Customers Struggling with Cloud Costs? There Are Answers

Back in the day, when cloud was bursting into the channel, the mantra was that the new approach to technology would save organizations money because it shifted capex spending to the opex budget.

Sure, moving to a subscription model helped because organizations didn’t have to invest in millions of dollars’ worth of infrastructure up front.

However, come to find out, cloud computing costs a lot, regardless of which budget covers it. And without proactive oversight, organizations will overpay, to the chagrin of the CFO and CEO. Too often, test buckets are left on, as are workloads that only need to be available during the day run and night and on the weekends — and so on.

The situation resembles the early days of corporate mobility, when IT didn’t have a handle on spending, and overages and expenses ran amok. Just like wireless, cloud computing requires cost and consumption optimization. Channel partners are well suited to oversee this responsibility for their customers, and they’ll learn more about it at the MSP Summit on April 12, co-located with the Channel Partners Conference & Expo in Las Vegas. The conference session is called “Cloud Cost Optimization as a Managed Service.”

Mark Williams, founder and CEO of CloudSaver, will lead the 35-minute discussion. While CloudSaver currently only addresses Amazon Web Services, that focus is expanding and Williams’ tips will apply across public cloud platforms. He’ll show attendees how to help customers save on cloud costs by better managing resources, eliminating waste, using advanced scheduling and discount programs, and taking advantage of proprietary software and managed services. Channel partners will learn how to:

• Build a dedicated cloud services team.
• Present proactive cost management options.
• Use specialized tools and managed service programs to find and implement additional savings.

In this edited Q&A, Williams talks with Channel Partners about what else to have in mind before the April 12 session.

Channel Partners: What three cloud categories tend to comprise the top areas for spending waste? And why?

CloudSaver’s Mark Williams

Mark Williams: No.1, EC2 and RDS instances. The vast majority of resources are dramatically oversized due to unknown requirements at launch; and lack of capacity to monitor actual instance usage after deployment. This can be addressed by simulating performance against other instance types to identify optimum instance platform and size. No. 2, AWS Elastic Block Store (EBS) volumes. The vast majority of these are dramatically oversized. Average EBS usage is 10-15%. No. 3, reserved instances and savings plans, or saving money with long-term contracts and commitments.

CP: How should channel partners think about addressing these issues?

MW: There are many factors to consider; it’s not a simple decision. You have to model different scenarios and not commit to oversized resources. It’s important to develop a comprehensive strategy based on historical usage.

CP: What two or three best practices should attendees be thinking about implementing as they prepare for this session? And why?

MW: Attendees should consider the following prior to attending this session:

• What are your customer’s major cloud challenges? Is cost one of them?
• What strategies has your customer tried to reduce cloud spend?
• What cloud resources are your customers looking to optimize?

CP: What two or three takeaways on cloud costs do you want to make sure attendees get from this session?

MW: Discover how to use a dedicated cloud optimization team to drastically reduce a customer’s cloud spend. Learn about proactive cloud cost management solutions to achieve savings. Understand how specialized tools and managed services programs can find and implement additional cloud cost savings above and beyond what cloud providers and software vendors offer.