Over three years ago, Jay Chapel took the most important learnings from his first cloud management company, Ostrato, and used it to build ParkMyCloud – a company that identifies and eliminates wasted cloud spend.
I sat with Jay to get his perspective on the important things managed services providers should keep in mind when educating customers about cloud costs.
M.R. Rangaswami: Why do AWS, Azure and Google Cloud dominate the cloud market?
Jay Chapel: There are good reasons why the “big three” cloud providers – Amazon Web Services (AWS), Microsoft Azure, and Google Cloud – dominate the market. First, they have the advantage of time – the first public AWS service launched in 2004, Microsoft Azure was announced in 2008, and Google’s first cloud services were also released in 2008.
In that time, the cloud service providers have created a wide range of product lines and are continually innovating. They have a low frequency of outages, and their scale requires a straightforward onboarding process and plenty of documentation.
AWS has the widest range of services and has made its offerings appealing to startups and global enterprises alike. Azure has done the same, with a focus on hybrid environments and PaaS, an advantage with organizations that already use Microsoft software throughout the company. Google has focused on leading in price and performance and does well with cloud-native businesses.
M.R.: What are some things customers should look for when comparing the three (or other providers)?
Jay: When comparing providers, you should consider your existing internal software and infrastructure, and perhaps most importantly, your staff expertise. When we ask our customers why they’ve chosen a specific provider, the most common answer is that they already have internal expertise with that provider. With many other factors coming up comparable, this is as good a reason as any to make a decision.
Consider also whether there are any specific services or technologies you will need, whether those are currently offered by the provider or on the roadmaps. The contract options available to you may also be relevant. And, we occasionally see businesses chose an AWS alternative as they compete with Amazon in retail or other spaces, though there are plenty of exceptions to this rule. And Azure because the enterprise uses Microsoft products and have an ELA in place, or Google if they are a G Suite user.
Of course, pricing is always a major issue. ParkMyCloud has offered a detailed analysis of the big three pricing models on our blog. See Cloud Services Comparison, AWS vs. Google Cloud Pricing and AWS vs. Azure pricing if interested.
In general, when you examine specific workloads and factor in Google’s more enlightened approach to charging for CPU/Hr time and their use of Sustained Use Discounts, GCP may actually be less expensive than AWS.
We also found that AWS on-demand pricing is still more competitive than Azure cloud pricing for comparable compute engines.
M.R.: How can you ensure you are getting the most cost-effective cloud computing?
AWS, Azure and GCP have a dizzying array of pricing options to choose from and doing an apples-to-apples comparison between them can be quite challenging. But the basic questions to ask when evaluating your cloud costs:
- Are we thinking about the cloud cost model correctly – OpEx rather than CapEx?
- Especially soon after a migration, this can be an issue, and out of habit, users will purchase far more capacity than they actually need.
- Have we taken advantage of enterprise agreements?
- Depending on the size of your cloud spend, it may make sense to commit to a certain level of spend in exchange for an overall discount on your resources.
- Are there compute options that would better suit our resources?
- Reserved instances, spot instances, pre-emptible instances, and other pricing options beyond On Demand can result in cost savings.
Finally, ask yourself if you are wasting spend on unused or oversized resources. Most likely, the answer is yes. Ensure that your organization has a cost control strategy in place to find and eliminate wasted cloud spend due to idle and oversized resources.
M.R. Rangaswami is the co-founder of Sand Hill Group and publisher of SandHill.com.