Let’s begin with a cautionary tale about pricing: a friend hired a moving company as they quoted a very attractive price for a complex move. They lured her in with a low-ball price then added more and more “extras” to the point where their price ended up higher than many of the other bids she passed up. And to make matters worse, they are already two weeks late with delivery of the furniture and are saying it might take another two weeks. As for customer service – this company turned out to be merely a broker for other movers, so attempting to get any accurate data about anything is her ongoing living nightmare.
Imagine that happening to your data stored in the cloud? You need to recover and the cloud vendor you selected ends up charging you an arm and a leg to get up and running again – and it takes you a week instead of a couple of hours!
Unfortunately, this can and does happen. Here, then, are some tips to avoid this fate.
Be Duly Diligent
The most obvious tip is to not stint on due diligence concerning cloud storage pricing. Many users get tripped up by hidden or unforeseen charges, so it makes sense to educate yourself on how cloud pricing actually works.
Trace Out Application Interaction
Users are advised to work out how an application interacts with different services around it. For example, how a virtual machine (VM) interacts with storage, network and the various other cloud services such as Platform-as-a-Service (PaaS) or Infrastructure-as-a-Service (IaaS). The way they communicate with each other and upload/download data can significantly add to billing rates in ways the users might not realize.
Avoid Fixed Usage Rates
What kind of fee structure should users avoid? It is recommended to stay clear of fee schedules that are based on a fixed amount of usage, bandwidth or storage. What typically happens is that cloud users like its flexibility so much that they learn to ramp up and own their usage more rapidly. Some providers make it clear how they charge for this and facilitate it. Others punish you in a similar way to cell phone carriers with roaming and other wildcat fees.
The fee structure that seems the fairest to both the enterprise user and the provider, then, would appear to one that locks in reduced prices for predictable requirements, while retaining the ability to purchase on-demand resources for any unexpected requirements.
Define Storage Requirements Carefully
Closely define storage needs in the cloud so you are getting exactly what your environment demands. Once that storage is sent to the cloud, it is no longer under the full control of internal IT. Upfront negotiations need to make it clear what kind of storage and performance you need for different tiers of data.
Dig into the Details
Depending on the storage type selected and the quantity of storage consumed, the cost can be as low as pennies per GB per month or can soar much higher. In addition to the actual storage, some cloud providers add charges for the number of I/O request to the storage. The cloud provider may have additional charges for exporting data to another location or region. Consumers are also charged for the allocated storage, not the storage actually consumed. So if you allocate 100 G of storage but are only using 10 GB, you will still be charged for the full 100 GB.
Just as in the moving business, lowballing is alive and well in cloud pricing. Pay close attention to services that have very low cost per GB or TB yet have extra fees and charges for use, activity or place service caps. Compare those with other services that have higher base fees and attempt to price it based on your actual storage and usage patterns.
Demand Enterprise Visibility
Medium-sized enterprises could be using up to 100 cloud services. Without visibility into active usage across these cloud services by department, group or cost center, organizations are likely to leave money on the table.
Help take some of the guess work out of the Cloud, and contact MCC’s Integrated Solutions Division today!