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Cloud Cost Normalisation?

Which is the most cost effective for your business, utilising your current three tier architecture you own, or public cloud?

Guess what? It's an almost impossible question as there are far too many variables, but this is one of the questions that companies are facing every day as they embark on their cloud journey.

A cloud first strategy shouldn't mean wholesale lift and shift to the public cloud, it should mean you are looking for the attributes of a cloud model, such as commoditisation, self service provisioning, LOB budgeting, and charge back accounting. There is no reason why your existing depreciating assets can't form part of (to a greater or lesser degree) your cloud first strategy.

The first thing we need to be able to do is to compare apples with apples, so we can ‘normalise’ the cost model between your depreciating assets and your public cloud price plans. To calculate a per hour cost for your on-premise infrastructure you can adopt one of two approaches:

Create a detailed spreadsheet that captures all of your current CapEx, OpEx, human resource costs, work out how far through the depreciation cycle you are, how long you think you can sweat the asset for, create some t-shirt size virtual machines that mirror what is available from the public cloud vendors, work out how many of each type of machine can fit into your estate, and hopefully that will spit out a cost per machine per hour.

Or alternatively determine how you want to drive your cloud first strategy and influence behaviour by making one environment look more attractive than the others. For example; if your existing depreciating asset is only 50% utilised you may want to price this more aggressively (at this point in time) than a public cloud vendor to increase utilisation, before building anything in public cloud.

With a ‘normalised’ commercial model across your multi cloud estate, not only are you able to dynamically compare costs between different clouds at the time of provisioning, you can truly now hold individuals accountable for their actions. An auditable account of who provisioned what and where for which period and whether there was any overrun or not, enables governance and compliance.

At the moment whomever in the organisation that is provisioning workloads has plausible deniability, "I couldn't get the environment needed that quickly in our on-premise infrastructure", "Public Cloud looked to be my best option as I had nothing to compare it against". However, with a holistic view of your multi-cloud environment, and a 'normalised’ commercial model there are no excuses and therefore your company gets a better return on investment.

illapa cloud can not only audit your existing IT infrastructure to improve utilisation efficiencies, we can build the same public cloud cost model in your private estate and present it alongside the leading public cloud infrastructures in a single customisable interface.

Cloud Management as a Service.

If you would like hear more about Illapa, and our services please email us at, or call Amanda Baxter on 07501 495058

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