Total cost of ownership

Are the claims that cloud computing delivers reduced costs based on fact and can they be substantiated? Do they hold true when you compare the cost of meeting a requirement using a traditional hosted solution to that of meeting the same requirement using the cloud?

To accurately design and cost the correct ICT (Information Communications Technology) solution, you will need to accurately predict or know the demand that users and citizens will place on the application you intend to provide, and exactly how that demand will vary over time, in order to ensure capacity to meet that predicted demand is in place. If the predicted demand is too high, infrastructure and resources will be under-utilised and investment wasted. Conversely, if predicted workloads are too low, there will not be enough capacity to meet demand, hence performance and availability may suffer, and users will be frustrated.

Cloud solutions deliver maximum flexibility as resources can be provisioned on-demand to match requirements, and scaled up or down as and when those requirements change. True cloud providers offer consumption-based pricing so you will pay only for what is used.

In building your business case, you should:

  • Ensure you identify all costs associated with individual solutions offered by different suppliers — to include any costs related to exiting an existing contract/service, procuring and contracting a new service, and then on-boarding and running the new service.
  • Carefully analyse prices, workloads and running costs. You should also check whether any discounts apply. Full operational costs, to include staff and accreditation costs, will need to be considered when costing an in-house solution.

Taking all these different elements into account, in our experience of working with the UK public sector, in all situations, cloud computing will deliver cost reductions whilst increasing both agility and availability.

Don’t believe us? Read our whitepaper which includes costed solutions for compute resources to meet real world requirements as detailed in tenders issued by public sector buying organisations in the last six months. The costed scenarios demonstrate savings of up to 66% but we have worked with organisations that have realised savings of up to 90% when compared to traditional computing or in-house solutions.