Chopping away Cloud bills

As cloud moves from the hype stage into implementations, let us take a look at how cost-analysis tools can be of help in cloud services By Jasmine Desai

Although cost saving is one of the key drivers for the trending success of cloud computing, cloud deployments do not always and necessarily mean saving costs; nor does the cloud mean that a company can perpetually go on saving with it.
In spite of businesses needing to deploy a cloud service, it is becoming increasingly necessary to see where can they cut out on any hidden cost. Can cost-analysis tools help here? In his report, Predictions for 2013: Cloud Computing, Forrester analyst James Staten mentions that cloud services don’t play fair. “Providers make their services look incredibly cheap by hiding the true cost of their services,” he writes in the report.

According to Sanchit Vir Gogia, CEO and Founder, Greyhound Research, “A cost-analysis tool has nothing special to do with cloud services alone. In today’s economic environment, organizations are facing decreased IT budgets. They have to do a cost analysis impact before going for any important IT investment. During any cloud migration you need data points to justify the migration. Thus, these tools provide decision makers to make an informed decision.” Thus, the concept of a cost-analysis tool is nothing new, but needs to be dug into deeper by organizations looking to optimize their cloud services to the fullest. Thus, such tool should ideally be a starting point of any IT project. These tools especially now matter much more with budget issues and CFOs asking hard questions.

Mentions Akhilesh Tuteja, Partner, KPMG, “The cloud services billing is very specific to very certain types of contracts, so there is no one standard model of charging for cloud services. It is hard to find third party tools that can manage the entire cloud cost. Depending on which cloud providers you select, their charging models will be different, their usage monitoring model will be different.” Clearly, there is no one tool that fits the bill.

Circumventing stumbling blocks

There will be some inherent challenges when it comes to using such cost-analysis tools both from the vendor as well as organization front. Jiten Patil, Head – Cloud Consulting (CTO Office), Persistent Systems, says, “One of the biggest challenges for some organizations could be granting access to cloud services and resources to third party tools for collecting data real-time. There will be challenges also with regards to privacy, for some it could be a very sensitive matter, while for few applications it would not matter a whole lot.”

Another challenge revolves around compliance issues to a set of industries or application domain; the usage of cost-analysis tools may mean overhead of additional audits and complications involved therein. Apart from these, the quality of recommendations these tools can make on usage, configurations and services, etc. are dependent on two things: the amount of data they can collect and the extent of usage variations they observe and record. The lesser the data they are able to collect or broader the usage variations of cloud services by applications, the more challenging it would be to form precise recommendations. Beyond these tools there is also relation that matters. Cost alone is not something that will push the usage of cloud services.

As per Subhasish Saha, CTO, Apeejay Surrendra Group, “Understanding of the tools and to provide right cost parameters for each resource is a challenge. There are many cost analysis tools available which are good for public cloud, let’s say in AWS or Azure kind of environment, but I’m not aware of the case studies for private cloud environment. Capability and knowledge on these tools would be critical.”

In its private cloud environment, Apeejay Surrendra Group is currently using vCenter from VMware to manage and monitor the actual usage of individual resources. However, cost is not something they analyze. There is also the trouble on data points front. Like any other analytical tool, unless organizations are able to capture sizable data points from all relevant resources, it will not throw up meaningful results.

There has to be a planned path before investing in such tools, although they seem to be quite necessary. As per Tuteja of KPMG, “The focus should not be cloud cost management tool but on which cloud service providers offer the most flexibly charged model to structure services. They are definitely useful but depending on the service the model changes.” A lot of cloud service providers provide services around this, like ROI management services which allow you to look into past consumption.

SLA is a major factor that determines a lot. As per Gogia of Greyhound Research, “Organizations need to calculate what cost they are paying for what SLA. Not all user workloads require the same SLA. Tight SLAs will attract higher cost. Also, organizations might already own some licenses. They need to check whether the vendor is ready to buy it out.” Thus, when investing in these tools organizations need to get a clear understanding of their infrastructure and need to understand that faster turnaround means higher cost. It is imperative to understand different users and their needs and accordingly the kind of SLAs they need.

According to Patil of Persistent Systems, “Organizations need to first think if it is their short term need or a long term need. In case of a short term need, tools from a cloud platform provider like Amazon and cloud management platform provider like RightScale could do a good enough job. For a long term need, organizations need to invest in identifying the right third-party tool that suits them the best.”Amazon Web Services guides their customers on usage optimization with the help from their CloudWatch service by leveraging features like KPI metrics and alarms. RightScale helps by identifying costs.

jasmine.desai@expressindia.com