Presented by Nutanix

Private clouds offer some very distinct benefits to IT teams. Most notably, security and predictability have become synonymous with private clouds. Security is a big reason to adopt private clouds because they limit access to a single organization, reducing many data security and compliance concerns. But companies also turn to the private cloud to support some workloads that may run more cost-effectively than in public clouds.

Estimates from experts such as Steve Kaplan, VP of Customer Success Finance at Nutanix, who authored The ROI Story: A Guide for IT Leaders, indicate that more predictable workloads can run on-premises for about half the cost of a public cloud solution — or even less. However, managing private cloud costs is still a thorny challenge for enterprises.

The process involves an increasingly complex balance of startup costs, including capital and automation investments, risk mitigation, and support costs. Kaplan suggests that businesses “run continuous analysis of where workloads should go,” pointing out that there are a lot of nuances in cloud total cost of ownership (TCO) calculations that are easy to miss and that factors change over time.

Cost optimization rules of thumb

For example, while the following provides three guiding tips for where different types of workloads will likely run at the lowest cost, you can expect prices, application behaviors, and other variables to change often. A prudent company, then, will always be checking that the private/public cloud mix continues to reflect the optimal balance:

  • Static workloads that are very predictable in nature generally run at the lowest cost in your private cloud. It’s fairly easy to forecast the volume of resources that static workloads will consume and to plan ahead to add resources to your established infrastructure to accommodate them.
  • Very dynamic workloads that are unpredictable in nature run most cost-effectively in a public cloud where you can turn resources on and off quickly. Retailers, for example, might run workloads associated with special sales or seasons that have erratic usage. These are best served by a service that you can dial up or down on demand — and pay for only when used.
  • Semi-dynamic workloads might run best in either type of cloud, depending on the data center resources you already have. If accommodating new or additional workloads involves significant on-premises buildout, it might be simpler and cheaper to fire up a public cloud service. From there, of course, you need the tools to be able to compare prices across providers and service tiers, and you need to frequently revisit those often-changing prices and adjust your allocations accordingly. Over time, for example, an application for which usage and access frequency was initially unknown might mature, grow more stable, and merit bringing back on-prem.

Avoid jumping over quarters to save nickels

Managing costs in both private and public clouds is important. However, there’s a tendency for enterprises to focus their energies on gaining more visibility into public cloud consumption at the expense of overlooking potential cost savings in their private clouds. As time passes and trends change, new tools emerge to help enterprises cope with changing environments.

Investing in cost management tools for insight into public clouds as well as the enterprise premises is a non-negotiable. You need visibility into the cost of purchasing your hardware and software products based on certain assumed market prices and license durations. Having this view into your physical and virtual assets allows you to understand your true total cost of ownership (TCO). At any point in time, you should be able to identify where you can make cost improvements by moving workloads based on current pricing and conditions. That takes the onus off of you to try to manually keep up with the latest services and pricing tiers — a near-impossible task in today’s environment.

The enterprise IT environment is only growing more complex and will continue to do so, at least at the back end. However, vendors such as Nutanix are doing what we can to mask that complexity. With a comprehensive, single-pane-of-glass tool that helps you see what’s what and keep a steady grip on what your various services cost, we help you continually tune your IT environment for cost optimization.

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