this post was submitted on 21 Aug 2023
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Has "cloud computing" ever been cheaper for most kinds of established businesses? Other than for some specific workflows, or very unpredictable workloads, the only cost-saving I've ever seen is avoiding the initial costs and avoiding the need for a real ops/obs team.
I can tell you at the enterprise level, Cloud services were absolutely pushed as a cost savings measure. All the math in the world can't save you from a determined C-suite, however.
We just finished our migration to the Cloud after 3 long years of effort, and while we are saving about ~2MM/mo in data center costs, our opex spend is up by around 2.5MM/mo YoY, not including all the Cloud-centric new hires.
Are you saying they already (over)spent in unrelated opex areas the savings from going to the cloud? I'm unclear if you're saying it's a consequence of the move to the cloud.
Our run rate is roughly 2.5MM more per month than what we were spending to operate two whole-ass data centers.
Hope that clarifies it a bit.
Initial and operational costs are huge if you are a small company of ~20 people. At least in this case the promise of cloud is achieved - bringing the economies of scale down to individuals and small companies.
Sure if you have 10k employees it makes no sense, you have enough resources for these same economies of scale to be possible inside your company.
You don't even need 10k employees, I see it make sense with ~450 employees if you also have a decent IT team and funding. The issue is most companies can't see the need to keep things they own up to date - there's always a temptation to "just put it off a year" to make the budgets look better, till they hit near catastrophe with being 5+ years beyond reasonable. The cloud "forces" them to put in update, maintenance, employee overhead etc up front and forever. They just pay a premium for that service IMO.
I used to think it was kind of stupid, but then I realized - companies hire consultants at exorbitant rates to help them do things they don't have the in house skills for - so really - building that into the overall cost might still be a wash. The expensive part of Cloud IMO turns out to be needing training, consultants or new employees with different skills to manage it, which all charge more than traditional on prem because cloud is still the current ?fad?. And the unseen costs of screw ups by the cloud provider themselves losing data, being down, or having a security breach that affects you - and you're completely out of the picture with remediation or even knowing what might be a risk.