The Growing Cloud Based Waste Problem

Due to the exponential changes constantly happening throughout the business world we are continuously introduced to more time-efficient and flexible ways of conducting business. Tech has seeped into virtually every sector, and we see more and more businesses making use of cloud computing services.

According to a recent statistic, about 96% of businesses worldwide are making use of at least one cloud computing service for their operations. We can not deny the relevance of cloud computing: it is safer, sustainable, prevents loss and flexible, among many other benefits.

The global cloud market, due to its worldwide acceptance, is expected to increase from $371.4 billion in 2020 to $832.1 billion by 2025.

Tech giant, Dell even reports that businesses and corporations investing in mobility, cloud, and big data experience a 53% higher growth rate compared to those who do not.

In spite of the growing importance of that cloud computing and cloud-based services provide, a nagging problem lingers: waste.

More often than not, when people hear or see the word “waste”, they think about the physical manifestation of discarded household and industrial products. But waste is not just physical; we are seeing that cloud based waste can also be generated.

Here, we explore what is cloud-based waste, how it is generated, and how to reduce it.

What is Cloud Based Waste?

Cloud waste is when you acquire and consume more cloud resources than your business needs. A lot of small and large businesses make the mistake of subscription to cloud-based services without taking full cognizance of what they really need.

And that becomes a problem on a large scale.

The real issue is that cloud waste is not just significant as a result of the resources that are in use, but also the cost allotted to the resources that are not.

Wasted cloud resources are forecasted to hit $26.6 billion in 2021. To put it mildly, businesses are wasting about $2.4 million in cloud resources every hour! These funds would have been better utilized in R&D and in strategies that would improve their bottom line.

The Main Causes of Cloud Based Waste

Here, we look at the various causes of cloud-based waste. Knowingly or unknowingly, many businesses are making expensive or wasteful mistakes:

Lack of Understanding

There are a lot of grey areas when it comes to cloud computing. We may know some of them and there are others we may not understand. To be able to fully utilize the cloud efficiently for your business, you must be able to understand how the cloud works.

It is a reserve and only what is necessary should be kept there.

Idle Resources

Think about constantly paying rent for an apartment you never get to use. Ever. Cloud-based services are not cheap. The average subscription ranges from around $400 monthly for a single server to $15,000 for your back-office infrastructure.

If you are looking at a fully hosted service, you would have to spend up to $200 per PC. And this does not include cost for data migration, ongoing storage, and implementation. Of course, when you consider the cost of maintaining your in-office network as well, you would see that cloud computing is an expensive venture.

Now, imagine paying for these services and you do not get to utilize them outside of work hours. Idle cloud resources keep running when not in use. It does not matter if it is a QA environment, testing, or a development process, as long as it is not used outside of work hours.

The cost of idle resources contributes to the generated cloud waste.

Over-provisioned Resources

Business executives tend to pay for cloud resources higher than what they need. The rationale behind this is that they would need more cloud to accommodate their expanding data as the business progresses.

But this is not the case. In fact, businesses may be spending more for less. Investing in oversized cloud resources has a poor ROI in the long run.

Unscheduled VMS

Most businesses are guilty of allowing their vendor management systems (VMS) to run non-stop. While it is necessary to do so, more often than not, these machines generate cloud waste by practically doing nothing.

How To Mitigate Cloud Based Waste

Cloud-based waste cannot be totally eradicated, but there are ways businesses and corporations can reduce this waste to the barest minimum. Some of them include:

Estimating Data Capacity

Businesses and corporations need to properly estimate their requirements. It would make sense to add at most 25% more capacity than paying for bulk capacities. It is not only good for the business but good for the cloud environment that you subscribe to.

Audit Purchased Capacity

Take control of the dashboard of your cloud platform and utilize the platform to its full capacity. From the dashboard, businesses can track down unused resources and save a lot during subsequent subscriptions.

Cut Down Unused CPU Time

You can also monitor unused storage and CPU time. Monitoring your cloud platform constantly will allow you to track and cut down cloud environments that are no longer useful.

Controlling and/or reducing cloud-based waste is not only useful for your business (in terms of reducing business expenses), but also for the cloud environment where it is hosted. This will help reduce energy consumption, reducing your business’ carbon footprint. And can be one of the expenses you reevaluate as we move into a “New Normal” in a post-COVID world.

Hire an Expert like ParkMyCloud

With over 1,500 companies including name-brand multinational firms ParkMyCloud is an expert when it comes to managing a businesses cloud platform. If you believe your business is wasting too much time, energy or capital ParkMyCloud can help you manage your resources, eliminate wasted spend and maximize savings with machine learning. If this is a service you could be interested in let us know and we would be happy to make an introduction!

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Marc Freedman

To help you achieve your company's financial growth goals, Marc serves as our Chief Cost Advisor, providing advice to client management teams. He is highly regarded as an expert in his field, and he frequently collaborates with and contributes to other spend consultants to develop and implement cutting-edge strategies for their respective clients.

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