Making cloud computing cost models work for you

Christine Cignoli

Cloud computing has changed the cost and budget equation for many businesses, and IT managers can get a better understanding of where the money goes -- and get more for their cloud money -- if they keep a watchful eye on the numbers.

Using cloud Infrastructure as a Service (IaaS) can remove a business's capital expenditure, said Kris Bliesner, CEO of 2nd Watch, an Amazon Web Services (AWS) systems integrator. But the timing involved in deploying IT services has shifted dramatically, Bliesner said.

"Before, when I talked about building a budget as an IT person, I thought about three years ahead," he said. "Now, my cost model is a by-the-hour cost model. How do I take advantage of that?"

Bliesner offered some tips on getting the most out of this new cloud cost model at the Modern Infrastructure Decisions conference in New York last week.

Lower your cloud computing costs

First, Bliesner said, employ a pay-for-use cost model. With that method, it makes sense to schedule regular server jobs and configure a baseline, then scale from that accordingly to meet demand.

"We schedule our servers to do backups every day," he said, "and it costs about $0.67 a month to do that."

To avoid wasting time during peak times or for installs, he recommends changing instance sizes.

And manage your storage the way you manage your data, Bliesner advised. "It can be a lot cheaper to store your archives in a cloud data center," he said.

For many years, planning storage purchases has been a wild guess -- and then that's what you buy, said Daniel Bozeman, software engineer at Mosaik Solutions. He's drawn to the elasticity and low cost of cloud storage.

Indeed, using cloud storage may reduce costs.

"Storage is a huge chunk of TCO savings when you look at the cloud," Bliesner said. A typical SAN represents a lot of wasted capacity, he said.

For further cost management, consider infrastructure automation, too.

"Make a template for your app," Bliesner said, "then manage that template in a source code repository."

Finally, use tools to manage your cloud server spend. (Bliesner's company, 2nd Watch, offers one called 2W Insight.) During the push toward virtualization ten years ago, Bliesner said, virtual sprawl came on suddenly, when admins created huge numbers of new virtual servers.

"The cloud makes that bad, if not worse," he said, "[Cloud] is cheap, easy to use, but costs can get out of control really quickly. You need to keep track of that."

Making cloud computing features work for you

IT shops can move to the cloud without getting burned if they use it wisely. The cloud can be a good place for research and development work, "pilot light" disaster recovery (DR) and backup, and website hosting. Adding capacity at peak times also makes sense, Bliesner said.

Plan for failure in the cloud.

Kris Bliesner, 2nd Watch

"Put infrastructure in the cloud, then the VPN between that and the data center" to add capacity when needed, Bliesner advised. "The opposite is also true. Can I front-end my existing data center with apps in the cloud?"

And pilot-light DR -- a "warm/cold" DR site in the cloud, ready to turn on if needed -- can make sense from a cost perspective, Bliesner said.

"I can have warm standby at the cost of cold storage," he said. "It's superfast to recover, and I don't have to worry about whether I have to transfer stuff over."

Software as a Service is a great place to get started with cloud -- particularly email.

"When you get beyond that, with applications like SharePoint, think about moving more," Bliesner said. "Start with team collaboration, because it's not a customer-facing thing."

For all its cost benefits, the public cloud also has its risks.

"Plan for failure in the cloud," Bliesner said. "You have to build in high availability in every tier. We have less visibility, so we want to account for that."

That's still a better bet, costwise, according to Bliesner. "It's less expensive for me to build a redundant infrastructure in the cloud."

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