Think beyond rights when it comes to cloud cost optimization

How can you optimize your cloud spending bill?

The usual answer is to reduce cloud costs on a workload-by-workload basis. Cloud administrators are advised to “right” virtual machine instances or take advantage of reduced prices for individual VMs, for example.

These strategies will definitely save some money on your cloud bill. But they fall short in providing every possible cost. To achieve true cost optimization in the cloud, you have to think big. Here’s why.

Related: 5 myths about cloud pricing

Traditional best practices for cloud cost optimization

Traditional approaches to cost optimization usually take the form of practices such as the following:

  • rights: Rights means choosing the best cloud hosting configuration based on the requirements of each workload. The goal is to avoid paying for resources that your workload doesn’t actually need.
  • Benefit from price discounts: Cloud vendors offer discounted prices for some of their services if users agree to some caveats. For example, you can save money on cloud storage by Using Amazon S3’s Glacier storage classeswhich cost less but are also less responsive than more expensive storage levels.
  • Track workloads: By keeping track of what you’re running in the cloud, you can find workloads or resources that are still running but shouldn’t be.

By reducing waste and improving cost-effectiveness, these practices can help reduce the costs of the specific cloud workloads that you leverage.

A rigorous approach to cloud cost optimization

However, traditional cloud cost optimization strategies themselves offer limited value. The main reason for this is that it only benefits specific workloads, rather than savings that you can apply across the cloud – or at least across all workloads of a given type.

Related: 6 tips for controlling cloud costs in a recession

Rights to individual VM instances only save you money in those cases, eg. Moving some data to a lower-cost, lower-performance storage tier doesn’t save you money for the data you’d have to keep in a higher-priced class.

That’s why the key to real cost savings is to approach cloud cost optimization more aggressively by leveraging strategies such as:

  • Multicloud migration: Adopt a multi-cloud architecture It makes it possible to lower cloud spending across the board by taking advantage of more low-cost cloud services than you could access if you used a single cloud. Perhaps one cloud provider has low-cost VM hosting, for example, while another provides low-cost object storage. By using both clouds at the same time – one for VMs and one for storage – you can save money across all of your workloads within these categories.
  • Foundation agreements: If you’re a large company, you can save big money by negotiating an enterprise agreement with your cloud provider (or service providers). Enterprise agreements provide blanket price discounts for customers who consume cloud services in high volumes. It’s another great way to lower your total spend.
  • Cloud startup credits: Small businesses can also lower cloud costs by asking cloud providers for startup credits. Startup credits provide free or discounted access to cloud services. They’re designed to provide a temporary boost for small businesses new to the cloud, but startups can negotiate for extended startup credits.

In addition to the fact that these strategies reduce cloud spend across your entire environment, they offer the advantage of being relatively easy to implement. Practices like virtual machine copy rights are too much work for the money they save you. In comparison, a strategy like getting startup credits is relatively easy to implement. You don’t need any special tools or technical skills. Simply ask your cloud provider for access to their startup software.

Conclusion: Think big and save time and money

Optimizing cloud spend on a workload-by-workload basis isn’t a bad thing. In fact, it is essential if you want to lower your cloud bill as much as possible.

But in many cases, the biggest cloud savings opportunities lie beyond strategies like equity or pricing discounts for individual workloads. Companies need to think more ambitiously and take advantage of practices that allow them to reduce spend across all cloud workloads, while investing less time and technical effort than traditional cloud cost optimization approaches.

About the author

Christopher Tozzi, shot in the headChristopher Tozzi is a technology analyst with substantive expertise in cloud computing, application development, open source software, virtualization, containers, and more. He also lectures at a major university in the Albany, New York area. His book, For Fun and for Profit: A History of the Free and Open Source Software Revolution, is published by MIT Press.

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