Why a Cloud Consumption Model Should Replace Pay as You Go for Data Storage

- Alan Jamieson, VP of Business Development

In a previous blog, we highlighted why planning your Cloud storage requirements is the only way to ensure your company achieves operational savings moving to the cloud.  Today, we are going to look at the various consumption options:

Pay as you Go

Subscription (fixed term, monthly fee per user or unit) based commercial models have been around for several years driven by Customer Relationship Management vendors such as Salesforce, Infrastructure as a Service (IaaS) vendors such as VMware, and Information Technology Service Management (ITSM) vendors such as ServiceNow, who all enable us to pay for services we use, typically based on user number pricing bands. This pay as you go approach has also been widely adopted by the leading Cloud vendors who companies are turning to streamline operations and offerings.  However, this approach is more limited when you look at Cloud data storage. Typically Cloud vendors look to companies to their Cloud infrastructure by charging them lower rates for storing historic or archived data in their infrastructure as opposed to in the company’s own data center. This often means recent data or even just 12-months old data get archived. The problem with this is, once the data is stored, how are companies easily able to access this data to extract business value or analytical insight to help businesses remain competitive? This is a big need!

Research also shows that companies are paying money for storage that they currently don’t need, as they either have too much in-house storage capacity or they have estimated and invested more than their businesses need today for Cloud storage. Regulation is often the main driver for companies to retain transaction data and customer data for a defined number of years, but unless there is a data retention policy, storage investments in this area can be an unnecessary expense. Companies should only retain data for specific periods of time, exceeding these period is an overhead to the business.
It’s clear there is a struggle to find the right balance of leveraging the Cloud to streamline the collection and storage of a company’s increasingly growing data without wasting money. As detailed above, the current standard method of pay as you go is not setup to help companies cost-efficiently move their storage to the Cloud. 

So, what is the solution?

BOHH Labs believes introducing a consumption-based model to the storage market can help companies maximize the benefits of moving storage to the Cloud without paying for resources they don’t actually need. Subscription (consumption-based) fixed term agreements are paid monthly or quarterly and can help businesses to start achieving operational savings with small initial investments that grow through greater use of the service and increased user adoption over time. This approach allows companies to pay for the resources they need without overestimating on resources that roll in to wasted costs, yet still allows them to expand as they grow. This model will be beneficial for all companies – those with a small number of employees to global enterprises with hundreds of thousands to benefit from the same services. 

Within the consumption model, we believe it needs to be split into two areas:

1. Data storage:
   As discussed above, companies should choose the right data storage period and commercial model to support their individual businesses, and thus pay for storage based on volume or data retention period.
   
2. Data acces
   This is an area that is included in user subscription agreements such as CRM, but if not, it is an area that all companies need to explore to understand how they can gain business value from data they store. Stored data serves companies no purpose if it cannot be accessed easily to leverage insight and analytics from it t apply to their business decision-making. 

What Does this Look Like? 

When companies run a marketing campaign, they typically include all their active target customers to help ensure that they gain the maximum return from the planned campaign.  However, when a global financial services or health provider needs to make longer term investment decisions based on historic data over several years, securely accessing this stored data, which often contains confidential data such as PHI (Personal Health Information), PII (Personal Identifiable Information) is not available, as they cannot guarantee the security of sensitive data accessed by business users.

BOHH Labs has identified this business challenge and has a created a Secure Storage as a Service solution that ensures that all stored sensitive data remains secure and confidential.  If you know which data fields or rows contain sensitive data, BOHH Labs protects these fields to ensure business compliance. As such, the BOHH service leverages a consumption model to provide a secure way to enable your noncompliant data to be utilized and have the cost of storage recovered from it as its value is extracted. By protecting the compliant data, securing it and only providing access to those who have the correct privileges to see it, allows longer period (often years) non-compliant and non-corporate sensitive data to be utilized by a wider audience to extract greater business value or insight.