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Understanding the Total Cost of Ownership in the Cloud

The cloud is one of the most critical technologies in the modern world. After all, its benefits for your business are second to none. However, the costs surrounding the cloud can be complicated to understand. With so many considerations, knowing the price of the cloud for your business might seem impossible.

Understanding the total cost of ownership and its broader impact on your business will help you consider long-term cost implications. You can consider whether the cloud will outperform your on-premise solution and whether the cloud is the right choice for your business.

In this blog, we will discuss the ins and outs of cloud cost of ownership, taking a deep dive into every aspect of cloud costs, from physical benefits to hidden fees.

Cost Savings and Benefits of Cloud Migration

Reduced Office Space Requirements

Cloud migration will massively reduce your office space requirements in a few aspects —

With all of these, you can easily save costs on both physical office space and hardware requirements, with the added benefit of productivity.

Lower Cooling and Energy Costs

Cloud migration will allow you to save on energy and cooling costs. Moving to the cloud reduces the hardware required in your business, both server hardware and office computers.

Because of this, you’ll save on energy and cooling, and your provider will do all of the cooling associated with the cloud.

Decreased Maintenance Expenses

Maintaining on-premises hardware is difficult and expensive. After all, configuring, tweaking, updating, and troubleshooting physical hardware requires personnel and time, which can be very costly.

By moving to the cloud, your cloud provider will take care of all the technical aspects, meaning you don’t have to worry about maintenance. You pay the cost to the provider, and they handle everything.

Opportunity for Innovation

Innovation breeds success, and the cloud is the home of innovation. The productivity and intelligence tools provided within the cloud fully unlock innovation in the best way possible, meaning that you can find success and innovate — helping your business prosper.

Simplifying Remote Work

Remote work is a key technology in the modern world, and the cloud will help simplify the cloud and ensure that you can take advantage of the power of remote working.

Things like cloud workspaces, cloud storage, virtualisation, and the ability to communicate freely using the cloud will ensure that your business can take advantage of remote working to its fullest potential.

Hidden Costs of Cloud Migration

No Depreciation of Assets

Cloud providers provide their assets as a service rather than allowing you to own them. This means that depreciation isn’t possible and needs to be accounted for when considering the long-term cost of the cloud.

Some cloud providers will allow you to bring your own assets so they can be depreciated, but this depends on your provider’s rules.

Data Transfer and Storage Costs

Cloud providers typically charge for data transfer, but some offer free inbound data transfers. Outbound data transfer is usually charged at a higher rate and must be considered in your cost calculations.

In addition, cloud providers charge for storage based on the amount and type of data stored, which must be considered when migrating; these costs can accrue if not considered and can be hefty.

The Need for Optimisation

Optimisation is vital when utilising the cloud. You must ensure you can optimise your cloud implementation and choose the right size to balance cost and performance.

Failing to do this will result in many extra costs, meaning you’ll spend far more than you need to. Because of this, optimisation is vital and knowing that you need to focus on optimising can be a game changer for your business.

Comparing Cloud vs. On-Premises TCO

Ultimately, the cloud’s total cost of ownership is far more lucrative than traditional on-premise infrastructure. After all, the cloud turns capital expenditures into operational expenses, making costs less harsh and more manageable and allowing you to spread costs more efficiently within your business.

In addition, the cloud’s positives massively outweigh its negatives if you’re aware of them; knowing how to implement cloud technology correctly is one key to maximizing its benefits, and so informing yourself on the issues of cloud migration will make it all more manageable in the long run.

Making an Informed Decision

The cloud is a vital technology for businesses. After all, there are a host of performance and cost benefits. The latter can be seen when considering the total cost of ownership in the cloud. However, this is more difficult than just considering standard expenses. You must consider other things, including unseen and hidden fees.

If you’re looking to get started with the cloud, contact us today. We’re here to help and will ensure you have everything you need to understand and use a cloud implementation.

Get in touch with us now and see how we can help you.