We’ve all heard the story. Those of us old enough to remember digital vs. analog cell phones and the roaming features that came with them probably experienced this issue firsthand. I’m referring to the dreaded monthly phone bill that greatly exceeds the planned spend.
One of the best (or worst) stories I’ve heard on this topic was from a friend who went to England with his family. His millennial daughter, being a digital native, happily documented the whole trip via Facebook posts and videos.
Unfortunately for my friend, he hadn’t purchased the international plan for her phone and found himself facing a $15,000 mobile phone bill upon his return. His fury was obvious, but he wasn’t sure who he should be mad at: his daughter, who was simply using her phone as she always had, or the phone company, which offered a separate international plan.
In the end, he realized he was to blame. Had he planned ahead and considered the impact of technology use on his trip, he could have simply paid the $15 for the international plan that month. Fortunately, he was able to negotiate with the phone company and reduce the costs, but he still paid a lot more than $15.
Spending efficiently on cloud
The lesson of this simple tale likely resonates with your company’s cloud spend. Similar to my friend, you may have employees who gleefully use technology to make their lives easier. This may be costing you big time, and cloud providers are happily accepting that money based on individual usage.
It may seem like no big deal for an operations person to open up their own Dropbox account or a salesperson to set up a monthly Zoom subscription for calls. After all, it’s saving you a ton on infrastructure and licensing to have these people working in the cloud, right?
Well, yes and no.
Take, for example, a company I know whose controller began looking into costs and found multiple individual Dropbox accounts being expensed, costing the company tens of thousands of dollars every month.
Working with Dropbox and the company’s own internal IT team, they were able to track and shut down all the individual accounts and move them over to an enterprise account, greatly reducing their monthly costs and putting control of the cloud usage into the right hands.
But this is an exception in today’s world. I see this all the time when talking to VARs and enterprises who get huge cloud bills and don’t know what the spend is for because they’re using computing without regard for cost.
Optimizing cloud costs
According to Right Scale, approximately 35% of cloud spend is wasted spend, while 58% of organizations see cloud cost optimization as a top priority. With a quarter of the companies surveyed spending more than $6 million a year on public cloud, a lot of money is being spent. And just like the phone companies, cloud companies are happy to allow hordes to roam and spend in their cloud.
As more executives begin to recognize and act on the issue, they’re searching for tools to help them control these costs moving forward. So we’re seeing the emergence of a new sector of monitoring products specifically designed to capture the true costs associated with cloud. But the tools aren’t enough; enterprises are going to have to start putting together teams and programs to tackle this huge shadow IT problem.
If you’re looking to better manage your cloud costs, we can help. In a follow-up post, we’ll reveal Ingram Micro Cloud’s new set of cost-optimization services, which can result in more efficient cloud spending. To learn more, contact us or your local cloud sales representative today.