Stop Throwing Away Money on Data Storage (Even When Moving it to the Cloud)

- Alan Jamieson, BOHH Labs VP of Business Development

Does moving your data center storage to the Cloud (Private/Hybrid) help with saving operational costs on increasingly challenged IT budgets?  For most people, this is an automatic answer, yes; however, recent studies are indicating that moving storage from in-house to the Cloud won’t achieve cost savings unless the storage needs are fully assessed, and anticipated savings are planned out. This is alarming, and you may ask why?

Firstly, capacity planning is an issue: how much do we need today and in 12 months’ time?  Over-estimating storage capacity is one area that can make a dent in the savings. While estimating a higher capacity can secure better cloud storage rates from vendors, if you don’t have enough data to meet this higher capacity, you are essentially paying for unnecessary and wasted space.

Secondly, while over 80% of data centers have the storage capacity in-house, it is difficult to do routine checks, so when looking to switch and invest in Cloud storage, companies often don’t have the whole picture and can be making a choice that is often not financially beneficial. The fixed costs (electricity, cooling, licenses and maintenance) of running a data center and any spare storage or processing capacity is often overlooked when formulating your cloud migration/deployment strategy.

The volume and variety (structured and unstructured, regulated data etc.) we are collecting is increasingly on an annual basis.  Data is now seen as a business asset with new Chief Data Officer roles in enterprise accounts being created, but are we realizing the value of the data assets we have?

From research done by Jonathan Koomey in late 2017, only 25% of companies would save money if they transferred their server data directly onto the Cloud, whereas 75% would see an increase in annual costs. However, all the sample group would save if the companies migrated after quantifying out how much server space they need. This unnecessary Cloud storage spends costs companies around the world an estimated $62 billion annually.

If we step back from the cost of storage, the other important and increasing challenge for global companies is extracting the value from data that is stored in the Cloud and often is not accessible.  With the massive amount of data being produced daily, operational cost challenges are pushing companies to store data over 12 months or even more recent too soon. The world has become analytically focused; however, insight is only gained when data over a significant number of years is analyzed to extract the insight to achieve greater operational efficiencies, greater insight in how to retain your customers and how to improve the quality of manufactured parts.

Another research report puts the cost of Cloud waste at about 35%. So, for every dollar spent on Cloud resources, you only get $0.65 investment value. Now that we have addressed how companies are losing money, below are six ways your company/department can alleviate some of the wasted

Cloud spend:

1. Identify and retire abandoned applications – why store what is no longer needed?
2. Choose the right storage model – What is needed today and plan.
3.  Right-size instances – Invest in only what is needed.
4. Perform licensing audits – Do your software vendors enable your licenses to be used in the Cloud at no extra cost?
5. Automate server usage for peak/off peak hours – only pay the Cloud provider for services that are needed.
6. Pay upfront – Looking at license options could save more than purely monthly subscription fees.

While the global market is focused on enhancing how data is stored and embracing the benefits of making a transition to the Cloud, having a clear idea of want storage is needed and how often you need to access your data will ensure that you select the most cost-effective model for your business.