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Real numbers for the Cloud guys to consider

By CG IT ·
This article at InformationWeek by Chris Murphy


smacks directly at all those IT hardware and software marketing and advertising guys who try to influence business decision makers with a bunch of Dog and Pony shows using terms of to quote Chris's article

" IT costs, internal customers, IT leaders, Alignment, IT systems, and "IT and the business."

but a much bigger issue that directly reflects Cloud Computing is actual costs of problems in the computer network and with cloud computing outages in service.

Chris's article mentions Northwestern Mutual Life assigning an actual cost to such problems.

To quote " that causing problems in the underwriting process costs $11,000 an hour in lost productivity, and problems that keep the field force from using their client management tools costs $25,000 an hour.

Imagine the cost of a service outage from your cloud provider that takes an hour to fix. Imagine the cost if it's a day to fix.

While I believe Cloud Computing has it's place in the business and consumer world, I believe that executives who solely base decisions on cost need real hard numbers not only on cost savings but also costs of service outages.

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Absolutely agree

by jck In reply to Real numbers for the Clou ...

I am currently pulling numbers for my boss, and he's going to show what per hour access cost is for applications, OSes, network clients, etc. Then, he's going to show the "powers that be" that for most cases keeping staff and hardware in-house means less cost plus higher reliability and faster response.

Like I've said before: Cloud is a niche market for a certain customer...not a one-fits-all solution to all problems in IT.

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by jeffv96818 In reply to Absolutely agree

I've been pulling numbers too. Cloud and ownership are not apples to apples. Just looking at the server alone, the standard dual quad core 2U can be configured with 16 VM's equivalent to 16 Amazon base CU's. At $7K with a 4 year lifespan, each VM would run less than a penny an hour, or 15 cents an hour for the entire server. Amazon would be $1.60.

Same with SAAS. Email might appear cheap, but it depends on what you have hanging off of your current system as to what it's really going to cost. If you had to shut down everything attached to the email system, what would it cost to recreate that functionality?

Shutting down email doesn't mean your going to save money in the data center either. Unless you decommission everything, the data center will remain. How about the security systems, Infrastructure servers, domain controllers, file shares, network backbone... That all has to stay to support the enterprise. What about bandwidth? That will most likely have to be beefed up to support the increase internet traffic.

Manpower savings will be minimal too. For SAAS, there might be an opportunity to save, but for PAAS and IAAS, it's a CIY (Cloud It Yourself) environment, so you will still need admins and developers.

Cloud is smoke and mirrors. Simply clever marketing meant to lure everyone into dependency.

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scary thought there

by Jaqui In reply to Real numbers for the Clou ...

11,000/hr in LOST REVENUE and 25,000/hr in costs to get it back up.
for an hour that is a $36,000.00 bill.
or, $864,000.00 a DAY in costs from a cloud service being down.

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