely based on the target cloud platform and thus will skew the estimated cost savings. Cost analysis helps decide whether to go ahead with moving a particular application to the cloud or not from a return on investment perspective. Cost should include capital expenditure, operational expenditure, and the overhead costs involved with migration.

Up to now, the success of applications in the Cloud, both virtual and physical, has been viewed in only two ways, availability and performance. Perhaps however, the most important dimension is cost, and it is this cost that will dramatically influence what, when and where businesses deploy to the cloud. Cost can increase exponentially without proper cloud monitoring and cloud cost modeling. The result of this is that it has become crucial for IT to tie cloud success to cost analysis, in addition to overall system performance.

To date, companies have been oblivious to the workload cost of an application running in the cloud, apart from unclear monthly billing. We are entering a new era where performance and availability will be baseline requirements, but workload cost efficiency will be the new key to success.

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Previous posts:

• Step 1 – Are your applications ready to run in the Cloud?
• Step 2 – How important is Technical Support for Cloud success?
• Step 3 – Do you have ownership and access to your data in the cloud?
• Step 4 – Understanding what fluctuating data volumes means to you.
• Step 5 – Is any part of the Cloud infrastructure Outsourced or Subcontracted?
• Step 6 – Helping you answer your Compliance Queries in the Cloud

Next posts:

• Step 8 – Have you prepared a Migration Strategy?
• Step 9 – The importance of Considering Downtime and How to Deal with it.
• Step 10 – The importance of Data Migration.

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