Cloud platforms offer many benefits, but choosing between private and public clouds isn’t always simple. Often, businesses assume that a public cloud costs less or that you have to pay more for higher security in a private cloud, which may not be the case.
To determine the cloud option that’s right for you, you must first understand the total cost of ownership (TCO) for your business. With each option, you’ll have a different TCO depending on your needs and what’s included with your cloud package. Let’s first discuss the two options: public and private.
Both these options bring different technology to the table, with varying price points. To choose the best one for your business, we need to compare what they offer.
The public cloud offers many different options with a multitenant environment and a pay-as-you-grow scalability. This means that as your business grows, your technology can grow right along with it. The public cloud also offers:
The private cloud shares some similarities with the public cloud. However, this option has a single tenant with enhanced security measures for the scalability you need. It provides:
While on paper it’s easy to pick an option for your business, you need to calculate your TCO before making a final decision. Here are six key steps to understanding the true costs of the cloud platform you’re considering.
How often will you access your cloud? This will determine which option is best for you in terms of cost, storage and space. If you only use your cloud sporadically, a public option that is pay-as-you-use could be best. If you use it daily for secure business processes, you could benefit from a private cloud. Think in terms of your whole business life cycle to get a better sense of TCO.
How will you reduce your current hosting model costs to the new cloud option? Your current TCO will differ when using the cloud. You must accurately calculate these reductions to see what your TCO will look like once the cloud is implemented. Your IT department should determine the hosting models that are currently in use first, then calculate the reduction using the new model.
Costs associated with a public cloud are variable due to its pay-as-you-use policy. In comparison, data costs remain fixed with a private cloud. However, your bandwidth may vary depending on your use. Your IT department should identify variable costs to help calculate the total TCO after these variables.
Even with a public cloud, your internal management will not be reduced to zero. You will still need to have an IT department to oversee the proper use of the cloud option you choose. Calculate the total cost of your internal management structure and add it to your TCO.
Your transition costs include anything associated with the complete transition from your old model to the new cloud model. This could include training, troubleshooting and consulting. Although these shifts can be difficult to calculate, the public and private models both come with unique transition requirements.
You IT department is an asset to your business. To effectively determine your true TCO, you need to consider your IT life cycle and the costs associated with it. With the new cloud option, your IT department and life cycle will change, perhaps for the better. Calculate these changes to see them reflected in reductions, savings and the whole TCO.
Both the public and private clouds offer amazing benefits for you and your business. In order to choose which one is best for your business, you must calculate the TCO of both options and compare it with your current system. Which one will give you the biggest return on investment? The answer may surprise you.
This post was brought to you by IBM Global Technology Services. For more content like this, visit IT Biz Advisor.
In this guest contribution from Steve Vonder Haar, Senior Analyst with Wainhouse, a Futurum Group…
In this guest contribution from Craig Durr, Senior Analyst with Wainhouse, a Futurum Group Company,…
Futurum's Daniel Newman dives into the recent announcement coming out of Micron, that they will…
Futurum analyst Michael Diamond recaps the Amazon Devices and Services event and reviews some of…
Futurum senior analyst Steven Dickens provides his take on the latest announcements coming out of…
Futurum’s Ron Westfall and Daniel Newman examine Micron’s financial results for the fourth quarter 2022…