The Hidden Cost of Cloud

Comms Business Magazine talks to Aidan Simister, Director of Sales EMEA at Intermedia, about the unwelcome surprises some users encounter when adopting cloud based IT services and discovers a set of six hidden costs.

“It’s no wonder why businesses are moving their essential IT apps to the cloud,” says Aidan Simister, Director of Sales EMEA at Intermedia.

“When they compare the cost of owning and managing their own infrastructure—which includes buying servers, licensing software, hiring people to administer and paying for real estate, electricity and air conditioning—it makes sense to offload those costs in exchange for a predictable monthly fee.

Unfortunately, there are other costs associated with cloud services. Many businesses don’t even think about them until it’s too late—because once you’re learning the hard way, it’s often too much trouble to pivot to another provider.

That’s why end users should know what to look for before they sign a contract.”

In Simister’s opinion there are six costs that often surprise businesses but there are also questions that can be asked in order to avoid them:

The cost of migrating data to the new service.  You might think data migration is free. But if you have to do it yourself, it will cost the valuable time of your IT staff. And what if you need assistance? Some providers may only help for a fee, and others will refer you to a third-party consultant. So make sure you ask about data migration, and make sure your provider will includes white-glove service for free.

The cost of downtime imposed by low reliability. Many providers promise 99.9% uptime. While this may sound good, it actually adds up to more than 525 minutes of unplanned downtime per year. Consider the cost of downtime—angry customers, lost sales, diverted IT resources—and make sure you settle for no less than a 99.999% uptime service level agreement (which is less than 30 seconds of unscheduled downtime a month).

The cost of not getting enough support. Your support teams can’t be productive if they’re on hold or floundering about for ideas within self-help support portals. However, many providers only offer phone support for critical or tier 2 issues. A good support plan will include 24/7 live support, short hold times, and skilled, certified staff.

The cost of sub-par security and protection. Where security is concerned, you must be confident that your business cloud provider has you covered. Make sure you get the nitty-gritty details on security procedures from your provider and insist on enterprise-class security from well-known partners.

The cost of management inefficiency. Your cloud management console should be powerful enough to support your IT needs, but simple enough to use that you can easily use it. Otherwise your IT staff are wasting precious time on tasks that should be trivial. Make sure you get a solution that balances ease-of-use with granular control to avoid imposing undue labour costs on your IT team.

The cost of services that lack integration. Your business is probably adding more and more cloud services. But as you add more services, you introduce more support, billing and management complexities. And so you end up in a tangle of services that you have to untie. Compare this to top providers with integrations that let you share user and device settings across services. Without this, the cost of managing your IT can skyrocket.

Simister says cloud providers should be chosen carefully.

“Choose a cloud-based IT services provider that offers transparent and worry-free service. Insist on getting the full range of services with no hidden costs, including migration, security and management.

Ed Says…

With the Cloud Industry Forum reporting last month that 78% of UK firms using at least one cloud based service, 60% using two services and the market growing the issue of hidden costs is important for channel resellers wanting to keep satisfied customers.


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David Dungay

Editor - Comms Business Magazine