Is the Cost of Cloud Computing More Expensive than Alternatives?

It can be difficult to identify and total your IT costs. These costs are usually subdivided into so many parts – costs of operations, maintenance, software, hardware, training, and more. Not to mention the costs it takes to keep your networks up and running 24x7 so all these can seamlessly work.

But if you figure out these costs by way of a simple monthly comparison of your subscription costs, that’s not the best way. And yet, if you ask an expert the question,” Is cloud computing expensive?”, you’re likely to hear the answer nobody likes hearing – “it depends”. Let’s try to answer this question by breaking things down and comparing the derived value against the costs... computer generated image - corporate income and financila issues

The Influencing Factors

Costs: How Much, How Often?

The biggest difference between a cloud computing model and a traditional model is that traditional models often require you to pay large sums of money upfront for complete ownership. On the other hand, you can pay as you go in the case of cloud models, in a way renting the cloud for your use.

This could be a game-changer, especially if you’re starting a company or wish to undertake major R&D, marketing, or other investments in the company at that point. On the other hand, if you have the funds to pay and own upfront, as well as the manpower to maintain it, you could go for that. Of course, that would prove to be costlier in most ways.

Licensing: Purchasing vs. Renting Hardware and Software

What do you prefer, buying, maintaining, and replacing hardware along with the costs that come with it? Or would you rather pay some of that money to a cloud provider to rent their cloud resources and tools? Equipment like new servers, data centers, etc. can be incredibly expensive to buy and maintain.

Also, technology is ever-evolving, so you may need to invest and re-invest in hardware and software that is easily upgradeable. How much does cloud computing cost to upgrade? Much less, in fact, than the traditional model.

Maintenance

You’ll need expert IT staff can to physically maintain the on-premise traditional equipment that you own. In the long term, this means you won’t have to rely on anything else. So then, is cloud computing expensive in this regard? That depends on your needs – when you compare the two, you won’t need to maintain the cloud resources because no physical resources exist. This saves the cost of hiring and training staff, the cost of space where you’d keep them, and more.

Over Usage and Scaling

What happens if you want to scale your business? What happens if you need more than what you already get in terms of computing capacity and storage? You could do the entire process of acquiring space and manpower for a new data center, but unless you don’t want to expand your existing storage by petabytes of data, the cloud would make life easier for you now.

Cloud Computing Cost Vs Traditional Costs

The Payment Model

The cloud computing cost vs traditional payment model differs significantly in terms of the initial costs. This could especially be critical in the case of a young business. Also, if you’re a very agile business, you might not want to invest in buying technology and resources for fear you might need to do that all over again in a short while. As far as the payment model goes, the flexibility and ease of paying on the cloud definitely make things easier and cheaper, because you have more control over how much you use, and in effect, how and how much you pay.

Maintenance Ease and Costs

Because the cloud has no physical presence, maintenance becomes significantly easier and cheaper. Also, if there is downtime at your cloud provider’s end, you won’t have to shell out time and effort or costs, to get it back up and running.

Of course, this also means that you may be at the mercy of the provider, but if you choose a reliable partner for your cloud services, your cloud computing cost will be lesser in contrast to the on-premise scenario.

Cost of ‘Limitless’ Storage

If it offers limitless storage, is cloud computing expensive, or is that cost worth it? Most free-tier plans and low-level subscriptions offer 5 to 100 GB of storage space. You’ll need to pay monthly charges to use more data. That may seem expensive at first. But if you think about it, how costly would it be to expand your on-premise storage?

Including acquiring space, maintenance, trained and qualified staff, etc., it could prove to be quite the endeavor. As it is also clear, the cloud offers this limitless storage flexibly as and when you need it, so you can choose the pace at which your business scales up, and the exact amount of investment you’re willing to put in for that to happen.

Final Word

The best way to answer if cloud computing is expensive or not is to calculate the total cost of ownership over a significant period. You should also consider the ease of maintenance and operations that the cloud brings. In the end, is cloud computing expensive? Not really, especially when you have a reliable cloud provider that can guide you and help you scale your business as you need.