Cloudy with a chance of bill shock, don’t get caught out

Cloud is a core component of most Australian organisations’ technology environment¹.

It’s flexible, empowers innovation, supports collaboration, and most of the time offers cost savings. Many organisations believe their cloud usage has increased since COVID-19², and according to IDC, cloud adoption and opportunities will continue to expand, leading to a $1 trillion market in 2024³.

Yet, there are still challenges that can come with cloud adoption and usage, from small and medium businesses to enterprise-level organisations, managing cloud spend is a significant challenge no matter the cloud maturity.

A part of cloud spend is the dreaded Bill Shock, also known as Cloud Shock.

Your organisation may have faced bill shock in the past, or even be going through one right now.

It could be that you went over your allocated bandwidth, or you have multiple cloud providers with bill complexity, or you simply hadn’t had the help you needed to set up your cloud to potentially avoid these shocks.

How can you guard your organisation against cloud bill shock?

Visibility

A way to potentially guard against bill shock is to have more or better visibility over your current cloud and the costs associated.

Cloud visibility is the ability to have a view of the activity in your cloud, and you should expect to see the following from your cloud provider’s platform:

Performance tracking
Security
Cost management
Business analytics
Traffic visibility
Packet monitoring

This can be done through regular monitoring with tools that allow you to get the visibility you need. If you have visibility over your cloud platform you’ll see where your performance is lacking, spot potential security holes, and potentially get better cost management.

There’s no need to overcomplicate your cloud visibility.

Forecasting

Every organisation needs to forecast budget, especially IT. There is no one size fits all approach to forecasting, and it won’t entirely remove bill shock, but will help you plan out and potentially avoid the dreaded shock.

There are many different methods to forecasting cloud costs, but some ways that vendors and providers can make it easier for your organisation is through 1) monitoring tools, 2) different contract options, 3) control

Monitoring tools allow you to see your past, current and potentially see your future spend, as well as utilising a cloud-managed service. They can also provide more than just cloud forecasting, giving you insights through reporting, performance management and security and compliance monitoring.
Choosing the right contract option from your cloud service provider gives you the flexibility to forecast your annual spend in advance and have better predictability over your cloud computing budget. You want your private cloud provider to give your organisation a flexible range of contract options – including one-month, one-year, two-year, or three-year commitments – helping to ensure that there is visibility and predictability to your business of your annual cloud spend and to help avoid ‘bill shock’ with each monthly bill.
In the case of private cloud, you could control your IT spend by purchasing dedicated infrastructure as your business requires. Ultimately, you want a private cloud provider that offers dedicated compute in Australian data centres, with compute that is purchased in advance on a fixed monthly rate, so you can control how much you provision and avoid over or under provisioning infrastructure. With the flexibility to increase hosts and storage, it’s easier to scale to your business needs.

Consolidation

Each cloud provider has a different bill, may bill on different dates, and may present their data differently. You may not be able to view all their bills through a single pane of glass, which decreases the overall visibility you have on your spend and creates extra administrative work for you and your finance team. The issue can be compounded when multiple bills are late or have any inaccuracies that need to be addressed.

Consolidating to one cloud service provider, potentially by utilising a Hybrid Cloud ecosystem may be a solution that could help with billing complexity. Having a blend of private cloud with fixed pricing, and public cloud with consumption-based pricing can help offer the best of both worlds, meeting both your business and technical needs.

This means you can reap the benefits of one seamless, fully integrated cloud environment, delivering a consistent experience no matter where your workloads are hosted. By simplifying the technology stack into a single unified experience, you could free up otherwise wasted time spent on managing cloud compute and storage requirements across varied IT environments.

Support

Doing cloud alone can be difficult and the constant retaining of staff to accommodate new environments or solutions can be costly and time-consuming. If you don’t have the right support network for your cloud, you could set yourself up to face bill shocks.

According to the Telstra Purple and Omdia State of Cloud Adoption in Australia 2021 report, only 41% of respondents surveyed would consider their organisations “well-prepared” for the cloud migration journey⁵. Enterprise strategy group found that 35% of organisations cite “support for our application development environment and tools” as the most important consideration for developing a hybrid cloud⁴, and Flexera discovered that 75% of organisations indicated that their cloud management efforts are hampered by the lack of skills, experience, and expertise¹.

Therefore, you want to make sure that you have the support to get your cloud services right the first time and lay the foundation for a successful cloud journey. Your cloud provider or vendor should familiarise with your new cloud environment so you can focus on innovating with the power of cloud from day one.

Moreover, partnering with a managed cloud service provider can provide you with the expertise to alleviate pain points such as bill shock, taking the pressure off your internal IT teams to focus on adding value to your business.

Don’t let your organisation get caught up in a storm of cloud bill shock

Make sure you have visibility over your cloud, you can adequately forecast, your cloud providers are consolidated, and you have the support you need to manage your cloud.