Navigating cloud economics

Veeam Pty Ltd

By Dave Russell, Vice President of Enterprise Strategy and Rick Vanover, Senior Director Product Strategy, Veeam
Thursday, 24 August, 2023

Navigating cloud economics

In Australia, cloud computing has emerged as a key catalyst to digital transformation, empowering organisations with scalability and unparalleled flexibility. As more businesses migrate to cloud-based solutions, understanding the financial implications of cloud adoption is critical to achieving sustained success from the use of such platforms. Cloud economics is a framework that has been tailored to assess and improve the financial dimensions of leveraging cloud computing services.

Unleashing the power of cloud computing: benefits and beyond

Organisations in their journey to building a cyber-resilient cloud strategy must first consider the benefits that cloud computing can provide. There are numerous advantages, including not only enhanced flexibility and scalability but also the potential for global reach and seamless collaboration. Cloud allows businesses to not only efficiently scale their operations but also adjust resources based on changing demands. This flexible nature, combined with managed services, frees organisations from the burden of maintaining on-premises infrastructure, enabling them to focus on core competencies and innovation.

IDC predicts that public cloud spending in Australia will reach AU$22.4 billion in 2026, an 83% increase from AU$12.2 billion in 2022. With strong interest in cloud adoption, cyber resilience stands as an indispensable pillar. A 2023 report by CloudStrike revealed that Australian businesses are hit every seven minutes by a cyber breach. This surge in cyberthreats in Australia demands fortified cloud security measures. An organisation’s ability to effectively safeguard its cloud-based assets and swiftly recover from potential cyber attacks or service interruptions can make all the difference in an increasingly digitally interconnected world.

Unravelling the cloud economic model

While the allure of cloud computing is undeniable, enterprises must carefully consider and evaluate cloud service providers. Adherence to a cloud economic model can make all the difference in understanding the financial implications of cloud adoption. Key cost considerations encompass a complex web of factors:

Pricing complexities: The pricing structures of various cloud service providers can be intricate and challenging to navigate. As organisations scale their cloud usage, accurately estimating costs becomes paramount. Understanding your business needs and finding the right vendor who can offer the best solution for you at a competitive price can ensure you’re getting the most out of your price range.

Data transfer costs: Transmitting data between cloud services, or between cloud and on-premises infrastructure, may incur additional expenses. Minimising data transfer costs requires a thorough comprehension of data flows.

Optimising resources: Overprovisioning or underutilisation of cloud resources can result in unnecessary expenditures. Optimising resource allocation involves ongoing monitoring and fine-tuning to match usage patterns.

Vendor lock-in: Choosing a cloud provider may bind an organisation to a specific ecosystem. Understanding the implications of vendor lock-in is vital to maintain agility and prevent potential switching costs in the future. Veeam, for example, allows businesses to be flexible in where they store their data and offers a range of solutions that are compatible with various systems.

Best strategies for cloud optimisation

Beyond comprehending the cost implications, organisations can implement strategies to optimise cloud usage and maximise the benefits of cloud provider selection.

Instead of relying on a single cloud provider, businesses should consider a multi-cloud approach. Embracing multiple cloud platforms offers flexibility, reduces reliance on a single vendor, and facilitates the adoption of best-in-class services from different providers. In these scenarios, it would also require resource monitoring and ensuring that cloud usage is correctly allocated. Implementing auto-scaling mechanisms based on demand patterns is one way that businesses can optimise performance and reduce costs during periods of lower activity.

Most importantly, it is crucial that cyber resilience is embedded into any cloud strategies. This entails adopting robust security measures, conducting regular audits, and proactively minimising potential vulnerabilities.

Charting the path ahead

For Australian organisations, the cloud is a gateway to unprecedented opportunities for growth and innovation. However, to fully capitalise on these possibilities, organisations must venture forth with a keen eye on the economics of cloud computing. Embracing a cyber-resilient cloud strategy that integrates cloud economic considerations and robust security measures will enable businesses to thrive in the digital realm.

As the cloud continues to evolve, organisations must remain agile and proactive, continuously adapting their strategies to seize emerging opportunities and tackle evolving challenges. By harnessing the power of the cloud, fortified with the knowledge of cloud economics and cyber resilience, Australian organisations can confidently navigate the ever-changing landscape, transforming challenges into triumphs and forging a path towards sustained success.

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