What the Cloud Really Costs: Do You Know?

14 ways CIOs under estimate the costs of cloud computing

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And when transitioning to the cloud, your cost model should allow for a few months of running the new and old systems in parallel, which will lead to a spike in expenses.

Organizations that have adopted principles of service-oriented architecture will be in the best position to take advantage of cloud technologies, Dirst says, while those that have not may need to play catch-up. That might mean training staff, upgrading middleware, or both.

Dirst admits he underestimated the management and monitoring costs associated with cloud apps. Because traditional enterprise-network-management tools don’t do a good job of tracking cloud apps, his department has had to script its own monitoring routines so it knows when a cloud app—or the integration between an app and enterprise systems—stops working.

“That usually costs more than we had expected,” Dirst says. Still, he sees good ROI, combined with the ability to deliver new capabilities faster in the cloud environment. That’s particularly true of SaaS apps, which typically deliver new features instantly two or three times a year. When a traditional software vendor releases a new version, it’s usually three to six months before DeVry can roll it out with confidence.

In the overall cost equation, “Not having to go through that? How does that commercial go? Priceless,” says Dirst.

David F. Carr is a freelance writer based in Florida.

Copyright © 2011 IDG Communications, Inc.

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