A clash of cost between cloud computing and in-house IT


It’s a constantly asked question of whether cloud computing is more cost-saving than an onsite IT environment. According to Charlie Burns, a researcher at Saugatuck

Maybe, because it greatly depends on each individual case and the customer in each. However, Burns has some general criteria, which comes down to the effectiveness of one’s in-house IT. Cloud computing might be more expensive for companies with highly customized IT infrastructure to serve their needs. But if the work consistently increases and decreases, the cloud proves to save more. Burns also noted that although cloud infrastructure can significantly reduce the costs, but practical savings heavily “depend on type of workload, its suitability to cloud, and the level(s) of efficiency and optimization of in-house IT resources and operations.”

The conclusion drawn from the newest study by Saugatuck is that in-house IT better suits statics operations, while the cloud is more ideal for dynamic ones. This is supported by other major research firms.

Last year’s report by Forrester said that the pay-as-you-go billing of public cloud computing helps companies save a lot in high seasons since they don’t have to expand their onsite resources. However, Forrester report also noted a catch that “cheaper isn’t always better”, as IT managers are not as confident of the cloud as their own in-house IT in terms of security, performance and reliability.

According to Burns, there are several criteria to be considered in determining whether the cloud is more cost-effective. Despite most public cloud computing services apply pay-as-you-go billing method, many also come with pre-configured virtual machine image sizes. A broad choice of VM sizes may not ensure that there will be an optimal one for the specific workload running in the cloud. Hidden costs also earn a wince. Since it’s often free of charge to upload data, customers often overlook the expenses for getting data out of the cloud, as well as for the accompanying network resources.

Shortcomings aside, cloud computing is still ideal for various workload, claimed Mike Pearl, a consulting partner at PricewaterhouseCoopers and leader of the entity’s cloud unit. A cloud, whether public or private, will usually saves costs for a company thanks to the benefits of having elastic resources on demand. The bigger question should be building it internally or in a public cloud, which usually needs more brainwork.

James Staten, another cloud expert of Forrester also argues that the cloud is an essential tool for IT administrators, but they should know when they are ideal to use, and the trustworthy platform and provider to employ. The cloud, however, is not going to replace traditional IT infrastructure any time soon.

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